Wisconsin intergovernmental agreement statutes allow for “major” boundary changes

by Hannah Dankbar

City of Kaukauna v. Village of Harrison
Wisconsin Court of Appeals, August 26, 2015

In 2013 the Village of Harrison was created within the Town of Harrison. The two communities created an intergovernmental cooperation agreement to share services and provide more land to the Village. The Cities of Kaukauna and Menasha, the Village of Sherwood along with individual property owners (referred to as the Challengers) argue that the agreement involved a “major” boundary change that exceeds the scope allowed by statute, and that the Town and Village did not strictly comply with statutory notice requirements.

In February 2013 voters in the Town of Harrison approved incorporating a 4.6-square-mile area as the Village of Harrison.  The Town and the Village published a notice about a hearing to discuss an Intergovernmental Cooperation Agreement concerning the provision of municipal services and the apportionment of costs, assets and liabilities, and the boundary line that would form the village limits. In addition to the published notice there was also a notice sent via certified mail to 1910 property owners. As a result of the boundary change 1,736 parcels that had been in the Town were assigned to the Village, which had an initial population of 9,597. This left the Town with 1,316 residents in “growth areas” with intermunicipal agreements with the cities of Appleton and Menasha. Prior to creation of the Village the Town of Harrison had about 10,700 residents.

The Challengers argue that WIS. STAT. § 66.0301 allows only “modest boundary changes incidental to” the sharing of services between governments and requires a prehearing notice to property owners of the effects of the intergovernmental agreement on the boundary lines. The Challengers conceded that the statute is silent on the scope of the boundary changes permitted via intergovernmental agreements, but they argue that the statute should be read to allow only “modest” boundary changes necessary to accomplish the statute’s “primary goal of sharing services between municipalities.” The Court of Appeals, however, believed that this would require it to read beyond the plain language of a statute, which the court determined it would not do.

The Challengers argue that allowing municipalities to achieve major boundary changes via intergovernmental agreements would lead to an “absurd” result and would take meaning away from other statutes related to intergovernmental agreements, and the agency and mandatory public referendum approval process required for other jurisdictional alterations. The court disagreed.  Just because there is a legislative process that the Challengers do not like does not mean it is “absurd”. Statutes can provide multiple methods for altering municipal boundaries.

The Challengers argue that even property owners who are not near the boundary are still affected by it and should be given notice. Wisconsin law provides for publication of “a class 1 notice” in a newspaper that is available to everybody in the area. The court found this to be sufficient notice to those property owners.

Both notices (direct mailed notice and newspaper notice) provided by Harrison made reference to “boundary line adjustments between the Town of Harrison and the Village of Harrison” as being part of the intergovernmental cooperation agreement. This complied with the minimal notice requirement of WIS. STAT. § 66.0301(6)(c)1 by informing property owners that the approval of the agreement would relocate many of them. The language of the statute does not specify what information is required to be in the notice.

The Court of Appeals found that Harrison fully complied with all statutory notice requirements.

Sewage holding tank pumped out by the city does not constitute “city sewer services”

by Hannah Dankbar

Charter Township of Haring v City of Cadillac
Michigan Court of Appeals, March 5, 2015

In the early 2000s the Charter Township of Haring signed an agreement with the city of Cadillac in accordance with MCL 124.22 which allows two or more local units of government to “conditionally transfer property for a period of not more than 50 years for the purpose of an economic development project” by means of “a written contract agreed to by the affected local units.” This contract conditionally transferred property in East Haring over to Cadillac so that Cadillac could provide public safety and infrastructure services for the property. The contract said that the property would belong to the city in 2053, however there was an early termination and reversal clause affecting part of the property, the Boersma parcel.

In relevant part, the early termination clause states:  For the [Boersma parcel], City water and/or City sewer services must be provided no later than 10 years from the effective date of this agreement. In the event that City water and/or City sewer services are not provided within the 10 year term provided above, then the real estate described in this paragraph shall be automatically removed from the terms of this agreement and the jurisdiction for such real estate shall immediately revert to the Township.

