Surprising Stuff

Zombie projects, like Zombie politicians, keep coming back to life to haunt the citizenry.
Zombie projects are projects that citizens believe they have killed and buried but rise from the dead to again haunt them all over again. Another Zombie project has reemerged. After being buried two years ago it has now joined the Zombie project list. It is called a “Premier Resort Area Tax”. It doesn’t matter how badly a Zombie project is defeated, it will come back to life every few years. Zombie projects include the parking garage, the road through Bigfoot Park, moving the city’s boat launch and a housing development on the Hillmoor Golf Course Property. Since the City of Lake Geneva does not meet the state’s legal requirements to impose the Premier Resort Area Tax, it should be a dead issue; however, there are two ways the city can still get approval. The state can amend the law, thus making it legal, and/or the residents can approve the Premier Resort Tax in a referendum vote and the state could then add Lake Geneva to its Premier Resort Area Tax list. Under normal conditions, neither of these scenarios should be likely to happen, but Lake Geneva’s city government is desperate. It is losing its share of the room tax to the Chamber of Commerce and that extra $1.9 million from TIF taxes every year. That money to the city is like economic heroin. Lake Geneva is not only dependent on it; it is addicted to it. The city does not have the fortitude (nor the will) to cut its spending, so it is looking for additional sources of revenue to replace the room tax and TIF revenues that seem to be drying up. After obtaining a water rate increase and the transfer of the Fire Hydrant Rental Fee to the water bill, the city has now set its sights on the “Premier Resort Area Tax.” The following article was written two years ago, and it, like a Zombie project has come back as a Zombie article retort to haunt the administration.

Here’s Former Alderperson Terry O’Neill’s old letter:

“Premier Resort Area Tax”.

The City of Lake Geneva is always after additional sources of revenue, which means raising or creating new taxes, fees and fines for citizens and/or tourists to pay. As if the extra $2 million from TIF, borrowing $2.5 million and doubling parking rates for another half million bucks are not enough extra income for the city, they want a new TAX, called a “Premier Resort Area Tax.” A few places like the Dells, Bayfield and Eagle River already have the “Premier Resort Area Tax” collections that range from 0.5% to 1.25%. There are only two requirements for the city to impose this tax on the public:

  •  At least 40% of the equalized value of the taxable property within the city is used by tourism-related retailers.
  •  The city must then enact an ordinance or resolution declaring itself a “Premier Resort Area”. It is my understanding that the city does not meet the 40% requirement and therefore they will be looking for an exception from the state, like Bayfield and Eagle River received.

The single most important fact with the “Premier Resort Area Tax” is that it would primarily be a tax on the citizens and not tourists, because a tourist season is only a few months of the year, but residents, who live in Lake Geneva all year long, would be paying that tax everyday all year long on virtually all purchased items and services within the city. The “Premier Resort Area Tax” is a hidden tax in that it is imposed on the retailer who will pass it on to the buyer (residents), but rest assured that the extra cost would get added to the price of the local products and services either as an extra tax (which they can do), or as an increase in the cost of their product or service. The “Premier Resort Area Tax” applies to virtually all shops, store and services that charge a sales tax, including gas stations, bakeries, restaurants, etc. Don’t expect to hear any negative comment about the “Premier Resort Area Tax” from the city government or from any local news agency, because public understanding and awareness could turn into an outrage and that would hurt the city’s chance of getting it approved at the state level and then later at the local level.” by Terry O’Neill

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