Gibraltar Investigates New Fee to Fund Roads

The Town of Gibraltar continues to investigate ways to pay for both its completed downtown streetscape and future road improvements, including the old downtown. 

“We looked at a wheel tax, special assessments, and then we looked at the idea of using a special transportation utility fee,” Town Administrator Travis Thyssen said. 

Under the property-tax levy limit enacted in 2011, Wisconsin municipalities are allowed to increase their levy only by the percentage increase in equalized value from net new construction. Even with the surge in building during recent years in the county, Gibraltar’s net new construction in 2021 gained only 1.12% in allowable increased levy. The countywide increase in net new construction was 1.2%, which means that as costs rise each year, municipal budgets fall further behind. 

“We could borrow and put it on the taxes, but everyone in town would have to pay for it,” Thyssen said. “This would put a little more of the cost on businesses whose traffic use is a lot more.”

Other local townships have sought voter approval at annual meetings for increased road spending.

Funds collected through the transportation utility fee (TUF) could be used only on expenses related to road improvements, such as surfaces, curb and gutter, sidewalks, lighting and stormwater management. Thyssen said the fee could raise $350,000-$400,000 per year and would enable the town to continue to resurface one to two miles of road each year. 

“We have good roads in Gibraltar, and we don’t want to fall behind on that as the cost of road maintenance continues to rise,” he said. 

TUFs have come under legal scrutiny from groups that say the fee is just a tax by another name. In February, Wisconsin Public Radio reported that the Wisconsin Institute for Law and Liberty is arguing in Outagamie County Circuit Court that TUFs are unlawful taxes. The organization is suing the Town of Buchanan for adopting a transportation utility district and corresponding fees in 2019.

A 2020 legal opinion written by the League of Wisconsin Municipalities stated that local governments have “broad statutory and/or constitutional home-rule powers to create a transportation utility and charge property owners transportation utility fees.” 

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