Fees for transportation impacts, business licenses and vehicle-license registrations all could be part of a funding package the Kent City Council may tap for funding city street projects.
The Council conducted a second workshop May 18 at City Hall to discuss how to fund an estimated $389 million worth of projects over the next 25 years, including $137 million in grade-separation projects for street and rail.
Earlier, at its May 4 workshop, the Council had discussed the possibility of charging vehicle-registration fees as one funding source for city street repairs.
At its May 18 meeting, the Council made it clear they wanted to spread the cost of street projects among residents, developers and businesses.
“Next to public safety, transportation is the No. 1 or No. 2 big issue in the city,” Councilwoman Deborah Ranniger said at the workshop. “It would be a lack of leadership if we do not move forward with something in the next 60 days. We need to get grade separations and other projects going. People are fed up with our roads.”
The funding options under consideration by the Council include:
• Charging Kent vehicle owners an annual $10-to-20 vehicle-license registration fee. A $10 fee would raise more than $1 million per year or about $28 million over 25 years.
• Charging developers a transportation-impact fee based on a set rate of so much per new house or so much per square foot for a new commercial building, based on the estimate of new peak-hour vehicle trips the project would generate.
Depending on the rate chosen by the Council, the fees could range from $4,072 to $12,340 per new single-family house; from $7.88 to $23.88 per square foot for a new office building; from $6.32 to $19.15 per square foot for a new shopping center; and from $1.88 to $5.70 per square foot for a new warehouse. The fees would raise an estimated $62 million to $189 million over the next 25 years, depending on the level of the fee.
• Charging a license fee for business based on the number of their employees. The council didn’t discuss specific fees or potential revenue amounts.
City officials want to construct street-railroad grade separation projects over the next several years along South 228th Street, South 212th Street and Willis Street at a cost of about $137 million. The projects would eliminate the issue of traffic backing up at train crossings, as the streets will go either over or under the railroad tracks.
So far, the city has about $32 million lined up for the street-railroad separation projects, with funding from the Washington State Freight Mobility Strategic Investment Board, Burlington Northern Santa Fe Railway, Union Pacific Railroad, the Port of Seattle, the Washington State Public Works Trust Fund and the federal government.
That leaves a gap of about $105 million for the city to fill.
Councilwoman Elizabeth Albertson suggested the city look at phasing in the impact and business license fees to lessen the financial impact on developers and businesses.
“We also need to talk to businesses to see what road (because of traffic delays) is killing their business and commit to projects but we need them to be a part of (funding) it,” Albertson said.
Kent Mayor Suzette Cooke told the Council impact fees that are too high as well as business fees charged per employee could cause businesses to leave the city or not even move to Kent.
“My word of caution does not mean I am against impact fees,” Cooke said. “But on the bottom line, do the fees generate more money or will the fees close down future development?”
Consultants hired by the city will return for another Council workshop this summer with a proposal that will include a range of transportation impact, business license and vehicle license fees and include which projects the vehicle fees would fund. Part of the vehicle-license fees also could be used for street maintenance.
The Council could adopt the vehicle-license fee without voter approval by keeping the cost at $20 or less. Voters would need to approve any fee higher than $20 with a ceiling of $100 per vehicle.
Councilman Ron Harmon said he thinks voters would approve a $25 or $30 vehicle fee if they knew which projects the money would fund.
Albertson said residents already had told her they are against a proposed vehicle fee.
“People are not going to be happy with a $20 fee, period,” said Albertson, who added maybe those opinions could be changed if the Council comes up with a funding package that includes business and developer fees. “We can be able to say our backs are against the wall and here is what else we are doing.”
The Council needs to take action by this fall to raise revenue for transportation projects or it could lose up to $17 million already set aside for the city for street-railroad projects through other funding sources, including the state Freight Mobility Strategic Investment Board.
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