Port TIF referendum approved by a landslide

Port Washington residents on Tuesday overwhelmingly voted to require the city to seek their approval before creating any tax incremental financing districts with project costs or a base value of $10 million or more.

In a referendum vote prompted by the city’s approval of a TIF district for the Vantage Data Centers Lighthouse Campus project, residents voted 2,710 to 1,371 to require the city to hold referendums for large future TIF districts.

With 51% of the city’s eligible voters, or 4,201 of 8,257 residents, casting ballots Tuesday, 66.4% voted for the referendum and 33.6% against it.

“Tonight voters spoke with one clear voice. The people deserve a seat at the table when their tax dollars are on the line,” said Christine Le Jeune, a founding member of Great Lakes Neighbors United, a group that has fought the data center and petitioned to force Tuesday’s referendum. 

Michael Beaster, another founding member of the organization and a newly elected alderman, said that while Tuesday’s referendum will not impact the data center, it was prompted by residents who oppose the center and feel they were not heard by officials.

“Decisions like the Tax Increment District 5 approval for Vantage Data Centers are far too large and transformational not to gain community input before proceeding,” he said. “We are not against development. We are for development that the community understands, supports and has chosen together.

“This referendum came about to give residents a say in these transformational projects for large corporations.”

The city’s TIF District 5, approved last fall just a week after Great Lakes Neighbors United turned in a petition signed by 1,028 residents that forced Tuesday’s vote, will fund $459 million in primarily infrastructure costs for the data center project.

Mayor Ted Neitzke said of Tuesday’s vote, “I think Port Washington has had a tradition of questioning tax incentives for developments and this verifies that concern.

“My hope is this does not put us into a perpetual campaign season. My worry for the future is this will stop people from investing here.”

Noting the referendum has already spurred a legal challenge by a group of Milwaukee area business organizations as well as a Port business and resident, Neitzke said, “The legality of this will be challenged.

“The voters have spoken, but I don’t think the discussion is over.”

His concern was echoed last week by the Lakeshore Realtors Association, which launched a campaign seeking to reject Tuesday’s referendum, saying that however well intended, the ballot measure is likely to have unintended consequences that include a reluctance by developers to invest in the city and added costs to residents for additional elections and court cases.

Those opposed to Tuesday’s referendum said the wording of the question is vague and is sure to bring legal challenges while creating a chilling effect on development by adding uncertainty to the creation of any new TIF districts.

TIF districts are complex, they noted, and are the only economic development tool available to communities. 

A legal challenge to the referendum has been filed by the Metropolitan Milwaukee Association of Commerce and other business organizations, who allege that it takes away powers given to the city and the Joint Review Board by the state, contrary to state law. It also argues that the ballot question was vague, wrongly suggested that general tax revenue will be used, provided no standards to determine when voter approval is needed and invites arbitrary application. 

Ozaukee Circuit Judge Adam Gerol rejected a request by MMAC to stop Tuesday’s vote, but he is expected to set further dates to hear the case during a scheduling conference on April 16.