Here's how a proposed Wisconsin Rapids roads utility would work as public hearing nears
Alan Hovorka
WISCONSIN RAPIDS – Residents have few chances left to make their voices heard as the city looks to formalize a new utility and overhaul road funding next month.
The Wisconsin Rapids City Council has scheduled a public hearing at 6 p.m. Sept. 21 for a new ordinance that would end the use of special assessment for road projects and create a new city-owned transportation utility aimed at increasing funding for local roads.
The city will take no action on the ordinance on Tuesday but will bring it back on Oct. 19 for a potential final vote, barring no major revisions.
The ordinance, approved earlier this month by the city's public works committee, lays out the details of how the proposed transportation utility would work. If approved in October, property owners will see a new line item on their utility bills in January 2022 for transportation, ending almost two years of work by the city to find an alternative to road funding.
Here's what that fee means, what it's for and what the recently unveiled ordinance includes:
Need for transportation utility came from lagging road funding, Wisconsin Rapids leaders say
Wisconsin Rapids leaders set out to reform transportation funding with the new utility with three goals in mind:
- Reduce or eliminate special assessments for road reconstruction projects
- Reduce or eliminate borrowing for reconstruction projects
- Create a more "sustainable" transportation system in the city
Wisconsin Rapids spends about $2.3 million on new road projects and maintenance every year. Leaders such as Mayor Shane Blaser say the city faces a $4.5 million funding gap that prevents regular repair and replacement of existing roads. Under the current funding system, a road built in 2021 would not be reconstructed for another 150 years.
Some of the money for street construction comes from special assessments, where the city charges individual property owners thousands of dollars, sometimes more, for roadwork on their street. Property owners pay based on how much of their land abuts the road.
Special assessments generate $300,000 in revenue for the city every year.
Last November, the City Council agreed to consider forming a transportation utility to replace special assessments. In June, the city's public works committee recommended a new utility to also eliminate borrowing for routine street projects.
The proposed ordinance creating the utility would end borrowing for regular street projects, end special assessments and boost revenue enough to spend an additional $450,000 on resurfacing projects each year. The additional funding means the city would resurface a half-mile to a full mile of road each year. Total revenue potentially generated by the utility would be about $2.7 million.
At the end of 2020, the city reached 46% of its debt limit and would be able to borrow only about $30 million more in the future.
Special assessments are a perennial source of complaints from residents who often end up paying higher tax bills over the course of 15 years to pay off the debt. Residents on 18th Avenue received their estimated bills just as the COVID-19 pandemic set in across the country and people in this older, working-class neighborhood lost their jobs or had hours cut back.
How the new utility fee would be set
The idea for a roads utility is a new one for cities in Wisconsin and across the country. They're more common in Western states, since the first transportation utility was created in 1984 in Fort Collins, Colorado, according to a feasibility study commissioned by the city. The core idea driving the new utility is that it would be more equitable to all residents because people would pay only for the traffic their property generates.
A person's total utility bill will heavily depend on the kind of property they own, say a two-bedroom home vs. a fast-food restaurant.
The city has not provided final estimates about how much owners would be charged for properties of different types, such as industrial, commercial or residential. Blaser said the city will release information on the fee schedule and how much each type of property will pay under the proposal either ahead of the public hearing or before the final vote in October.
The city's public works department is working through those numbers; a feasibility study completed in August includes broad estimated costs to property owners. According to an email from Public Works Director Joe Terry, the city has nearly completed the fee schedule but is working through utility rates for "unconventional properties where the use is not obvious."
According to the feasibility study:
- A homeowner of a single-family home could expect to pay an additional $9 a month on their utility bill.
- Someone who owns a multi-use retail building could expect to pay an additional $340 a month on their utility bill.
- A fast-food restaurant could pay about $879 a month more on their utility bill
- A 12,000-square-foot church with no school could expect to pay about $55 a month more on their utility bill.
Terry said the feasibility study provided a good starting point but that final numbers will likely mean lower costs.
According to the ordinance, property owners would pay both a base fee and a trip fee.
- The base fee will be a flat, equal dollar amount that everyone pays for access to and administration of city roads.
- The trip fee will vary from property to property, whether it's a house, apartment complex, church, mall or factory.
The trip fee is what people pay based on the traffic volume to and from their property.
The city defines a trip as any time a car enters and leaves a driveway under the ordinance. Calculating the trip fee involves calculating the number of vehicle trips on an average weekday.
City employees won't stand outside people's homes counting the cars that leave and arrive. Rather, the city will use property assessment information and data from the Institute for Transportation Engineers that details how much traffic different kinds of properties create. The new utility, run by the city engineer, would operate similar to that of the water and sewer utilities.
Wisconsin Rapids joins a handful of municipalities in the state that are adopting or have already adopted a transportation utility, such as Buchanan, Oshkosh, Janesville, Neenah and Pewaukee. Oconomowoc and the village of North Fond du Lac tried to create their own roads utilities in the early 2000s but failed, according to the feasibility study.
What the new utility fee would fund
The new utility would pay for:
- Road construction projects
- Road resurfacing and other maintenance activities
- Sidewalk construction or maintenance
- Street lighting
- Traffic signal maintenance or construction
- Upkeep and storage for equipment used in road work
It will not pay for:
- Street sweeping, snow removal and stormwater management, which are funded through the general budget or the stormwater utility.
Some Wisconsin Rapids properties will be exempt or receive temporary credits
Not every property in the city will pay into the new utility. These properties include:
- Parking lots not associated with any services other than public parking
- Undeveloped publicly owned parkland or greenways unless public off-street parking for them is provided
- Undeveloped properties
If the utility is approved in October, residents facing special assessments for projects not completed and paid for, such as the one on 18th Avenue, will not receive their final bill from the city.
Residents currently paying a special assessment for roadwork done outside their property will not have to pay into the new transportation utility until their special assessment is paid off.
The ordinance also includes a provision for recently vacant properties to receive a credit toward their utility bill.
The ordinance includes a process to challenge utility rates
Property owners that disagree with how much the city charges them have a way to appeal.
Under the proposal:
- Property owners submit in writing a letter to the city engineer asking for an appeal, pay a $150 administrative fee and must be current on all utility bills.
- The letter must include why they're challenging and supporting documentation of how the city's fee differs from what the actual property road use is, which may include a traffic study.
- The letter must be filed within 30 days of the most recent utility bill and that bill must be paid.
- The city will reject the appeal If the city engineer finds the number of vehicle trips on an average weekday, or trip generation rate, falls within 10% of the rate used to calculate a property owner's utility fee.
- Property owners can appeal a rejected appeal to the city's public works committee.
Contact reporter Alan Hovorka at 715-345-2252 or ahovorka@gannett.com. Follow him on Twitter at @ajhovorka.