Eau Claire City Council Approves Higher Wheel Tax in 2026 Budget

The Eau Claire City Council officially voted to approve increasing the vehicle registration fee, or wheel tax, at its meeting this week.

Beginning next year, the annual vehicle registration fee will increase from $24 to $50. During a public hearing on Monday covering the budget, City of Eau Claire Finance Director Kitzie Winters advised the council that the increase would bring in an additional $1.2 million in revenue that was needed to balance the 2026 budget.

While the City Council voted to approve the increase 7-3, council members who voted in favor of it acknowledged that it would place additional financial strain on constituents. They also noted that the wheel tax is one of the few tools the city has to increase revenue and maintain its other services.

Finance Director Winters outlined some of the alternate plans she had considered to balance the budget, which required a reduction in service in other areas. “I ran different scenarios of the cost of the pool being open for one day, but that didn’t make any sense,” she said. “You know, it would be a reduction in hours of pool, it could be a reduction in, you know an entire day the library’s open, shortening up that gap, or the time on transit in the evening was part of one of my scenarios. It could be, you know, pretty much closing anything for a day.”

The Eau Claire City Council also approved an amendment to sunset the wheel tax increase by the end of 2028. Council member Joshua Miller introduced that amendment, arguing that potential changes following the 2026 election and the next biennial state budget process in 2027 could bring additional state funding. City officials also plan to explore additional revenue-generating options, like a local sales tax, to reduce the need for the increased vehicle registration fee.

A number of other Wisconsin municipalities have also pursued increased vehicle registration fees as they struggle with inflation and inadequate state funding for transportation projects. According to a Wisconsin Policy Forum report, nearly half of state residents will pay a wheel tax by the end of this year. The report also found the fees will bring in a total of over $70 million of revenue in the 2025 fiscal year.