With a $10-per-vehicle wheel tax set to expire at the end of 2019, Chippewa County officials are looking at ways to make up the $550,000 the tax has brought in annually for the past five years.
The Chippewa County Board met on Tuesday, where they heard several ideas for increasing “sustainable funding” for highway projects, including significantly increasing the amount spent each year on roads and bridges.
“You don’t have to make any decisions tonight, so no pressure,” county administrator Randy Scholz told the board.
One proposal includes a referendum to be held at a November election — in 2020 or a future fall election — to increase the property tax levy by $2 million each year for road projects. It would mean a $57 per year increase in property taxes on an average $150,000 home.
Chippewa County is spending about $4.4 million for road projects annually, between levy and sales tax dollars, state and federal aid, and borrowing. The county is currently replacing just 8.9 miles of highway each year, but the county is responsible for maintaining 489 miles. Thus, the replacement cycle is 55 years.
The proposal shared with the board recommends increasing the road funding to $7.99 million a year, nearly double the present amount.
The county also is averaging $490,000 each year for bridge maintenance and replacement; the proposal calls for increasing that to $700,000 annually.
“If the referendum were to fail, we’d still have to come up with finding a sustainable option,” finance director Melissa Roach said.
The county board approved the controversial wheel tax in September 2014 on an 8-6 vote because of a $1.2 million deficit in the winter road maintenance account. Chippewa County is responsible for plowing and maintaining 1,666 lane miles — the fourth-largest total of any county in the state. The wheel tax was specifically set up to run for just five years, expiring Jan. 1, 2020.
Highway commissioner Brian Kelley said the county will have $600,000 to $800,000 remaining in the winter maintenance account by the time the wheel tax expires.
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Many county residents spoke against it when it was implemented, and several of the board members who voted for it were defeated in the next election; only two of the supervisors who supported the measure remain on the board. Critics have noted that the county has more than $20 million in surpluses. Also, opponents don’t like that larger vehicles, such as semis and farm equipment, are exempt from the tax under state law.
One of the other funding proposals outlined Tuesday was to establish a new wheel tax, with no sunset date. A $20-per-vehicle fee would net $1.1 million annually, or a $30 fee would generate almost $1.7 million. A $72-per-vehicle fee would generate $4 million.
Other new funding ideas were explored. The sales tax in Chippewa County is 5.5 percent. If legislation allowed the county to increase it to 6 percent sales tax, that would generate an additional $5.25 million annually, the report states.
“We’re taking our time to do this right,” Kelley said.
Roach also showed the board a variety of short-term and long-term borrowing options, and how that would increase the debt.
Board supervisor Dean Gullickson of the town of Tilden thanked the administration staff for pitching the variety of options and data.
“Very good ideas; I think you are on the right track,” Gullickson said.
In other news, the board voted to eliminate the “pay for performance” wage system for county employees. The motion to eliminate the system passed on a 10-4 vote.
The program provides wage increases for workers who exceed the criteria established by their supervisor. The county switched to that merit-based wage increase system in 2013, under previous county administrator Frank Pascarella, eliminating a pay scale based on seniority. The program was considered controversial, as some departments with numerous employees were asked to spend a significant amount of hours on compiling reviews and determining who earned wage increases.
Board member Steve Gerrish of Lake Hallie described pay for performance as cumbersome, but he expressed concerns about not knowing enough about the program that would replace it.
Board member Mechele Shipman pointed out that several municipalities in the state have abandoned pay for performance, because the data shows it doesn’t work.
Scholz said beginning Jan. 1, 2020, all employees will be under a standard evaluation that is common in most counties, and staff would go back to an “across-the-board” percentage wage increase.