Poulsbo is considering forming a Transportation Benefit District with the implementation of a $20 car-tab fee for vehicles registered in the city to increase funding for neighborhood street improvements.

According to the Municipal Research and Services Center, TBD’s are quasi-municipal corporations and independent taxing districts that can raise revenue for specific transportation projects, usually through vehicle license fees or sales tax.

At Wednesday’s City Council meeting, finance director Deb Booher said there are very minimal, if any, grants eligible for neighborhood streets as they’re not an “arterial that meets the minimum requirement in order for it to be funded.”

The Neighborhood Streets Program is $150,000 per year, and the car tabs would add an additional $90,000 per year totaling $240,000. The car-tab fee could potentially be increased to $40 after two years and $50 two years after that, but the council would need to vote on that. Poulsbo is the only jurisdiction in Kitsap County that has yet to form a TBD.

“We’ve got a lot of deferred maintenance out there,” councilmember Gary McVey said. “We’ve tried in the past to attract grant funds for some of this work. It’s not available…It’s kind of on our own dime to take care of our neighborhood streets. This has been a pent-up need for some time. I like the plan.”

Public works superintendent Mike Lund said in 2017, the city chip-sealed 1.5 miles of roads at $216,000. In 2020, they chip-sealed 1 mile of roads at $118,000. The city is under contract to sealcoat 3.3 miles of roadways at eight different developments totaling $305,000. There are also many other neighborhood street improvement projects beyond 2022.

“Streets are a core service and for many years they did not receive priority as a core service,” councilmember Dave Musgrove said. “We spend money on all kinds of stuff and somehow we could never spend enough money to maintain 80 percent of our roads that are residential. It’s about time that we’re taking care of it.”

A public hearing was held, but there were only a few written comments. Council will vote on whether to pass the ordinance at its meeting Dec. 8. If the TBD is formed, notification will be provided to the state Department of Revenue. Funds will not be collected for six months and will be based on DOR’s regulations of date and implementation.