New tax district might be in Olympia’s future to raise $350 million to tackle sea level rise
Olympia officials are weighing whether creating a new special funding district is a viable option for paying to save downtown from rising sea levels. Such a move would ultimately raise up to $350 million in taxpayer money to keep the city from going underwater.
Assistant city manager Rich Hoey gave a presentation earlier this month on the funding needed to tackle Olympia’s Sea Level Rise Response Plan, established in 2019. He said a very large investment is needed to protect downtown, and officials need to start looking at funding options.
To protect critical infrastructure downtown and the LOTT water plant over the next 30 years, it will cost the city anywhere from $190 million to $350 million in 2018 dollars, Hoey said.
Some of the physical improvements include elevating the streets and paths in the downtown core, as well as installing raised walls and other barriers. All of Heritage Park will need to be raised, along with the buildings around it.
A Request for Proposal has been sent out, and Hoey said the plan is to select a consultant to help the city determine the best funding options. The consultant will be tasked with researching funding options through both the federal and state government, and through private grants. They’ll also have to evaluate if a flood or improvement district will be needed to tax property owners.
Hoey said $50,000 was allocated for hiring a consultant for the work.
Olympia has a number of taxing districts already, including the proposed Downtown Improvement District, the Parking and Business Improvement Area, and the Transportation Benefit District. For example, the Downtown Improvement District would tax residential properties in the downtown core $5.70 per foot of frontage, plus $0.00078 per $1 of assessed property value.
Creating a new special district would also include creating a governing body to make funding and project decisions and ensure funds and costs for improvements are distributed equitably.
Dani Madrone, chair of the Sea Level Rise Response Collaborative committee, questioned the need for a separate governing body when the Sea Level Rise Response Collaborative already exists. She also wondered how the city plans to finance future increases in downtown property taxes. She said the city needs to evaluate how it can benefit from future increases to in turn continue investing in downtown infrastructure.
“If we do a lot of work to protect downtown from sea level rise, that will influence property value downtown,” Madrone said.
Hoey said there’s no answer yet about whether the SLR response collaborative could take the lead. And as property values increase, he said owners will have to continue paying their fair share.
“Certainly there would be property owners downtown that would be benefiting from these investments, and what should their fair share of contribution be toward this work — we’d need some help sorting through what that looks like,” he said.
No action has been taken yet, and the city is still early on in its planning process.
This story was originally published June 15, 2023 at 5:00 AM.
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