Olympia car tab increase inevitable
Olympia is doubling its car tab fee to $40 per year, the latest move by a local government to keep up with road repairs by using local taxes to patch holes in city street budgets.
Faced with the same challenge, Tumwater went to voters last year and won passage of a sales tax increase that provided new funds for local road repairs and maintenance.
Other cities have done the same since the Legislature gave cities more authority almost a decade ago.
State gas tax receipts do get shared with local governments, but it’s not enough to keep up with costs.
Olympia’s higher tax, which takes effect on Jan. 1, was enacted by the Olympia Transportation Benefit District on Tuesday night. It will raise an estimated $750,000 extra a year.
This will go with the roughly $3 million the city already puts toward repairs and maintenance of its streets. But it’s far short of the roughly $4 million in new money that would erase a growing backlog of city street projects.
Getting support for more asphalt isn’t the more exciting task in the world, but people are quick to complain when roads deteriorate and potholes go unfilled. After state lawmakers provided the option, Olympia created its transportation district in 2008 and started collecting $20 car-tab fees in 2009.
Under the law, Olympia can impose its latest $20 fee without a city referendum, and it can raise the fee again to $50 in another two years. But any higher tab fee — up to a maximum $100 fee per year – must be approved by local voters.
Alternatively, Olympia could have done as Tumwater did last year, asking voters to approve a sales tax of up to 0.2 percent. But car tabs are more clearly a user fee, hitting those who own cars registered in Olympia.
The car-tabs tax may annoy some vehicle owners. Low-fee car tabs carry a certain mystique with professional initiative promoter Tim Eyman and his followers. Eyman made his name in 1999 by successfully leading Initiative 695, an infamous measure that cut car tab costs to just $30 a year (plus handling fees). Eyman has often complained that fees are now higher than he once promised, but he’s never provided a realistic alternative for raising funds to pay the real costs of road repairs.
That’s not the Eyman way.
Provisions of I-695, which the Legislature’s subsequently reenacted, wiped out a revenue stream that helped transit agencies, cities and counties, health departments and other government functions. Other initiatives capping property tax increases added to the strain for local governments. So in the ensuing years we’ve all seen a ratcheting up of car tab fees to fill in gaps left by state funding.
Olympia public works director Rich Hoey says there is a backlog of $48 million in repairs for streets rated “poor.” Streets are rated on a scale of zero to 100 based on potholes, cracking and other wear and tear — and anything below 50 is considered poor. Above 70 is good, and city streets on the whole rate an average 75.
Keeping streets in good enough shape to allow cheaper maintenance and repairs is essential. This is a case of doing what needs to be done.
This story was originally published March 26, 2016 at 11:00 AM with the headline "Olympia car tab increase inevitable."