Iowa:
Not applicable.
Michigan:
Not applicable.
Minnesota:
Not applicable.
Summary of factual data and analytical methodologies
The department reviewed statutes, Acts, and the rules presented in this order to determine which rules needed to be repealed or revised.
Small Business Impact
The rules will not have a fiscal effect on businesses.
Fiscal Estimate
State fiscal effect
None.
Local government fiscal effect
None.
Private sector fiscal effect
None.
Long-range fiscal implications
None known.
Agency Contact Person
Pat Benesh, Quality Assurance Program Spec-Senior
Division of Quality Assurance
1 West Wilson Street, Room 534
Madison, WI 53701
Phone:
608-264-9896
Fax:
608-267-0352
Notice of Hearing
Revenue
NOTICE IS HEREBY GIVEN That pursuant to ss.
73.029
and
227.11 (2) (a)
, Stats., the Department of Revenue will hold a public hearing to consider rules revising Chapters
Tax 1
,
2
, and
3
, relating to electronic funds transfer; original and amended corporation franchise and income tax returns; information returns and wage statements; returns of persons other than corporations; the recycling surcharge; estimated tax requirements; addback and disclosure of related entity expenses; pass-through entity withholding; and the dividends received deduction for corporations.
Hearing Information
The hearing will be held:
Date:
August 13, 2010
Time:
1:00 PM
Location:
Events Room
State Revenue Building
2135 Rimrock Road
Madison, Wisconsin
Handicap access is available at the hearing location.
Copies of Proposed Rules
A copy of the full text of the proposed rule order and the full fiscal estimate may be obtained at no cost by contacting the department. See
Agency Contact Person
listed below.
Submission of Written Comments
Interested persons are invited to appear at the hearing and may make an oral presentation. It is requested that written comments reflecting the oral presentation be given to the department at the hearing. Written comments may also be submitted to the contact person shown under
Agency Contact Person
listed below no later than
August 20, 2010
, and will be given the same consideration as testimony presented at the hearing.
Analysis Prepared by the Department of Revenue
Statutes interpreted
Sections
71.01 (5g)
,
71.19
,
71.22 (2m)
,
71.255
,
71.63 (3m)
and
(3r)
,
71.68 (2)
,
71.775
,
71.80 (20)
and
(23)
,
73.029
,
77.982 (2)
, and
77.9941 (4)
, Stats.
Statutory authority
Explanation of agency authority
Section
73.029
, Stats., provides that the department may require electronic funds transfer only by promulgating rules. Section
227.11 (2) (a)
, Stats., provides that each agency may promulgate rules interpreting the provisions of any statute enforced or administered by it, if the agency considers it necessary to effectuate the purpose of the statute.
Related statute or rule
Plain language analysis
The proposed rule order will:
•
Expand the taxes, fees, and other amounts required to be paid or deposited using electronic funds transfer (EFT) and the returns, reports, and refund claims the department may require be filed electronically.
•
Provide further interpretation and explanation of the statutory provisions for disclosure of related entity expenses and the related addition and subtraction modifications.
•
Provide additional guidance with respect to the statutory provisions for pass-through entity withholding tax.
Comparison with federal regulation
s
There is no existing or proposed federal regulation that is intended to address the activities to be regulated by the rule order.
Comparison with rules in adjacent states
Illinois:
Illinois Administrative Code, title 86, sec. 100.2430, provides that addbacks are required for interest and intangible expenses paid to 80-20 companies (companies that cannot be included in unitary group because 80% or more of their activities are outside U.S.), to the extent such amounts exceed taxable dividends received.
Iowa:
Iowa Admin. Code r. 701-46.4(2) provides that withholding is required against income distributable to nonresident individuals.
Summary of factual data and analytical methodologies
The department processes hundreds of thousands of paper checks, refund claims, reports, and returns each year. Each one costs more to process and takes more staff time to handle than if submitted electronically. The department has determined that in order to operate in the most cost effective and efficient manner possible, it is necessary to expand its electronic filing and payment requirements.
In addition, this rule order has been created to incorporate and provide further interpretation, explanation, and guidance with respect to the statutory provisions of
2009 Wisconsin Acts 2
and
28
and the statutory provisions relating to related entity expenses and pass-through entity withholding.
Analysis and supporting documents used to determine effect on small business
The department provides methods to electronically file and pay taxes with little or no cost. In addition, an exception to the requirements to file and pay electronically for situations where an undue hardship is caused is provided in the rule. Based on this, the department has concluded that this rule order does not have a significant effect on small business.
As explained above, this proposed rule order also has been created to reflect changes in and provide further interpretation, explanation, and guidance with respect to Wisconsin's tax laws. As the rule itself does not impose any significant financial or other compliance burden, the department has determined that it does not have a significant effect on small business.
Small Business Impact
This proposed rule order does not have a significant economic impact on a substantial number of small businesses.
Fiscal Estimate
The provisions relating to
2009 Wisconsin Acts 2
and
28
and related entity expenses interpret existing statutes and therefore have no fiscal effect. The provisions relating to treatment of withholding for pass-through entities are expected to generate minimal administrative savings. The provisions relating to electronic fund transfer payments and to electronic filing of returns, reports, and refund claims are anticipated to reduce administrative expenditures by an estimated $152,900 annually as described below.
