• KRM rail line delayed as leaders argue over how to pay for it
• Needs local funding source before feds commit money
• RTA working on more comprehensive plan, including public transit funding, to submit to legislature and governor
• Supporters hope line would relieve congestion while I-94 is under reconstruction

Disputes over funding have put the breaks on a plan to build a Milwaukee-to-Kenosha commuter rail line, as area leaders search for a local funding source for the proposed $200 million project.

Disagreements over how to fund the KRM train line stalled in part because of funding questions for other area transportation, including buses.

The Southeastern Wisconsin Regional Transit Authority suggested lawmakers increase the tax for vehicle rentals in Milwaukee, Racine and Kenosha Counties from its current rate at $2-per-car to $15-per-car, but legislators did not approve its inclusion in the 2007-'09 state budget, according to Ken Yunker, deputy director of the Southeast Wisconsin Regional Planning Commission.

The $13-per-car increase was projected to have generated $40 million and would have covered the local share of the KRM capital and some operating costs, Yunker said.

The RTA suggested the rental tax when opposition arose to a 0.5 percent local sales tax increase for all public transit in the region. Most metropolitan areas use a fraction of their sales taxes to fund transit, Yunker said.

But there is still talk the RTA may consider recommending a sales tax to the legislature and Gov. Jim Doyle this year.

The seven-member RTA board is currently working on a larger plan to address both KRM and public transit funding in southeast Wisconsin. The RTA has until November to make its recommendation to lawmakers and the governor, but some board members hope to be done sooner, Yunker said.

"Part of criticism was (the RTA was) moving ahead on commuter rail but not all public transit," Yunker said. "They're stepping back and coming up with a proposal for all public transit."

With I-94 reconstruction between Milwaukee and the Illinois-Wisconsin state line to start in 2010, supporters of KRM hope the rail line will be built and in operation to lessen congestion on the roads. If the RTA's expected funding plan is worked into the 2009-'11 budget and approved, construction on KRM could begin by 2009 and the line operational by 2013 at the earliest, Yunker said.

Federal "new starts" dollars would fund $100 million for the line's construction, but a guaranteed local funding source needs to be secured before that money is available. Without the approval of the increased car rental tax, the RTA put its application for federal funds on hold last year, Yunker said.

Kerry Thomas, interim director of the Southeastern Wisconsin Coalition for Transit Now, said the sales tax is a good idea because it would generate funds while growing the economy. And it would lessen public transit's reliance on property taxes for funding, she said.

But some area leaders, including Milwaukee County Executive Scott Walker, have indicated they would not support a sales tax, Thomas said. There is also opposition to a sales tax in western Racine County, which is largely rural west of I-94 and would be less affected by the KRM line.

The car rental tax may again be brought up in the legislature this year, which resumed its session Tuesday. The $13-per-car tax increase was proposed for the 2007-'09 budget because it would have been easier to pass with a cast of other items, Thomas said, but it can be a stand-alone bill.

Another item the legislature could consider is a measure to allow for local referendums on creating regional transit agencies statewide. Voters in municipalities could vote to create such taxing bodies in their areas to fund public transit and commuter rail. The bill is currently being drafted, said Rich Eggleston, spokesman for the Wisconsin Alliance of Cities, which recommended the legislation.

Such legislation could allow for western Racine County to opt out of paying for KRM.

The bill would permit groups of municipalities to join together across the state, but it might conflict with what is in place in southeast Wisconsin since the RTA is organized by counties, Yunker said.

Thomas said the bill in its current form is a negative for the RTA. Another option could be to draw district boundaries based on areas that get service, she said.