Pierce Transit Sales Increase Will Be On November Ballot
This November you’ll be seeing an item on the ballot asking you to approve a 0.3% sales tax increase for Pierce Transit.
The proposed increase is designed to restore some of the transit services that have been cut in recent months due to decreases in revenue. Service hours would be increased, and further reductions would be staved off.
An overall drop in sales tax revenue, and the recent redrawing of Pierce Transit’s boundaries to not include Bonney Lake, Buckley, Dupont, Orting, Sumner, and other unincorporated parts of the county have contributed to the drop in revenue, but might also mean a change in the balance since the last time such a proposal went to voters.
In February of 2011 voters narrowly rejected a 0.3% sales tax increase, leading in part to the cuts. With the pared-down district, the areas that remain are in general those that showed higher support for the increase in the last vote, and passage would mean that the benefits would only be seen by those areas. But will that be enough to sell voters on it?
According to a recent Tacoma Weekly article about the June 4 public hearing on the topic, most commenters supported the measure. A sales tax increase is a tough sell right now. But on the other side of the coin are concerns that decreasing transit services could ultimately mean that the whole system becomes insufficient.
Read more from the recent public hearing from the Tacoma Weekly.
Previously from Exit133: Potential Sales Tax Increase for Pierce Transit.
Filed under: Transportation, Legislation, Pierce County, Transit
22 comments
F fredo June 12, 2012
“According to a recent Tacoma Weekly article about the June 4 public hearing on the topic, most commenters supported the measure”
That meeting was carefully staged to provide the appearance that the public was in support of the tax increase. If you hold a meeting about hair styles the people who will tend to show up will be people interested in hair styles.
E Erik B. June 12, 2012
If the Pierce Transit measure passes, it will, for the first time make the the City of Tacoma the highest (sales) tax rate in the State of Washington.
The City of Tacoma should consult some marketing people and/or economists to determine what effect, if any this could have on consumer buying in the City of Tacoma. Consumers do make some buying decisions based on tax rates.
Also, what effect will having the highest tax rate have on the budget deficit that the City of Tacoma has?
If Tacoma wishes to allow itself to become “Washington’s Most (sales) taxed city” it should at least balance the potential adverse consequences of doing so before it hemorrhages more businesses. Tacoma already has a large B&O tax which many surrounding cities do not have.
O OkayThen June 12, 2012
I wonder if this would scare off the remaining car dealers. The remaining boat dealers might disappear too. (Are there any left?)
hmmm… If the City gets tax $$$ from these dealers and this money disappears with passage, it would seem those Councilmembers voting for it should have a plan to replace the lost revenue or a plan to cut City services. Do Strickland & Fey have a plan?
E Erik B. June 12, 2012
Good points Chris. Yes, bus service is good.
However, in this case, we have balance the benefit of extra bus service with the potentially harmful effect of trying to impose the highest tax rate in Tacoma for the first time in the city’s history.
At what point do Tacoma’s tax rates become toxic to businesses and potential buyers of large ticket items? Tacoma has already lost most of it’s car dealerships. Trying to impose a record 9.8 percent tax rate could drive the rest of them out of the city.
While Pierce County grew 13.5 percent from 2000 to 2010, Tacoma grew only 2.5 percent. Olympia grew at 9.3 percent and Seattle grew 8 percent.
Tacoma is failing to attract businesses and people like adjacent cities and suburbs are. Many adjacent cities have no B&O tax which Tacoma has.
Tacoma has to be very careful they are not creating yet more barriers for people to move, shop and do business here.
F fredo June 12, 2012
The focus at PT has to be efficiency. If they are paying even one employee more than has to be paid then they aren’t operating efficiently.
Erik B. is correct. We’re crossing over into an unacceptable level of sales taxes and the slight benefit of restoring some bus routes for a year or two comes at a very dear price indeed. If we drive sales volumes out of the taxing district then we may end up taking in LESS sales taxes at 9.8% then we are at 9.5%. Who would benefit from that?
E Erik B. June 13, 2012
Chris,
I certainly agree with your belief that buses are good for cities. That is exactly why I voted for the last Pierce Transit measure.
However, that is simply the beginning of the analysis, not the end of it.
The value of more bus service in Tacoma has to be balanced with the possible detrimental effect on people and businesses choosing to live in Tacoma and potentially buying large ticket items in Tacoma.
In addition to the loss of businesses in Tacoma, there is also the potential for loss of revenue for the City of Tacoma.
Imposing the highest sales tax rate for purchases made in Tacoma is a completely new territory for the city, and I do not believe it should be taken lightly or the potential downsides dismissed out of hand.
The concern for Tacoma’s competitiveness was one of the main reasons the Tacoma City Council rightfully choose to raise the threshold for the B&O tax to $200,000. Tacoma’s B&O tax is perceived by many as one of the reasons business choose to flee Tacoma and/or start in the suburbs or in less taxing cities.
Similarly, I think it is important to weigh all potential effects, even if they make us feel uncomfortable before Tacoma decides to become the city in Washington with the highest sales tax in the state.
The Pierce Transit tax measure has no sunset provision so Tacoma better analyze well and choose wisely as Tacomans may be stuck with the highest tax rate for many years to come.
F fredo June 13, 2012
Chris, Erik just used car dealers for an example of a business with high ticket items. He could have cited dozens of other businesses with high ticket items such as appliance dealers, furniture stores, or jewelry stores. Do you want to run all those businesses out of town too because they aren’t high tech or medically related?
C Chris K June 13, 2012
Businesses got a tax cut and now city services have to be cut as a result. We closed two libraries and now we have to layoff people in police and fire.