The Department of Revenue estimates a potential 88% decrease in paper sales tax filings (from 422,000 to 48,000 annually) under the proposed rule, which translates into a cost savings of $152,900. This also would result in electronic sales tax filings increasing from 52% to 95% of all sales tax filings (increasing from 462,300 to 835,900 of 884,259 total sales tax returns based on a recent 12-month period). Additional cost savings may also be achieved as other filings, especially individual income tax withholdings, are shifted to electronic form. The timeline for cost savings, however, will be dependent on the pace at which this shift is implemented. Cost savings will also be reduced to the degrees to which waivers from the proposed rule are granted.
Anticipated costs incurred by private sector
This proposed rule order does not have a significant fiscal effect on the private sector.
Agency Contact Person
Dale Kleven, Dept. of Revenue
Mail Stop 6-40
2135 Rimrock Road
PO Box 8933
Madison, WI 53708-8933
Phone: (608) 266-8253
Notice of Hearing
Revenue
NOTICE IS HEREBY GIVEN That pursuant to s.
227.21 (2) (a)
, Stats., the Department of Revenue will hold a public hearing to consider the creation of Tax 4.001, 7.001, 8.001, and 9.001 and revision of Tax 11.01, relating to motor vehicle, alternate fuels, and general aviation fuel tax return and refund claim forms; fermented malt beverage tax return and refund claim forms; intoxicating liquor report, tax return, and refund claim forms; cigarette and tobacco products report, tax return, and refund claim forms; and sales and use tax, local exposition tax, and premier resort area tax return forms.
Hearing Information
The hearing will be held:
Date:
August 11, 2010
Time:
1:00 PM
Location:
Events Room
State Revenue Building
2135 Rimrock Road
Madison, Wisconsin
Handicap access is available at the hearing location.
Submission of Written Comments
Interested persons are invited to appear at the hearing and may make an oral presentation. It is requested that written comments reflecting the oral presentation be given to the department at the hearing. Written comments may also be submitted to the contact person shown under
Agency Contact Person
listed below no later than
August 17, 2010
, and will be given the same consideration as testimony presented at the hearing.
Analysis by the Department of Revenue
Statutes interpreted
77.982(2), 77.9941(4), 78.005(6m), 78.39(4m), 78.55 (2r), 139.01(2r), 139.30 (4m), and 139.75 (4m), Stats.
Statutory authority
Explanation of agency authority
Section
227.11 (2) (a)
, Stats., provides that each agency may promulgate rules interpreting the provisions of any statute enforced or administered by it, if the agency considers it necessary to effectuate the purpose of the statute.
Related statute or rule
There are no other applicable statutes or rules.
Plain language analysis
This rule order expands the returns, reports, and refund claims the department may require be filed electronically.
Comparison with federal regulations
There is no existing or proposed federal regulation that is intended to address the activities to be regulated by the rule.
Comparison with rules in adjacent states
The department is not aware of a similar rule in an adjacent state.
Summary of factual data and analytical methodologies
The department processes hundreds of thousands of refund claims, reports, and returns each year. Each one costs more to process and takes more staff time to handle than if submitted electronically. The department has determined that in order to operate in the most cost effective and efficient manner possible, it is necessary to expand its electronic filing requirements.
Analysis and supporting documents used to determine effect on small business
The department provides methods to electronically file with little or no cost. In addition, an exception to the requirements to file electronically for situations where an undue hardship is caused is provided in the rule. Based on this, the department has concluded that this rule order does not have a significant effect on small business.
Small Business Impact
This rule order does not have a significant effect on small business.
Fiscal Estimate
Assumptions used in arriving at fiscal estimate
The Department of Revenue (DOR) processes millions of reports, returns and refund claims every year. To improve the department's efficiency, modern technologies are continuing to be deployed to increase the use of electronic processing, and, as a result, reduce dependency on paper transactions requiring manual processing. For example, the portion of individual income tax returns filed electronically increased from 66.7% in 2009 to 74.4% in 2010 (as measured through May 2010). Similarly, the portion of sales and use tax returns filed electronically increased from 52.6% for the entirety of 2009 to 75.5% during the first five months of 2010.
Section
227.11 (2) (a)
of the statutes allows the department to promulgate rules interpreting the provisions of any statute enforced or administered by the department, if it considers the rule necessary to effectuate the purpose of the statute.
Utilizing the authority provided by this statute, the proposed rule permits DOR to require additional tax reports, tax returns, and refund claims to be filed electronically. Specifically, the rule would allow DOR to require electronic filing of the following forms and returns:
•
Motor vehicle fuel, alternate fuel, and general aviation fuel tax returns and refund claim forms.
•
Fermented malt beverage tax returns and refund claim forms.
•
Intoxicating liquor reports, tax returns, and refund claim forms.
•
Cigarette and tobacco products reports, tax returns, and refund claim forms.
•
Local exposition tax returns.
•
Premier resort area tax returns.
Consistent with certain forms for which the department may already require electronic filing, the proposed rule includes an exception which allows the DOR Secretary to waive the requirement to file electronically when the Secretary determines that the requirement causes an undue hardship.
