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Public favors one-half cent county sales tax, Wadena Board hears

County Engineer Ryan Odden, far right, explains the on-half cent sales tax proposal at the Oct. 21 public hearing in Wadena.

By Rin Porter

     The Wadena County Board of Commissioners held a public hearing on Oct. 21, at the Courthouse to give information to the public about the proposed one-half cent county sales tax to be established in 2014.

     The proceeds of the one-half cent sales tax would be used for transportation projects within the county, including county road repairs and maintenance, public transit costs, road striping, and other necessary projects.

     If the county board approves the tax, then each year, the County Engineer would be required to come before the public at a hearing to explain the projects proposed by the Highway Department to be paid for by the one-half cent sales tax.

     About ten members of the public attended the public hearing on Oct. 21, plus four commissioners, the County Auditor/Treasurer, and County Engineer Ryan Odden, who gave a 15-minute presentation about the proposed tax and how it would be used.

     After Odden answered a few questions, Board Chair Dave Hillukka asked those in attendance to share their views about the tax.

    Only one person, City of Wadena Economic Development Director Dean Uselman, spoke in opposition to the tax, and his opposition was not strong.  Uselman said he had concerns that people from outside the county would stop coming to Wadena to shop if the tax were established.

    Uselman also said that the City was considering establishing its own one-half cent sales tax, which is allowed under the same Minnesota Legislature new rules, which allowed the county to have a one-half cent sales tax.  Mayor Wayne Wolden said he favored the tax.

     Former county commissioner Ralph Miller said, “It’s 50 cents on a hundred dollars.  That’s not a lot.  It wouldn’t stop me from shopping here.”

     Commissioner Bill Stearns said, “People from Minnesota go to Fargo to the mall and buy clothes and North Dakota has a 7 percent tax on clothing.  Minnesota doesn’t tax clothing at all, but these people still go to Fargo to shop.”

     Uselman shared recent statistics showing that Wadena is third highest in Minnesota for retail spending (excluding the Metro area and Moorhead).  That means than thousands of people come to Wadena to shop.

     The one-half cent sales tax would be collected by the state on the same items that are already taxed.  It would not apply to food, clothing, or other items that are not taxable in Minnesota.

     Odden presented figures estimating that the average Wadena County resident would pay 62 cents per year for the new one-half cent sales tax.

     The county is estimated to receive about $821,000 in sales tax revenues in 2015 – the first full year the tax would be collected – as a result of the one-half cent sales tax.  In 2014, the tax would be collected only April 1 to Dec. 31, and the estimated revenues are $597,000.  

     One effect of the one-half cent sales tax would be to reduce the county’s property tax levy by about $155,000 in 2014 pay 2015, and perhaps by a greater amount in succeeding years, depending on the success of the tax collection.