Newsmakers, March 23, 2017

Voters in La Crosse County are being asked in an April 4 advisory referendum to become the first governmental body in Wisconsin to raise the local sales tax by 0.5 percent to pay for long-delayed road improvements.

La Crosse County wants to raise the money by creating the little-used Premiere Resort Area Tax (PRAT) designed to raise sales taxes on tourism-related businesses.

County officials say there are $87 million of road and bridge repairs or replacement waiting to happen including 43 percent of the 285 miles of county roads and 12 of 69 bridges.

“We (La Crosse County) don’t have a number of the tools that cities, villages and towns have to establish other taxing authorities like a room tax or a utility tax,” La Crosse County Board Chair Tara Johnson said. “In addition to the need, the county board has really come at this kind of out of desperation. We don’t have other options to look at for generating additional revenue to meet the unmet road needs.”

Much like the state of Wisconsin, La Crosse County has relied more heavily on borrowing money as a way to do road work. The county has borrowed money for the past seven years to help pay for roads. In the current budget its borrowing $2.7 million, and roads now account for about 20 percent of the county’s debt payments.

But the advisory referendum is being met by stiff opposition from business groups in the county including the La Crosse Area Chamber of Commerce, the La Crosse Area Convention and Visitors Bureau, Downtown Mainstreet, the North La Crosse Business Association and the La Crosse County Tavern League.

The groups surveyed area businesses and received nearly 200 responses; 60 percent were opposed to the new tax.

“What we heard from was the small businesses,” said Chamber Executive Director Vicki Markussen. “A lot of them feel that this is a burden being placed on their customer base, and so they believe that that’s just an unfair way for them to lose some competitiveness.”

While hotels, restaurants and bars would definitely have to charge the new tax, Markussen said there’s confusion among many other businesses who would only be required to charge the tax if they may do business with a tourist.

Tara Johnson said county officials believe only 11 percent of the revenue will come from tourists, with 25 percent coming from people who live in the region. Roughly two-thirds of the new sales tax will be paid by people who live in La Crosse County.

The 165 members of the La Crosse County Tavern League have no doubt the new tax will hurt their profits, since most would decline adding an extra nickel to a $3 beer.

“Our small businesses would end up swallowing that whole tax,” Tavern League President Mike Brown said.

Still, all are in agreement that more money needs to be raised in Wisconsin to fund road improvements. Brown said raising the gas tax across Wisconsin is a better solution than raising the sales tax in one of 72 counties.

“I’d like to say that we’re 100 percent against this PRAT, urge everybody to vote no. But if there’s one positive thing about it, it brings everybody to the table and start a dialog how we’re going to pay for this (roads) cause its unacceptable what we’ve got right now,” said Brown. “So I would urge everybody when you go and take the time to vote and vote ‘no,’ that you go home and pick up the phone and call your state legislator and say ‘we need to fix this problem.’”

Johnson argued current state lawmakers and Gov. Scott Walker have had ample time to fix the way road improvements are paid for in Wisconsin and have done nothing.