The Blueprint: Advocacy Day '18 Draws 50


ALSO: Development and Housing Affordability Act Passes Both Houses; Wetland Reform Also Ready to Be Signed into Law; State Assembly Signs Off on Civil Justice Reform; Governor Walker Announces Administration Staff Changes; From NAHB: Single-Family Permits Post Solid Gains in 2017

Advocacy Day Draws 50


Last Thursday, 50 members and local HBA staff traveled to Madison to advocate for Wisconsin housing during our 2018 Advocacy Day at the Capitol.  This year, our annual lobby day coincided with the last day on the floor for the State Assembly.

The day started with a housing and property rights update from State Representative Rob Brooks and State Senator Tom Tiffany.  During the presentation, a member presented feedback to Senator Tiffany on the fact that a provision of the Homeowner’s Bill of Rights that established a set process to receive a variance from a local unit of government was used in Slinger and really streamlined the process.

Members were then presented with an issue briefing to get them additional information on the topics to cover at the capitol with their legislators during their afternoon meetings.  Topics this year included new data from NAHB on the value of housing in communities to create jobs and a tax base, the cost of regulations that go into the price of a new home, support for civil justice reforms to create a better business climate in Wisconsin, and finally a bill to make some revisions to loans available from the Wisconsin Housing and Economic Development Authority (WHEDA).

Professor Charles Franklin from the Marquette Law School presented polling data ranging a number of different topics including Governor Walker’s favorability ratings, Senator Tammy Baldwin’s favorability ratings, the general mood of the Wisconsin and national electorate, and a look back to recent special elections in Wisconsin for state assembly and state senate.

After lunch and visits with legislators at the Capitol, those in attendance returned for a cocktail hour and panel discussion moderated by editor Jeff Mayers and featuring former State Senate Majority Leader Chuck Chvala and form Assembly Speaker Scott Jensen focusing on current events on the state and national level.

The feedback we received from those in attendance was very positive, and we will also be sending out a brief survey to attendees to better plan for the event in 2019.  

Development and Housing Affordability Act Passes Both Houses

Last Tuesday was a busy day when both the state assembly and state senate were on the floor debating large calendars of bills before the session comes to an end.  One very important bill, the Development and Housing Affordability Act, was up for a vote in the state senate.  As you may remember this bill, Assembly Bill 770, contains a number public policy changes that were part of the WBA 2017-2018 Advocacy Agenda.

Some highlights AB 770 are: 

  • Park fees in state statutes are addressed only as an impact fee and not in multiple places in state statutes.
  • Changes to provide clarifications and greater flexibilities for developers to use bonds in the dedication of infrastructure that is paid for by a developer and dedicated to a municipality.  These are clarifications of 2013 Wisconsin Act 280 which passed the legislature on voice votes in both houses. 
  • Prohibiting a developer’s agreement from mandating building codes that exceed the statewide uniform standards of the Uniform Dwelling Code. 
  • Multiple changes to the impact fee state statutes, including refunding impact fees if not used after 8 years (current law is 10 years), municipal reporting on the usage of impact fees, allowing the use of a letter of credit  to pay for an impact fee if the fee is not going to be used right away, allowing an impact fee to be paid when a permit is pulled or 6 months prior to when the fee will be used, deleting the requirement of a petition to contest an impact fee needing to be filed within sixty days of the fee going into effect, and forbidding a municipality from using impact fees for operations and maintenance of public facilities. 
  • Prohibits the use of inclusionary zoning ordinances. 
  • The income approach can be used in the valuation of property that is acquired through eminent domain. 
  • The regulation of storm water management systems is made more uniform. Some municipalities have stormwater stay-on requirements that far exceed the state DNR standards at a detriment to housing affordability for low and middle-income families, while failing to provide an environmental or economic benefit to the municipality that would not have been achieved by using the state DNR standard.
  • Asks local units of government to be more transparent with the public on fees related to housing and development that are being charged in that municipality

AB 770 was approved by the state senate on a partisan vote of 18-14 with one minor clarifying amendment that was offered by State Senator Steve Nass.  With the change offered by Nass to the assembly bill, it then had to go back to again be voted on in the state assembly.  AB 770 was the last bill to be signed off on with a voice vote early in the morning on Wednesday, February 21.

AB 770 is now being reviewed by Governor Walker, and hopefully will be signed into law soon.

Wetland Reform Also Ready to Be Signed Into Law

After being passed by the state assembly the prior week, the state senate also signed off on a comprehensive reform that will streamline the process to build in areas that contain state regulated wetlands in Wisconsin.

Over the past few months, State Senator Roger Roth, Representative Jim Steineke, and State Senator Rob Cowles have been working together on a proposal to simplify and streamline the process to provide more flexibility for state regulated wetlands.

That hard work has paid off with several important provisions that are now contained in Assembly Bill 547 and Senate Bill 600 (AB 547 and SB 600).

