The Metropolitan Milwaukee Association of Commerce (MMAC), along with several other local organizations, has filed a lawsuit against the City of Port Washington related to an April referendum that would require voter approval for any economic development project that uses tax increment district (TID) financing over $10 million.

The MMAC’s lawsuit seeks an injunction against the April referendum.

In November, a citizens group named Great Lakes Neighbors United presented a petition to the city with signatures of more than 1,000 Port Washington residents calling for referendums on any future tax increment districts of more than $10 million. A petition signed by a number of eligible city voters equal to at least 15% of the total number of votes cast in the city for governor in the last general election requires the Common Council to place the proposal on the ballot for a referendum.

The petition was submitted in response to the $458 million TID approved by the city for Vantage Data Center’s $15 billion data center development in Port Washington for OpenAI and Oracle. Great Lakes Neighbors United also filed a lawsuit against the city over the TID for the Vantage Data Center project, saying it violates state law. In response, the city has filed a motion seeking to dismiss that lawsuit.

The April referendum would not impact the TID for the Vantage Data Center project, since it is already approved.

But the referendum, if approved by voters, would require future TIDs of more than $10 million in Port Washington to be approved by voters via referendum.

The Wisconsin Realtors Association, Associated General Contractors of Greater Milwaukee, Building Advantage, NAIOP Wisconsin, the Commercial Association of Realtors Wisconsin (CARW) and Sid’s Sealants in Port Washington are all listed as stakeholders in a Thursday announcement from MMAC about its lawsuit.

“Drastic measures like the one we’re embarking on with this lawsuit are not taken lightly,” said MMAC president and CEO Dale Kooyenga. “State statute already dictates the process in approving TIDs. A measure of this nature would not only conflict with state law, it would be devastating for economic development in Port Washington and would set a dangerous precedent with long-lasting economic impacts across the region and throughout the state.”

TIDs are created by municipalities and subject to approval by their City Council (Common Council) or Village Board and a Joint Review Board, which includes representatives from each property tax collecting entity included in the proposed district.

“Our region’s continued success depends on our ability to welcome investment, create jobs and support the development that keeps communities thriving,” said Tracy Johnson, president and CEO of CARW. “Introducing uncertainty into a process that already includes public oversight will only slow projects, increase risk and push opportunity to other communities. We need to keep Wisconsin competitive – and that means protecting the tools that help us build strong, vibrant places to live and work.”

Representatives for the city did not immediately have a response to the MMAC’s lawsuit Thursday afternoon.

“Our business’s success is heavily reliant on new construction,” said Sid Arthur, owner of Sid’s Sealants and a plaintiff named in the lawsuit. “If large-scale construction projects become subject to the process being proposed, those opportunities will dry up. That means a loss of jobs, fewer investments and less growth in our community.”