Document you need to read then ask …



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A Document you need to read then ask where did the money go? Did it do Racine and good?

This will be talked about at tonight’s COW meeting 2/13/14





            The area-wide Sewer Service Agreement was signed on April 25, 2002 by the City of Racine, the Racine Wastewater Commission, the Town of Mt. Pleasant and its Utility District, the Town of Caledonia and its Utility Districts and was later signed by the Village of Sturtevant and the North Park Sanitary District.  Other communities are also expected to sign during the first 120 days after April 25, 2002, which is the “Effective Date” of the Agreement.  Revenue sharing payments required by the Agreement are based on a model developed by the City’s consultant, Ruekert-Mielke, Inc.  Payments are based on factors including the municipal budget, population and equalized property values.  Payments are calculated based on information from the prior calendar year, with notification of the amounts by July 1 of each year.  Payments are due by March 1 of the following year.  The Wastewater Commission is required to bill the parties for such payments by January 15 of the year payment is to be made.  The Wastewater Commission will distribute revenue sharing payments to Net Recipient Parties within 15 days of payment by all contributing Parties, except if there is a late payment, proceeds will be distributed based on the amounts received.  For each area participating, there will be 30 payment years beginning in 2002 with payments due March 15, 2003.  New areas entering the agreement will have 30 years of revenue sharing payments to make beginning at the time the area enters the agreement. 

            The agreement requires the City to use these revenues for capital improvement projects and thereby be able to increase its equalized value.  Such projects are envisioned to include infrastructure improvements as well as redevelopment projects.  Additionally, the Agreement requires certain expenditures to be made for designated projects and a designated area.  The City is required to spend not less than $6,000,000, 2001 net present value at 5% annually, of the total revenue sharing payments from Mt.. Pleasant in the area designated in Exhibit I of the Agreement (see attached) within 10 years after signing the Agreement.  Such expenditures must include the Oakes Road extension, which is to be improved during the same year that Mt. Pleasant participates in reconstruction of Chicory Road, which is a project that the City is pursuing.  Additionally, the City must spend its pro-rata share of upgrading and improving Three Mile Road at the border of Caledonia and Racine, contingent on Caledonia expending funds for its share of the Three Mile Road project. 

                        In addition to revenue sharing payments received from the outlying communities, the City will receive transfers of assets from the Wastewater Utility, subject to the Utility retaining an amount of funds that is reasonable and prudent in light of the needs and circumstances of the Utility.  The transfers will include reimbursement for equity contributions made by the City to the Utility or the Wastewater Commission after the effective date of the Agreement, plus interest; the amount of $660,000 per year to reimburse the City for assets originally transferred to the Utility, with a total transfer of $6,690,407, of which $3,300,000 was paid through the end of 2001; payment for Racine County’s funding shortfall for library services, beginning with a 2002 payment of $467,527; a payment for zoo funding in the amount of $285,000 in 2002 with a 3% increase per year through 2007 and the amount fixed for future years, and a payment for Wustum Museum services in the amount of $115,000 for 2002 with a 3% increase per year through 2007 and payments fixed in that amount thereafter.  These items total $1,527,527 for transfers in 2002.  It is anticipated that sufficient reserve funds exist in the Wastewater Utility accounts to support these payments for at least 20 years.  The agreement also anticipates that Racine County will increase its funding for library services and the amount funded by the Utility reserve funds would vary based on the County’s participation in payment for library services.  The items in this paragraph are not subject to expenditure limitation for capital projects.  It is anticipated that these funds will be used for offsetting current expense in each year’s City budget.

     -Dan Wright, City Attorney

11 Responses to Document you need to read then ask …

  1. Mr. Racine says:

    A very good question – Where has all the Sewer and Water revenue gone? It’s disappeared into the Blackhole known as Racine City Hall, and hasn’t been seen since!

    How about the PSC’s 2013 study of Racine’s PILOT program in relation to the Utilities?

    “Municipally owned water and electric utilities in Wisconsin are subject to a payment in
    lieu of local general property taxes, or PILOT. In contrast, investor-owned utilities pay a gross
    receipts tax. For rate-making purposes, the Commission makes an allowance for PILOT as a
    component of a utility’s total revenue requirements. Over time, the PILOT payments have
    become a substantial portion of the revenue requirements for municipal water utilities.

    Commission staff and others have raised concerns about the PILOT payment’s impact on
    utility costs and rates, primarily with respect to municipal water utilities. On January 25, 2012,
    the Commission opened an investigation on the PILOT calculation for municipal utilities and
    directed staff to investigate the following issues:”

    Continue reading more by going to the PSC’s website and reading: INVESTIGATION INTO MUNICPAL UTILITY PAYMENT IN LIEU OF TAXES (PILOT)
    Staff Report
    Docket 5-GF-215
    January 30, 2013


    After googling the above, you will still need to click on the link to to Docket 5-GF-215, which will bring up the DOCKET SUMMARY Summary. Click on DOCUMENTS to see the reports contents and links.

    Tens of Millions of $$$$ have disappeared! and Racine has little to show for it! No doubt, the City abusing it’s authority has to be some of the problem! Look at one of the financing options for TID 17!

