The Executive Summary: The Wheel Tax
Note: This is part two of the latest Executive Summary, with Chris Holman. To read part one, check out The Executive Summary: What’s on the horizon for county building projects
By Chris Holman
Portage County Executive
The Wheel Tax (aka Vehicle Registration Fee) passed late last year, too. Why? Well, in addition to our capped budgets, there has been—on average—a 52% increase in the price of asphalt, a 98% increase in the cost of salt, and a 55% increase in the price of oil since 2007. In that same time frame, the county’s budget has been allowed to increase by 0% or the percent of “Net New Construction” in the county, which for 2018 came in at 1.81%. That’s not sustainable, nor is borrowing for the $3 million dollar deficit that the Highway Dept. has been running in order to maintain the current levels of programs and services.
That kind of borrowing strategy can work, but if you rely upon it for too many programs and for too long it puts you onto a debt treadmill of sorts where, before you know it, you’re only making payments on the interest. Unfortunately, many other counties are on that treadmill or are about to get on it, and the Wheel Tax keeps our budget on more solid ground. It also keeps the funding in Portage County, and state statutes designate that funding for transportation purposes only.
The Wheel Tax is not, as some have speculated, being used to update and expand the 33-year old Highway facility. I’ve heard several other exciting and incredibly creative claims about where the funding is going and none of those are true, either. I know that people have a healthy skepticism about government officials whenever they open their mouths, but I learned a long time ago that it’s easier if you just stick to who you are and telling the truth. If you don’t, you’ll lose track of both. But I digress. If the state had kept up with sound funding strategies for our roads, we wouldn’t see wheel taxes being adopted by counties and municipalities all over Wisconsin. Make no mistake, we would still see the costs elsewhere, though (e.g. a gas tax). There’s no free lunch, and as I’ve pointed out above, it’s not getting any cheaper to maintain or build roads and bridges.
That’s why it’s important to build what you can operate and maintain with known and expected revenues whenever you are able to do so. Governments across the country haven’t always done that, which is presenting dilemmas that would be solvable with more prudent planning. For instance, if you build a bridge that you know needs to be replaced in 50 years, it’s probably a good idea to save money over that time frame so that when it comes time to replace it, all or most of the funding is there. That’s
a long-term look at financial sustainability and it isn’t always easy to take that look, but short-term thinking creates long-term problems.
There’s another truth that should concern all of us as well, and it’s just as true whether we’re talking about our personal vehicles, our homes, farm equipment, septic systems and water treatment facilities, or anything else that plays a crucial and often underappreciated part in our day-to-day lives. We do not have the luxury of taking our time or not taking action because the longer we put off fixing the problems, the costlier the solutions will be. We can do our best to maintain what we have for as long as we can, but even that approach will eventually pass the point of diminishing returns and put you into a precarious position where everything fails at once. Not good.
All of these things I’ve mentioned are precisely why I am beginning a budget prioritization process this year. It will take some time to perfect, but prioritizing our discretionary (i.e. non-mandatory) spending— which is only 30% of our budget—puts the County Board, county staff, and the public into a better position for understanding what we’re funding and why we’re funding it. Similarly, if we need to cut a program or reduce levels of service or personnel, we know where to start. Our priorities will change over time and with different county boards, department heads and county executives, but having a process in place that puts us all in a better position to have difficult conversations is something that will be very helpful.
For one, we’re already having those conversations, and secondly it doesn’t look like they’ll get easier any time soon.
So we’ll see what 2019 brings. The only thing I am certain of is that every year brings changes—expected and unexpected. I am hopeful that we can continue on those paths that lead us toward solutions for the challenges we know of today, and if we cannot tie up our loose ends all at once, that we can put in place a solid and sustainable plan for tomorrow. Our future depends on it. Happy New Year!