Taxpayers in Hennepin and Ramsey counties will find their wallets a bit lighter when it comes time to renew their car tabs this year. Both counties have opted to join Anoka, Washington, Dakota, Scott and Carver in collecting a so-called “wheelage” tax from the owners of vehicles registered in their borders. The $10 tax will likely be effective immediately, and is so far set to only apply to cars and trucks actively registered in Hennepin and Ramsey counties (or one of the other counties that already has a yearly wheelage tax), not bicycles, motorcycles, scooters or trailers. 

Interestingly, the new tax is being described as a “user fee” by local and state government authorities like Hennepin County Commissioner Peter Laughlin, presumably to ward off constituent angst at the introduction of another new tax, particularly since we have recently seen a massive tax increase on tobacco products as well as other “user fees” related to the subsidizing of the upcoming Vikings stadium. Laughlin specifically says that it is a “user fee, so it’s paid by people who use the roads and bridges.”

The $10 fee is designed to bolster dwindling county coffers that should be taking care of infrastructure issues like road resurfacing, potholes, crumbling curb facings and other “pain points” for those driving on the road for business or pleasure. While both Hennepin and Ramsey have both generally committed to using the estimated $9 million and $3 million (respectively) annual income to kick off deferred maintenance issues, Laughlin himself hints that the money might be earmarked for a different purpose, specifically mentioning that there are projects in the works to help ease congestion, including “coordinated light systems” complete with “smart lights” that can adjust to meet changing traffic needs. 

What do you think about the new “wheelage tax?” Do you believe it will really be used to help make our roads better? Only time will tell…

Source: WCCO/CBS Minnesota, “Hennepin & Ramsey Tack on $10 Wheelage Tax on Drivers,” Reg Chapman, July 16, 2013.