Wisconsin tax credit proposed for people relocating from Los Angeles, North Carolina disasters

The idea for a natural disaster tax credit came to state Rep. Cindi Duchow, R-town of Delafield, while watching news reports from destructive January wildfires in Los Angeles.

“I thought ‘You know what, we could use people right here in the state of Wisconsin. Let’s incentivize those people to move here where we do not have wildfires,’” she said.

She’s introduced an Assembly bill creating a $10,000 tax credit for people who moved to Wisconsin from Los Angeles County because of those fires.

The bill also includes those moving from North Carolina due to 2024’s Hurricane Helene. That was an addition by state Sen. Dan Feyen, R-Fond du Lac, who introduced the bill in the Senate.

The tax credit would cover income earned in the 2025 or 2026 tax years, but it can only be used once.

“I think it’s a way to attract people to our state who are also looking to make a change because things are moving very, very slow in their home communities right now,” Feyen said.

Duchow said the bill could be part of a larger effort to attract people to Wisconsin. If it is signed into law and proves successful, she said the strategy could be used on a more regular basis.

“We are a very old state, and we need younger people, and we need workers,” she said.

“I understand we have winter, but you can buy a good coat. You can get through it. You’re fine,” she added.

In 2024, migration fueled a small increase in Wisconsin’s population.

But long-term, the state Department of Administration expects Wisconsin’s population to shrink by almost 200,000 people by 2050.

Some northern cities in the United States — including Madison — have marketed themselves as “climate havens” whose low risks of natural disasters make them an attractive relocation destination for people living in disaster-prone areas.

There’s evidence, however, that most people affected by natural disasters stay local. A 2023 study found that 74 percent of people who got government buyouts of their flood-prone homes moved within 20 miles of their original address.

Duchow said she hopes the bill gets bipartisan support because attracting new Wisconsinites should be an area of agreement. Besides herself and Feyen, the bill has five other Republican cosponsors.

The state Department of Revenue estimated that the credit would cost Wisconsin about $1.8 million. That’s based on prior years’ migration tallies from Los Angeles County and North Carolina that the department said could’ve grown due to the disasters.