Sheboygan TID proposal targets public incentives of $5M or more

By ALEX GARNER

USA TODAY Network via Reuters Connect

A group of community organizers seeking more public oversight of the city’s approval of large developments submitted a petition with signatures to the city clerk.

The group — motivated to give Sheboygan residents a say in major tax incremental financing and public inventive agreements — reported collecting 2,702 signatures over 60 days for the petition. The deadline to submit signatures was July 21.

Under state direct legislation law, the group was told it needed to collect at least 2,599 signatures, which equaled 15% of votes cast for the governor in the last general election.

More than 40 volunteers have helped collect signatures at various community events since May, like food truck nights, summer parades and the Levitt Amp concerts.

Residents have been critical of public spending, performance of existing TIDs and that only a handful of developers benefit from these TID projects. Other concerns linger about possible property tax increases as a result of TID projects.

“Regardless of anyone’s position on TIDs, this effort demonstrates that citizens are willing to become directly involved in shaping the future of their community,” Lisa Salgado said in a statement.

Petition signatures need to be verified before Common Council consideration

The city clerk has 15 days to verify the signatures, including the eligibility of individuals who signed the petition. If errors are found, the group would have 10 days to fix them.

After that, the Common Council would have 30 days to pass the ordinance without any changes or submit it as a referendum in the next general or spring election.

If passed, the proposed ordinance would require voter approval of TID projects with costs of at least $10 million and public incentives of at least $5 million. It would also prohibit the use of non-disclosure agreements for TID projects, prevent projects from being divided into smaller phases to avoid voter approval, require financial analyses like the “but for” test and tax increment projections be publicly available before approval, and require compliance with the state’s competitive bidding laws.

The mayor could not veto the referendum, and the council could not amend or repeal it for two years without voter approval.

A news release about the petition explained, “If a project is financially sound, it should be able to withstand public review.”

Sheboygan mayor probes transparency around TID petition

Mayor Ryan Sorenson, who previously warned against possible negative effects of the TID petition effort, reinforced in a written statement July 20 that the proposal is “deeply concerning because it would make it significantly more difficult for Sheboygan to remain financially competitive and fiscally sustainable over the long term.”

Requiring citywide voter approval for each TID project qualifying under the petition would create political barriers that would delay projects and discourage further investment in Sheboygan, Sorenson continued.

Sorenson also said the proposal lacked transparency: “Who wrote this petition? Was it written by someone with qualified experience? Was it done with AI? Did someone from outside the community write this? Did all the signatories thoroughly read the two page, small font proposal?

“This proposal would have a long-lasting fiscal impact on our community, and if folks are going to sign this petition, don’t you think they should be fully aware of what they’re signing and who wrote?” Sorenson said to the Sheboygan Press.

Salgado said volunteers had the full petition on hand when collecting signatures, but signatories aren’t required to read an entire petition before signing.

Salgado added that Sheboygan’s petition is based on Port Washington’s. She did not want to give any more information when asked if she wrote the petition or if AI was used to write it.

“The proposed ordinance was reviewed and approved by the petition sponsors,” Salgado said in a written statement. “The relevant legal question is not who helped draft it, but whether it complies with Wisconsin law.”

An anti-data center advocacy group in Port Washington got a similar referendum on the April ballot that would require public approval for similar large TIF projects. It passed with 66% of voters in support of it, according to the Milwaukee Journal Sentinel.

The city of Port Washington is being sued by several area business groups over the referendum, saying it would slow development and set a “dangerous precedent.”