Smaller counties not sold on new tax

  • Article by: HERÓN MÁRQUEZ ESTRADA , Star Tribune
  • Updated: March 12, 2008 - 12:03 PM

Scott and Carver counties don't seem eager to use their power recently passed at the Legislature to levy a quarter-cent sales tax.

Given how tight money and budgets are these days, it's hard to imagine any county government turning its back on millions of dollars.

But on Tuesday, there were indications that Carver and Scott counties would do just that by not partaking of a $100 million pot of money for metro-area counties that implement a recently approved quarter-cent optional sales tax for transit projects.

The two counties' boards, like others around the seven-county metro area, discussed the issue Tuesday. All boards held off a formal vote until the end of the month because they have until then to decide on the new tax.

But especially in Carver, adding the sales tax seemed all but a dead issue as none of the five commissioners spoke out for the increase, even though it could mean the county could get back an estimated $1.5 million a year for transit.

"It's going to be hard to support this," said Carver County Commissioner Gayle Degler, who, like other board members, said she has received more comments against the new tax than for it.

The biggest objections seem to be concerns about raising taxes during tough fiscal times, what immediate benefits smaller counties would get, and who would decide which projects are funded.

"I think this is a trying time for a lot of people," Carver County Commissioner Tim Lynch said Tuesday. "I just don't know if this is the correct time to implement this tax."

Those sentiments were echoed in Scott County, which stands to collect about $3 million from the new transit tax, according to figures on the seven-county area's tax collections compiled by the Metropolitan Council.

"I don't know of any board member who supports joining," said Scott County Commissioner Jon Ulrich of Savage, a leader on transportation.

Ulrich questioned how much benefit his county would get given that Scott County doesn't have any plans for transitways, which are the main projects to be funded by the new taxes.

Questions abound

Some of the uncertainty about the proposed tax might be answered this morning in St. Paul, when representatives of the metro counties meet to discuss a joint powers agreement that would bind them in their use of the quarter-cent sales tax.

A draft of the agreement suggests that each county appoint two members to a governing board and the counties divide 95 votes among them, leaving five votes for the chair of the Metropolitan Council.

The draft proposes several ways to divide the votes based on population and sales tax revenue. How great an advantage to give Hennepin -- which has more than 40 percent of the population and more than 50 percent of the tax receipts in the seven-county area -- is expected to be a key discussion point.

"We want to make sure counties get their fair share of benefits based on population and what's been contributed," said Anoka County Chairman Dennis Berg.

In Hennepin County on Tuesday, one of the five board members present said she doesn't support the sales tax.  Board discussion focused  on how the board that would rank projects and distribute money would work. Commissioners said they wanted to make sure they have sufficient influence on the proposed new board.

However, the degree of voting weight that the larger counties will have is a concern for many of the smaller counties, such as Scott and Carver.

Ulrich said Scott would contribute so little, "we'd have little impact" when it came to voting on the proposed board.

Better benefits for bigger

The counties most likely to benefit from rail transit are Hennepin and Anoka, said Anoka County Commissioner Dan Erhart. He said that for Anoka, approving the quarter-cent tax "is a no-brainer."

"Rail travel will make Anoka County the most desirable place to live in Minnesota in the next few years," Erhart said. "Why wouldn't we pass this? It makes more sense than raising property taxes."

But Anoka County approval vote is not a slam-dunk, as suggested by a lively discussion at Tuesday's board meeting.

Approval in Washington County, another of the smaller counties, also is far from a done deal, judging from Tuesday's board meeting.

Commissioner Gary Kriesel, of Stillwater, said he has been busy answering many e-mails from county residents offering opinions about the quarter-cent sales tax.

"Everybody recognizes that there's transit in the future," he said. "It's just how do you fund it?"

Also contributing to this story were Laurie Blake, Paul Levy, David Peterson, Joy Powell, Allie Shah and Mary Jane Smetanka. Heron Marquez Estrada • 612-673-4280

COUNTIES THAT COULD ENACT A TRANSIT TAX

% of metro % of sales

County Population population tax receipts

Anoka 328,614 11.6% 8.05%

Carver 86,236 3.1% 1.61%

Dakota 391,613 13.9% 12.25%

Hennepin 1,152,508 40.8% 52.57%

Ramsey 515,059 18.3% 17.37%

Scott 119,646 4.2% 2.93%

Washington 228,103 8.1% 5.22%

Total 2,821,779 -- --

Sources: Met Council population estimate as of April 2006; sales tax receipts estimated by the Department of Revenue

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