Glen Ullin may travel where no other city in North Dakota has ever gone by having people chip in when they fill’er up.
The idea of a 2-cent tax on vehicle fuels is being proposed by new City Councilman Sid White, who brought the idea from his home state of Washington. White thought a small tax — paid by anyone fueling at the town’s two pump stations — could help build a kitty toward future street improvements and take the burden off the community’s elderly, fixed-income residents.
“It’s a way to think outside the box and a quicker avenue toward some changes,” White said.
His proposal caught city attorney John Mahoney off guard. Mahoney said he was kind of surprised to find that a tax on vehicle fuels is allowed under an entity’s home rule charter.
Mahoney said the Legislature clarified home rule taxation powers in 2011 and provided an exemption for vehicle fuels. He said the tax could only be levied on fuel actually sold in town, not delivered by way of bulk sales in the countryside.
People are also reading…
“If Glen Ullin primes the pump on this, there might be other municipalities that might like to do it,” Mahoney said.
Kathy Strombeck, a state Tax Commission research analyst, said a few communities have looked into the concept, but none so far have adopted the tax. If Glen Ullin does, the challenge may come in actually collecting it.
“The state has no history of administering local fuels taxes for cities or counties,” she said.
White said about 750,000 gallons of vehicle fuel are sold annually in Glen Ullin, adding to about $15,000 in revenue. That’s not a lot — not at 20 to 40 cents a fill — but it could make the city’s payment on a street improvement loan or other fixed costs, White said.
He said the town gets a fair amount of commuter traffic and people who use the city streets while fall pheasant hunting or en route to recreate at Lake Tschida.
“This could be an alternative way to fund repairs without putting a huge burden on the community,” White said.
He said the concept is getting mixed reviews from rural residents, but adds the majority say it would be an easy way to help fund improvements for a town they use often, with no property investment.
Mahoney said the process would require the city to amend its home rule charter, then citizens would have to approve the amendment in an election. White says he’d like to see an election sometime this spring so the city could start making plans for street and other repairs.