Fiscal Note
The inclusion of any new property within the City's boundary will have some fiscal impact, as assessable property is added to the City tax roll and as services are extended to new areas. Usually, annexations involve undeveloped land in relatively unpopulated peripheral locations. In these situations, the initial cost of providing City services is relatively low, and the tax revenues derived from future taxable development is typically sufficient to fund the increased City costs associated with extending infrastructure and services to the newly developing area. When annexations involve previously developed properties, they typically occur in small increments, often involving single parcels. In these cases, the impact on existing service delivery routes, schedules and staffing requirements is minor. Often, the additional tax revenues derived from the annexed property will more than cover the marginal cost associated with extending services to the new parcels.
The proposed attachment of Town of Madison territories located in the vicinity of Badger Road, Ann Street and Park Street presents a considerably different case, however. The revenue sharing provision contained in the proposed settlement agreement and the inclusion of a significant number of existing residents within the attachment area will act to increase the budgetary impact of this boundary adjustment when compared to the typical annexation.
Revenue Sharing
The state approved cooperative plan between the Cities of Madison and Fitchburg and the Town of Madison required a revenue sharing payment in cases of “early attachment” of Town property such as this one. That plan states that the Town will retain the property taxes collected for the most recent year, and the City will provide a revenue sharing payment to the Town, equal to that amount, for the succeeding 9 years. The currently proposed settlement agreement pertains to the second allowable early attachment, which is broken...
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