Since the proposed rule will increase the number of transactions filed electronically, it will reduce paper based transactions and lead to a more efficient use of DOR's resources. Individuals and businesses submitting returns to DOR may also benefit by electronic increased electronic filling.
While cost savings will be achieved as various tax filings are shifted to electronic form, the timeline for these savings, will depend on the pace at which this shift is implemented. Some of these savings have already been realized as 64% of local exposition tax returns, 59% of premier resort area returns, and all liquor tax returns are already received electronically. In addition, DOR's cost savings will be reduced to the degree to which waivers from the proposed rule are granted.
Based on DOR estimates, the switch-over of certain excise tax forms from paper to electronic format will require the department to incur transitional costs of approximately $5, 000 per changeover (for form revisions, informational letters, and other one-time costs). These transitional costs are expected to be absorbed within existing expenditure authority and permit subsequent long-term savings.
State fiscal effect
Increase costs — may be possible to absorb within agency's budget.
Fund sources affected
GPR.
Affected Ch.
20
appropriations
Local government fiscal effect
None.
Anticipated costs incurred by private sector
This rule order does not have a significant fiscal effect on the private sector.
Text of Proposed Rule
SECTION 1.
Tax 4.001 is created to read:
Tax 4.001
Motor vehicle, alternate fuels, and general aviation fuel tax return and refund claim forms. (1)
FORMS. The department shall provide official forms for filing motor vehicle, alternate fuels, and general aviation fuel tax returns and refund claims. Except as approved by the department, tax returns and refund claims may only be filed using these official forms.
(2) FILING RETURNS. (a) Forms filed with the department shall be submitted by one of the following means:
1. Mailing them to the address specified by the department on the forms or in the instructions.
2. Delivering them to the department or to the destination that the department prescribes.
3. Filing them electronically by means prescribed by the department.
(b) The department may require motor vehicle, alternate fuels, and general aviation fuel tax returns and refund claims be filed electronically. The department shall notify a person at least 90 days prior to the due date of the first return required to be filed electronically of the requirement to file electronically.
(c) The secretary of revenue may waive the requirement to file electronically when the secretary determines that the requirement causes an undue hardship, if the person does all of the following:
1. Requests the waiver in writing.
Note: Written requests should be e-mailed to
excise@revenue.wi.gov
, faxed to (608) 261-7049, or addressed to Mandate Waiver Request, Wisconsin Department of Revenue, Mail Stop 5-107, PO Box 8900, Madison WI 53708-8900.
2. Clearly indicates why the requirement causes an undue hardship.
(d) In determining whether the requirement to file electronically causes an undue hardship, the secretary of revenue may consider the following factors:
1. Unusual circumstances that may prevent the person from filing electronically.
Example: The person does not have access to a computer that is connected to the internet.
2. Any other factor that the secretary determines is pertinent.
SECTION 2
. Tax 7.001 is created to read:
Tax 7.001 Fermented malt beverage tax return and refund claim forms. (1) FORMS. The department shall provide official forms for filing fermented malt beverage tax returns and refund claims. Except as approved by the department, tax returns and refund claims may only be filed using these official forms.
(2) FILING RETURNS. (a) Forms filed with the department shall be submitted by one of the following means:
1. Mailing them to the address specified by the department on the forms or in the instructions.
2. Delivering them to the department or to the destination that the department prescribes.
3. Filing them electronically by means prescribed by the department.
(b) The department may require fermented malt beverage tax returns and refund claims be filed electronically. The department shall notify a person at least 90 days prior to the due date of the first return required to be filed electronically of the requirement to file electronically.
(c) The secretary of revenue may waive the requirement to file electronically when the secretary determines that the requirement causes an undue hardship, if the person does all of the following:
1. Requests the waiver in writing.
Note: Written requests should be e-mailed to
excise@revenue.wi.gov
, faxed to (608) 261-7049, or addressed to Mandate Waiver Request, Wisconsin Department of Revenue, Mail Stop 5-107, PO Box 8900, Madison WI 53708-8900.
2. Clearly indicates why the requirement causes an undue hardship.
(d) In determining whether the requirement to file electronically causes an undue hardship, the secretary of revenue may consider the following factors:
1. Unusual circumstances that may prevent the person from filing electronically.
Example: The person does not have access to a computer that is connected to the internet.
2. Any other factor that the secretary determines is pertinent.
SECTION 3.
Tax 8.001 is created to read:
Tax 8.001 Intoxicating liquor report, tax return, and refund claim forms.
(1)
FORMS. The department shall provide official forms for filing intoxicating liquor reports, tax returns, and refund claims. Except as approved by the department, reports, tax returns, and refund claims may only be filed using these official forms.
(2) FILING FORMS. (a) Forms filed with the department shall be submitted by one of the following means:
1. Mailing them to the address specified by the department on the forms or in the instructions.
2. Delivering them to the department or to the destination that the department prescribes.
3. Filing them electronically by means prescribed by the department.
(b) The department may require intoxicating liquor reports, tax returns, and refund claims be filed electronically. The department shall notify a person at least 90 days prior to the due date of the first report or tax return required to be filed electronically of the requirement to file electronically.
