County approves half-percent sales tax

 Money collected will go toward road repairs

by Derrick Knutson

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By a 3-2 vote, the Chisago County Board of Commissioners approved a half-percent sales tax on merchandise sold in the county and a $20 excise tax on vehicle sales at the board’s Nov. 18 meeting.
The funds raised from the tax will go exclusively to projects identified in the county’s approved transportation improvement plan.
State law enables counties to enact a local option sales tax but requires the revenue raised be used specifically for transportation related projects, according to information from the county. The Minnesota Department of Revenue estimates approximately $1.2 million in revenue could be generated annually in Chisago County from this sales tax.
The tax applies to the same items that are subject to the state sale and use tax of 6.875 percent, thereby making the new sales tax rate in Chisago County 7.375 percent. However, the sales tax on motor vehicles purchased for road use will remain at the current rate. Instead, a $20 excise tax must be paid when purchasing a vehicle from a Chisago County auto dealer. Currently, there are 20 counties that have enacted the local option sales tax for transit or transportation purposes.
The tax allows the county to conduct approximately 30 more miles of road repairs over the next five years.
Commissioners Ben Montzka and Lora Walker voted against the tax, while Commissioners Rick Greene, George McMahon and Mike Robinson voted in favor.
“I would strongly encourage the board to not add an additional tax,” Walker said, noting that she thought there was enough money in county program aid (funds from the state) to pay for the needed road repairs.
Montzka offered similar views.
“Seven years we’ve kept the levy at zero,” he said. “One of those years we cut the levy. This unit of local government has worked hard to constrain spending. At this point, I cannot support this additional tax. I appreciate the need to do this, but I hope we can prioritize roads.”
There were citizens on both sides of the issue who spoke at the meeting. Amador Township resident Bruce Pederson was against the tax.
“There are so many people who don’t shop here,” he said. “They shop over in St. Croix falls. If you bring it (the tax) up, then they’re going to shop over there.”
Lent Township resident Sue Sinna said she doesn’t like new taxes, but a sales tax, as opposed to a levy increase, is easier to stomach because the county would be bringing in revenue from nonresidents.
“Roads are one of the things that are nice and everybody likes,” she said. “I agree that it’s not fun to have an increase in taxes. However, I think we’ll benefit some from the folks driving on I-35 and going across Highway 8. It’s one of the less awful increases.”
Commissioner George McMahon said if the county tried to procure $1.2 million for road repairs by a property tax levy, the result would likely be the levy increasing by more than 4 percent.
“This is one way that we can offset the residential property tax,” he said. “This gives us a leveler playing field than we have now. It’s probably the fairest way to do it.”
McMahon explained that just because the board voted to enact the tax for next year, that doesn’t mean it couldn’t vote in the future to not utilize the tax.
“You can click it on or click it off,” he said. “This is a good tool to use, and I hope that my two commissioners could reconsider their position.”

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