The Daily Globe - Serving Gogebic, Iron and Ontonagon Counties

Mercer voters approve PRAT

 

April 8, 2021

Tom LaVenture/Daily Globe Town of Mercer education officials, Mary Vaughn, right, and Wendy Schmidt, work behind a COVID-19 protective shield during the spring election Tuesday at the Mercer Community Center.

MERCER, Wis. - Mercer voters approved a half-cent consumer tax to help pay for roads and infrastructure costs in Tuesday's spring election.

The voter approved the Premier Resort Area Tax (PRAT) with 278 votes (59.7%) for the proposal and 187 votes against. This contrasted the previous PRAT attempt in the 2019 spring election when the proposal lost 507-264.

Mercer is eligible to utilize PRAT as a municipality with at least 40% of its equalized assessed property value in use by tourism-related retailers.

The PRAT is a consumer tax that allows seasonal visitors and part-year residents to share the burden of roads and infrastructure costs with Mercer's overall population of approximately 1,445 residents. According to the town board, the number of visitors and part year residents outnumber the actual population by several thousand.

Once in effect, the cost of tourism related sales will be 50 cents per $100. The goal is to reach $12,500 in annual sales per capita to acquire the $250,000 needed for roads and infrastructure, John Sendra, town board chair, said at previous meetings. Sendra could not be reached for comment on Wednesday.

If PRAT would not have been approved by the voters, the remaining options were to increase the property tax to $52 per $100,000 of valuation, or $125 annually for a $250,000 home, or to take out transportation loans, he said.

Mercer has 95 miles of paved roads and 159.4 miles of total road miles to maintain, which is second in the state only to Minocqua with 160 miles of roads, Sendra said. State transportation aid levels remain constant and additional funding is needed for approximately $250,000 in annual road related costs, or an estimated $2.3 million for the town's five-year roads plan.

Residents who opposed PRAT at public meetings expressed concerns that the funds raised would be used for purposes other than the voters approved. The state Department of Revenue lists what PRAT funds may and may not be taxed the allowed uses at revenue.wi.gov.

The PRAT would be applied by any merchant involved in sales, licenses, leases or rentals of products or services and who is subject to state sales tax. Captured funds are remitted to the Department of Revenue and back to the town of Mercer through a funding account.

Most but not all items in retail stores, bars and restaurants, liquor stores, sporting goods, golfing, lodging, entertainment, camping to include recreational vehicles are subject to PRAT. A complete list of categories and sales covered under PRAT can be found online at revenue.wi.gov/Pages/FAQS/pcs-premier.aspx#premier4.

The election results are considered unofficial until the county canvasing committee certifies the election and the town board approves the results at its next regular meeting.

 
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