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Purchase
DNR land for sale.
Donate
your land to DNR.
Sell
your land to DNR.
Payments
to local governments in lieu of taxes.
Contact information
For information on PILT, contact:
Kurt Byfield
Bureau of Facilities & Lands
608-266-4535

Real estate programPayments in lieu of tax (PILT)

The department of Natural Resources (DNR) makes an annual payment in lieu of real estate taxes to replace property taxes that would have been paid if the property had remained in private ownership. The payment is made to the local taxing authority where the property is located.

How is PILT calculated?

The dollar amount the DNR sends to each municipality is dependent upon the number of acres of land the DNR owns and the time of acquisition. The following Wisconsin State Statutes apply to these acquisition dates:

  • Statute 70.113
    • Prior to July 1, 1969
    • Between July 1, 1969 and December 31, 1991
  • Statute 70.114 - January 1, 1992 to present

How is PILT distributed?

Under Statute 70.113, a payment is made directly to a municipality (city, town or village) and retained. Under Statute 70.114, a payment is sent to a municipality, and then these funds are to be distributed to its corresponding taxing jurisdiction, such as a school district, vocational school, county, state or other special districts.

Wis. Stats. 70.113 payments

Two different types of payment are made under Section 70.113.

  1. On land acquired by the department before July 1, 1969, the department pays municipalities 88 cents per acre for lands owned in fee title and for lands leased from the federal government.
  2. On land acquired by the department after July 1, 1969 and prior to January 1, 1992, the payment is based on the local assessment of the following January 1, multiplied by the county, local, and school tax rates for the year. Therefore, the first year payment is equal to the full property tax that would have been paid had the property remained on the tax roll. The statute directs that the amount be decreased at the rate of 10 percent per year after the initial payment. In the tenth year, and every year thereafter, a payment of 10 percent of the first year's payment will be made but will never be less than 50 cents per acre.

Wis. Stats. 70.114 payments

The Department of Natural Resources pays aids-in-lieu-of-taxes equal to property taxes that would have been paid had the land remained in private ownership. The effective date of this program was January 1, 1992. The first payment was made in January 1994 for the 1993 tax year. According to s.70.11(1) Wis. Stats., property acquired by DNR comes off the tax roll. In lieu of the loss of tax base, each taxing jurisdiction receives an aid payment generally equivalent to property taxes.

There are two separate formulas for calculating the PILT payment under this statute. For land acquired between January 1, 1992 and June 30, 2011 the PILT calculation is based on the price the department paid for the land. For lands purchase after July 1, 2011 the PILT payment is based on the equalized value of the land the year prior to the year in which the land is purchased. Whether the calculation is based on purchase price or equalized value, the value is adjusted each year to reflect the change in the assessed value (up or down) of land in the taxation district.

How does PILT work?

The program works like this:

  1. In the year of purchase, the property taxes levied against that parcel for that year are prorated at the time the property is transferred to the department. The landowner pays the taxes for the portion of the year they owned the land and the department pays the taxes for the portion of the year the department owned the property.
  2. For each subsequent year the department adjusts the purchase price or the equalized value (depending on when the land is purchased) to reflect the change in the assessed value of all land in the taxation district for that year. This State department of Revenue supplies this adjustment rate. The adjustment factor is used to calculate a current "estimated value." In addition, the adjusted "estimated value" is equalized. The equalization rate is also provided by the department of Revenue. The "equalized estimated value" is then used to calculate the aid payment.
  3. Each December, the department gathers the general property tax rates for the current tax year for all taxing jurisdictions from the taxation district clerk in the taxation district where the DNR land is located.
  4. On or before January 31 of the next year DNR calculates and pays the taxation district treasurer the PILT. The amount is calculated by multiplying the equalized estimated value by the appropriate tax rates.
  5. On or before February, the taxation district treasurer pays each taxing jurisdiction (town, village, city, chool district, vocational school, county, state or other special districts) its appropriate share of the aid payment.

Summary

Under two previous aid-in-lieu-of-tax programs (s. 70.113 Wis. Stats.), land acquired by DNR went off the tax roll and DNR made an aid-in-lieu-of-tax payment to only the town, village or city taxation district at discounted rates; the school, vocational school and county jurisdictions did not receive an aid payment. However, the loss of tax base triggered increases in other state aids to offset possible tax losses. While these aid programs prevented adverse tax impacts, it was difficult for local taxpayers to believe the system worked. Consequently, many taxpayers thought DNR acquisitions made their property taxes higher. The new PILT program treats DNR similar to tax-paying property owners.

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Last revised: Sunday July 22 2012