Village of Lomira Contemplates Continuing Wheel Tax

Trustee Gary More gave a presentation on the Village of Lomira’s wheel tax to a small crowd of residents at a village public hearing on Wednesday, January 14.

In 2021, the village created a $30 vehicle registration fee (wheel tax) to help cover the cost of street repaving projects. This equates to roughly $2.50 per vehicle per month for village residents. Per Department of Transportation (DOT) regulations, the funds accumulated from a wheel tax can only be used for road-related expenses. The village ordinance that instituted the wheel tax will expire August 31 unless a referendum to continue the wheel tax is passed.

Vehicles exempt from wheel taxes include, but are not limited to, “vehicles registered at more than 8,000 pounds, dual purpose farm trucks, motor homes, buses, trailers, mopeds, motorcycles, and any other vehicle classes exempted by statute or administrative rule.”

Trustee More explained in his presentation that heavier vehicles, such as large trucks, are not charged the wheel tax because “they are extremely highly taxed by the state.”

At the beginning of his presentation, Trustee More provided a statewide overview of wheel taxes.

“Since 2021, when Lomira instituted the wheel tax, municipalities with wheel taxes have grown in numbers from 28 in 2021 to 54–almost double in that five-year period. Six of those original 28 municipalities have increased their fees. Every municipality that had a wheel tax in 2021 still has a wheel tax,” stated Trustee More. “There are now 14 counties that have instituted a wheel tax as well.”

In addition to Lomira, other area municipalities with wheel taxes include Eden ($30) and Iron Ridge ($10). Municipalities set the wheel tax fee amount. Usually, the fee is between $10 and $40.

Lomira’s $30 wheel tax generates roughly $60,000 each year. Projects funded by the tax include portions of Third Street, Water Street, Grove Street, Acorn Street, South Avenue, and Meadow Lane. The wheel tax fund has a remaining balance of roughly $153,408.

“Why does Lomira need to continue the wheel tax?” posed Trustee More. “Well, separately, limited tax levies cannot keep up with inflation. The second thing is: state transportation aid continues to decline.”

“These are from the Bureau of Labor Statistics, the Midwest region,” Trustee More continued. “Basically, the average per year inflation is 2.75% over that ten-year period. This equates to a 30.4% increase in the cost of goods over that period.”

According to Trustee More, village revenue kept up with inflation between 2016 and 2019, increasing by 4.9%. However, this decreased when the state changed revenue limits for municipalities.

“The state sets the limits. We don’t,” stated Trustee More. “It’s determined by new construction. In 2019, that’s when we started flattening out . . . Then, we drop to 1.4%. We’re falling behind [inflation].”

Along with reduced revenue, the village has experienced reduced state transportation aid since 2015.

“They’ve been declining through that entire period by about 1.76%. The overall reduction in the last ten years is a 22% drop,” explained Trustee More. “We’re trying to recover from that kind of a loss.”

Trustee More went on to explain that the wheel tax helps the village obtain additional funding for road projects.

“The village undertakes street projects only after securing financial assistance,” stated More. “We don’t have that kind of income, so we end up doing grants. The wheel tax makes those possible.”

Most grants require municipalities to provide matching funds. The percentage of total project costs that the municipality must provide the funds for differs depending on the grant. Some grants may cover 50% of the project costs and require the municipality to cover the remaining 50%, while others may require a larger or smaller percentage from the municipality.

“If we don’t have the wheel tax, we don’t have the seed money,” said Trustee More.

The board has three options concerning the future of the wheel tax. It can allow the tax to expire on August 31, hold a referendum during the fall election to renew the wheel tax, or change the wheel tax ordinance (Ordinance 317) so that it no longer requires a referendum.

“The purpose of the ordinance is to limit the time. We didn’t want the wheel tax to be out there forever. We wanted to be able to reconsider where we stood financially,” stated Trustee More.

Trustee More added that going to referendum would cost the village about $3,000 and may cause some inequality, as the wheel tax would expire before the referendum, leaving some residents paying the tax and others not, depending on when they registered their vehicles. He also expressed his desire to change the ordinance because he believes that a referendum likely would not pass.

“I guarantee you that no one in this room wants a tax–not one. But without it, things start to disappear,” Trustee More said. “If we don’t have a wheel tax, and we need to repair roads because they start falling apart, what happens is the pool goes away, or the leaf vacuum is on the chopping block. They’ll start dropping like flies because we’ll need money from somewhere.”

When he concluded his presentation, Trustee More opened the floor for residents and other board members to comment or ask questions.

“Do you have any indication on if the state aid for villages and cities is going to increase this year?” asked one resident.

“I think we have the 2026 numbers that have come through now. They are slightly up,” answered Trustee More. “There’s no indication that there’s a trend.”

Another resident inquired if the village could send updates on what revenue the wheel tax has accumulated and what projects it has been spent on.

Administrator-Clerk-Treasurer Jenna Rhein responded that she could add the information to the village newsletter.

During the public comment portion of the hearing, Trustee Eric Kohlmann shared that a repaving project on a portion of South Avenue was completed using $6,000 in wheel tax funds, though the section of street is primarily used for private parking per a village agreement with Haak Chiropractic.

“The property owner was willing to throw in $12,000, which is payable over three years,” explained Trustee Kohlmann. “$6,000 was coming from the Village of Lomira. If you assume a roughly 4% interest rate conservatively, we lost another $450-ish . . . It comes out to be roughly $5 per taxpayer that just paid for a section of road that none of you will likely drive on.”

When deliberating on whether to complete the repaving project, the village also discussed abandoning the roadway and drafting easements to the adjacent property owners.

Director of Public Works Nick Roskopf added that abandoning the roadway was not as straightforward as it appeared since utilities run beneath it, meaning easements would be required not only for abutting property owners, but also for the village.

After the public hearing, the regular village board meeting began. During the meeting, a poll was taken among present board members on whether there should be a wheel tax referendum. President Don Luedtke was absent from the meeting.

All six trustees were in favor of opting not to hold a referendum and instead changing the ordinance if the village decides to continue the wheel tax. The trustees also agreed to include a timeline to reevaluate the necessity of the wheel tax within the ordinance if it were changed.

No formal vote was made regarding the continuation of the wheel tax.

Board Matters:
• During the board meeting, Joe Martirano and Sheri Scott of MSA Professional Services presented on the upcoming wastewater treatment plant disinfection treatment project. The project involves installing an outdoor UV disinfection system and replacing aeration blowers. The disinfection system must be installed by 2029 to meet updated DNR permit requirements. The estimated project cost is $1.71 million. MSA and the village plan to hold a public hearing next month to inform residents about the project.
• The board discussed granting a Class B retailer’s liquor and fermented malt beverage license to 211 Lomira LLC, doing business as (dba) Kountry Korners, agent Akil Ajmerz. A motion to grant the license was made by Trustee Joey Jewell and passed unanimously.