Valley forum looks at options for road funds

The question is: Does Spokane Valley want to pay now or pay more later?

A recent proposed 6 percent utility tax on power, water, sewer, cable and garbage in Spokane Valley has been taken off the agenda after residents and businesses pelted City Hall with angry opposition.

The tax was proposed to cover a growing deficit in the city’s road maintenance and street preservation funds, which are funded by a dwindling tax on phone lines.

At an open forum at Spokane Valley Tech on Tuesday morning, city staff presented the financial reasons why a different source of revenue is needed if Spokane Valley wants to maintain its streets at the current level.

At the beginning of the meeting, City Manager Mark Calhoun said the 6 percent utility tax is off the table for now.

“The council heard you loud and clear,” Calhoun said.

He added that the city has about $2.4 million set aside for road maintenance but needs $6.8 million. He explained that the city has filled the gap with real estate excise taxes, but that isn’t a lasting solution because the city needs the REET funds to match state and federal grants its applying for. By 2019 the REET fund will be depleted.

“We estimate that our annual unmet revenue need is $3.2 million,” Calhoun said.

Public works director Eric Guth said the priority is to keep roads in their current condition, but that too much slack will lead to a more expensive repair backlog.

“Every dollar not spent on preservation will cost us $8 in reconstruction later,” Guth said.

Spokane Valley has not taken the 1 percent property tax increase it’s allowed by state law for the past eight years, and could tap into a banked property tax capacity of about $555,000 in 2017.

“But we can’t go back and collect all the property taxes we have foregone in past years,” Taylor said.

The forum was hosted by the Greater Spokane Valley Chamber of Commerce and filled the auditorium at Valley Tech with business owners and Valley residents.

Deputy Mayor Arne Woodard cautioned everyone that if street maintenance isn’t funded continuously, Spokane Valley streets will end up looking like Spokane streets.

“And we don’t want to look like our sister city to the west. They will never catch up,” Woodard said.

One proposal is to create a Transportation Benefit District and collect a vehicle license fee that would start at $20 and gradually reach $50.

But even at $50 a year, the fee would only pull in an estimated $3.6 million.

Calhoun promised everyone that the city will continue to reach out and have meetings and hearings as it tries to figure out how to replace the street funds.

“Perhaps people want to maintain the roads at a lesser standard than now,” Calhoun said. “If that’s the case, then that’s OK.”