Committee weighs $10 transportation fee vs. property-tax option to address ~$110M roads backlog

Staff presented a transportation-utility study concept and a draft fee framework to the Citizen Budget Committee, saying the city must identify a sustainable funding source to address a significant roads backlog.

Why this matters: staff estimated that bringing all roads to new condition would cost roughly $110 million and that about $90 million of that cost is associated with roads that have 10 years or less of remaining life. The committee discussed options—starting with a modest monthly fee and increasing it over time, or raising property taxes—and the political and legal trade-offs of each approach.

John, a staff member, said the recommended approach in staff materials is a study and a tiered fee that would treat residential connected units differently from non‑connected units and scale business charges by trip generation using Institute of Traffic Engineers trip-rate guidance. “Staff recommendation is gonna be around $10 a month,” John said, adding the intent would be to phase the fee upward over time rather than start at a very high level.

Staff provided these planning-level figures during the discussion: an inventory of roughly 55 road miles in city jurisdiction; current capital fund balance of about $2 million; typical annual road funding of roughly $900,000; and an illustrative goal that would require on the order of $10 million per year to fully address the backlog. With those inputs, staff said a $10/month fee combined with existing road funds and targeted prioritization could roughly double current annual road work and extend pavement life on roads that have 6–10 years remaining.

Committee members raised equity and legal concerns. Several members said a property-tax increase—though politically difficult—would be legally safer (Truth in Taxation obligations apply to tax increases), and others supported a user-fee framing because it can be more clearly tied to road usage and restricted to road work. Staff said transportation utility fees are controversial in the state; nine cities have adopted such fees and some have faced legal challenges. Staff recommended budgeting $10,000–$15,000 to commission an external study to document the methodology and trip-generation calculations so the fee would be more defensible if challenged in court.

The committee asked staff to present the detailed study parameters and the consultant cost estimate during the council work session in two weeks. Staff also recommended that, if council chooses a tax approach, the council should update any existing resolution that currently dedicates property tax revenue to public safety so the accounting and communications to the public clearly show the portion directed to roads.

Next steps: staff will present the fee study scope and estimated consultant cost to council; the committee will discuss whether to recommend the fee approach or a property-tax increase; and staff will provide materials for public messaging that explain where any new money would be directed.