The city of Spokane quietly has begun building a case for a dramatically different way to fund street repairs here.


Spurned last spring by voters, who overwhelmingly rejected a property-tax-supported bond issue to fix the streets, and dubious about City Councilman Steve Eugsters proposal to carve money out of the citys general fund to repay street-repair bonds, officials now are exploring the creation of whats called a street utility.


Used in other communities, street utilities are similar to other municipal utilities that provide such services as water and sewer. A street utility here would charge fees to users of the road system, collect street-related funds from outside sourcessuch as state gas-tax receiptsthen use all those funds to pay for all of the citys road maintenance and construction needs.


Such utilities, asserts city Public Works and Utilities Director Roger Flint, are more consistent and reliable funding mechanisms for street repairs than bond issues or additional gas taxes, and arguably are a more equitable way of charging taxpayers for such repairs. For some types of businesses, though, the fees charged by a street utility would be significant, and thus much discussion is needed before the way those fees are assessed is determined, says Rich Hadley, president and CEO of the Spokane Regional Chamber of Commerce.


First, though, the city will need to lobby the Legislature next session to fix what Flint calls inherent flaws in the legislation that allows for such utilities. Key among those envisioned fixes would be easing the limitations on how street utilities can assess fees. The city of Spokane is working with the Association of Washington Cities to push for those changes. The city also expects that even if such legislation passes, it or another Washington city will need to test the legality of its street utility in court, and thus likely will force a lawsuit on the matter, Flint says. In anticipation of that, Spokane might work with other cities to establish a legal defense fund, he says.


If the city decides to go ahead with the utility, the action would only require approval from the City Council, though officials could decide to ask voters to consider the plan.


Given the tasks that lie ahead, Flint says its likely it will be at least two years before a street utility could be established here.


Currently, the city of Spokane spends about $14.8 million annually on streets, though only about $3.4 million of that is spent on actual maintenance, with the rest going toward such things as signals and lighting, street cleaning and plowing, and parking enforcement.


City officials estimate that because not enough has been spent on street maintenance, theres a current backlog of as much as $200 million in repairs needed to bring the citys streets up to acceptable levels. A citizens committee also has estimated that even if that backlog were eliminated, the city should be spending about $6.6 million a yearabout $3.2 million more than it spends nowto maintain its streets.


If a street utility were created, Flint says, the city would propose that it spend about $28 million a year on streets, including the about $6.6 million suggested for maintenance; the about $11.3 million spent today on signals, plowing, and the like; and another $10 million on the backlog of repair projects.


On the revenue side, the utility would take in the about $5.7 million annually that the city receives for street work from the state gas tax and real estate excise tax, and other outside sources, and add to those funds about $22.4 million it would assess on residents and businesses here in street utility fees.


As envisioned, if a street utility were created, the city would eliminate its current $7.9 million general-fund allocation to streets, and would reduce other forms of tax, such as other utility taxes, accordingly, Flint says.


Just how those fees would be calculated hasnt been determined, but city officials have put together a sample of how the fee system could work. Similar to other utility fees, ratepayers of the street utility would pay both a base fee and a trip fee, and the fees would be based on the impact the payer has on the citys streets.


For instance, as envisioned, the owner or renter of a residence would pay about $7.60 a month into the street utility, including both the base fee and the trip fees. For businesses and other organizations, the fee would vary greatly. A small, light-industrial business that generates vehicle trips only from its own employees, might pay about $20 a month, while businesses that attract a lot of consumers by car would pay much more. A large supermarket, for instance, might pay about $2,300 a month and a fast-food outlet around $600 a month.


The utility likely would use the same standardized vehicle-trip estimating data used for traffic studies done in connection with development projects.


Overall, businesses and other organizationsincluding government entitieswould pay about 64 percent of the overall street utility fees, and residents would pay the rest.


We felt like thats a good starting pointa fair way to assess peoples use of the streets, Flint says.


Flint already has begun the process of trying to convince the business community that thats the case. He made a presentation to the Spokane Regional Chamber of Commerces transportation committee last week, and is giving talks to other groups as well.


He contends that when businesses compare the proposed street utility fees to other possible road-repair funding methods, such as a property-tax increase to repay bonds, theyll find the utility fees to be favorable.


That, at least, is what Avista Corp. is thinking so far, says Judy Cole, the power companys director of business and public affairs.


Whats really gratifying is that its a common-sense approach, says Cole, who served on the citizens committee that has been studying street-repair options for Spokane. When we ran the numbers at Avista, we found that this by far was the most economical approach.


The chambers Hadley says that while the chamber hasnt fully studied the idea or voted on a formal position, his initial reaction to the proposal is that its a well-thought-through approach to street-maintenance funding.


We definitely need a dependable level of funding for street repair and maintenance for this community to keep growing and be successful in attracting new businesses, he says. We definitely have to figure that out.


Still, he says, it needs some vetting. We have some concerns with the trip fees, and how that falls heavily on businesses. We also need to talk about the border issues between the city and the county, since this is just a city proposal.


Avistas Cole declines to say how much Avista likely would have to pay into a street utility if it were formed, but said the amount would be less expensive than if the city were to use other forms of taxation to fund a comprehensive street-repair package.