With work on Wisconsin’s biennial state budget finally done, two of La Crosse County’s elected representatives in Madison have introduced legislation to pave the way for a special tax the county has promised to use to pay for road work. The county’s third representative, however, is not backing the bills.
State Sen. Jennifer Shilling, D-La Crosse, and state Rep. Steve Doyle, D-Onalaska, both have introduced bills that would permit La Crosse County to become the first county in the state to have a half-percent premier resort area tax. State Rep. Jill Billings, D-La Crosse, is not supporting the legislation, however.
The tax, which would be collected on any taxable items or services sold at businesses designated by the state as tourism related, would raise an estimated $6.6 million per year, according to the state Revenue Department. The county intends to use money raised from the tax exclusively for improvement and maintenance of roads and bridges, spending $5 million per year to catch up on an $87 million backlog of road work. The remaining 25 percent of the tax proceeds would be split among the county’s 18 municipalities.
State law allows premier resort area taxes to be used to pay for infrastructure other than roads and bridges, including parking ramps, park improvements or a civic center, for example. The county board, however, has formally gone on record with an official resolution committing itself to spend the money only on roads and bridges.
State law allows any municipality or county that has at least 40 percent of its equalized property value in tourism-related businesses to charge the tax. Those that fall short like La Crosse County, which has only 5 percent, must seek an exception from the Legislature.
Gov. Scott Walker has indicated that he would sign La Crosse County’s bill as long as it contains a provision requiring a binding referendum before the tax can be implemented, which it does. “I think that’s very significant,” Doyle said. “I think that’s the governor saying he respects the idea of local control.”
Billings said she understands and appreciates the jam the county is in over the road funding shortfall, but said she can’t support the special sales tax approach, even though a nonbinding referendum last spring on the sales tax was approved by 55 percent of the county’s voters and just under 56 percent of the voters in the city of La Crosse.
“I have a problem with it because I’ve heard from so many people about the adverse effects on brick-and-mortar businesses, especially downtown,” Billings said. “I have to say that I understand that the county is trying to be creative. But I think the state needs to come up with solutions to this, with a reliable revenue stream. … I would like to see a funding stream that’s more directly related to users.”
A user-related funding stream could be higher gas taxes or vehicle registration fees, for example, but the Republican-controlled Legislature opted not to go for boosting these revenue sources in the recently approved biennial budget. If the budget had included those tax hikes, Walker had promised a veto.
Doyle and Shilling, who is Senate minority leader, agree with Billings that a state solution to the county’s road woes would be preferable. “I would prefer to have a statewide fix to transportation so we would have enough revenue to renovate, rehabilitate and maintain our crumbling roads and bridges,” Shilling said.
In the past week, Shilling and Doyle both noted, the bills they are sponsoring were given numbers (SB493 in the Senate, AB610 in the Assembly). They also were assigned to committees, and Doyle and Shilling must work with the chairs to get the bills scheduled for public hearings before the committees, a necessary step before they can move on to final votes in the Senate and Assembly.
In the Senate, Shilling’s bill goes to the Economic Development, Commerce and Local Government Committee. In the Assembly, the bill will go before the Ways and Means Committee, on which Doyle sits. As Doyle sees it, the assignment to his committee could be a positive sign for the legislation getting a hearing and a committee vote.
On the other hand, Billings’s lack of support for the bill doesn’t help. “At least she’s acknowledging the problem,” Doyle said. “This isn’t an easy issue. The referendum got 55 percent in the county, which shows that it got support, but it also shows there’s opposition.”
And the opposition is organized. During the recent annual Oktoberfest in the Capitol event in Madison, members of the La Crosse Area Chamber of Commerce, La Crosse County Republican Party Chairman Bill Feehan and others actively lobbied lawmakers to oppose the county’s bid to win approval for the premier resort area tax.
Feehan argues that half the tax revenue would be paid for by city of La Crosse residents, but little of the money would go to fix roads in the city.
Doyle, who serves on the La Crosse County Board as well as in the Assembly, noted that the county is responsible for some roads within cities and villages.
And as an acknowledgement that municipal roads are in need of attention, too, the county board approved designating 25 percent of the proceeds from the “tourism tax” will be split every year among the county’s 18 municipalities.
Jane Klekamp, the county’s associate administrator, has been meeting with municipal officials to discuss how the county would divide the municipalities’ share of the tax proceeds. So far, the preferred method is to base the split on the total municipal road mileage.
The municipalities’ estimated $1.6 million share of the tax revenue would amount to $2,116 per year for each of the 756 miles of city, village and town roads. By comparison, the county would get $17,730 annually for each of the county’s 282 miles of road.
The city of La Crosse has the most municipal road miles at just over 192, and it would get $406,960 in additional annual funding based on the proposed split, which means a 21 percent overall funding increase for roads when combined with state general transportation aid.
The city of Onalaska has 89 miles and would get a boost of $188,365, a 28 percent increase. Holmen would get $85,488 (up 41 percent), West Salem would get $47,578 (up 36 percent) and Bangor would get $17,453 (up 34 percent). Campbell’s road funding would go up by 50 percent, with a $41,020 increase, while Shelby would see a 68 percent hike with $95,986 in additional revenue.
Rural towns would feel the most benefit from a split based on road mileage, with 10 towns getting a 96 percent bump in funding, nearly double their current levels. Four towns — Hamilton, Holland, Onalaska and Shelby — would get more money than Holmen as they have higher road mileage totals, and the town of Farmington would get nearly as much as Holmen.
Doyle hopes to get a committee hearing for his bill before the holidays, but a full Assembly vote probably wouldn’t happen until next year. If the bill passes and wins Walker’s signature to make it law, the county board would have to pass a resolution by a two-thirds margin to send it to a binding voter referendum.
One thing Doyle will emphasize in urging support for the bill is that the bill does not raise anybody’s taxes. “What it does is give the voters the ability to decide if they want to raise their own taxes,” he said. “It’s what school districts do every time they have a referendum.”