MOUNTLAKE TERRACE — The City Council voted 5-2 to form a Transportation Benefit District to help pay for the council’s top priority: the Main Street Revitalization Project, which carries a $10.5 million price tag. The extra car-tab fees that come with the district would cover one-third of those costs.
Council members will serve on the board of the independent taxing district and establish an annual vehicle licensing fee of up to $20 per vehicle without voter approval. The state Department of Licensing could begin collecting the tax as early as July 2012. TBD revenues are earmarked for funding transportation projects. Residents will stop being charged when the projects are complete.
TBD revenues are expected to cover $3.5 million of the downtown project’s costs. Utilities fees and grants are expected to cover the remaining $7 million. In 2012, the license fee is anticipated to yield more than $140,000, assuming collections start in mid-2012. More than $280,000 is expected to be collected in 2013.
The council was divided on the fee issue during a Dec. 5 public hearing. Councilmen Rick Ryan and John Zambrano, who voted against forming the district, wished to postpone a decision until the economy shows signs of improving.
Zambrano said the project is worthwhile but the timing isn’t right.
Council members who voted in favor said the licensing fee is the least invasive tax.
Councilman Doug McCardle added the projects the fee benefits will attract developers and put the city in a better position to receive grant funding.
“We talk about a vibrant downtown and this is a step toward that,” he said.
Half a dozen residents and small-business owners pleaded with the council to vote against forming the district.
Bill Whalen accused the council of making too many assumptions. “You want a downtown? You already have it; you’re sitting on it,” Whalen said.
It’s called a benefit district, he added, but who benefits?
“People don’t want to pay for it, especially not in this economic climate,” Whalen said.
Business owner Mike Hickey asked the council to consider the impact on business owners who have been hit by the economy. “Why are we asking the people of Mountlake Terrace to give more money which will impact my business and other businesses?” he asked.
Neighboring cities also have looked to Transportation Benefit Districts as a means to pay for infrastructure improvements, city staff said.
Grants can’t cover the costs of all of the improvements, said Shane Hope, economic development director.
“A TBD is one way to help make up that funding (gap),” Hope said.
The revitalization project would reconstruct the downtown area, specifically the stretch of 56th Avenue W from 230th Street SW to 236th Street SW. The project includes repaving, adding bicycle lanes, moving power lines underground, adding energy-efficient lighting and planting trees, among other improvements.
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