Tax procedure provisions unconstitutional, Wisconsin Supreme Court
Supreme court majority rules that municipalities cannot opt-out of
statutory provisions that give taxpayers a right to de novo review of
tax assessment decisions.
By org jforward wisbar Joe Forward, Legal Writer,
State Bar of Wisconsin
29, 2011 – Municipalities cannot block de novo review of tax
assessment decisions by municipal tax assessment review boards, the
Wisconsin Supreme Court majority recently held in a 4-3
In 2008, the Wisconsin Legislature passed 2007 Wis. Act 86, which
allowed municipalities to adopt ordinances that prevent de novo review
of tax assessment decisions by review boards but created a new form of
circuit court review, “enhanced certiorari review.”
Before 2008, taxpayers could challenge tax assessment decisions through
de novo review or common law certiorari review. De novo review allows
courts to review decisions independently of the record established by
the tax assessment review board. Under common law certiorari review,
circuit courts are limited to a review of the record already
Enhanced certiorari review under Act 86 gave taxpayers additional
rights associated with the review board proceedings, like a 60-day
extension of the initial hearing date, but still limited the circuit
court’s independence upon review of the review board’s
The City of Milwaukee’s Common Council unanimously adopted an
“opt-out” ordinance in April 2008. Three months later,
Metropolitan Associates filed a class action lawsuit against the City of
Milwaukee, challenging the constitutionality of the
“opt-out” provisions of Act 86.
Associates v. City of Milwaukee, 2011 WI 20 (March 25, 2011),
the Wisconsin Supreme Court majority – in an opinion written
by Justice Michael Gableman – ruled that Act 86’s opt-out
provisions violate the Equal Protection Clauses of the Wisconsin and
Specifically, the majority ruled that taxpayers in opt-out
municipalities receive significantly different treatment than taxpayers
in other municipalities and the difference in treatment lacks a rational
Chief Justice Shirley Abrahamson filed a dissenting opinion, joined by
Justices Ann Walsh Bradley and N. Patrick Crooks. The State Bar’s
Law Section filed an amicus
brief in the case, supporting the position of Metropolitan
In the 2001 case of Nankin v. Village of Shorewood, 2001 WI
92, 245 Wis. 2d 86, 630 N.W.2d 141, the supreme court struck down a
provision that prevented taxpayers in counties of 500,000 or more from
seeking de novo review of tax assessment decisions.
Preventing taxpayer access to de novo review solely based on
population, the court ruled in Nankin, unconstitutionally
denied those taxpayers equal protection of the laws.
In Nankin, the court reviewed the difference between de novo
review and common law certiorari review to determine the law’s
constitutionality. Here, the majority reviewed the difference
between de novo review and enhanced certiorari review under Act 86.
Applying the same three-step analysis applied in Nankin, the
supreme court majority ruled in Metropolitan Associates
that Act 86’s opt-out provisions violate a taxpayers right to
equal protection of the laws because they treat a distinct class of
citizens differently than others similarly situated, and no rational
basis exists for the different treatment.
“While Act 86 requires opt out municipalities to grant their
taxpayers additional rights during Board of Review proceedings, Act 86
limits both the type and scope of circuit court review these taxpayers
may seek,” Justice Gableman wrote.
In addition, the majority noted that under enhanced certiorari
review, circuit courts must presume a review board’s assessment is
correct absent a “sufficient showing” of incorrectness.
“Even with the additional rights granted under Act 86, the Board
of Review proceedings continue to favor municipalities over taxpayers,
just as they did in Nankin,” Justice Gableman wrote.
“For one, the sixty-day hearing date extension under Act 86 runs
the risk of forcing complex property disputes into being heard much more
quickly than such disputes would typically be heard in a de novo
Thus, it ruled that all of Act 86’s modifications to Wis. Stat
sections 70.47, 73.03, and 74.37 are unconstitutional, but severable
from other provisions of Act 86.
The State Bar’s Taxation Section filed its amicus brief under a
similar view, noting that in some complex cases, “the compressed
and relatively informal [Board of Review] procedures simply do not
afford taxpayers the opportunity fully to develop and present their case
at the [Board of Review] stage to assure judicial review is based upon a
full and fair record.”
In her dissent, Chief Justice Shirley Abrahamson concluded that
“treatment of taxpayers in ‘opt-in’ districts under
2007 Wis. Act 86 is not significantly different from the treatment of
taxpayers in taxation districts operating under Wis. Stat. section
Even if taxpayers are treated differently, she argued, “a
rational basis exists for enabling taxing districts to determine whether
to enact an ordinance to ‘opt-in’ under 2007 Wis. Act
86.” She noted that unlike Nankin, the classification is
not based on county population.
“A legitimate purpose of this law is to increase the efficiency
of the tax assessment challenge process for taxpayers and taxation
districts,” Chief Justice Abrahamson wrote. “Put simply,
there is a legitimate government interest in efficiently handling tax
Abrahamson argued that taxpayers unhappy with a municipality’s
decision to opt-in have recourse at the ballot box.
Alan Marcuvitz, Robert Gordon, and Andrea Roschke of Michael Best &
Friedrich LLP, Milwaukee, represented Metropolitan Associates. City of
Milwaukee Attorney Grant Langley and Vincent Moschella, deputy city
attorney, represented the City of Milwaukee.