Sales tax may be key to new water efforts

Published 12:00 am Thursday, May 15, 2003

After the Shell Rock River Watershed District got a ticket to become reality after a three-year debate, the next focus will be the funding for the governmental body that would cover a third of the county.

Being a tax authority independent from the county and city, the district can levy property taxes. But, the watershed district backers are reluctant to use that tool. Rather, they prefer to count on a proposed one-half percent city sales tax.

Board of Water and Soil Resources Water Management Specialist Jim Haertel explained that the properties within the Shell Rock River watershed have enough tax capacity to sustain the watershed district’s maximum levy allowed by the state.

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Haertel said the average contribution by each property owner in more than 40 watershed districts in the state is between $5 to $15 a year.

However, Chamber of Commerce Executive Director Marge Hamersly, whose organization has become explicit in its support of the watershed district, pointed out the taxing or assessment against properties would be the least preferable choice.

&uot;Whether it is by taxing or by assessment, it is going to be a point of division between rural areas and lake(shore) owners and people who live in the city of Albert Lea. Therefore, we are thinking some kind of equitable means of funding,&uot; she said. &uot;It does seem a local-option dedicated sales tax would be more equitable than either taxing or assessment.&uot;

Chamber Lake Committee Chairman Don Sorenson said the watershed projects would need $1 to $1.5 million every year. The figures exactly match the expected revenue from the sales tax.

The Albert Lea City Council earlier this month adopted a resolution to pursue the one-half percent sales tax for a 10-year-period.

The city last year had brought the sales tax proposal to the state legislature, which has a statutory authority to allow or disallow a local-option sales tax,

and failed to gain enough support.

This time, the council amended the proposal by designating 100 percent of the sales tax revenue to lake improvement, excluding downtown redevelopment projects that were discussed last time. Mayor Jean Eaton said the city might put the proposal to a referendum this fall before taking it to the next year’s legislative session. It must pass the legislature and be approved by local voters to become law.

BWSR board member Ginny Imholte questioned how the city’s funds can be used by other governmental entities. City Manager Paul Sparks answered that it would be possible if the city entered a contract for projects with the watershed board.

The county is concerned about

adverse effects of possible taxation by the watershed district on the county’s taxing ability. But Haertel said the county’s levy would be free from whatever the watershed district would do for funding. But, Gabrielsen stated it would still trigger sentiment among residents against taxation in general.