University Place ready to pull trigger on $20 car tab fee

Staff writerNovember 29, 2013 

stock: University Place, University Place Town Center Feb 14, 2013 by Peter Haley


Four years ago, the University Place City Council created a mechanism for collecting $20 on annual car tab renewals to pay for road maintenance, but it never authorized that the money be collected.

Two years ago, council members came close to activating the mechanism but a week later changed their minds after revenue projections improved.

Now the debate is before the council again, and this time city leaders don’t expect to be saved by a last-minute uptick in revenues. The council will hold a public hearing Monday on whether to collect the $20 car tab renewal fee through the city’s transportation benefit district.

“We’re bringing it back because we really need to fund it,” Assistant City Manager Eric Faison said. “This is just to maintain what we’re doing now.”

Authorizing a fee increase will not be popular with people, especially when streets appear to be in good shape, Mayor Ken Grassi said. But if the city can’t continue its current level of service because it can’t afford the rising costs, it won’t be long before streets deteriorate to a noticeable level, he said.

“We don’t want to end up in the situation that Tacoma did,” Grassi said, referring to the larger city’s pothole-riddled streets.

“It’s like taking care of a car,” he said. “You can run them and run them and run them, and when you don’t do the routine maintenance and take care of them, you run into problems after a while.”

Elsewhere in Washington, about 46 other cities, including Tacoma, have imposed the car tab fee. Lakewood has authorized a transportation benefit district, but like UP it has yet to initiate the collection. The Lakewood City Council will reopen the debate in the coming months, City Manager John Caulfield said.

Faison said the UP council needs to find a sustainable way to pay for road maintenance. Revenue projections show that by 2016 the city will be unable to maintain its current level of service unless it finds additional money, he said.

The city spends about $1 million a year on basic road upkeep, including fixing potholes and street sweeping. It receives about $450,000 a year from gas tax collections, with the remaining $500,000 to $600,000 coming from the general fund.

Thirteen years after voter-approved Initiative 695 repealed the state’s motor vehicle excise tax, city leaders say they’re still trying to overcome the $3 million financial hit. During the recent down economic years, the city juggled that loss with a decline in sales and property taxes and the real estate excise tax. Last year’s liquor privatization initiative also took away about $300,000 a year.

State law gives municipalities the authority to create a transportation benefit district and collect a $20 license tab fee without voter approval. The money generated can be used only to pay for roads.

UP estimates the district would bring in about $300,000 a year, cutting by half the current drain on the general fund.

Councilman Javier Figueroa, who heads the city’s finance committee, said UP needs the guaranteed revenue source for roads.

“This is not for any lavishly building of new streets,” Figueroa said. “It’s just purely street maintenance.”

Grassi says the city’s financial picture points toward collecting the fee, but he cautioned that he’d want to see it discontinued if voters pass a road maintenance levy someday.

“I can’t stand double taxation, and the trouble with these kinds of things is once they get on the books it’s very hard to get rid of them,” he said.

Brynn Grimley: 253-597-8467

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