Cities target loading docks to fund roads

Cities routinely tax gambling, utilities and property to balance their budgets. But Fife may become the first city in the state to adopt an unusual tax to help maintain its transportation system.

The target: loading dock doors.

The Fife City Council is considering adding a $100 annual tax on doors where trucks pull up at the back of warehouses to load and unload freight. The first step is a public hearing tonight.

Sumner and Auburn are considering the same type of tax.

Fife City Manager Steve Worthington said the proposed tax targets warehouse shipping because trucks wear down roads more quickly than cars.

The excise tax would pay about a quarter of the cost to resurface more than 12 miles of truck routes in Fife over the next seven years. Truck routes are generally major arterials that trucks are allowed to use in a city.

“It is really about the local users of our roads paying an equitable share for the maintenance of those roads,” Worthington said.

Under the measure, the first two loading dock doors for each business would be exempt – a move intended to spare small businesses. After that, each door would be taxed $100 a year.

Fife estimates that 2,022 loading dock doors – out of 2,247 in the city – would be taxed, generating more than $200,000 a year.

One reason for imposing the tax is the loss of sales tax revenue in warehouse-rich cities. The decline stems from the state’s streamlined sales tax, which went into effect in July. Washington governments now collect the tax based on where a buyer lives rather than the place from which the merchandise is shipped.

That’s a plus for suburban communities like University Place. But it’s a minus for Fife, a distribution hub for the Port of Tacoma. Fife expects to lose about $500,000 a year in sales tax revenue from the change, said finance director Steve Marcotte.

The state is paying cities such as Fife to help make up for some of the loss in sales tax revenue.

Mayor Barry Johnson said Fife residents have voiced concerns that warehouse businesses aren’t paying their fair share for road maintenance, given that truck traffic generates more wear on roads than cars do.

“This is one way to address that,” Johnson said. “I think it’s a good idea.”

Besides the public hearing, a vote on the ordinance is listed on tonight’s agenda. But Johnson said he expects the council will defer a vote until Feb. 10 to allow more time to consider the tax and the public’s response.

Paul Sullivan, of the Municipal Research & Services Center, said he’s not aware of any Washington city that has adopted a tax on loading dock doors.

Several large warehouse operators in Fife could not be reached for comment Monday.

But an executive for a freight company planning to move to Fife from the Port of Tacoma said he’s concerned about the proposal.

“It just appears to be another attempt to go after a select portion of the business community with an excessive additional use tax,” said Mike Schuller, vice president of marketing for American Fast Freight.

“I would think it would be hard for them to implement it and collect it.”

Worthington said businesses would identify which doors they use, pay the tax per door and receive an annual sticker.

It’s not the first time Washington governments have explored creative tax-and-fee schemes to pay for transportation problems caused by years of heavy port traffic.

State lawmakers in the past have proposed slapping a fee on each 40-foot shipping container loaded and unloaded at local ports.

Sumner also is developing a tax proposal for its 3,000 loading dock doors. A proposal may go to the Sumner City Council in about six weeks, said City Administrator John Doan.

With a decline in money for maintaining truck routes, Doan said, “we’re doing it because we need to find a way to maintain and improve those roads.”

Steve Maynard: 253-597-8647