From one perspective the option to impose a county sales or wheelage tax is viewed as a necessary tool to aid in balancing the 2014 county budget. From the other, it is yet one more instance in which the state has elected to pass the buck onto counties, forcing them to raise taxes on their constituents rather than legislators doing it themselves.
"It's just another tax scheme by the state. It's time to put our foot down and say no," said Yellow Medicine County Commissioner Louis Sherlin at Tuesday's regularly scheduled meeting.
Bucking a recommendation from county administrator Peg Heglund, board members Gary Johnson and John Berends joined Sherlin in voting against the institution of a local 2014 wheelage tax during a 3-2 vote.
As a result of recent legislation, the option of a local wheelage and/or sales tax is a new possibility for counties. The wheelage option involves the institution of a standard $10 tax on applicable licensed automobiles that can be applied toward road and bridge projects. Meanwhile, the sales tax, though hardly discussed by commissioners, allows counties to impose a tax on anything already subject to a sales tax to generate dollars for transportation and transit projects.
Counties must submit their intentions to implement one or both tax options to the state by August 1 to allow for the collection of funds beginning January 1, 2014. Should they choose not to institute the taxes, the counties may do so in the proceeding year––again, by August 1.
Of the favorable opinions expressed by commissioners Ron Antony and Greg Renneke, the former was the most outspoken board member in favor of the wheelage tax. Antony emphasized that he viewed the tax as an opportunity to shift the tax burden toward something else besides property owners, which largely impacts the ag-sector.
"It is the only way we can tap into money that is non-property owner directed," he said.
In light of imminent but undetermined insurance hikes and state-imposed levy limits, the recommendation to approve the wheelage tax was all about balancing the county budget for Heglund.
"Given the limits and budget constraints, I would recommend applying for it for a year and seeing how it goes," she suggested. "It looks as if we could seek the max levy and a wheelage tax and still end up deficit spending."
Based on current vehicle registrations, it is estimated that the wheelage tax would have generated $116,000 in county tax revenues. That figure would cover the expense associated with a roughly 1.5 percent levy increase.
In other news, commissioners approved a 10-year tax abatement for the 4 Lancers, Inc. owned Subway built in Canby in 2010 on a 3-2 vote.
According to board member Louis Sherlin, the abatement would have not been necessary if a former Canby administrator had followed through on the promise to arrange tax increment financing (TIF) for the Canby-located company.
Page 2 of 2 - The city of Canby already granted 4 Lancers an abatement. Commis-sioners John Berends and Gary Johnson comprised the votes opposing the tax break, stating their belief that the county shouldn't have to account for Canby's misstep.
The maximum amount of taxes that can be abated over ten years is $11,400.