The Isanti County Board on July 16 passed a county wheelage tax, estimated at generating $339,000 for county highway needs that otherwise would have depended on property taxes.
Commissioners George Larson, Susan Morris and Greg Anderson voted to authorize and impose the $10 tax beginning next year on motor vehicles kept in Isanti County. Solely voting against was Mike Warring, who favored the potential revenue and process that includes public hearings on specific projects that come with the sales tax route.
Discussing the issue at length, board members acknowledged that the tax burden is on users of the road rather than on property owners. County finance director Chad Struss, in researching the issue following a previous work session, said the projected $339,000 revenue is equivalent to a 2 percent property tax levy increase.
“If the wheelage tax is enacted,” he said, “some of the property tax dollars used for overlays and county road projects can be used for other needs such as road equipment.”
Yet the issue of what wheelage tax revenue can be used for was the big question at last week’s board meeting. Commissioners specifically wondered if the money, which must go into the county highway department’s road and bridge fund, could go toward the department’s aging snowplow fleet as well as highway maintenance.
“There’s an overwhelming need to buy equipment over there,” said Richard Heilman, county engineer.
Board members figured the projected wheelage revenue in Isanti County could cover a truck and a half.
“We need at least one snowplow this year,” Larson said. “We could use this money to catch up.”
Struss noted Minnesota state statute says the revenue must be used for “highway purposes,” while the Minnesota Constitution discusses public highways in broad terms and without a list of authorized expenditures.
“My opinion is any expenditure from the road and bridge fund qualifies as ‘highway purposes,’” Struss said. “At minimum, the overlays and county road construction certainly qualify as appropriate uses of the wheelage tax.”
The county attorney’s office is anticipated to research the legal interpretation further.
Struss also hit on the budget end of the wheelage tax money.
“From a budget standpoint, the additional revenue would certainly be helpful,” he said by memo to the board. “The 2015 budget will be difficult to balance without an increase in the property tax levy or a reduction of service levels. Payroll and insurance costs alone may require a 4-5 percent increase in the property tax levy. There are also many capital outlay needs to address plus general inflation for goods and services used by the county.”
Said Larson, “I feel this is the only financially responsible thing to do, rather than passing the burden on to property taxes.”
The Minnesota Legislature’s 2013 Transportation Appropriation Bill authorized expansion of the $10 wheelage tax authority to all 87 counties. The tax is determined by where a vehicle is ordinarily stored or parked during non-business hours or when not in use.
Wheelage tax funds are distributed to the appropriate county and are used for transportation needs, including highway preservation projects, expansion projects and transit improvement. The tax does not apply to motorcycles, motorized bicycles, trailers or mopeds — that is, vehicles that do not require an annual registration tax.
In other action, the board:
• Approved the following community organization payments for 2014: Agricultural Society, $4,500; Central Minnesota Initiative Fund, $2,925; Commission on Aging, $14,400; Historical Society, $7,650; Historic Buildings Maintenance, $900; Humane Society, $2,250; Refuge, $10,620; Safe Cab, $900; Soil and Water Conservation District, $13,500; and East Central Regional Library, $184,836.
• Tabled a request to purchase maintenance equipment for tax forfeit properties. Auditor-treasurer Terry Treichel presented a list of equipment, totaling $18,848, including two commercial lawn mowers and trailer for hauling the equipment. The board expects to revisit the issue at a future meeting, when particulars of the work is ironed out.
• Approved a preliminary plat of Flodquist Farm First Addition in North Branch Township for George Snider, of North Branch. The applicant is looking to create two building rights on the lot, which is currently an outlot of Flodquist Farm.
• Approved a preliminary plat of Red Oak Addition Phase 2 in Cambridge Township for Kenny Olson, of Cambridge. Olson wants to make the property, an outlot, a buildable lot.
• Hired Jennifer Psyck as fraud investigator, effective Aug. 18, as requested by Family Services.
• Accepted, with regret, the resignation of social worker Roxanne Botz, effective Sept. 30, after serving the county for over 21 years.
• Approved a collaborative contract for chemical dependency counseling with Cambridge-Isanti and Braham school districts. The contract carries a cost of $34,020, which is covered in the budget.
• Approved a Canvas Health contract for a 24/7 crisis line service in relation to the closure of Riverwood Centers.