(c) The secretary of revenue may waive the requirement to file electronically when the secretary determines that the requirement causes an undue hardship, if the person does all of the following:
1. Requests the waiver in writing.
Note: Written requests should be e-mailed to
excise@revenue.wi.gov
, faxed to (608) 261-7049, or addressed to Mandate Waiver Request, Wisconsin Department of Revenue, Mail Stop 5-107, PO Box 8900, Madison WI 53708-8900.
2. Clearly indicates why the requirement causes an undue hardship.
(d) In determining whether the requirement to file electronically causes an undue hardship, the secretary of revenue may consider the following factors:
1. Unusual circumstances that may prevent the person from filing electronically.
Example: The person does not have access to a computer that is connected to the internet.
2. Any other factor that the secretary determines is pertinent.
SECTION 4.
Tax 9.001 is created to read:
Tax 9.001
Cigarette and tobacco products report, tax return, and refund claim forms. (1) FORMS. The department shall provide official forms for filing cigarette and tobacco products reports, tax returns, and refund claims. Except as approved by the department, reports, tax returns, and refund claims may only be filed using these official forms.
(2) FILING FORMS. (a) Forms filed with the department shall be submitted by one of the following means:
1. Mailing them to the address specified by the department on the forms or in the instructions.
2. Delivering them to the department or to the destination that the department prescribes.
3. Filing them electronically by means prescribed by the department.
(b) The department may require cigarette and tobacco products reports, tax returns, and refund claims be filed electronically. The department shall notify a person at least 90 days prior to the due date of the first report or return required to be filed electronically of the requirement to file electronically.
(c) The secretary of revenue may waive the requirement to file electronically when the secretary determines that the requirement causes an undue hardship, if the person does all of the following:
1. Requests the waiver in writing.
Note: Written requests should be e-mailed to
excise@revenue.wi.gov
, faxed to (608) 261-7049, or addressed to Mandate Waiver Request, Wisconsin Department of Revenue, Mail Stop 5-107, PO Box 8900, Madison WI 53708-8900.
2. Clearly indicates why the requirement causes an undue hardship.
(d) In determining whether the requirement to file electronically causes an undue hardship, the secretary of revenue may consider the following factors:
1. Unusual circumstances that may prevent the person from filing electronically.
Example: The person does not have access to a computer that is connected to the internet.
2. Any other factor that the secretary determines is pertinent.
SECTION 5.
Tax 11.01(title) and (1) (intro.), (a), (b), and (c) are amended to read:
Tax 11.01(title) Sales and use tax
, local exposition tax, and premier resort area tax
return forms.
Tax 11.01(1) (intro.) For filing sales and use tax
, local exposition tax, and premier resort area tax
returns, the following forms shall be used:
(a) Form MV-1. A department of transportation form for occasional and dealer sales of motor vehicles,
mobile homes
recreational vehicles as defined in s.
348.01 (48r)
, Stats.
, trailers
,
and semi-trailers.
(b) Form S-012. Also called form ST-12. The monthly, quarterly
,
or annual return used to report state, county
,
and stadium taxes by persons holding a Wisconsin seller's permit, use tax registration certificate
,
or consumer's use tax registration certificate. This form is also used to file refund claims or report additional taxes for prior periods.
(c) Form SU-050. Also called form UT-5. For consumers other than persons holding a Wisconsin seller's permit, use tax registration certificate
,
or consumer's use tax registration certificate.
SECTION 6.
Tax 11.01(1) (h) and (i) are created to read:
Tax 11.01(1) (h) Form EX-012. The return used to report local exposition taxes. This form is also used to file refund claims or report additional taxes for prior periods.
Tax 11.01(1) (i) Form PRA-012. The return used to report premier resort area taxes. This form is also used to file refund claims or report additional taxes for prior periods.
SECTION 7.
Tax 11.01(2) (a) 3. and (b) are amended to read:
Tax 11.01(2) (a) 3. Filing them electronically
via the department's sales internet process, or "SIP," or some other electronic means
as
prescribed by the department.
Note to LRB: Remove the note at the end of Tax 11.01(2) (a) 3.
(b)
The
Except as provided in par. (c), the
department may require a person registered or required to be registered for Wisconsin sales and use tax purposes to file its sales and use tax return
by electronic means
electronically
. The department shall notify the person at least 90 days prior to the due date of the first sales and use tax return required to be filed
by electronic means
electronically
of the requirement to file
by electronic means
electronically
. In its notice, the department shall indicate the period covered for the first return to be filed
by electronic means
electronically
.
SECTION 8
. Tax 11.01(2) (bg) and (br) are created to read:
Tax 11.01(2) (bg) Except as provided in par. (c), the department may require a person registered or required to be registered for Wisconsin sales and use tax purposes to file its premier resort area tax return electronically. The department shall notify the person at least 90 days prior to the due date of the first premier resort area tax return required to be filed electronically of the requirement to file electronically. In its notice, the department shall indicate the period covered for the first return to be filed electronically.
