Special Assessments Raise Questions in Fish Creek
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UPDATE FEB. 5: The Town of Gibraltar will hold a special meeting Feb. 24 about the special assessments for sidewalks and street lighting. The meeting will be held at 6 pm. The meeting is not a public hearing, but there will be time for public comment. View the agenda and assessment information here>>
Just because you can do it, should you?
That’s the question some property owners are asking in the Town of Gibraltar, where a special assessment for streetlights and sidewalks has flown largely under the radar. The assessment will cost dozens of property owners $5,000 to $25,000, and some in excess of $100,000.
“I’m absolutely against the way they’re going about it,” said Bob MacDonald, owner of the Bayside Tavern. MacDonald said the town has not sent him any official notification about the assessment that will cost the tavern $4,974.
MacDonald is not alone. The Peninsula Pulse has spoken to at least nine property owners who say they have not received any word from the town about the upcoming assessments. Most said they found out only when the Peninsula Pulse published the assessment role Nov. 27.
When the town discussed estimated costs for the Highway 42 reconstruction project in July of 2018, the board said it might look to pay a portion of the cost through special assessments. On Oct. 2, 2019, it approved a preliminary resolution identifying the properties that would be assessed, but not the formula to determine the assessments or an estimated amount. It did not notify the affected property owners.
“This town hasn’t had good communication with residents for a long time,” said Bob Spielman, owner of Hathead on Highway 42. “But the communication factor between the board and its people has never been further apart than it is now.”
The town worked with consultant Dennis Stiegenberger of Cedar Corporation to devise an assessment formula based on a combination of highway frontage and property value.
In 2018, the town estimated the sidewalks would cost $146,111, but the final cost came to $554,123.06. That overrun came in part because the board did not realize that its original plan would result in a patchwork of some new sidewalks and some old. When the Department of Transportation resurfaces a highway, it is responsible only for the driving lanes and any additional pavement, curb and sidewalks that it removes as part of its work. The municipality must plan for and pay for any additional work.
After a property owner pointed that out in June of 2019, the town had to scramble to persuade contractors to replace more of the sidewalks and curb and gutter through town, adding significant expense.
The total cost of the streetlights came in at $1,277,000. That’s $393,000, or 31 percent, more than the town’s 2018 estimate.
The Wisconsin Department of Transportation contributed $466,560 to the streetlights, leaving $811,128.61 to be paid by landowners.
The town discussed payment options for the assessment during a Nov. 4 meeting. Those options included paying it all at once or spreading it out over five or 10 years, with interest.
Town Chair Steve Sohns said that property owners should be aware that the assessments were coming because the topic was discussed at public meetings. But Sohns and town staff said no specific notice of the assessments or estimated costs were ever sent out to affected property owners.
“That will go on the 2022 budget,” Sohns said. “We wanted to give people time to figure out how they want to pay for it and what the options are.”
Sohns, who lives outside the downtown area, said the town chose to pay for the project with a special assessment to spare outlying property owners.
“The people out in my neck of the woods didn’t feel they had to pay for that,” he said. “But they are paying for the frontage the town has. The downtown property owners are the ones benefiting from it.”
Supervisor Brian Merkel is one of those property owners. His business, Nor Door Sport and Cyclery, will be assessed $7,435.
Cal Burnton, a board member for the Fish Creek Condominiums – where the condo association will be on the hook for $111,997 – has argued that sidewalks and streetlights are an improvement for the good of the town, and their costs shouldn’t be put on the shoulders of only downtown residents and business owners.
“I don’t understand how expenditures for remote rural roads are deemed for the good of the community, but this is not,” Burnton said.
The assessed property owners will also be pitching in for the town’s portion, and a portion of the $254,755 that will be assessed to Gibraltar School.
“And for those who are members of the Catholic church, we’ll be pitching in for that as well,” Burnton said.
The church will be assessed $25,751.
Adding to the disenchantment is the fact that downtown business owners were impacted by several road closures during the project, then had revenue slashed by the COVID-19 pandemic.
“You’ve got a property-tax increase and the lights and sidewalks to pay for, and nobody anticipated a pandemic coming along,” Spielman said. “It doesn’t seem like any of that is taken into consideration.”
A Statutory Process, with a Loophole
The process for levying special assessments is laid out in Wisconsin State Statute 66.0701, which says that a municipality must complete several steps before beginning work on a specially assessed project.
Those steps include producing a complete special-assessment report, cost estimates and published notice; holding a public hearing; and sending written notice to each property owner affected. That’s also the process laid out in guidance from the Wisconsin League of Municipalities in its official publication in July of 2018.
The Town of Gibraltar did not complete any of those steps. Instead, before the work got underway, the town approved that 2019 preliminary resolution stating its intent to assess the property owners. Although that appears to be at odds with the language of the statute, case law seems to have supported it. In Park Avenue Plaza vs. City of Mequon, the Wisconsin Court of Appeals ruled in 2008 that although the legislature did not expressly grant municipalities the authority to levy special assessments after the completion of public work, it did not expressly prohibit such a procedure.
Before it can bill property owners, the town must complete the statutory steps. The board has said it will hold the required public hearing in February or March, but it is unclear whether that hearing will have any bearing on the assessment.
Stiegenberger said he has been performing assessments this way for 40 years.
“It’s an option,” he said. “You can do it as an estimate or as a final cost. In my opinion, they’re doing everything that’s required.”
The town’s attorney, Bob Gagen, agreed.
“I’ve read the statute, and the way the town is doing it is correct,” he said.
But for many Gibraltar residents, doing what is legally allowed isn’t the same as doing it right.
