North/South Corridor savings may require $100 million local investment

This issue is a bit complicated, so you'll need a little history to put it into perspective. Last year the state legislature dusted off and re-wrote some old legislation that gives local jurisdictions the authority to form Transportation Benefit Districts (TBD), which are local or regional taxing districts designed to address local transportation needs.

The revived legislation comes at a time when the Legislature is also telling local jurisdiction that they need to begin generating much more of their transportation revenues at the local/regional level. TBDs are granted several different tax and fee authorities ranging from sales taxes to parking taxes.

The old legislation had been on the books for awhile, and very few jurisdictions had taken advantage of the option. That prompted lawmakers to amend the legislation to allow the "councilamanic authority" to impose a $20 license tab fee. Councilmanic authority is essentially the authority to impose a fee or tax without voter approval. A $20 car tab fee collected in Spokane County would generate slightly more than $8 million annually.

This new authority did get several cities, the county and many civic leaders discussing the possiblity of forming a TBD in Spokane, but some are still apprehensive. For one thing, the old legislation also limited the amount of time the TBD could collect any new revenues to a maximum of 10 years. This is typically refered to as a "sunset clause." The sunset clause limits the TBD's ability to use that money to bond any significant projects in the region.

So, the legislature went back to the drawing board this year and tweaked the legislation again. This time they removed the 10-year sunset clause -- but only on the TBD's authority to impose a 2/10 of a cent sales and use tax, which still requires a vote. (See, I told you it was complicated).

And for good measure, the new language would also require the state to rebate all of the sales tax spent on materials to build Mega-Projects like the North/South Corridor. The rebate money would go back into the construction accounts for those projects. In the case of the N/S corridor, that would generate roughly $250 million for the project. But -- and this is a BIG BUT -- the TBD would have to generate $100 million of local revenue toward the project to be eligible for that rebate.

Here is the rub...no less than four bills were introduced to deal with the sunset clause and the sales tax rebate issue, two of which were introduced by a handful of our local lawmakers. None of the local bills included the $100 million requirement, which was introduced by Westside lawmakers.

Considering that a $20 car tab fee would only generate $8 million annually, is it reasonable to expect the local taxpayers to generate $100 million toward the North/South Corridor to qualify for the $250 million rebate?

Related Spokesman Review story here.