In a 3-2 vote, The Dalles City Council decided Monday to prepare a ballot proposal for a 3-cent-per-gallon increase in the local gas tax.
The measure will be considered at the Monday, July 28, meeting, which begins at 5:30 p.m. at City Hall, 313 Court Street.
Councilors Carolyn Wood, Bill Dick and Dan Spatz said the issue should be brought before the electorate because the city needs more money for street improvements.
“I think we should present it to the voters and let them decide,” said Spatz.
“I don’t like the idea, but I think the voters should be the ones to say ‘Yea’ or ‘Nay,’” said Wood.
She said the city had taken many steps to tighten its budget after the downturn in the economy, but infrastructure upgrades could not continue to be put off. She said having streets in good repair raised the value of properties as well as benefitted motorists, which drew agreement from Dick.
Nolan Young, city manager, and Dave Anderson, public works director, anticipate that doubling the gas tax will bring in $450,000 more per year. They said the extra money would allow 27 projects to be completed in about 16 years.
“The funding would help us catch up with the backlog,” said Young.
He said, although the city currently received $450,000 from the local tax and another $810,000 from the state gas tax, it was not enough to catch up with projects that had been put off by past councils due to economic constraints.
“Placing a measure on the ballot will create some excitement in the community but we will be giving people a choice,” he said.
Resident Russ Brown challenged the city’s ability to keep up with the long list of street repairs when only a few blocks a year were rebuilt. Young has previously reported to the council that 60 percent of the city’s streets are either in poor or very poor condition.
“You can’t get ahead of the curve this way, you are losing more streets than you are saving,” said Brown.
The council asked Anderson to prioritize a list of street projects that would be undertaken with extra tax dollars and present it at the July 28 meeting.
Councilors Linda Miller and Tim McGlothlin voted against an increase in the tax out of a belief that city officials should first scout the budget to see if money could be found for the projects in the existing budget.
“I’m in favor of tightening the belt,” said Miller. “Unless something changes, we just try to maintain without raising taxes.”
Mayor Steve Lawrence, who can only vote to break a tie, also opposed the increase. He said the city is going to receive a major increase in franchise fees from electricity sold to Google once the new data center is up and running.
For example, he said the city had pulled the Northwest Natural Gas franchise fee of $81,402 from the general fund, used to pay more operational expenses, to make more street repairs.
He said the budget committee needed to reconvene in the fall to do as Miller had suggested. He claimed to have personally suggested $425,000 in funding that could be reallocated to transportation-related projects. He said that potential shift in money from the general fund had not been considered by the budget committee last spring.
“It’s time to make some hard choices,” said Lawrence.
Downtown business owner Steve Stroud, also an opponent of the tax, had this response to the mayor’s statement: “Let’s not forget the private sector does that all the time in business. We (the city) should operate the same way.”
Miller added, “Every household operates that way.”
Alex Hattenhauer of a fuel distributing company in The Dalles, said Safeway and Fred Meyer have added gas stations to the existing total so the city is already receiving more gas tax dollars.
“It’s my opinion those funds have not been spent appropriately and now the burden’s placed on the citizens and I don’t think that’s fair,” he said.
Lawrence questioned why the numbers given by Young appeared to remain unchanged despite the addition of two new gas stations. He said further study also needed to be given to that issue.
Hattenhauer told the council that fuel providers would oppose a change in the local tax because it created an inequity. He said it was difficult to compete with lower prices offered to freeway travelers by cities in Eastern Oregon without a gas tax.
The only fair way to enact a tax, he said, was at the state level where it would be uniformly applied.
“I think that’s the best bet for everybody,” he said. “It’s hard on businesses when you ask for more revenue all the time — that’s not the answer.”
Young told the council that the League of Oregon Cities’ website had listed 23 out of 476 municipalities in the state with a local gas tax. The highest charge was Eugene with a 5 cent per gallon tax.
He said, besides The Dalles, three cities east of the Cascades had a tax — Hood River, Sisters and Stanfield. He said cities across the state were grappling with the same problem of finding enough funding to cover the replacement of aging infrastructure.
“In an older community like ours, it becomes a bigger issue,” he said.
The council discussed the possibility of getting more money in the future from state and federal gas tax increases.
Portland officials plan to ask the Oregon Legislature in 2015 to raise the existing state tax of 30 cents per gallon by a nickel. And the Obama Administration is also looking at a 12 cent per gallon increase in the existing federal tax of $18.4 cents.
Anderson said it was possible that even if the federal tax went up, states and cities could end up receiving less money due to transportation needs across the nation.
Young’s option for the city to pursue a bond levy for a specific list of projects instead of a gas tax increase failed to gain traction.
Spatz was concerned the bond levy would interfere with North Wasco County School District 21’s plans to ask the electorate for more tax dollars in the future.
He said the advantage of the gas tax was that everyone who used local roadways, including tourists, would pay for improvements.
“I don’t like the gas tax, but I think it’s the best solution I’ve seen so far,” he said.
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