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County approves Local Option Sales Tax

Mon, Sep 1st, 2014
Posted in All Government

County engineer Ron Gregg reviews road and bridge improvements to be funded with the half cent sales tax

At the Fillmore County board’s August 26 meeting County Engineer Ron Gregg gave a detailed presentation describing the need for more road and bridge funding. He then reviewed an eight year capital improvement plan listing specific projects for each year and the estimated cost per year beginning in 2016.

Gregg made it clear that current funding is not keeping up with the rising cost of construction. The state of Minnesota helps fund County State Aid Highways (CSAH), but that funding has stagnated and has not grown with the rising cost of maintenance and construction. Local property taxes or tax levy funding does not provide enough funding for the county’s roads. Fillmore County has 350 miles of CSAH roads. It has 131 miles of county roads (three digit roads) which do not get any state funding and are only funded with local tax levy dollars.

The county currently has four closed bridges and 61 on the county’s 10 year priority list for replacement. MnDOT measures roads every four years and rates them on a Pavement Quality Index, a scale from 0 (the worst) to 4.5. The average rating in the county is 2.7.

During the 2013 legislative session the law was amended to allow outstate counties to enact a Wheelage Tax or a half cent Local Option Sales Tax or both to help with funding shortfalls.

The law requires a specific plan for the Local Option Sales Tax. Gregg developed the eight-year capital improvement plan as required. Revenues estimated to be generated with the half cent tax are about $700,000 annually or $6,186,430 over the eight year period. The county board called for the required public hearing on August 5.

Gregg said the plan has an emphasis on preserving the county’s infrastructure. It also includes some bridge replacements, some reconstruction of roads that are not repairable, and the graveling of some three-digit county roads. Gregg expects about $1.5 million to be used for pavement preservation or chipsealing on CSAH roads. He maintained that if roads are sealed up as soon as cracks develop, the life of the road will be extended. Gregg emphasized, “Extending life of roadways is the key to keeping our infrastructure together.”

The remaining $4.7 million will be used for work on three-digit county roads which are otherwise funded only through tax levy dollars. Plans for improvements on three-digit county roads include 11 bridge structures, nearly eight miles of surface reconditioning on paved roads, and 26.5 miles of graveling on gravel roads.

Gregg noted there would be some flexibility in the plan. The intent is to enact the tax starting at the beginning of 2015 with the first construction season benefiting from the funding in 2016.

Only one person from the public attended the public hearing. Bonita Underbakke thanked Gregg for explaining it so well that the average person could understand.

Gregg noted that the law requires the improvement plan and after all projects in the plan are satisfied the tax will go away. The projects listed in the plan are the only ones that the sales tax funding can be applied to. The tax could be continued according to the legislation as it is now written, if another plan is provided, another public hearing is held, and another resolution is adopted implementing a new or amended plan.

Commissioner Randy Dahl said he much prefers this sales tax option rather than using property taxes to raise revenue to make these improvements.

The board unanimously approved a resolution to enact the half cent sales tax and to proceed with its implementation. Chairman Duane Bakke explained that anything a sales tax is paid on now will be subject to this half cent tax.


The board had a very extended meeting to review several departmental budgets, including but not limited to Facilities Maintenance, Feedlot, Sheriff, Emergency Management, Highway, Airport, Public Health, Veteran Services, Social Services, SWCD, Coordinator, and Information Systems. The county Program Aid is to be $613,347 for 2015 which is $145,469 less than in 2014. The loss in aid may be do to the increase in Ag land values. Proposed 2015 numbers as of August 12 showed an 11 percent levy increase. This number is expected to be reduced before the preliminary budget and levy is approved by mid September.

Other Business In Brief

•An access permit was approved for Nathan and Esther Yutzy, CR 15, Section 34, Bristol Township. Yutzy wants to close the existing access to CR 30 and place a new access to CR 15. Zoning Administrator Chris Graves explained the new access should be safer and has a good site distance.

•An access permit was approved for Dennis and Sevilla Swartzentruber, CR 21, Section 16, Canton Township. The new access is for access to a new home. It was noted that the building site has a CER rating over 65, but has been in pasture for ten years.

•A resolution was adopted in support of an application for the Hazard Mitigation Plan grant from Homeland Security Emergency Management. The county’s plan expired at the end of 2013 and the county is now eligible for grant money for an updated plan. Emergency manager Kevin Beck noted that whenever the President issues a declaration for any state, any government entity in that state can apply for funding which is a 75-25 match. The county will be responsible for 25 percent.

Beck went on to explain that FEMA has changed their format since the county’s last plan was approved. FEMA added some components including terrorism. Beck acknowledged that three communities have applied for money to buy out property on a flood plain and their applications have been denied because the county’s plan had expired.

Beck said three vendors submitted proposals to update the plan. The board approved the proposal from Region Nine Development Commission even though the cost ($28,836) was higher than the lowest cost proposal.

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