Tuesday, September 1, 2015

Chamber Endorses City of Tacoma Roads Package (Prop. 3 & 4)

On August 27th, the Chamber Board of Directors voted to endorse Tacoma City Council's Propositions 3 and 4.  

The text of the resolution is below:

SUBJECT:    TACOMA PROPOSITION 3: Concerning a property tax levy rate increase and utility gross earnings tax increase to fund street improvements

TACOMA TRANSPORTATION BENEFIT DISTRICT PROPOSITION 4: Concerning the imposition of a sales tax to fund street improvements


BACKGROUND: In 2013, the City of Tacoma placed a proposition to the voters to add an additional 2% to the existing utility gross earnings tax in order to fund street improvements.  The Chamber opposed the measure on several grounds.  Some of these included concerns about prioritization of existing dollars, task force/commission processes, and expecting a handful of businesses to pay the bulk of the taxes despite most of the improvements going towards residential roads.  A majority of voters agreed with the Chamber that this was not an appropriate tax.

Since 2013, the Chamber has worked with community stakeholders, including electeds and staff at the City of Tacoma, to evaluate alternative funding and improvement plans.  While no tax is an ideal scenario, the proposed package successful spreads the tax burden to all parties and users throughout the area while setting a 10-year sunset on the entire package.  The two propositions combine for $175M in new revenue.  When added to new matching funds from the general fund, existing street funding revenues and new grant matches, the total package is $425M.

City Funding Source
10 Year Revenues
     New Sales Tax (+0.1%) (Prop 4)
$45 M
     New Utility Gross Earnings Tax (+1.5%) (Prop 3)
$90 M
     New Levy Lid Lift (+$0.2 per $1,000AV) (Prop 3)
$40 M
     New Additional General Fund Support (Council Budget)
$30 M
     Existing Revenues ($20 Tab, 2% UGET)
$100 M
City Funding
$305 M
     Grant Matching Funds
$120 M
$425 M

This funding would then be spent on residential streets (67%), arterials & freight access (18%), and walking and biking infrastructure (15%).  This work would pave 167 blocks of gravel streets, resurface 2,100 blocks of failed and poor streets, and provide sufficient maintenance for all excellent, good, and fair residential streets, totaling another 4,211 blocks. In addition it would provide funding for key freight mobility connection in the Port of Tacoma and multimodal facilities like an improved Schuster Parkway and Prairie Line Trail.

The residents of Tacoma have consistently ranked the condition of the streets as a number one priority, but despite several options on the ballot, have to choose to increase taxes to pay for the street repairs.  It is unclear the level of support these measures will need to be successful at the ballot box.

While the Chamber supports these proposals to improve streets throughout Tacoma, we will continue to encourage the City to look for additional efficiencies in general operations.  With an annual general fund budget of $200M, saving just 1% would allow an additional $20M to be spent on roads over 10-years.  To this end, we hope that this City will continue to focus on job creation in the private sector by hiring private contractors to complete the work rather than increasing internal staff.

IMPLEMENTATION:  With approval of a policy, the Chamber will utilize is communications tools for advocacy.

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