A fix for county roads: sales tax
The Douglas County Board of Commissioners will consider a local option sales tax to fund county road improvement projects totaling about $35 million.
If approved, sales tax countywide would increase by 0.5 percent and generate about $3.5 million per year for 10 years.
The process was set in motion last week when Douglas County Public Works Director Dave Robley met with commissioners and scheduled a public hearing for April 1.
WHAT IS THE LOCAL OPTIONS SALES TAX?
The Local Option Sales Tax for Transportation was initially implemented in Minnesota in 2008 as part of a comprehensive transportation funding bill that made a 0.5 percent sales tax increase subject to approval by voters.
Then, last year, new language passed by the Legislature eliminated the voter approval requirement and authorized a county board to impose a 0.5 percent sales tax by resolution following a public hearing.
The funds generated by a local option sales tax must be used for the capital cost of a specific transportation project or improvement.
The taxes must terminate when revenues are raised to finance the project.
DOUGLAS COUNTY’S PROPOSAL
The Douglas County board will consider a sales tax increase to fund a $35 million County Highway Improvement Program – a collection of projects that would rebuild 11 segments of county roads.
“These roads we’ve identified really need to be constructed, rather than a surface treatment overlay. The roads were generally built in the 1950s or earlier, so they were built to an older standard,” Robley told the Echo Press.
The proposed project includes reconstruction of:
● County State Aid Highway (CSAH) 1 from the county line to south of Kensington.
● CSAH 3 from CSAH 10 just south of County Road (CR) 71.
● CSAH 4 from Highway 114 to CSAH 28.
● CSAH 5 from CSAH 7 to CSAH 6.
● CSAH 7 from CSAH 8 to Interstate 94.
● CSAH 8 from west of CSAH 7 to CSAH 40.
● CSAH 9 from north of Nelson to south of Carlos.
● CSAH 12 from north of Garfield to CR 58.
● CSAH 14 from east of Miltona to east of the county line.
● CSAH 17 from CR 79 to CSAH 82.
● CSAH 41 from Interstate 94 to CSAH 82.
When asked why these particular roads, Robely said, primarily, it’s the age of the roads, but they also make good connections to the outlying towns and surrounding area and have a relatively higher traffic count.
He said, “With our current funding, these are road projects we wouldn’t get to. With the sales tax, it’s a way of upgrading and reconstructing these roads.”
Primarily, Robley said, the county’s state aid allocation has not kept up with the increased construction costs to maintain the county roads system.
“I think we’ve done a fairly good job, but as time goes on it’s becoming more and more difficult to keep it in good condition.
“The [county] board has been reluctant to increase property taxes enough to make up the difference,” he said.
Before commissioners vote on increasing the local sales tax, a public hearing will be held at the county courthouse on Tuesday, April 1 at 9:05 a.m. to consider it.
Prior to that, an informational meeting will be held to address the Local Option Sales Tax for Transportation on Thursday, March 20 at 7 p.m. at the Douglas County Public Works building.
If the county board approves the sales tax increase at its April 1 meeting, the tax could be in effect as early as July 1.
The 0.5 percent sales tax increase would be in effect countywide. In Alexandria specifically, the sales tax rate would reportedly increase from 6.875 percent to about 7.3 percent.
Three counties have already adopted the Local Option Sales Tax for Transportation – Beltrami, Rice and Wadena counties.