The exemption for big hospitals was dropped because this community, when given the chance, believes in paying your fair share of taxes for vital public services, like parks and schools, emergency services, and yes, transit.
It’s worth noting that
The Sales tax rate went up last year because of 911 measure, but that’s not related to this measure.
F fredo June 13, 2012
“this community, when given the chance, believes in paying your fair share of taxes for vital public services” Chris K.
Nobody is going to argue that point Chris. The problem is that everybody has a different interpretation of the word “fair.”
For you the fair tax rate for Pierce Transit is .09% (the proposed rate). For me the fair tax rate for Pierce Transit is .06% (the current rate). See,I’m just as fair as you are!
J jackson June 13, 2012
Explain your “buisnesses wont come” theory when we talk about Russell? When Russell moved from Tacoma at a 9.3 rate to Seattle which at the time was at 10 what was the excuse then people?
Do you really think businesses want to come to a place where there is no weekend buses hauling their employee’s to and from their work? Doubtful. Howe about no bus service past 7pm? What abut those workers that can get to work but cant get home?
Lets not forget about our aging population or do you not care about them either?
J jackson June 13, 2012
Who is going to pay the toll to go to Gig Harbor where it will be 8.8%? So a $100 purchase your going to save $1 dollar but loose $3 for the toll?
Or drive out of the county to King County were its 9.5 to save 30 Cents? Gosh, you null and void your savings before you even get out of the driveway!
BTW, PT has cut $111 Million in 4 years Fredo! You cant point your “you have not done enough” at PT like you can at other Government Agencies! But I suspect you the type that no matter how much government cut and saved there still would not be enough until its no more!
F fredo June 14, 2012
“Do you really think businesses want to come to a place where there is no weekend buses hauling their employee’s to and from their work? Doubtful” jackson
I don’t think that the transit schedules are a key determinant of location for most businesses. Try to imagine an executive who wants open up a business in Tacoma. Is he really going to say “I can’t open there…there’s no Sunday bus service.”
When we had full bus service until a couple of years ago we saw very few businesses opening in Tacoma so that invalidates your theory about businesses wanting to open here if we have full bus service.
F fredo June 14, 2012
“BTW, PT has cut $111 Million in 4 years Fredo! “ jackson
Well, if they were able to reduce expenses by that amount in four years then they could certainly be expected to reduce expenses a bit more so that a sales tax increase would not be needed. They haven’t even touched salary levels yet. These transit folks are living high on the hog.
T tacoma_1 June 14, 2012
Fredo
Of course CEO’s consider access to transit when they locate their company’s.
The new location for amazon.com in Seattles SLU neighborhood is specifically situated because of it is a transit rich walkable neighborhood. The SLUT uses the same train cars that TLink does. Goes the same distance. It is supported by tons of local bus service that runs late into the weekday eves as well as weekend service too.
T tacoma_1 June 14, 2012
The old Wamu bldg, Russrll Invesmnts new digs is 55 stories above ground, totalling 1M sq sq ft of office space. The tower only has 6 floors below ground for parking. Only way that math works is with lots n lots of transit.
Anyone that thinks that a city can have a viable downtown core without a viable transit system is foolish.
F fredo June 14, 2012
Something that appears to work in a major city like Seattle where you have extremely high density living and employment may not necessarily work in a sleepy old mill town like Tacoma with few employers and almost zero DT residential..
For the record just 2 or 3 years ago we had lots of transit and yet…nobody was opening businesses here. You can’t expect the voters to believe that businesses which wouldn’t open when we had lots of transit before will now want to open when the transit is restored. Doesn’t make sense tacoma1.
T tacoma_1 June 14, 2012
Not true fredo hou can’t rewrite history The downtown grocer opened up recently and wouldn’t do so until the city built them a new TLink stop.
Transit is an important part of a DT business plan.
O OkayThen June 14, 2012
Love data from the beginning of the recession. Let’s pull a little deeper on car (& parts) sales in Tacoma:
2001: $513M
2002: $541M
2003: $562M
2004: $564M
2005: $636M
2006: $635M
2007: $647M
2008: $522M
2009: $434M
2010: $475M
2011: $536M
Recession? Climate? Exodus? Other?
F fredo June 14, 2012
“The downtown grocer opened up recently and wouldn’t do so until the city built them a new TLink stop. “ tacoma_1
Source?
It should be noted that t-link is a part of Sound Transit and not Pierce Transit. The sales tax increase proposed doesn’t have anything to do with t-link or any tlink stops.
T tacoma_1 June 14, 2012
I don’t think that a business cares whether their customer arrives via PT or ST. The important thing to the business is that it is one more customer and inherently a more profitable customer since the business owner didn’t have to build an expensive parking spot for them. It would be a foolish business decision to campaign against that customer.
F fredo June 14, 2012
Did you find a source for your claim that the grocery store wouldn’t open up without a new transit stop?
F fredo June 15, 2012
I read the entire news piece you linked, tacoma_1 In fact I read it twice because I’ve never known you to just make stuff up.
It doesn’t say anywhere in your link that “the grocery store (Pacific Ave. IGA) wouldn’t open up without a new transit stop.” Somebody was quoted in the story who claimed that the city of Tacoma “pushed for a new transit stop.” You’re certainly permitted to draw whatever conclusion you wish but there’s no evidence that the store wouldn’t open up without a new transit stop.
But since you brought up the idea of providing transit services to prospective new business I wonder what you think of this idea. Anytime a new business is thinking of locating in Tacoma, the city and/or Pierce Transit is required to put in a new transit stop or a new line to serve that business. Is that a good idea or a bad idea?