Lawrence County to revise wheel tax

In order to maximize points and placement in the Bridge Improvement Grant (BIG) award system, Lawrence County Commissioners have revised its current wheel tax and will hear a first reading of the ordinance proposing the changes June 25. The change would affect vehicles 6,001 pounds and up, with an overall increase of $2. Pioneer photo by Jaci Conrad Pearson

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DEADWOOD — As a way of posturing for more Bridge Improvement Grant (BIG) points and subsequent dollars, the Lawrence County Commission decided June 11 to move forward with revising its current wheel tax, with a first reading of the ordinance that officially sets the changes to be heard June 25.

The county’s current wheel tax is $2 per wheel, for up to four wheels on every vehicle.

Per a draft of the ordinance discussed, the wheel tax would change to $2 on a maximum of four wheels not to exceed $8 per vehicle for vehicles weighing up to 6,000 pounds. For vehicles weighing 6,001 pounds or more, the wheel tax shall be set at $5 per wheel on a maximum of two wheels, not to exceed $10 per vehicle.

“So if you own a vehicle over 6,001 pounds, it would cost you an extra $2 a year,” said Commissioner Daryl Johnson. “Everything else stays the same.”

The proceeds from the wheel tax are retained by the county, deposited into the County Road and Bridge Fund and the revenue, as set forth by state law, shall be used only for highway and bridge maintenance and construction.

Since the wheel tax was implemented 2016, around $300,000 has been collected each year in Lawrence County.

A taskforce chaired by Commissioner Randall Rosenau and consisting of Johnson, Treasurer Deb Tridle, and Highway Superintendent Allan Bonnema met to develop a recommendation to the board. 

Rosenau asked Lawrence County Deputy State’s Attorney Bruce Outka to share an email from Doug Kemper with the South Dakota Department of Transportation answering questions regarding the changes proposed.

“The number of wheels does not impact the points, so if you move from $2 a wheel to $5 a wheel, regardless if it’s one wheel or 12 wheels on a 6,000 pound vehicle class, your points will go from four to the maximum of 10,” Outka said.

“That’s where we were looking to go,” Rosenau said.

Commissioner Richard Sleep voiced concerns about the complexity of the BIG score and how points are arrived at, suggesting that perhaps the county’s tax structure should remain as is.

“We’re playing into the state’s hands,” Sleep said. “It gives the state something to play with in there, and we’re going to be just like we were with the 50-50 deal before. It isn’t going to work out the way we think it does.”

Rosenau said bringing up the 50-50, the previous funding level, is where he was trying to go.

“Because it is almost like a game of poker in some aspects, we’ve been upping our percentage, which costs us more in the long run. It costs the taxpayer more to go 50-50 for a road and bridge project. However, if we go $5 one wheel 6,000 pounds and above, we now acquire all 10 points, and we’re getting, what, four now, the way we’re set up instead of 10. By increasing one tire to $5, 6,000 pounds and above, we get 10 points. We don’t necessarily have to do the 50-50 match. What we put in at 50-50 is far more than we collect in wheel tax. There’s no way around it. So if we go $5 one tire, 6,000 pounds and above, we now get all 10 points, and we may not have to play the 50-50 split, saving the taxpayer money. That’s the concept we were going forward with this. That’s why we needed that information from the state.”

Commissioner Randy Deibert suggested that a two-wheel, $10 tax on the larger vehicles may be more appropriate, as they are the vehicles that are doing more damage to the roads.

“I would agree wholeheartedly on that, and that would be my recommendation,” Bonnema said. “That would mean a $2 increase for those vehicles, right now, over the 6,000 pounds.”

Commissioner Brandon Flanagan said the only reason he voted for the $2 a wheel tax in the first place was to qualify for the bridge grant.

“It appears to me that if we just had $5 for one tire, it would still qualify for the bridge grant,” he said. “It wasn’t intended, at least by me, to be an additional tax, which it has become, and will continue to be. So, anything other than one tire at $5, I’ll vote against. I never intended to have this as a fundraiser to build bridges. I wanted it to be able to qualify for those programs.”

