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In addition to establishing a Vehicle Licensing Fee, we recommend the County pursue a County Road
<br />property tax levy lid lift, up from the current rate of $0.98 per $1,000 of assessed value to $1.75 per
<br />$1,000 of Assessed Value (which is still below the statutory maximum of $2.25 per $1,000 Assessed
<br />Value). The levy lid lift requires a public vote. We project that this can bring in an estimated additional
<br />$62 million over 20 years.
<br />The Vehicle Licensing Fee, combined with a County Road property levy lid lift, can generate $94 million
<br />in additional revenue, sufficient to cover the deficit of $91 million while allowing the County to build a
<br />slight surplus for unknown and/or emergency events.
<br />Alternatively, the County can pursue a TBD Sales and Use Tax, in combination with a higher County Road
<br />property tax levy lid lift. The County could also choose to pursue debt financing, though there are
<br />additional costs associated with taking on debt. The recommended revenue options are summarized in
<br />Exhibit 3 below, and the benefits and challenges associated with each option are outlined further in this
<br />report.
<br />Exhibit 3. Operating and Capital Funding Gap and Potential Additional Revenue (2018$)
<br />Operating Surplus or Deficit
<br />Capita l E1<penditures Surp lus or Deficit
<br />2018-2023 2024-2027 l~YearTotal,
<br />2018-2027 2028-2037 2~YearTotal,
<br />2018-2037
<br />(Years 1-6) (Years 7 -10) (Years 1-10) (Years 11-20) .(Years 1-20}
<br />$ lll,206,000) $ (8,077,800) $ (19 ,283,800) $ (21,368,600) $ (40,652,400)
<br />:
<br />Total Operatin_g and Capital E><penditures Surplus or Deficit I Is (91,112,000)
<br />Estimated Potential Additional Revenue I
<br />Transportation Benefit District -
<br />Vehicle Licensi ng Fee $ 6,540,000 $ 6,5:l.0,000 S 13,DS@_;l!)(i)(l $ 18,570,000 $ 31,ft.h0.;0(:)0
<br />Property Tax Levy Lid Lift -
<br />County Road Fund ($1 .75 per
<br />$1000AV) $ 22,170,000 $ 13,150,000 $ 35,320,000 $ 26,990,000 $ 62,320,000
<br />Total Estimated Additional
<br />Revenue $ 28,710,000 $ 19,660,000 $ 48,370,000 $ 45,560,000 $ 93,930,000
<br />Sources : Kittitas County Public Works 2018; Kittitas County A ss essor's Office 2018 ; Washington Departme nt of Licen sing
<br />2018; Washington De partment of Revenu e 2018 ; BERK Con sulting 2018.
<br />Note: The se figure s are rounded to the near e st 10,000.
<br />Exhibit 4 shows 20-year projected revenues when the County implements a phased Vehicle Licensing Fee
<br />and a County Road property tax levy lid lift to $ 1.7 5 per $1 000 Assessed Value (AV), along with
<br />projected operating and capital expenditures and the application of the operating surplus with the two
<br />recommended revenue tools. The exhibit shows a one-time levy lid lift to $1.75 per $1 000 AV; strategies
<br />on how the County might reach this $1.7 5 per $1,000 AV levy limit could vary.
<br />: ~I I May 22, 2018 Kittita s County Public Works I 20-Year TIP Fiscal Sustainab ility Strategy: Final Report 4
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