Legal Note ... June 2002

 

Decision Clarifies Meaning of "Set Upon Foundation" for Mobile Homes

 

Caption: Taxation 1018; Mobile Homes 46

Other Captions: Taxation; Mobile Homes

 

(001) For property tax purposes, mobile homes, as defined by 66.058 (1)(d), Stats.1, are classified into two categories: improvements to real property and personal property.

 

(002) Under 70.043(1). Stats., a mobile home is an improvement to real property if it is connected to utilities and is set upon a foundation upon land owned by the mobile home owner.

 

(003) The statute provides that a mobile home is "set upon a foundation" if it is off its wheels and is set upon some other support.

 

(004) Under 70.043(2); a mobile borne is personal property if the land upon which it is located is not owned by the mobile home owner or if the mobile home is not set upon a foundation or connected to utilities.

 

(005) Mobile homes that are classified as personal property are exempt from taxation under 70.111(19)(b), Stats ., if the home is no larger than 400 square feet and is used primarily as temporary living quarters for recreational, camping, travel or seasonal purposes.

 

(006) A large group of persons who each own a mobile home located on an individually-owned lot in a real estate development known as Wisconsin's Rock River Leisure Estates joined together to appeal the Town of Fulton's classification of their mobile homes as improvements to real property.

 

(007) The owners claimed that their mobile homes were not "set upon a foundation" under 70.043(1), Stats.

(008) Twenty owners were selected as being representative of all the owners and stipulated to the following facts.

 

(009) Each owner had, on his or her lot, a "basic unit" which met the definition of "mobile home" under Wis. Stats. 66.058(1)(d).

 

(010) The floor areas of the basic units ranged from 372 to 420 square feet.

 

(011) Each basic unit still had its wheels attached and was connected to utilities.

 

(012) All but four (4) of the units had their weight at least partially on their wheels and partially on some form of stabilizer, such as cement blocks, cinder blocks, or screw jacks.

 

(013) Three units had their weight completely supported by stabilizers.

 

(014) One unit had no stabilizers and was supported only by its wheels.

 

(015) Each owner also had additional structures including decks, screen rooms, porches and sheds on their lot that were either attached to the basic unit or freestanding.

 

(016) The amount of time the owners spent in the homes varied.

 

(017) Two of the owners resided in their homes for 12 months, three for seven months, three for six months, one for five and one-half months, one for three months, and the rest for two months of the year or less.

 

(018) The circuit court had interpreted "set upon a foundation" as requiring that a majority of the weight of the mobile home be off its wheels before it could be classified as real property.

 

(019) The court of appeals held that a mobile borne is "set upon a foundation" when any part of its weight is off its wheels and set upon some other support.

 

(020) The Wisconsin Supreme Court rejected that conclusion because state law2 requires that at least some portion of every mobile home's weight be supported by something other than its wheels.

 

(021) The Court held that the key was not how much weight was supported by something other than the wheels, but whether the support was temporary in nature.

 

(022) The Court stated: We hold that a mobile home is "'set upon a foundation" when the home is resting for more than a temporary time, in whole or in part, on some other means of support than its wheels.

 

(023) This definition rests on a distinction between temporary and permanent, recognizing that the legislature intended that the permanency of the mobile home was important in making a distinction between real and personal property.

 

(024) We conclude that the legislature intended that anything more than a transient location would be permanent and, accordingly, an improvement to real property.

(025) Ahrens v. Town of Fulton, 2002 WI 29, Case No. 99-2466 (March 26,2002), affirming 2000 WI App 268.

(026) The Court declined to define "temporary" in terms of a specific number of days, concluding that such a responsibility is better left to the legislature or the state Department of Revenue.

 

(027) The Court called upon the legislature to fix the various statutes, calling them "nearly irreconcilable" in their current form.

(028) The Court concluded that all of the mobile homes in question were resting for more than a temporary time on some other means of support than its wheels and had all been properly classified as real property.

 

(029) With regard to the mobile home that was said to be resting only on its wheels, the Court noted that under the definition of mobile home, additions or attachments are considered as part of the mobile home itself and stated that as a result, if that part of the mobile home is resting on some other means of support than the wheels of the basic unit, the mobile home itself is being supported by means other than the wheels.

 

Caption: Taxation 1018; Mobile Homes 46

Other Captions: Taxation; Mobile Homes

 

Endnotes

 

(030) Section 66.058(1)(d) was renumbered as 66.0435(1)(d) when ch.66 was recodified but the court's decision is based on the statutes as they existed before the recodification.

 

(031) The court noted Judge Dykman's dissent in 2000 WI App 268, 240 Wis.2d 131, 621

 

 

10/28/03