Tax 11.01(2) (br) Except as provided in par. (c), the department may require a person registered or required to be registered for Wisconsin local exposition tax purposes to file its local exposition tax return electronically. The department shall notify the person at least 90 days prior to the due date of the first local exposition tax return required to be filed electronically of the requirement to file electronically. In its notice, the department shall indicate the period covered for the first return to be filed electronically.
SECTION 9.
Tax 11.01(2) (c) (intro.) and (d) (intro.) and 1. are amended to read:
Tax 11.01(2) (c) (intro.) The secretary of revenue may waive the requirement
for a person
to file
by electronic means
electronically
when the secretary determines that the requirement causes an undue hardship, if the person does all of the following:
Note to LRB: Replace the note at the end of Tax 11.01(2) (c) 1. with the following:
Note: Written requests should be e-mailed to
DORWaiverRequest@revenue.wi.gov
, faxed to (608) 264-7776, or addressed to Mandate Waiver Request, Wisconsin Department of Revenue, Mail Stop 5-77, PO Box 8949, Madison WI 53708-8949.
Tax 11.01(2) (d) (intro.) In determining whether the electronic
means
filing
requirement causes an undue hardship, the secretary of revenue may consider the following factors:
Tax 11.01(2) (d) 1. Unusual circumstances that may prevent the person from
using electronic means
filing electronically
.
Note to LRB: Replace the notes at the end of Tax 11.01(2) (d) 2. with the following:
Agency Contact Person
Dale Kleven, Dept. of Revenue
Mail Stop 6-40
2135 Rimrock Road
PO Box 8933
Madison WI 53708-8933
Phone: (608) 266-8253
Notice of Hearing
Revenue
NOTICE IS HEREBY GIVEN That, pursuant to s.
227.11 (2) (a)
, Stats., the Department of Revenue will hold a public hearing to consider rules revising Chapter
Tax 11
, relating to sales and use tax.
Hearing Information
The hearing will be held:
Date:
August 13, 2010
Time:
9:00 AM
Location:
Events Room
State Revenue Building
2135 Rimrock Road
Madison, Wisconsin
Handicap access is available at the hearing location.
Copies of Proposed Rules
A copy of the full text of the proposed rule order and the full fiscal estimate may be obtained at no cost by contacting the department. See
Agency Contact Person
listed below.
Submission of Written Comments
Interested persons are invited to appear at the hearing and may make an oral presentation. It is requested that written comments reflecting the oral presentation be given to the department at the hearing. Written comments may also be submitted to the contact person shown under
Agency Contact Person
listed below no later than
August 20, 2010
, and will be given the same consideration as testimony presented at the hearing.
Analysis Prepared by the Department of Revenue
Statutes interpreted
Statutory authority
Explanation of agency authority
Section
227.11 (2) (a)
, Stats., provides that each agency may promulgate rules interpreting the provisions of any statute enforced or administered by it, if the agency considers it necessary to effectuate the purpose of the statute.
Related statute or rule
There are no other applicable statutes or rules.
Plain language analysis
This proposed rule order does the following:
•
Reflects recent law changes relating to sales and use tax.
•
Makes various other changes to improve readability.
•
Adds examples where needed for clarification purposes.
•
Updates certain department procedures to follow, such as the various methods to register to collect Wisconsin sales or use tax and how to inactivate a seller's permit.
Comparison with federal regulations
There is no existing or proposed federal regulation that is intended to address the activities to be regulated by the rule order.
Comparison with rules in adjacent states
Minnesota, Michigan, and Iowa:
Minnesota, Michigan, and Iowa administer their sales and use tax laws in a manner consistent with Wisconsin. These states do this through a combination of statutory provisions and administrative rules.
Illinois:
Illinois does not administer its sales and use tax laws in a manner substantively consistent with Wisconsin.
Summary of factual data and analytical methodologies
2009 Wisconsin Acts 2
,
28
,
204
, and
330
adopted statutory changes to Wisconsin's sales and use tax statutes. The department has created this proposed rule order to reflect these changes in Wisconsin's sales and use tax laws.
Analysis and supporting documents used to determine effect on small business
As explained above, this proposed rule order is created to reflect changes in Wisconsin's sales and use tax laws. As the rule itself does not impose any significant financial or other compliance burden, the department has determined that it does not have a significant effect on small business.
Small Business Impact
This proposed rule order does not have a significant economic impact on a substantial number of small businesses.
Fiscal Estimate
The proposed rule updates Chapter
Tax 11
of the Administrative Code, pertaining to the sales and use tax, to reflect certain sales tax changes adopted during the 2009 Legislative session. Specifically, the proposed rule updates Chapter
Tax 11
to conform, or more clearly conform, this chapter of the administrative code to sales tax provisions contained in the following 2009 Acts:
•
Act 2 — 2008-09 Budget Adjustment Legislation
•
Act 28 — 2009-11 Budget Bill
•
Act 204 — Food Sold by Child Welfare Facilities
•
Act 330 — Streamlined Sales and Use Tax Agreement Changes
The proposed rule modifies Chapter
Tax 11
to reflect law changes, improve clarity, and add examples to illustrate the tax treatment of certain items.
The proposed rule includes:
•
Updates and clarifications to reflect amendments to the Streamlined Sales and Use Tax Agreement.
