Funds would also take buses off property tax
By LARRY SANDLER
Posted: Dec. 20, 2006
The new Southeastern Wisconsin Regional Transit Authority is considering local sales taxes to help pay for a proposed commuter train line and to take public buses off the property tax in Milwaukee, Racine and Kenosha counties.
Authority members could vote Jan. 9 to ask the Legislature to authorize the new sales taxes. But other funding options, including property and gas taxes, remain under consideration, authority chairman Karl Ostby noted.
Under the sales tax plan, the three-county authority would be able to levy a 0.05% tax - or 5 cents on each $100 purchase - to cover the local share of building and operating the KRM Commuter Link, a train line that would connect Kenosha, Racine, Milwaukee and its southern suburbs. Federal and state aid and passenger fares would pay most of the train line's $237 million construction cost and $14.7 million-a-year operating cost.
The authority also would ask the state to give each of the three counties the option of levying up to 0.45% more in sales taxes to replace property tax support for local public transit systems. If lawmakers agreed to both the train and bus taxes and Milwaukee County opted for the maximum bus tax, the sales tax on most items would rise from 5.6% to 6.1% when the new taxes are added to existing state, county and stadium taxes.
A 0.05% sales tax in the three counties would raise $8 million a year. That would be enough to cover both the local share of the train line's annual operating cost and the debt service on the bonds issued to fund construction, transit authority spokesman H. Carl Mueller said. The transit authority itself is funded by a rental car tax that is raising about $600,000 a year.
As currently planned, the KRM Commuter Link would run 14 round trips each weekday - and seven on Saturdays, Sundays and holidays - with stops in downtown Milwaukee, the Bay View neighborhood, Cudahy, South Milwaukee, Oak Creek, the Town of Caledonia, Racine, the Town of Somers and Kenosha.
Shuttle buses would link the trains to downtown destinations, Mitchell International Airport and the University of Wisconsin-Parkside. Passengers could transfer to Chicago's Metra commuter trains at either Kenosha or Waukegan, Ill.
Unlike Amtrak's faster Milwaukee-to-Chicago Hiawatha line, the commuter trains would be aimed at workers, students and shoppers seeking relatively short trips between downtown Milwaukee and its suburbs, or from suburb to suburb, not at people traveling between downtown Milwaukee and downtown Chicago. Like Amtrak, commuter trains run on existing freight rail tracks.
By calling for both train and bus taxes, the authority would respond to two concerns:
• The push to establish the proposed commuter rail line. Business leaders portray it as a major economic asset for the region's future, by providing greater access to jobs and encouraging development around train stations.
• The plight of the Milwaukee County Transit System - and to a lesser extent, its Racine and Kenosha counterparts - as competition for limited property tax revenue continues a cycle of fare increases and service cuts. Some public officials, riders and bus drivers have pressed for a dedicated revenue source to protect the buses that tens of thousands of people ride to work and school every day.
Ostby said authority members consider the rail line their first priority, as they try to meet a June deadline for applying for federal aid. But the Legislature told the authority to recommend funding options for other forms of transit as well, and two authority members - George Torres, Milwaukee County public works director, and Len Brandrup, Kenosha Transit chief - have urged their colleagues not to ignore bus needs.
The Milwaukee County Board has failed in several attempts to ask the Legislature for a new sales tax to support the bus system, or even to hold an advisory referendum asking voters if they would support the idea. The concept became entangled in similar attempts to wean parks and cultural programs off the property tax, and both efforts ran into County Executive Scott Walker's opposition to any new taxes.
The rail line, meanwhile, has attracted relatively little controversy to date, but that could change once new taxes are on the table, Ostby conceded.
"I think everybody loves things until they have to pay for them," Ostby said.
By comparison, the five-county sales tax levied to pay for building Miller Park is 0.1% - twice the rate under consideration for commuter trains alone, or one-fifth of the combined bus and train tax. The stadium tax drew bitter opposition when the Legislature imposed it in 1995.
Sales taxes are among the most common ways of funding new commuter rail lines nationwide and transit systems in metropolitan areas about the same size as Milwaukee, the Southeastern Wisconsin Regional Planning Commission staff has told the authority.
State Rep. Jeff Stone (R-Greendale), who sponsored the legislation creating the transit authority, said it was too early to predict how the Legislature would react to a request for new taxes. Packaging the bus taxes as a replacement for current property tax funding would be essential, Stone said.
Ostby said new property taxes would likely be less popular than new sales taxes. Visitors also pay a larger share of sales taxes than of property or gas taxes, which fall more heavily on residents, Stone said.
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