Council debates scope and timing of renewing transportation benefit district funding for transit and streets

Ellensburg City Council held an extended discussion about the future of the city’s Transportation Benefit District (TBD) funding and how it should be used to support transit operations and the broader transportation system.

Staff framed the item as a policy decision the council should consider in the context of a structural deficit in the general fund and upcoming expiration of the current TBD authorization. “The intent is and was to continue to fund both of our, to continue our service levels with transit, and to look to the future for how we can continue to expand those,” City Manager Heidi Baron Stornoway told the council while outlining budget pressures and the role of the TBD. Staff reminded the council that the existing TBD authorization—voted in April 2016—expires Sept. 30, 2026, and that state law allows municipalities to use up to 0.3 percent sales tax for transportation purposes with voter approval.

Staff recommended the council consider renewing two-tenths of a percent while broadening the permitted uses of the revenue to support both transit operations and transportation system maintenance (streets, sidewalks and related capital). Staff said, under projections that include continuing grant support, that approach would provide a sustainable revenue stream to maintain service levels and allow limited reinvestment.

Council members asked for more financial detail and raised concerns about the proposal’s dependence on continued state and federal grant funding. One councilmember summarized fiscal risk by noting the current operating cost for transit is about $2.2 million per year and that the city is receiving a mix of sales tax, grant dollars and a $75,000 annual contribution from Central Washington University. Council members asked staff for a breakdown of the TBD fund balance (discussed in the meeting as roughly $4.2 million in ending fund balance) and which portions are restricted by grants or capital requirements. Staff clarified the ending fund balance does not include restricted grant dollars and agreed to return with a budget analysis showing which dollars would be available to backfill operations if needed.

Views among council members diverged. Some members said the ballot language adopted in 2016 already allows flexibility for transportation uses and urged caution about asking voters for a new or expanded measure too close to the existing expiration. Others said the city should broaden the permitted uses so the TBD can fund sidewalks, street preservation, and transit together, arguing that the transportation system is interconnected and that sidewalks and streets support transit ridership. Several councilmembers expressed concern about the council relying on state and federal grant funding going forward, calling that reliance a risk if grant availability declines.

Council agreed to give the Transportation Advisory Committee (PTAC) and other advisory bodies several months to discuss the options and return recommendations. Staff and council asked for additional detail on the composition of the existing fund balance (restricted vs. unrestricted), a clearer projection of multi-year operating needs for transit under different renewal scenarios, and revised ballot language options that would be voter-ready if the council chooses to proceed.

Ending: Council did not set a date for a ballot measure and directed staff to return with detailed financial analyses and to solicit PTAC recommendations before taking further action.