•
Act 204's sales tax exemption for food, except soft drinks, sold by any child welfare facility licensed or certified under Chapter
48
.
•
Examples of items not directly used in manufacturing (to facilitate the administration of Act 28's modifications to the definition of manufacturing).
•
Clarifications to earlier changes pertaining to Act 2 and Act 28.
The fiscal effects of these rule changes were included in the fiscal estimates of
2009 Acts 2
,
28
,
204
and
330
. Consequently, these rule changes have no fiscal effect.
Anticipated costs incurred by private sector
This proposed rule order does not have a significant fiscal effect on the private sector.
Agency Contact Person
Dale Kleven, Dept. of Revenue
Mail Stop 6-40
2135 Rimrock Road
PO Box 8933
Madison WI 53708-8933
Phone: (608) 266-8253
Notice of Hearing
Transportation
NOTICE IS HEREBY GIVEN that pursuant to ss.
110.06
,
110.20 (9)
and
227.11 (2)
, Stats., the Department of Transportation will hold a public hearing to consider the amendment of Chapter
Trans 131
, Wis. Adm. Code, relating to the vehicle emission inspection process.
Hearing Information
The hearing will be held:
Date:
August 12, 2010
Time:
11:00 AM
Location:
Hill Farms State Transportation Bldg.
Room 254
4802 Sheboygan Avenue
Madison, WI
This hearing is held in an accessible facility. If you have special needs or circumstances that may make communication or accessibility difficult at the hearing, please call Carson Frazier at (608) 266-7857 with specific information on your request at least 10 days before the date of the scheduled hearing. Accommodations such as interpreters, English translators, or materials in alternative format will, to the fullest extent possible, be made available upon a request from a person with a disability to accommodate your needs.
Copies of Proposed Rule
A copy of the rule may be obtained upon request from Carson Frazier, Department of Transportation, Bureau of Vehicle Services, Room 253, P. O. Box 7911, Madison, WI 53707-7911. You may also contact Ms. Frazier by phone at (608) 266-7857 or via e-mail:
carson.frazier@dot.state
. wi.us
to obtain copies of the proposed rule. Copies will also be available at the hearing.
Submittal of Written Comments
The public record on this proposed rule making will be held open until close of business the day of the hearing to permit the submission of comments in lieu of public hearing testimony or comments supplementing testimony offered at the hearing. Any such comments should be submitted to Carson Frazier, Department of Transportation, Bureau of Vehicle Services, Room 253, P. O. Box 7911, Madison, WI 53707-7911. You may also contact Ms. Frazier by phone at (608) 266-7857 or via e-mail:
carson.frazier@dot.state
. wi.us
.
Analysis Prepared by the Department of Transportation
Statutes interpreted
Statutory authority
Explanation of agency authority
Section
110.20
, Stats., requires the Wisconsin Department of Transportation to administer a motor vehicle emission inspection and maintenance program to verify that vehicles customarily kept in a `non-attainment' county meet motor vehicle emission standards. Most private automobiles are subject to the emission limits, although certain newer and older vehicles are exempt. A non-attainment county is one that has air pollution that exceeds the federal Clean Air Act standards. Section
110.20 (13)
, Stats., requires the Department to waive compliance with emission standards if the vehicle owner proves that despite attempted repairs the vehicle cannot meet the standards and that the actual costs of repairs exceeded the repair cost limit. In general, a vehicle is tested every two years. The waiver is valid for 2 years, after which additional repairs may be required as a condition of registration. Current law at s.
110.20 (9) (b)
, Stats., requires the Department to promulgate rules prescribing a procedure for determining whether the cost of necessary repairs and adjustments exceeds the limit under sub. (13). The Department of Natural Resources determines the repair cost limits in an amount required by the federal Clean Air Act.
Related statute or rule
Plain language analysis
Current law requires vehicles registered in counties that do not meet federal Clean Air Act standards to be tested to ensure they meet pollutant emission limitations. In general, vehicles that are required to be tested and emit too many air pollutants cannot be registered. Chapter
Trans 131
governs the vehicle emission inspection process. If a vehicle does not meet emission standards after repairs — up to the maximum cost required under law--the vehicle owner may request from the Department of Transportation a waiver of compliance that allows the polluting vehicle to be registered and used. When an owner requests a waiver to register a polluting vehicle, the vehicle must be inspected for evidence of tampering or disrepair. Section
Trans 131.05
establishes the items that must be inspected, and their condition, that may show evidence of tampering. If tampering is evident, the Department may not issue a waiver of compliance from emission test standards.
Trans 131.05(1)(j) requires that to pass an anti-tampering inspection a Malfunction Indicator Light (MIL) must be operational and non-active (that is, not lit). It is expected that an adequate vehicle repair will cause the MIL to turn off, since the underlying condition triggering illumination of the MIL is corrected. In prior years, the Department inspected vehicles by direct tailpipe emission sampling, regardless of the MIL status. However, the Department now administers only the OBD II test, which reads engine performance and pollutant output through the vehicle's on-board diagnostic computer with no direct sampling of tailpipe emissions. The rule that prohibits issuing a repair cost waiver whenever a MIL is illuminated effectively prevents issuing a cost waiver to all tested vehicles, regardless of the amount spent on repairs. This is because a vehicle that cannot be repaired to meet pollutant emission standards under the repair-cost limit is polluting, and a properly functioning MIL should be illuminated to indicate those emissions. This creates a circularity problem: only a polluting vehicle will need a waiver from compliance, but if the vehicle's computer knows it is polluting and the MIL is lit, the waiver cannot be issued.
