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A tale of two taxes.

Byline: The Register-Guard

CORRECTION (ran 10/12/04): A Sept. 29 editorial overstated the amount of revenue the city of Eugene is receiving from its 3-cent-per-gallon tax on gasoline. According to the city's Public Works Department, the city received just over $2 million in the first year of collections. The larger figure cited in the editorial included funds from sources other than the gasoline tax.

The Eugene City Council voted 5-3 Monday to ask the city manager to prepare proposals for financing street maintenance. The split vote is a sign that the discussion is already off to a rocky start - if a substantial minority isn't ready to even ask for proposals, opposition to the proposals themselves can be expected. Yet Eugene has come this way before, and can glean useful lessons from experience.

Just two years ago, the City Council approved a 3-cent-per-gallon gasoline tax to pay for street projects. The lack of public opposition to the tax was almost eerie. Here was a major new tax imposed without a public vote, and the only result was some scattered grumbling.

It helped that the new tax was added at a time of volatile gas prices - a 3-cent addition was lost in the flurry of daily price changes. Moreover, people are used to paying gas taxes to support roads, and see a logical connection between the tax and its purpose. Most of all, Springfield added a gas tax at the same time, in the same amount and for the same reason, thereby avoiding a disparity in gas prices and underlining the fact that paying for street maintenance is not just one city's problem.

Eugene and Springfield also adopted transportation utility fees - charges levied against each property, based on the number of vehicle trips it generates. A large fee, for instance, would have been assessed against a suburban shopping center, while the fee for a single-family house would have been much smaller. The transportation fees died, first in Springfield and then in Eugene, after members of the Lane County Board of Commissioners demanded that they be subject to a public vote, and the Eugene Area Chamber of Commerce threatened to petition for a referendum.

The Eugene City Council can learn from this tale of two taxes. The gas tax was adopted regionally, was familiar to taxpayers, was added to an existing tax of the same type and was masked by the fact that gas prices often rise or fall by a nickel a gallon. The transportation utility fee lacked regional support, was a novel approach to funding street maintenance, would have required a new collection mechanism and would have added a new bill to household budgets and business costs.

One tax is generating $3.5 million each year for street work in Eugene. The other hasn't contributed a dime, because it was never implemented - but it will be among the proposals studied by the city manager. The council should bear the divergent fates of these two taxes in mind as it revisits the perennial problem of how to support the chronically underfunded street program.
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Title Annotation:Editorials; Street funding plans meet different fates
Publication:The Register-Guard (Eugene, OR)
Article Type:Editorial
Date:Sep 29, 2004
Words:512
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