Some of the highlights of the amended version of the State Wetland Modernization Act (AB 547 and SB 600) include:

  • Wetland identification and confirmations (delineations) that were provided by the Department of Natural Resources (DNR) on or after January 1, 2003 will now be effective for 15 years instead of 5 years (current law).  
  • The 15-year validity applies even if the wetland identification or wetland confirmation expired prior to the effective date of this bill unless a more recent wetland identification or confirmation was provided by the DNR showing that a discharge to a wetland on a parcel was conducted in compliance with a wetlands permit issued prior to the bill’s effective date.
  • Exempts from state permit requirements a fill of a state wetland that occurs in an urban area if the discharge does not affect more than one acre of wetland per parcel; does not affect a rare and high-quality wetland, and the development related to the fill is done in compliance with any applicable storm water management zoning ordinance or storm water discharge permit.
  • Exempts from state permitting requirements a fill of a state wetland that occurs outside an urban area if the discharge does not affect more than three acres of wetland per parcel; does not affect a rare and high-quality wetland; and the development related to the discharge is a structure, such as a building, driveway, or road, with an agricultural purpose.
  • “Artificial wetlands” will now be exempt from state permit requirements.  
  • “Artificial wetland” is defined in the bill to mean a landscape feature where hydrophitic vegetation may be present because of human modification to the landscape or hydrology and for which the DNR has no definitive evidence showing prior wetland or stream history that existed before August 1, 1991. This definition excludes wetlands that serve as a fish spawning area or a passage to a fish spawning area and wetlands created because of a mitigation program.
  • The new regulatory provisions of the bill relating to state regulated wetlands are statewide and uniform throughout Wisconsin, much like the Uniform Dwelling Code in the construction of one and two-family homes. 
  • DNR will have the ability to award grants to nonprofit organization to create, restore, or enhance wetlands under the in-lieu fee program on state stewardship land.  DNR will also be able to make grants to nonprofit organizations for property development activities relating to wetlands created, restored, or enhanced under a wetland mitigation grant on DNR stewardship land.

If you would like read a comprehensive summary of the State Wetland Modernization Act (AB 547 and SB 600) click here. We now await notice from Governor Scott Walker on a date to sign this important piece regulatory reform into law.  Thank you to all those that used the WBA Advocacy Action Network powered by VoterVoice to contact your state legislator in favor of this important bill.  

State Assembly Signs Off on Civil Justice Reform

As was mentioned above, one of the topics that members were lobbying their legislators on last week Thursday was a comprehensive bill to improve our legal climate in Wisconsin.

The Wisconsin Legislature and Governor Walker have made civil liability reform a priority since 2011. These substantive civil liability reforms have brought Wisconsin’s civil justice system back into the mainstream and have created a stable and fair litigation climate. This, in turn, has helped with job creation and economic development.

Assembly Bill 773 (AB 773) has been introduced this session by Representatives Mark Born and John Nygren, and Senators Tom Tiffany and Dave Craig.

The proposed reforms contained in AB 773 build on these positive reforms by making many common sense and reasonable changes to Wisconsin’s civil procedure laws.

The heart of AB 773 aligns Wisconsin’s civil procedures for discovery and class actions to the corresponding federal rules, along with other reforms such as removing contingent fees for third party audits on unclaimed property and reducing the statute of repose.  

The statute of repose is the default time limit for commencing an action for damages that result from a deficiency or defect in an improvement to real property.  For example, the improvement to real property would be the construction of a new home.

Under current law, the exposure period for such claims is 10 years from substantial completion of the improvements; however, if the damages are sustained during years 8 through 10 from substantial completion, the time for commencing an action is extended 3 additional years.  Thus, the exposure period is up to 13 years. AB 773/SB 645 would establish an exposure period of 7 years. If the damages are sustained in years 5 through 7, then the time for commencing an action is extended 3 additional years. Thus, the exposure period will be up to 10 years.  

The statute of repose is founded on the public policy that persons claiming that they suffered damages should not sit on their claims to the detriment of the builder. The longer the exposure period, the more likely that evidence of a meritorious defense is lost. Over time, memories fade and evidence disappears.   A statute of repose gives potential defendants a degree of certainty and control over their legal exposure.

The statute or repose specifically does not apply to:

  • A person who commits fraud, concealment or misrepresentation related to a deficiency or defect in the improvement to real property.
  • A person who expressly warrants or guarantees the improvement to real property, for the period of that warranty or guarantee.
  • An owner or occupier of real property for damages resulting from negligence in the maintenance, operation, or inspection of an improvement to real property.

Reducing the exposure period will better accomplish the policies behind the statute of repose by reducing the burden of stale lawsuits on the courts and Wisconsin businesses.  The proposed period of 7 to 10 years, depending on the facts of the specific case, protects property owners by providing an abundant amount of time to commence an action against a builder.  Most statutes of limitations in Wisconsin reflect this balance and proscribe a much shorter exposure period that range from 1 year (for example, most claims against an insurance policy) to 6 years (for example, breach of contract).

