Wright County Board approves half-cent local option sales tax

By John Holler

At the June 13 meeting of the Wright County Board of Commissioners, the board approved imposing a half-cent local option sales tax to apply toward county road projects that are no longer being funded by state aid funds – a tax that is expected to generate about $4.5 million a year from current estimates.

After spending months discussing and investigating options, which include an evening public hearing to get resident input, it appeared it was going to be approved in a matter of seconds, as Commissioner Mike Potter made a motion to approve that was immediately seconded by Commissioner Christine Husom.

But, it wasn’t that easy.

The resolution in front of the board identified 17 county projects that would be completed and gave a 15-year window for the tax to be in place. The first objection came from Commissioner Mark Daleiden, who felt the 15-year approval was simply too long.

“I don’t like the idea of doing it for 15 years,” Daleiden said. “I would like to do it just for five (years) to start out with. That way, we can have some metrics to make sure that we’re not going to cause any issues with local businesses. With some of the metrics that the state provides from the Department of Revenue, we can look at sales and tax amounts. I’d like to able to look at it in five years and make sure that we haven’t done anything detrimental to our local businesses.”

Potter didn’t want the amendment added, saying that the tax can be repealed at any time by the county board. He said the 15-year timeline was based upon the number of projects and the amount of tax that would need to be collected to complete them (approximately $86 million), adding the infrastructure issue is a national problem, not just a Minnesota problem or a Wright County problem.

“If through some miracle, the state and the feds actually step up and do what they’re supposed to do, this can go away,” Potter said. “As we’ve seen at the (Association of Minnesota Counties) meetings, more and more counties are adopting this. I think by the end of the year, north of 40 counties will be doing this because they all have the same bad taste in their mouths about how the Legislature dealt with this. The needs have kept growing. In the four years I’ve been on this board, unfunded needs went from $12 billion to $18 billion. The longer you just kick the can down the road, we may turn to Pennsylvania and do a 31 cent-per-gallon gas tax increase just to makes ends meet.”

The sales tax would start Oct. 1, 2017 – the first quarter of the year that meets the standard of a 90-day implementation period – and Potter felt it would be shortsighted to put a short term on the tax, resisting any amendment to his original motion. But, given the resolution had time frames left blank – spaces that needed to be either left alone or filled in with a solid timetable – at the time the motion was made the term of the sales tax remained ambiguous. Assistant County Attorney Brian Asleson clarified the matter.

“The way the statute reads, you either set an end date or it remains until all those projects named are completed,” Asleson said. “It could be interpreted that his motion was to have this go into effect indefinitely until those projects are completed.”

Potter reiterated that was his intent and that such a program would take time to implement. Commissioner Darek Vetsch said that this is the public’s money and that a sunset date should be in place would empower the public or a new county board in the future to have a say in whether or not the tax is an effective policy.

Vetsch made a motion to set the sunset date for Dec. 31, 2022. The motion passed by a vote of 3-1-1 – with Husom voting against it and Potter abstaining.

The vote to implement the five-year sales tax implementation followed and was passed 4-1 with Board Chair Charlie Borrell voting against the resolution.

Borrell stated that his opposition to the sales tax was based upon giving all of the additional money to the highway department and not reducing it somewhat on the side that is budgeted.

“We already give the highway department $4 million a year in taxpayer dollars,” Borrell said. “This new tax would go solely for road projects, but, if it generates $5-6 million a year, why couldn’t we reduce the amount we put in their budget by $2 million a year to give residents some property tax relief? I know how these things work. If you keep funneling more money into it, they’ll spend it all and may not spend it wisely.”

The local option sales tax will officially start being collected Oct. 1, but it was noted that it won’t include big-ticket items like cars and boats that could legitimately impact whether people buy a motorized vehicle from a Wright County business or went elsewhere to potentially save several hundred dollars that would be involved with the local sales tax.

Freelancer John Holler covers government and the Wright County Board of Commissioners.