| This research examines the fiscal impacts of annexation from the perspective of city and town governments in Wisconsin. Ten annexations occurring in 1990 are examined, and financial impacts are measured five years after the annexation took place. The method used to explore the issue is fiscal impact analysis.;The study uses three different methods to estimate the fiscal impacts of annexation--the per capita multiplier method, the proportional valuation method and the case-study method. Under all three methods, tax rates are calculated five years after the annexation, as if the annexation did not occur, and this rate is compared to the actual rate to determine the effect of the annexation.;The ten cases include a mix of annexations in terms of land use types. The primary purpose of the research is to assess the fiscal impacts of annexation and to compare results across the three different fiscal impact methods. The secondary purpose of the research is to highlight the motivations to annexation and perceptions of local officials as to the fiscal consequences of annexation.;The results illustrate how the assumptions inherent in each method influence the outcome of the fiscal analysis. Overall results are consistent across the three methods in only six of the twenty municipalities. Results also show that annexation is not necessarily always a "winner-take-all" game, as is commonly assumed. Annexation can be fiscally desirable or undesirable to both municipalities involved. Results also highlight the role of intergovernmental aid in estimating fiscal implications.;Interviewees from towns, cities and villages replied similarly to the question of motivation. Nearly all replied that annexation is driven by development. Perceptions as to the impact of annexation are unique to each annexation; however, town officials generally agree that annexation results in a fiscal loss, especially cumulative annexations. All interviewees noted that the important issues surrounding annexation go beyond the fiscal.;Based on the results of the analysis, policy implications are discussed and recommendations for areas of future research are highlighted. |
