OUTAGAMIE COUNTY, WI (WTAQ-WLUK) – Outagamie County approved it’s budget Monday night.
The approval came with a veto from the county executive and a potential lawsuit.
County leaders approved a half-percent sales tax hike in May. It’s expected to bring in $20 million.
The majority of the budget would go towards debt and tax levy reduction, $5 million to capital improvement and $3 million to municipalities and schools.
County Executive Tom Nelson gave a partial veto to the $5 million in projects.
“Of the money, there was specifically $5 million that I believe was not being spent in a way that’s consistent with the law,” Nelson said.
Outagamie County resident Jeff Krueger agrees with Nelson.
Krueger filed a legal claim against the county in September for its plan to spend $5 million on projects.
Krueger’s lawyer, Anthony LoCoco with Wisconsin Institute for Law and Liberty, tells FOX 11 spending sales tax revenue on projects is illegal.
“Using a sales tax as an additional source of revenue for brand new spending, as is being suggested, that’s not something that directly reduces the property tax levy. At best, it indirectly reduces the property tax levy by preventing an increase, and that’s not good enough.”
Outagamie County’s lawyer believes it is legal to use sales tax revenue on new projects.
“In 1998, then-attorney general Jim Doyle, said that sales tax has to be used for direct levy reduction or to pay for anything that the county would levy taxes for, and capital projects certainly fall into that category,” Outagamie County Board Chair Jeff Nooyen said.
Krueger’s lawyer says they may pursue further legal action now that the budget has passed. Brown County is facing a similar lawsuit over its half-percent sales tax increase that started last year.
Outagamie County’s budget and sales tax increase will go into effect on January 1st.
