Pasco council directs staff to draft ordinance for 0.1% sales tax to fund roads

Pasco’s City Council on Feb. 2 directed staff to return with an ordinance to form a transportation benefit district funded initially by a 0.1% sales tax and to consider consolidating the TBD board’s duties into the council.

Deputy City Manager Seagdale described two primary revenue options: a phased vehicle-license fee (commonly called car-tab fees) and a one-tenth of 1% sales-tax option. "If the city was to go this route at the $20 vehicle license fee, the revenue for the city for transportation projects would be around $1,300,000," Seagdale said, and the 0.1% sales-tax option was projected to produce about $2,300,000 annually.

The council’s discussion focused on equity and effectiveness. Councilman Perales said he preferred the sales-tax approach and that "I'd like to see the residents vote on it," while Councilman Cotto confirmed the $1.3 million figure tied to a $20 car-tab projection. Several members, including Mayor Pro Tem Milne and Councilman Campos, said they dislike new taxes but supported the 0.1% sales tax as the least regressive option. Councilman Figueroa urged clear communication about how funds would be used so residents can see where their dollars go.

Staff noted legal and reporting obligations: state law requires annual reporting on how TBD revenues are used and some revenue choices (such as higher car-tab amounts or additional sales-tax increments) trigger voter referendums. Seagdale explained implementation mechanics, including that the council can serve as the TBD governing board or the city can assume the district’s powers so a separate board would not be required.

Councilmembers asked technical questions about asset life cycles and maintenance funding: staff stated road miles in Pasco have grown roughly 23% since 2015 and 43% since 2010 while the street crew size has not increased since 2010, increasing deferred-maintenance pressure. Staff also clarified that new-road construction typically carries a one-year defect warranty after which the city assumes maintenance responsibility.

Next steps: staff will prepare and return with an ordinance for council consideration that proposes a citywide 0.1% sales tax dedicated to transportation projects and an option to consolidate TBD governance into council meetings. The ordinance will include reporting language required by state law and draft project-expenditure plans for council review.