City seeking tax district for street work

Public hearing set for April 3 at City Hall
By Nicholas Johnson | Mar 29, 2017

The City Council is moving forward with a plan to establish a taxing district to raise money for transportation infrastructure and maintenance projects, but it needs public input first.

Creation of a Transportation Benefit District, which would serve as a vehicle for levying new taxes and fees, requires a public hearing, which is set for 7 p.m. Monday, April 3, in the council chambers at City Hall.

For those unable to attend, written comments will be accepted at City Hall, 11930 Cyrus Way, until 4:30 p.m. April 3.

The council is expected to follow the hearing with a vote on whether to form the district.

“I appreciate the council all recognizing that we need a sustainable funding source for our public works to manage and maintain the roads,” Councilmember Randy Lord said during a council discussion March 20.

“I do also support the idea that we form a transportation benefit district, whether or not we move forward.”

Lord’s fellow council members seemingly agreed, with most the of discussion focusing on funding options, which would be settled after creation of the taxing district and would be subject to public hearings.

If approved, the council would begin weighing two main funding options, one of which would likely go before voters on the Aug. 1 primary ballot.

The first funding option is projected to generate $1.16 million each year through a 0.2 percent sales tax increase. The second option is projected to generate $1.175 million each year through a $20 vehicle license fee and a 2 percent increase in the solid waste utility tax, which was last increased in 1993.

These options come after a yearlong effort by the city’s Wise Investments Transportation Taskforce to identify ways to pay for a recommended doubling in funding for maintenance of Mukilteo’s 67 miles of streets.

Last year, the council earmarked 70 percent of the city’s real estate excise tax revenue and increased business license fees, which together amount to $560,000, to pay for pavement preservation in 2017.

Any money raised through the taxes and fees would go toward pavement preservation, as well as pedestrian improvements outlined in the city’s By The Way Plan for biking, transit and walking.

Transportation districts are independent taxing districts that can raise money for specific projects. Although they are independent, quasi-municipal corporations, these districts can be absorbed into regular city operations so long as their boundaries are the same.

If approved, Mukilteo’s would be the 11th transportation district formed in Snohomish County, according to the Municipal Research and Services Center of Washington.

About half of the existing 10 districts have levied a car tab fee, including Edmonds and Everett. Only one district – Lynnwood – levies both a car tab fee and a sales tax.

Statewide, car tab fees are the most common funding source for transportation districts, which can levy fees up to $50 without a vote. Sales tax increases require a vote and are limited to 0.2 percent.

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