These badly needed changes will reduce litigation costs for small to large businesses, as well as state and local governments who must spend taxpayers’ dollars responding to aggressive discovery practices.

With the help from WBA members attending Advocacy Day in Madison on Thursday, the state assembly signed off on AB 773 with a voice vote in the early evening on Thursday.  Next stop is the state senate, where the WBA will be working overtime to make sure AB 773 is on the calendar of items to be considered on the state senate’s last day on the floor on March 20. 

Governor Walker Signs Off On Administration Staff Changes

Governor Scott Walker recently announced the following administration staff changes: 

  • Scott Neitzel – Leaving the Department of Administration. 
  • Ellen Nowak – Secretary, Department of Administration. 
  • Lon Roberts – Chairperson, Public Service Commission of Wisconsin (PSC).

“We welcome Ellen and Lon to their new positions in the administration, and we thank them for their continued willingness to serve. I know these strong leaders will continue to help us get positive things done for the people of Wisconsin,” Governor Walker said. “I give my deep appreciation and thanks to Scott Neitzel for his valued service and counsel. He will be missed in our administration. Scott is an effective executive, and his leadership has served the people of our state in a very consequential way.”

Ellen Nowak will begin her role as Department of Administration (DOA) secretary on Monday, March 5, 2018. Nowak was appointed to the PSC in 2011 by Governor Walker and was named PSC chairperson in 2015. Prior to her time at the PSC, Nowak served as the chief of staff to Waukesha County Executive Dan Vrakas and as legal counsel and subsequent chief of staff to Wisconsin State Assembly Speaker John Gard. Nowak has a law degree from Marquette University and a Bachelor of Science from the University of Wisconsin–Milwaukee.

“Serving the public at the PSC has been a tremendous honor, and I thank Governor Walker for placing his trust in me to lead DOA,” Ellen Nowak said. “We will continue building upon Governor Walker’s reforms which have made Wisconsin a stronger, more prosperous state for everyone.”

Scott Neitzel’s last day as DOA secretary will be Friday, March 2, 2018. In 2015, Neitzel left a senior management position at Madison Gas & Electric to join the administration.

“It’s been an honor serving the people of Wisconsin under Governor Walker’s leadership, and I wish Ellen Nowak the very best as she begins this exciting journey as DOA secretary,” Scott Neitzel said. “We set out to make our government more efficient, effective, and accountable to the people, and that’s exactly what we’ve done. I thank Governor Walker for this opportunity, and I am proud to have served with such a dedicated team during such a historic and momentous time for our state.”

Commissioner Lon Roberts begins as PSC chairperson on Monday, March 5.

“I am humbled by this appointment to serve as chairperson of the PSC, and I look forward to working with utilities and industry stakeholders to fairly and efficiently facilitate quality utility services for the people of Wisconsin,” Lon Roberts said. 

Lon Roberts was appointed to a six-year term at the Public Service Commission of Wisconsin by Governor Scott Walker in March 2017 and confirmed by the State Senate in April 2017. Governor Walker previously appointed Roberts to the positions of Secretary of the Department of Financial Institutions in February 2016, and prior to becoming secretary, Roberts served as chair of the State of Wisconsin Investment Board, and as a committee member of the Governor’s Judicial Selection Advisory Committee. Roberts joined the law firm of Ruder Ware in Wausau Wisconsin upon graduating from law school in 1973 and concentrated his 43 years of practice in business and commercial law, primarily in the area of corporate mergers and acquisitions and finance and private equity capital transactions. Roberts served as the firm’s president from 1999-2010.

Governor Walker’s appointment to replace Ellen Nowak on the PSC is forthcoming.

Single-Family Permits Post Solid Gains in 2017

From NAHB: Preliminary data show that the total number of single-family permits issued in 2017 reached 817,319, a 9.6% increase over the 2016 total of 745,525.

Between December 2016 and December 2017, 45 states and the District of Columbia saw growth in single-family permits issued. Twenty states recorded an increase above the nationwide average of 9.6% but five states had a decline in growth. Hawaii had the highest growth rate during this time at 23.6% while single-family permits in North Dakota declined by 9.8%.

It’s important to note that the year-to-date figures are based on a sample of permitting offices. The annual data, which will be released later in the year, will reflect information from all offices.

In terms of total number of single-family permits, Texas led the nation with 114,094 permits issued year-to-date in December 2017 and Florida was second with 83,911 permits. Meanwhile, the District of Columbia posted the lowest permit total at 352. The 10 states issuing the highest number of single-family permits combined accounted for 58% of the total permits issued in the nation.

NAHB economist Danushka Nanayakkara-Skillington provides more analysis in this Eye on Housing blog post.

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