    “The City can issue revenue bonds to be repaid from revenues of the sewer and/or water
    systems, including revenues paid by the City that represent service of the system to the City.
    There is neither a statutory nor constitutional limitation on the amount of revenue bonds that can be issued, however, water rates are controlled by the Wisconsin Public Service Commission
    and the City must demonstrate to bond underwriters its ability to repay revenue debt with the
    assigned rates. To the extent the City utilizes utility revenues other than tax increments to
    repay a portion of the bonds; the City must reduce the total eligible Project Costs in an equal
    amount. ”

    Click to access Racine%20TID%20No%20%2017%20DRAFT%20Project%20Plan%20-%20%202%2025%2012.pdf


  2. Lizzy Borden says:

    Dickert’s comment from the PILOT study:

    “Thank you for the opportunity to provide feedback and your consideration regarding Municipal Utility PILOTs. In addition to serving as Racine mayor, I am also the President of the Urban Alliance, which represents 46 Mayors and City Administrations statewide. I believe the current system of PILOT payments does not need state intervention or interference. On behalf of the UA, we urge you not to alter the formulas or current structure of PILOT payments, which would ultimately cut yet another funding source of municipal programs. ”

    I say that PILOT payments from Racine’s Utilities needs to end NOW! Because clean water is too important to allow Political Hacks to loot and plunder Public Utilities for their own political agendas and purposes!

    And the comment of Keith Haas is UTTERLY MORONIC!

    “PILOT provides a benefit to the municipality in that it reimburses the municipality for the
    lack of a tax base due to municipal utility ownership and in that sense is like a dividend
    that the municipal utility pays to the local government that owns the utility. ”

    Hey Keith! Want to try Cities without those municipal utilities? Do you suggest that Racine eliminate it’s municipal utilities so we can go back to the good old days – of Waterborne Diseases that ravaged communities?

    How asinine can you get? Why couldn’t Racine have something besides mental midgets at the helms of Leadership?

  3. Lying John says:

    Damn….Yeah I know Haas is one of the good guys too, but that was a dumb comment. It’s no secret he is pushed into corners by Dickert and forced into saying and doing dumb things (i.e. Tom Molbeck of the Parks Dept.) By the way, Lizzy Borden your above comment is SPOT ON!

    • Mr. Racine says:

      It’s such a shame to waste that valuable Lakefront property that Developers are just fighting each other over! Racine needs to open up a few new TID’s so that big $$$ money making hotel and conference centers – each with it’s own County owned and operated Marina, can be built. Imagine the Illinois Boaters!

      I can see it now – tear out the Water Works, Wastewater Treatment Facility and the Library – then the City of Racine can replace them with “Motel Dickert”, “The Monte Osterman Marble and Granite All-Star Resort”, and on the former site of the Racine Public Library, “The DTB Hotel and Convention Center”!

      That would be a much better use of valuable Lake Michigan shoreline property. The $$$$ would just roll in!

      • Your right! We need to as well build a huge monument to His Greatness John Dickert has he not done a great job as Mayor 24/7 and working as a “Lobbyist” and “Political adviser” Dose he use clones?

  4. I can remember when this agreement was reached among the City of Racine and surrounding communities (early 2000s).. The understanding I had via the big detailed news stories with pictures and through participation with Sixth Street Business Association was that the $21,000,000 coming into the safe for the City of Racine were to be spent on remediation of distressed grounds which silly me thought were the many wonderful and vacant grounds around warehouses and big old elevator buildings and wagon/tanning/welding industries lining the Root River watershed. Then I pictured the barbed wire being removed and creating more access to watershed bluffs and lowlands and making use of railroad track routes, underpasses, connecting up parks, connecting up neighborhoods. Clean up, restore indigenous ground. The reason I believed all of that was the earlier Crandall & Arumbula, architects redevelopment plan paid for by SCJohnson (1998-99) and signed off on and promoted everywhere.. Jim Smith was then mayor and Susan Greenfield the person getting the communities into line re this sewer pact. Crandall & Arumbula’s redevelopment was more than a gentrification or a privatization of land. It focused on the size of the geography and the vacant properties and land which could be utilized and be a model for a pedestrian friendly downtown with many outdoor opportunities and a continuity via the Root River via integrating neighborhoods. And a clean river and good tasting water is part of the attraction. So what happened to those intentions? How did we get from there to here? Ask Development? Ask the backroom. Ask the mayor with no time. Ask WHERE IS THE MONEY?

  5. Then we are back on the roundabout because what I really want to know is how did the purpose of the allocations become so flexible it can rewrite boundaries, drop ordinances, avoid public discussions (via citizens advisory committees that are hand picked), and STILL avoid reality. The years have not been kind to the City of Racine and it has a huge left out hood. Opportunity is missing for people who live here and how is it that the purpose of the shared community agreement ignores the taxing body that pays for it. Ka Ching for a few; misery and discontent for the many. Discontent=disrespect. WHY? roundabout we go until the system is broken? or silence is broken? The time is now. COW mtg – rumblings afoot!!!! push back is gathering strength.

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