After a proposal to add a 6 percent utility tax to all utilities in Spokane Valley last year was loudly rejected by residents, the city is back at the drawing table trying to find funding to maintain its roads.
At a Spokane Valley City Council workshop on Tuesday, City Manager Mark Calhoun and Deputy City Manager John Hohman introduced a yearlong plan that may help the city define and address the issue.
Spokane Valley’s street operation and maintenance is mainly funded by a tax on telephone landlines, a source of revenue that’s disappearing.
In 2009 that tax revenue was $3.05 million compared to $2.2 million in 2016. It’s expected to continue to decline.
The Public Works Department has identified an annual deficit of $6.1 million if the city wants to maintain streets at the current standard.
Calhoun said “a tax is a terrible thing to contemplate” and proposed a yearlong project to analyze the issue.
The project includes surveying pavement across Spokane Valley and suggestions as how to pay for its maintenance.
Calhoun said the city will then hold community meetings and explain its findings.
A measure called a Pavement Condition Index is used to describe the condition of streets.
According to a staff presentation in December, Spokane Valley’s PCI was 78 in 2010 and it’s declined to 71 in 2015.
“We need to find out what it costs to maintain streets at a certain PCI, and what is the deficit we are looking at to get to that point,” Calhoun said.
Hohman said the study is also an attempt at evaluating the community’s tolerance of street conditions.
“What does a street look like at a 65 PCI and is that OK?” Hohman said. “How many potholes and bumps are we OK with?”
This will be the ninth year where Spokane Valley has not increased its property tax with the state-allowed 1 percent.
Many have suggested that would be a better way to pay for street maintenance than any other tax, but Councilman Ed Pace said a 1 percent increase would earn the city about $100,000.
The city could tap into a banked property tax capacity of about $555,000 in 2017, but that would be a one-time event.
Calhoun said the plan is to develop a range of PCIs – perhaps 60, 65 and 70 – and the cost associated with each.
“This will be a fairly involved and time-consuming process,” Calhoun said.
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