Garfield Baptist Church v. City of Pewaukee (Municipal Fees)

In Garfield Baptist Church v. City of Pewaukee (2018AP673), the Court of Appeals District II held that entities must challenge municipal sewerage and storm water fees with the Public Service Commission (PSC), not in circuit court. Furthermore, the burden of proving that municipal fees do not bear a “reasonable relationship” to the services provided should be on the challenger, not the defendant municipality.

Garfield Baptist Church alleged that the City of Pewaukee’s storm water management fees were unreasonable and inequitable. The court of appeals rejected the church’s means of challenging the city fees. Wis. Stat. § 66.0821(5) allows users to file complaints regarding unreasonable and unjust sewerage and storm water rates with PSC. PSC decisions, like other agency decisions, are then subject to judicial review under Wis. Stat. Ch. 227. The appeals court found that under that statute the church should have first filed a complaint with PSC about the city’s imposed fees.

The court of appeals also determined that the circuit court erred in imposing the burden of proof on the city to establish that its fees bore a “reasonable relationship” to the service provided, as required under Wis. Stat. § 66.0628(2). According to the court, common law generally places the burden of proof in municipal fee cases on the party challenging the fee (in this case the church). Additionally, § 66.0628(4) allows parties challenging municipal fees to appeal to the tax appeals commission and places the burden of proof of “reasonable relationship” on the city. The court found that by stating that the burden of proof is on the city in tax appeals commission cases, the law implies that the burden of proof is on the challenger in cases not before the tax appeals commission. Therefore, the burden of proof should be on the church to establish that the fees imposed by the city did not bear a reasonable relationship to the sewerage and storm water services provided.

In a concurring opinion, Judge Reilly agreed that the church did not properly challenge the city fees. However, the concurring opinion would have required the church to appeal to the tax appeals commission under § 66.0628(4), not PSC. According to the concurring opinion, PSC should handle challenges to rates, whereas the tax appeals commission should handle challenges to fees.