Sales tax going up in Goodhue County
Goodhue County will have a half-cent sales tax starting Jan. 1, 2019.
The Goodhue County Board passed the tax increase July 24 to help fund transportation projects over the next 10 years. The county joins 40 others to implement a local option sales tax.
The discussion started with Public Works Director Greg Isakson going through a long list of potential projects the county will have to address in the coming years. Two slated for 2021 are particularly important because they put the county in a position of raising an additional $6 million to pay for them.
The Minnesota Department of Transportation and county together would disconnect Goodhue County Road 14 from Highway 52. The project would instead connect to the westernmost roundabout on County Road 24 in Cannon Falls, costing $4 million.
The second project would be construction of an interchange to replace the intersection at Highway 52, Minnesota Highway 57 and County Road 8 near Hader, costing $2 million.
Isakson said based on current infrastructure investment, which is underfunded by $9 million per year, the average replacement age of the county roads would exceed 120 years.
Isakson explained that the county has fallen behind with over 130 miles that are over 50 years old. Within 10 years, another 170 miles will be over 50 years old.
Even the bridges — Goodhue County has 200— haven't been properly addressed. Isakson said Goodhue County has replaced just two in the last 10 years.
The recommendation for funding centered on the sales tax, which passed in a 3-2 vote; Commissioners Jason Majerus and Barney Nesseth voted against the motion.
Isakson offered other suggestions such as:
• Increasing the annual wheelage tax from $10 to $20 per vehicle. This option would raise around $1,530,000 in three years. However, Goodhue County residents would take on a majority of the cost.
• Increasing the county's property tax levy. The levy would need to be increased by 2.61 percent for each of three years to collect $6 million by 2021.
• Issuing bonds that can be repayable from county's property tax levy. This would require the board to lift its self-imposed bond repayment ceiling or use the bonding capacity until after 2032.
The motion to approve the sales tax was started by Commissioner Ron Allen, who was voting via video conference while undergoing cancer treatments at the VA Health Care System in Minneapolis. Commission Paul Drotos seconded his motion.
During the discussion portion, Drotos stated that it was the board's "constitutional responsibility" to care for the county's roads. Drotos used County Road 21 as an example.
"I recently drove on that road and I can tell you, from experience after they opened the interchange on Highway 58, that there are 529 thumps on that road," Drotos said. "Thumpity, thumpity, thumpity."
"We need roads, and good roads, in Goodhue County," Drotos continued to say. "And this is just one example of a road that without some sort of dealing with roads that are crumbling or inadequate or non-maintained that we're going to have issues throughout the county."
Nesseth said that he doesn't agree with the increase of a sales tax on the county, preferring bonding for the projects. Nesseth said increasing the sales tax would hurt the economy and Goodhue County residents most of all.
Commissioner Brad Anderson said the issue with bonding is the imposing interest it creates, saying the board shouldn't continue to pay for projects long after their completion date.
The county will certify the local optional sales tax to the state by Sept. 30. The state then will begin collecting the sales tax for the county Jan. 1, 2019, raising the tax on items sold in the county to 7.375 percent.