“It’s about points and dollars, I understand,” Rosenau said. “My concept being, with one tire or two tires, don’t care, we’re saving money in the long run because we don’t have to put $600,000 in any more.”

Tridle said she’d play devil’s advocate and that the wheel tax does help the taxpayers.

“Because we have a lot of out-of-staters that license here and they don’t ever come here or drive here, but they want to license here because we’re cheaper, and we’re getting wheels tax out of them,” Tridle said. “They’re helping us with the wheel tax, and we do get a lot of money from out-of-staters … and so, they are taking a little bit of a burden off of our taxpayers.”

A wide variety of factors, developed by the state of South Dakota, comprise what is referred to as a BIG Score, which ranks project and funding priority with a point score.

The BIG program was created by the 2015 legislative session in Senate Bill 1 (SB 1). 

SB 1 states that in order to be eligible for a BIG grant, a county must impose a wheel tax. In addition, a county must have a County Highway and Bridge Improvement Plan. The plan should detail proposed county highway and bridge improvement projects in the county for the next five years.

The wheel tax ordinance was first passed Oct. 27, 2015, and a change would require a new ordinance, with a first and second reading. The wheel tax was first implemented and money collected beginning March 1, 2016.

Should it pass through first reading, the revised ordinance will become effective July 29,and implemented and collected by the county beginning Jan. 1, 2020, with all registrations and renewals and for all subsequent months thereafter.

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FanB

Without knowing what the points mean, or what the 50-50 refers to, this entire article is not understandable (see below). Better to use the space to let readers know how this impacts them that telling us the confusing things the commissioners talked about without any context! “The number of wheels does not impact the points, so if you move from $2 a wheel to $5 a wheel, regardless if it’s one wheel or 12 wheels on a 6,000 pound vehicle class, your points will go from four to the maximum of 10,” Outka said. “That’s where we were looking to go,” Rosenau said. Commissioner Richard Sleep voiced concerns about the complexity of the BIG score and how points are arrived at, suggesting that perhaps the county’s tax structure should remain as is. “We’re playing into the state’s hands,” Sleep said. “It gives the state something to play with in there, and we’re going to be just like we were with the 50-50 deal before. It isn’t going to work out the way we think it does.” Rosenau said bringing up the 50-50, the previous funding level, is where he was trying to go. “Because it is almost like a game of poker in some aspects, we’ve been upping our percentage, which costs us more in the long run. It costs the taxpayer more to go 50-50 for a road and bridge project. However, if we go $5 one wheel 6,000 pounds and above, we now acquire all 10 points, and we’re getting, what, four now, the way we’re set up instead of 10. By increasing one tire to $5, 6,000 pounds and above, we get 10 points. We don’t necessarily have to do the 50-50 match. What we put in at 50-50 is far more than we collect in wheel tax. There’s no way around it. So if we go $5 one tire, 6,000 pounds and above, we now get all 10 points, and we may not have to play the 50-50 split, saving the taxpayer money. That’s the concept we were going forward with this. That’s why we needed that information from the state.” Commissioner Randy Deibert suggested that a two-wheel, $10 tax on the larger vehicles may be more appropriate, as they are the vehicles that are doing more damage to the roads. “I would agree wholeheartedly on that, and that would be my recommendation,” Bonnema said. “That would mean a $2 increase for those vehicles, right now, over the 6,000 pounds.” Commissioner Brandon Flanagan said the only reason he voted for the $2 a wheel tax in the first place was to qualify for the bridge grant. “It appears to me that if we just had $5 for one tire, it would still qualify for the bridge grant,” he said. “It wasn’t intended, at least by me, to be an additional tax, which it has become, and will continue to be. So, anything other than one tire at $5, I’ll vote against. I never intended to have this as a fundraiser to build bridges. I wanted it to be able to qualify for those programs.” “It’s about points and dollars, I understand,” Rosenau said. “My concept being, with one tire or two tires, don’t care, we’re saving money in the long run because we don’t have to put $600,000 in any more.”

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