The Sconi

Wisconsin Manufacturers & Commerce (WMC) has taken legal action against the City of Neenah, serving a notice of claim over the city's Transportation Assessment Replacement Fee (TARF). WMC, represented by its Litigation Center, contends that the fee is an unlawful tax based on recent legal precedents. The city acknowledged receipt of the notice on Wednesday.

The basis for WMC's claim stems from previous court rulings in Wisconsin. Last year, the Wisconsin Supreme Court unanimously invalidated a similar Transportation Utility Fee (TUF) in the case of Wisconsin Property Taxpayers v. Town of Buchanan. In March, the Wisconsin Court of Appeals also struck down another TUF imposed by the Village of Pewaukee in WMC v. Village of Pewaukee. According to WMC, Neenah’s TARF closely resembles these fees which were declared illegal.

Scott Rosenow, Executive Director of WMC Litigation Center, stated: “First Neenah was imposing an unconstitutional sign ordinance, which the Litigation Center fought against and defeated in court. Now Neenah is disregarding the rule of law again with its TARF. And this time, it’s doing so in the face of directly on-point and recent case law.” He emphasized that "Buchanan and Pewaukee couldn’t be any clearer: The TARF is a tax and Neenah has no authority to impose it.”

Neenah began implementing its TARF in 2023 across all developed properties within its jurisdiction and raised the costs significantly earlier this year. Under state law, municipalities can only levy taxes if explicitly authorized; they do not have inherent taxation powers. Courts have consistently ruled that no state law permits municipalities to impose property taxes based on estimated road usage.

Nathan Kane, Deputy Director at WMC Litigation Center, expressed concern over the impact on local property owners: “Neenah’s TARF hurts every property owner in Neenah, especially businesses,” he said. Kane hopes that Neenah will reconsider its stance: “We hope the City will do what it refused to do with its unconstitutional sign ordinance and repeal the illegal TARF before it’s invalidated in court.”