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Business organizations say ‘no' to premiere resort area tax

Survey shows most businesses oppose PRAT

Business organizations say ‘no' to...

LA CROSSE, Wis. - Area business organizations are taking a stand against a proposed Premiere Resort Area Tax (PRAT) in La Crosse County.

The La Crosse Area Chamber of Commerce, Downtown Mainstreet, Explore La Crosse and the North La Crosse Business Association are all saying no to PRAT, the tax La Crosse County has proposed as a way to address $87 million in unmet road needs.

"If they keep coming up with other ways to tax us, it keeps getting harder and harder to make a living at what we do,” said Chris Olson, vice president of the North La Crosse Business Association.

Olson owns the Sports Nut on La Crosse's northside, and worries the premiere resort area tax of 0.5 percent would fall not on tourists, but unfairly on locals and business owners.

"In my business, I add tax onto any of the food I sell, but any of the liquor or beverages ... that's built into the cost of the purchase by the customer, so I can't pass half a percent of tax on them for drinks,” he said.

The PRAT would affect a variety of purchases, from clothing to food and alcohol.

Area business organizations sent out a survey to local businesses, and found about 60 percent of those who responded are opposed to PRAT. There was some overlap between businesses who belong to more than one organization, but of the 2,800 surveys sent out, 190 were sent back within the five-day response window.

"This is significantly going to impact our small businesses, because they are the ones that see tourists the most,” said Vicki Markussen, executive director of the La Crosse Area Chamber of Commerce.

"We are running out of options,” La Crosse County board chair Tara Johnson said. “We have run out of options."

Johnson acknowledged that most of the tax revenue would actually come from local residents but said PRAT shifts road payment responsibility off just the shoulders of county property tax payers.

“What the PRAT does is it opens up the payment to everybody who shops at these businesses in our community,” she said.

Still, some local businesses worry the additional tax would send customers across the border or online.

"They feel strongly about making sure we're not known as a community where you have to pay more state tax for purchases,” Downtown Mainstreet executive director Robin Moses said.

Johnson believes that's a valid question, but so is this:

"Am I going to go to La Crosse where roads are in terrible disrepair, or am I going to go to Eau Claire where they're in better repair?" she asked.

On April 4, La Crosse County residents can vote in an advisory referendum -- meaning it's just gathering public input and is non-binding -- on whether they're open to the idea of a premiere resort area tax.

The referendum is worded as, "The County has identified $87 million in unmet road needs. To pay for transportation infrastructure while eliminating borrowing for county road improvements, should La Crosse County seek authority to levy a 0.5 percent (one half cent on the dollar) sales tax on tourist related items sold, leased or rented though tourist related retailers (approximately 50% of local retail sales)?"

After that, if the county board chooses to continue, it would need to vote in a two thirds majority in favor of enacting a PRAT, and then it would be put to voters again in an official referendum.

To qualify becoming a "Premiere Resort Area," at least 40 percent of the equalized assessed value in the city, town or county wishing to enact such a tax must come from tourism-related retailers, and La Crosse County doesn’t meet that threshold.

If the referendum were to pass, therefore, the Wisconsin State Legislature and Gov. Scott Walker would have to sign off on it, granting an exception to La Crosse County.

For more information on PRAT, you can visit the La Crosse County's website here.


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