Item B: Transportation System Maintenance Fee

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ATTACHMENT A Public Works Administration City of Eugene 858 Pearl Street M Eugene, Oregon 97401 EMORANDUM (541) 682-5241 (541) 682-6826 FAX www.ci.eugene.or.us Date: July 24, 2006 To: Mayor Piercy and City Council From: Kurt Corey, Public Works Director, 682-5241 Subject: An Ordinance Establishing Transportation System Maintenance Fees Based on Council direction at the February 27, 2006, work session on transportation system funding needs, staff has prepared this memo, which describes the principal provisions of a proposed transportation system maintenance fee (TSMF) rate methodology, provides estimated rates and example customer fees and points out major elements of a TSMF ordinance. A proposed ordinance accompanies this memo. This ordinance is based on and is similar to the prior TSMF ordinance adopted by Council on December 9, 2002 and subsequently repealed by Council on September 8, 2003. Overview of an Ordinance Establishing the TSMF Under state law and local code a TSMF would fall into the category of utility or user fees. Authority to establish utility and user fees falls to local governments under state statutes. An ordinance establishing a transportation system maintenance fee should address the following elements: Purposes of the TSMF, which also control the allowed uses of the fee; $ Definitions for terms used in establishing and controlling the TSMF; $ Restrictions, beyond the purposes statement, on uses of TSMF revenues; $ Authority for imposing, setting and modifying the amount of the fee (ratemaking procedure); $ Ratemaking standards which control the basis and methodology for implementing the fee; $ Adjustments and appeals; $ Mechanisms for billing, payment and collections; and, $ . Authority for administrative rule making and methodology $ The proposed ordinance would establish a TSMF to be paid by all customers having possession or control of premises in the city. Vacant or undeveloped property would not be charged. The purpose of the fee will be to fund operation, maintenance and preservation of the transportation system, including reducing the backlog of needed street repairs. A detailed definition of the transportation system is provided in the ordinance to further clarify those portions of the system which are eligible for use of TSMF revenues. Revenues would be used to operate, preserve and maintain the existing street and bikeway system. Use of revenue would be restricted to the prescribed purposes and would be further prohibited from use for capacity-enhancing improvements of the street system. The ordinance is structured to be generally consistent with adopted wastewater and stormwater service charge (user fee) ordinances. Based on prior Council direction, the TSMF ordinance would provide more detail on ratemaking standards and customer categories than ordinances governing stormwater and wastewater user fees. The ordinance would provide a policy framework, fundamental rate structure and minimum customer categories, procedures, limitations and a mechanism for implementation of the rates by administrative order of the City Manager. This implementation mechanism would provide for public notice and a public hearing prior to the City Manager issuing an order imposing or amending the fee. The ordinance also would provide for the Council, if it so chooses, to review and hold a hearing on any change proposed by the City Manager. The Council could