This proposed rule making amends s.
Trans 131.05 (1) (j)
to allow a "cost waiver" (a waiver of emission inspection based on the vehicle owner having spent an amount of money for repairs exceeding cost thresholds established in NR 485.045 and the vehicle still failing emission inspection) even if a vehicle's MIL is unable to be turned off.
This rule making makes two other clarifications to the rule. First, ch.
Trans 131
refers to the vehicle emission inspection also as an "emission test." The proposed rule changes reference to "inspection," and reserves the term "test" to refer to the vehicle's internal computer check of diagnostic codes. In addition, the term "test" continues in the reference to the "remote sensing test" method of assessing vehicle emissions. Second, the proposed rule expands reference to the functions of the Technical Assistance Center to clarify that those functions may be performed by an inspector that the Department designates who may issue waivers of compliance. This is because program operations in the future may not simply rely on a physical location called a Technical Assistance Center for these functions to be carried out.
Comparison with federal regulations
Wisconsin's vehicle emission inspection program complies with U.S. Environmental Protection Agency (EPA) law and regulation. Wisconsin Department of Natural Resources (DNR) manages program compliance with EPA rules and laws through the Wisconsin State Implementation Plan. DNR administrative rule establishes the repair cost limit in accordance with EPA guidance for adjusting the repair cost limit.
Comparison with rules in adjacent states
Michigan:
Michigan does not have a vehicle emission inspection and maintenance program at this time.
Minnesota:
Minnesota does not have a vehicle emission inspection and maintenance program at this time.
Illinois:
Illinois performs the OBD II inspection. Illinois allows a vehicle owner to receive a "cost waiver" if, after certain expenditure, the vehicle still is non-compliant. Illinois allows a cost waiver even if the MIL cannot be turned off.
Iowa:
Iowa does not have a vehicle emission inspection and maintenance program at this time.
Summary of factual data and analytical methodologies
Trans 131.05 (1) (j) requires that to pass an anti-tampering inspection a Malfunction Indicator Light (MIL) must be operational and non-active (that is, not lit). It is expected that an adequate vehicle repair will cause the MIL to turn off, since the underlying condition is corrected. In prior years, the Department also provided an alternative test allowing a vehicle to be inspected regardless of the MIL status. However, now that the Department administers only the OBD II test, the Department's Office of General Counsel has determined that Trans 131.05 (1) (j) is contrary to the availability of repair cost waivers required in s.
110.20 (13)
, Stats., since the rule prevents issuing a cost waiver to all tested vehicles, regardless of the amount spent on repairs.
The proposed rule clarifies that the functions performed by the Technical Assistance Center need not be performed simply in a particular physical location, so that program operation may have flexibility in performing those functions. The proposed rule also makes some changes in language for consistency of reference to the vehicle emission inspection without making any substantive change.
Analysis and supporting documentation used to determine effect on small businesses
The proposed amendment codifies the Department's policy and practice to issue a cost waiver even if the MIL is unable to be turned off. Since the Department is following this policy currently, the proposed amendment will not affect small business. If, however, the Department's current policy were not in effect, this proposed rule would have the effect of potentially reducing cost for small business, as well as any other vehicle owner, since without this proposed rule, no cost waiver would be possible.
The proposed rule clarifies that the function performed by the Technical Assistance Center need not be performed in a particular physical location. This clarification has no effect on small business or any other vehicle owner. The functions will continue to be carried out.
Finally, language changes to refer to the vehicle emission inspection consistently throughout the rule have no substantive effect on small business or any other vehicle owner.
Small Business Impact
The proposed rule will have no effect on small business. The Department's Regulatory Review Coordinator may be contacted by e-mail at
ralph.sanders@dot.state.wi.us
, or by calling (414) 438-4585.
Fiscal Estimate
The Department estimates that there will be no fiscal impact on the liabilities or revenues of any county, city, village, town, school district, vocational, technical and adult education district, sewerage district, or federally-recognized tribes or bands.
The Department estimates that there will be no fiscal impact on state or private sector revenues or liabilities.
Agency Contact Person
Carson Frazier, Dept. of Transportation
Bureau of Vehicle Services, Room 253
P. O. Box 7911, Madison, WI 53707-7911
Phone: (608) 266-7857
Notice of Hearing
Workforce Development
Public Works Construction Contracts,
Chs. DWD 290-294
NOTICE IS HEREBY GIVEN that pursuant to sections
103.005 (1)
and
227.11 (2)
, Stats., the Department of Workforce Development proposes to hold a public hearing to consider the amendment of rules relating to the state prevailing wage program and affecting small businesses.
