New Municipal Law Alert Now Available for August

A new edition of the Municipal Law Alert is now available online. This month’s articles discuss a First Amendment case regarding municipal sign ordinances and a bipartisan bill introduced regarding small employers and health insurance premiums.

View the latest articles clicking the titles below, or click here for a print-friendly version. Archives of the Municipal Law Alert, including the ability to key word search, are also available.

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Bipartisan Bill Introduced Regarding Health Insurance Premiums

The Affordable Care Act (ACA), as interpreted by the Internal Revenue Service, prohibits small employers from reimbursing or paying for an employee’s individual health insurance premiums. It is possible violators could be fined up to $100 per day, per employee (which could be up to $36,500 a year). This applies whether or not the reimbursement or payment is made before-tax or after-tax. Although there is some question about whether these penalties would apply to a municipality, the IRS apparently believes they do.

A bipartisan bill entitled the “Small Business Healthcare Relief Act of 2015” has been introduced in both the House (H.R. 2911) and the Senate (S. 1697), which would allow such reimbursements or payments. The bipartisan sponsors of the bill are Senators Chuck Grassley, R-IA, and Heidi Heitkamp, D-ND, and Congressmen Charles W. Boustany, Jr., MD, R-LA, and Mike Thompson, D-CA.

If this is an issue that affects your municipality, you may wish to contact your elected federal representatives and ask them to support the Small Business Healthcare Relief Act.

You can find the history and status of the joint bills on, or Both sites have search links where you can search “hr2911” or “s1697”. The April edition of the Municipal Law Alert contained an article concerning this issue. For details, I would strongly suggest you review that article which is available on our website at

On a related note, the State of Ohio has sued the federal government over a very similar, but more complex, aspect of applying ACA “taxes” to the states. If you are up for some heavy legal reading, you may want to review the Ohio Attorney General’s Opinion 2015-021, which can be found at:


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First Amendment Case May Void Many Local Municipal Sign Ordinances

You may have missed this in the news; probably because there was almost no news coverage of it. In Reed v. the Town of Gilbert, the United States Supreme Court declared a municipal sign ordinance unconstitutional because it violates the First Amendment. By way of background, in case you’re thinking the “town” of Gilbert is some small out of the way place, it is basically suburban Phoenix—it has a population of over 200,000, and one of the highest median incomes of any municipality in Arizona.

Also by way of background, for those of you who have never read the First Amendment, here’s your chance: “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances.”

This language has been widely litigated and ended up in many, many Supreme Court cases. In this case, the Supreme Court held unanimously that Gilbert’s ordinance, which has different rules and exceptions for certain categories of signs, violates the First Amendment. Specifically in this case, Gilbert’s Sign Code had restrictions on temporary directional signs that were not applicable to political signs and ideological signs. A small church in Gilbert would put up signs giving people directions to its Sunday service. The church had no permanent building, and so services would often be in different locations from week to week. In Gilbert, a person could put a politician’s campaign sign up for longer periods than a person could put up a directional sign. The Supreme Court said that this violated the First Amendment.

When it comes to local municipal sign ordinances, the general rule is that sign codes should be content-neutral. How that gets interpreted by courts is complicated. One very rigid test is if you must read the sign in order to tell whether it complies with your sign law, that sign law is content-based. However, that rigid test is not “black letter law” – there are a number of exceptions to this kind of strict interpretation; for example, distinctions tied to obscenity, defamation, libel and slander. A classic example is that your right to free speech does not give you the right to yell “fire” in a crowded theater. In addition, there is a previous Supreme Court decision allowing a distinction between commercial and non-commercial speech. Of course, one does need to read the sign to know if it is commercial, or slander, etc.

In a complete reversal on what has been traditionally understood regarding exceptions for political speech (primarily election campaign signs), content-based exceptions to prohibitions, or variations in treatment of signs, can invalidate the prohibition itself. For example, I suspect many local sign ordinances contain an exception allowing or favoring political signs. That language may invalidate an ordinance.

Local governments should have their sign ordinance reviewed by their municipal attorney.


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What is a “No Asset” Bankruptcy? Find out in the latest Lender Edition of Bits & Bytes.

B&BTake a moment for “Bits & Bytes” as Deanne Koll explains what a “no asset” bankruptcy is and what it means to a lender.

Click here for a transcript or click here to view previous videos in the Lender Edition series.

Disclaimer: This video is designed to be educational and informative, but it is not legal advice. Collection law is constantly evolving and subject to change. Each situation is unique, and each case should be addressed to fit the unique situation.

What is a “No Asset” Bankruptcy?

B&BTake a moment for “Bits & Bytes” as Deanne Koll explains what a “no asset” bankruptcy is and what it means to a lender.

Disclaimer: This video is designed to be educational and informative, but it is not legal advice. Collection law is constantly evolving and subject to change. Each situation is unique, and each case should be addressed to fit the unique situation.

If your customer filed for Chapter 7 bankruptcy protection, you may—at some point—receive a notice from the bankruptcy court saying that the bankruptcy is a “no asset” case. What does that mean?

In Chapter 7 bankruptcies, the appointed trustee must determine whether there are assets of the debtor that would be available for distribution to creditors.

In other words, the trustee has to review the assets disclosed by the debtor and determine if any of those assets are not “exempt” assets and thus can be taken by the trustee to satisfy creditors.

The vast majority of Chapter 7 bankruptcies are “no asset” bankruptcies. Meaning, the debtor has no assets which are available for distribution to creditors. Exempt assets are not available for distribution.

In Wisconsin, an individual may exempt personal bank account cash up to $5,000 and home equity up to $75,000 (or $150,000 if a couple). Those exempt assets are not available to be taken and sold by the trustee.

When you receive notice that a bankruptcy is a “no asset” bankruptcy, you know that you need not file a Proof of Claim, since there are no assets that will be sold to pay unsecured creditors.

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