The contract was not specific about what constitutes “city water or sewer.” Cadillac did not put in a sewer pipeline that led to the wastewater treatment facility, rather the City installed a self-contained sewage holding tank and a truck was used to pump the sewage in order to transport it to the facility. Haring sued Cadillac in 2003 claiming a breach in the contract, and seeking termination of the contract for failing to install a sewer system.

The early termination clause specified that jurisdiction over the Boersma parcel would “immediately revert” to Haring Township if Cadillac failed to provide the Boersma parcel with “City water and/or City sewer services” within ten years of the agreement. The Township argued that the sewer services that Cadillac provides to Boersma are different, and of lower quality, than the services it provides to the other properties within their jurisdiction. Neither the early termination clause nor the wider contract defined “City sewer services.” The Court of Appeals referred to dictionary definitions of “city,” “sewer,” and “services” to ascertain the “plain and ordinary meaning” of the term as used in the agreement.

The infrastructure Cadillac installed on the Boersma parcel merely collects sewage in a holding structure, and leaves the sewage on the property. It does not “carry off waste water and refuse” to another location—the dictionary definition of what a “sewer” does…. The fact that Cadillac planned to upgrade the sewage infrastructure on the Boersma parcel militates against finding that the existing infrastructure satisfies the mandates of the early termination clause, because it indicates that Cadillac believes the existing infrastructure to be inadequate in some way—and perhaps not the “sewer” contemplated by the contract.

To meet the conditions of the agreement Cadillac must have installed a sewer pipeline that leads to the wastewater treatment plant within ten years of signing the agreement.  Accordingly, the Court of Appeals found that the property “immediately reverted[ed]” to the Township.

Intermunicipal agreement not a “boundary agreement” exempting Village from payment requirement

by Victoria Heldt

Town of Buchanan v. Village of Kimberly
(Wisconsin Court of Appeals, December 6, 2011)

This case revolves around an agreement made between the Town of Buchanan and the Village of Kimberly regarding annexation.  In 2000 the two municipalities designated a specific area within the Town as a Village growth area.  The Town agreed not to oppose the Village’s annexation of land within the described area and the Village agreed not to try to annex land outside the area.  In 2006 the Village annexed property known as Emons Farm that was situated outside the designated Village growth area.  To settle the matter, the Village and the Town entered into an “intermunicipal agreement” in 2007.  In it, the Village agreed to pay the Town $25,000 and to refrain from attracting property owners to annex additional property in the Town.  On the other hand, it clarified that the Village may not disallow future annexation of property within the Town if a unanimous petition to do so is presented.

In 2009, the Village once again annexed property within the Town.  The Town did not object, but claimed that it was entitled to five annual payments pursuant to Wis. Stat. §66.0217(14)(a)1. This statute states that the annexation of a property cannot take place unless the party petitioning for annexation agrees to pay the Town five annual payments equal to the amount of property taxes the Town would normally collect for the property.  The Village was of the opinion that it was exempt from the payments under subd. 2 of the same statute, which states that, in the existence of a boundary agreement, the payment requirement does not apply.  The Village argued that the intermunicipal agreement made in 2007 constituted a boundary agreement, so the payments were not required.  The Town countered that the agreement was not a “boundary agreement” as defined by statute.  The circuit court ruled in favor of the Town that the agreement was not a “boundary agreement.”  It found it illogical to allow a one-time boundary negotiation for a specific instance to govern all future boundary agreements.  It opined that doing so would “render meaningless the statute.”

On appeal, the Town argued that the 2007-2008 version of Wis. Stat. §66.0301 applied while the Village argued that the 2005-2006 version of the statute applied.  The two versions were identical except that the more recent version contained an additional subsection (6) which addressed agreements “determining all or a portion of the common boundary line between two municipalities.”  The Court noted that it did not need to settle the conflict regarding which version applied since the intermunicipal agreement formed in 2007 did not constituted a boundary agreement per statute.  In order to constitute an agreement under Wis. Stat. §66.0301, it must provide for “the receipt or furnishing of services or the joint exercise of any power or duty required or authorized by law.”  Since the agreement made between the Village and the Town in 2007 contained no such provision, it did not qualify as a boundary agreement under the relevant statute.  Consequently, the payment exception in §66.0217(14)(a)2 did not apply.  The Court affirmed the circuit court’s decision in favor of the Town.





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