Hearing Information
Date:
August 11, 2010
Time:
10:00 AM
Location:
MADISON
G.E.F. 1 Building, Room F 305
201 East Washington Avenue
Visitors to the GEF 1 building are requested to enter through the left East Washington Avenue door and register with the customer service desk. The entrance is accessible via a ramp from the corner of Webster Street and East Washington Avenue. If you have special needs or circumstances regarding communication or accessibility at the hearing, please call (608) 266-9427 at least 10 days prior to the hearing date. Accommodations such as ASL interpreters, English translators, or materials in audiotape format will be made available on request to the fullest extent possible.
Submittal of Written Comments
Interested persons are invited to appear at the hearing and will be afforded the opportunity to make an oral presentation of their positions. Persons making oral presentations are requested to submit their facts, views, and suggested rewording in writing.
Comments may be submitted to Howard Bernstein, Office of Legal Counsel, Dept. of Workforce Development, P.O. Box 7946, Madison, WI 53707-7946 or
Howard.Bernstein@ dwd.wisconsin.gov
. The deadline for submission is
August 13, 2010.
Copies of Proposed Rule
The proposed rules are available at the website
http://adminrules.wisconsin.gov
. This site allows you to view documents associated with this rule's promulgation, register to receive email notification whenever the Department posts new information about this rulemaking order, and submit comments and view comments by others during the public comment period. You may receive a paper copy of the rule by contacting Howard Bernstein at the addresses given above or by telephone at (608) 266-9427.
Analysis Prepared by the Department of Workforce Development
Statutory authority
Statutes interpreted
Explanation of agency authority
The state prevailing wage laws require that when a state agency or local governmental unit contracts for the erection, construction, remodeling, repairing, or demolition of a public works project, it must obtain a prevailing wage rate determination from the Department of Workforce Development and require that the contractors and subcontractors on the project pay their employees in accordance with those wage rates. Changes to the state prevailing wage law were enacted in
2009 Wisconsin Act 28
, including:
•
A new threshold level determines the applicability of the law. Under the current law, any project of public works with an estimated completion cost of at least $25,000 requires a prevailing wage rate determination.
•
Contractors are required to provide a monthly report of wage payments made to employees on public works projects. These reports are posted on an internet website maintained by the department. A contractor may submit a copy of its collective bargaining agreement (CBA) if the payments made under the CBA meet the prevailing wage requirements.
•
Under sec. 66.0904, Stats., the prevailing wage law now also covers a private project which receives $1,000,000 or more in direct financial assistance from a local governmental unit.
Summary of the proposed rule
The proposed rule amends the Department's existing rule on the prevailing wage program to reflect the changes made by
2009 Wisconsin Act 28
. In addition, the proposed rule covers the following issues:
•
The proposed rule clarifies that, depending on its actions, a state agency or a local governmental unit way be an "employer" or a "contractor."
•
The proposed rule provides that the Department may conduct wage surveys by electronic means.
•
The proposed rule provides that the Department may determine residential rates as a percentage of building or heavy construction rates rather than as a separate survey category.
•
The proposed rule provides that no corrections or recalculations to an annual survey may be completed after March 1 of each year.
•
The proposed rule provides that, if a state agency, local governmental unit, or developer receiving more than $1,000,000 in direct financial assistance has not requested a prevailing wage rate determination for a project covered by the law, and the Department later issues a prevailing wage rate determination for such a project, then, in addition to the payment of the increased wages which the state agency, local governmental unit or developer must make to reimburse the employer of workers who were not correctly paid, the state agency, local governmental unit or developer must also reimburse the employer for any liquidated damages that employers may have been required to pay.
Comparison with federal regulations
The federal prevailing wage law (known as the Davis Bacon Act) applies to a federal public works project for which the contract cost is greater than $2,000. It does not apply to a private project which receives financial assistance from public funds unless the assistance is on such a scale that the project is determined to be a public project.
Comparison with rules in adjacent states
Minnesota:
Minnesota has a statutory threshold of $2,500 for a single-trade project and $25,000 for a multi-trade project. In addition to public works projects, the Minnesota law covers the construction of a "value-added agricultural product processing facility" that is financed in whole or part with certain state loans or grants.
Illinois:
Illinois does not have a threshold in its prevailing wage law. The law covers public works projects and defines public works projects as projects financed under various other specified laws. The Illinois law requires certified monthly payroll reports.
Michigan:
Michigan does not have a threshold in its prevailing wage law. The law covers projects that must be bid and relies on other agencies to determine the thresholds for what projects must be bid.
Iowa:
Iowa does not have a prevailing wage law.
Summary of factual data and analytical methodologies
The proposed rule is based on the new or amended requirements the statutes as affected by
2009 Act 28
.
Small Business Impact
Because the proposed rule carries forward the new or amended requirements of the statutes as affected by
2009 Act 28
, the proposed rule of itself does not have an effect on small business.
Fiscal Estimate
Assumptions used in arriving at fiscal estimate
The proposed rule does not create any new costs in the administration of the state prevailing wage program.
State fiscal effect
None.
Local government fiscal effect
None.
Long-range fiscal implications
None.
Agency Contact Person
Julie Eckenwalder, Section Chief
Construction Wage Standards Section
Phone: (608) 266-3148
