Cook County has been given two new ways to collect taxes for road and bridge projects.
The first is a new bill passed this year by the state legislature that gives counties throughout the state the authority to collect a wheelage tax. A tax of $10 a year per vehicle can be collected through 2017, and up to $20 a year can be collected after that. Counties have the option of having the state collect the tax on their behalf as part of the license tab renewal process. Metropolitan counties, which have been authorized to collect a wheelage tax for years, have been collecting the tax this way.
Funds from the wheelage tax must go into county road and bridge funds. Charging the tax does not require counties to decrease their levies, and it will not decrease state funding for county state aid roads.
Cook County could bring in an estimated $52,780 a year with the wheelage tax.
Several types of vehicles would not be subject to the tax, including motorcycles, mopeds, trailers, semis, cars not subject to annual registration such as collector cars, and tax exempt and state-owned vehicles.
Counties that want to impose the wheelage tax in 2014 have until August 1 to notify the state. The tax can be imposed by resolution of the county board.
The second new funding mechanism is a local option sales tax of up to ½ of 1 percent levied on anything that is currently subject to sales tax in the county except for the sale of motor vehicles. According to the Minnesota Transportation Alliance, counties can impose a $20 vehicle fee instead.
Revenue from the local option sales tax, which can be imposed by resolution of the county board after a public hearing, can be used for four purposes: 1) To fund a specific capital improvement project such as reconstruction of a road or construction of a maintenance facility; 2) To pay for capital or operating costs of a specific transit project such as a train line, bus stop, or bus garage for a local transit program; 3) To cover capital costs of a Safe Routes to School project such as city sidewalks; 4) To fund operating costs for a transit system (such bussing systems, light rail or subways).
County Engineer David Betts spoke with the Cook County News-Herald about the new taxing authority, saying that the local option sales tax could be levied to pay for new Highway Department facilities, which staff has told the county board are currently inadequate and in need of replacement.
On July 9, 2013, Engineer Betts told the county board that the wheelage tax could help fund “major dollar projects” that are needed but have no other funding, such as work on County Roads 45 and 60. The funding could also help pay for bridge replacements. Bridge bonding does not include removal of old bridges or preparing approaches to bridges, he said.
“I support doing this,” Betts told the board. He said that he would also encourage the board to increase the wheelage tax to its maximum amount of $20 when it is allowed in 2018. He said he was frustrated that the gas tax had not been raised recently, but that tax doesn’t pay for county roads anyway.
Commissioner Bruce Martinson said he has heard people from the state tell him, “you can levy for that” to fund road projects, since the county has not been levying the maximum amount allowed.
A ½ percent sales tax would currently generate about $640,000 a year that could be used for capital improvement projects, Betts said. He said this is about half of the county’s current road and bridge levy and called it a “significant” amount of funding. In addition, the people benefitting from a project – everyone who is in the county buying things – would be paying for it.
West End lodging establishments are already charging more than 11½ percent in sales tax, Commissioner Martinson said.
The county has no money for reconstruction of its own 125 miles of road, Betts said. State funds for use on local roads are very limited, he said. Asphalt prices have about doubled in the past 10 years. “There’s a ton of roads that are in horrible shape.” Work has been put off “to the point that some of our roads are falling apart,” he said.
Commissioner Gamble expressed a concern regarding increased taxation, saying that government tends to continue taxing until they get a lot of pressure to stop. “Once you find new revenue streams,” he said, ‘it hardly ever goes away.” He said he didn’t think the wheelage tax would be worth the benefit to the county.
Commissioner Sue Hakes said she has only heard negative comments from constituents about wheelage taxes. She said she wanted to think about it more before voting on whether to take advantage of the opportunity.
Commissioner Jan Hall said she also was opposed.
Commissioner Heidi Doo- Kirk said she thought people who live in the county part-time might start registering their vehicles in other states if Cook County imposed a wheelage tax. “We might start seeing license plates from other states,” she said.
Commissioner Bruce Martinson said he thought this was “the easy way out” for legislators, allowing them to avoid increasing the gasoline tax.
“I am very sensitive to the fact thatwealreadyhavea1percent right now,” Betts said. He said he thought that he would be remiss to not suggest imposing these taxes and that most counties will collect the wheelage tax. “This is significant money. This would benefit the taxpayers of Cook County.”
Forest-related funding the county has been receiving from the federal government for its roads (payment in lieu of taxes and Secure Rural Schools) continues to decrease. Engineer Betts said this impacts his department a great deal. “Fuel’s not getting cheaper,” he said.
The board took no action on the taxes at this meeting. West Rosebush Lane summer maintenance
One bid was received for summer maintenance of the West Rosebush Lane subordinate government service district (SGSD) in a re-bidding process conducted because of a lack of any bids the first time around.
The board approved a contract with LaBoda Grading Inc. at a cost of $280 per grading, $130/hour for additional grading, $25/yard for Class 1 aggregate, and $125/hour for debris cleanup if needed after a big storm.
Leave a Reply