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KRM tax stirs up mix of opposition

Holly Caretta, an employee of Mayfair Rent-A-Car talks with Paul Renning in the lot outside the 2727 E. Layton Ave. location Monday. They are reflected in a Toyota Prius rental car.  Photo by Charles Auer

Holly Caretta goes over a contract with Jim Cenagy, who was returning a rented car to the Mayfair Rent-A-Car, 2727 E. Layton Ave., Monday. Photo by Charles Auer

Sean Ryan

Pro-transit groups, residents and car-rental companies are scrambling for the best argument for why someone else should pay for the Kenosha-Racine-Milwaukee Commuter Link.

The Wisconsin Senate and Assembly versions of the state budget propose paying for the estimated $200 million project with a car-rental tax increase. Car-rental companies and pro-train groups oppose the tax increase, preferring a sales tax to raise the project money.

But a sales tax increase in Kenosha, Racine and Milwaukee counties would incur the wrath of residents.

“We are definitely butting heads on that,” said Kandy Meyers, president of the Racine Taxpayers Association, which opposes any tax increase for the project. “But we just have to on this point.”

The Wisconsin Car Rental Alliance is threatening to sue the state if the car-rental fee increase stays in the budget. The tax would crush car-rental companies by scaring away customers, forcing the companies to hire fewer workers and buy fewer cars, said Dan Ewald, president and owner of Mayfair Rent-A-Car, which has 10 stores in southeastern Wisconsin.

“We’ve been put in a position now where, quite frankly, the industry is going to have to be quite aggressive on this,” Ewald said. “Frankly, we’re just not seeing much cooperation on this from Madison.”

The Coalition for Advancing Transit, on the other hand, would settle for the car-rental tax but prefers the sales tax increase to pay for the KRM project, said Kristi Luzar, program manager for the Urban Economic Development Association of Wisconsin Inc., a Milwaukee-based member of the coalition.

“Right now it’s tricky,” she said, “because we want to still be engaged in the process, and you don’t want to create such an anti-whatever stance that you can’t really advocate for anything.”

Ewald and Luzar agreed the sales tax would be a steadier source of money than car rentals. That, in turn, would improve the region’s chance to get federal money to help pay for the project.

The transit coalition this week will send out an alert to members asking them to contact legislators to lobby in favor of the sales tax, Luzar said.

Meanwhile, groups such as Meyers’ taxpayers association will keep pushing for the KRM to use only private money.

“It’s not that we completely disagree with having a train or anything,” Meyers said. “Our group’s purpose is to take the hard line and make sure it makes fiscal sense.”

The Coalition for Advancing Transit has not approached the Wisconsin Car Rental Alliance to team up in a push for a sales tax, Luzar said. Although there may be other groups that would stamp their feet against a sales tax increase, organizations such as the transit coalition or car rental alliance can make their voices stand out, she said.

“I think you could have just as big of a politically charged fight with the rental-car fee, too,” Luzar said, “just because it’s such a small population you are targeting.”


  1. I strongly disagree that a sales tax to advance area transit would “incur the wrath of residents”. For one thing, poll respondents in Kenosha and Racine have consistently supported the KRM Line concept though it’s common knowledge that a sales tax would probably be necessary for that; for another, it would remove the burden of transit from property-tax rolls, where they have been for decades. Kenosha, for example, pays nearly $2 million annually to support local transit. And thirdly, at area RTA hearings I attended over the winter and spring, the sales-tax topic was hardly mentioned by anyone who spoke.

  2. The whole thing misses the point: While we argue about where the money will come from to pay for it, I don’t hear anyone arguing the case for where the riders will come from, to sustain it.
    There’s a reason Amtrack is government subsidized…it’s the PBS of transportation.
    Do the math! And try to understand the independent, freedom-loving American citizen. Realistic ridership projections (I stress ‘realistic’)…it would be cheaper to buy all the riders a new economy car…heck, at the same time we’d help the bailout of GM (Government Motors)
    Of course, like everything else…we could simply declare it a ‘crisis’, relate it to global warming, errr I mean climate change, and government simply mandates it’s use.

  3. I too would prefer the sales tax option, but will do with the rental car fee. It is time for Southeast Wisconsin to move forward with transit!

    @Warren ALL forms of transportation are subsidized.

  4. I personally disagree with the tax on car rentals. I do not rent your typical car when I need to. I use a service called Zipcar. This service offers insurance, gas, mileage and maintenance costs all rolled into an affordable and clean rental car. The going rate is $7 an hour. If I only need a car for an hour, that raises the price to $20. It doesn’t even pay to go get groceries with (my main usage.)

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