Why Pennington County needs a wheel tax

Gary Drewes

As I stated in early 2019 that I would be bringing a wheel tax ordinance for consideration by this commission, the time has come to present that proposal.

As we were told last year by our Highway Department and again just two weeks ago, there is not sufficient dollars for the construction, reconstruction and repair of bridges and roads in Pennington County. This is not a new issue but the longer we fail to provide adequate funding, the further behind the county will be in providing necessary road and bridge maintenance. This is a current public health and safety concern for our traveling public that will only get worse if we fail to implement a plan now to address the issue.

Just a brief history. In 1985, the South Dakota Legislature adopted statutes permitting counties to implement a wheel tax to assist counties with their financial needs, especially for roads and bridges. Since that time, 58 the 66 counties adopted a wheel tax. Pennington County chose not to adopt that tax. Until 2015, all counties were given the opportunity to apply for grant funds from the state or federal government to assist in maintaining, repairing or replacement of roads and bridges.

In 2015 legislators chose to adopt a new statute which divided the available funds into two pots of money. The only way for a county to access or apply for funds in the Local Bridge Improvement Grant Fund (BIG) is to have implemented a wheel tax. In 2015 Pennington County Commissioners adopted a wheel tax ordinance designed to generate about $2.4 million annually. This would then allow the county to apply for funds from the BIG fund. However, this was referred to a vote and voters overruled the county commissioners. When adopting the ordinance, the commission also voted to remove $2.2 million of property taxes from the Highway Department in the FY2016 budget to be replaced with the wheel tax revenue. With the defeat of the ordinance, that $2.2 million was permanently lost for the Highway Department. Consequently, each year since with an aging infrastructure and inflation we have fallen further behind in funding necessary repairs and replacement of bridges and properly maintaining roads.

We currently have 127 bridges located on county roads in Pennington County. Twenty-one of those bridges are currently determined to be structurally deficient, that’s right deficient, and 10 of those bridges have load limits imposed for public safety. We have 88 bridges needing replacement in the course of the next 25 years. I am also reminded that last year alone we had two bridges fail, one collapsed and the other was determined to be too dangerous for further travel and both needed to be replaced.

It is clear that additional funding is required annually and is necessary for public health and safety due to the poor conditions of so many bridges. A wheel tax will spread the responsibility of paying for roads and bridges from the amount property owners pay to all potential vehicle owners. Wheel tax funds are necessary to support the county highway department in its responsibility to maintain and repair bridges and the 837 miles of roads in the county. This should have been adjusted in previous years and since it was not, there is now an immediacy to generate additional funding sources.

I am proposing this ordinance as being necessary for the support of Pennington County government and its existing public institutions and to declare an emergency to exist and for the Wheel Tax Ordinance to take effect upon publication.

In comparison to the 2015 ordinance, I am proposing a modest wheel tax to not exceed $2 per wheel and a maximum of $24 for vehicles with 12 wheels or more. It is estimated this will generate approximately $1.347 million annually. In addition, it will allow Pennington County to apply for funding grants through the BIG Fund.

Pennington County residents pay into the BIG Fund, but currently without a wheel tax we have no way of applying for any dollars to come back from that fund for use by the county. We have no idea how much Pennington County may have received from the BIG Fund during the last four years since we were ineligible to apply.

As the Rapid City Journal pointed out a year ago, “The bottom line is that one way or the other, taxes are going to pay for bridge repairs and replacements. It’s clear that a wheel tax is the best route to take.”

This wheel tax is necessary, not only as a means to secure necessary additional revenue for the Highway Department but also to maintain existing funding needed to prevent a shriveling of present sources of revenue. Any further delay in generating additional revenue for bridges and roads will have devastating consequences to the highway department’s ability to make county bridges safe. Our county infrastructure is at serious risk if we don’t acquire the revenue necessary to properly maintain, repair and replace those roads and bridges that are our direct responsibility.

As per South Dakota law, all wheel tax revenue collected within Pennington County stays locally in the county and is not remitted to the state and is required to be dedicated solely to the construction and maintenance of roads and bridges.

A meeting to discuss the proposed wheel tax will be held at Hill City City Hall on Thursday June 11 at 6 p.m. Several Pennington County Commissioners will be present. A phone in number is available at 605-313-5111. The access code is 574154#

User login