Item 4: Ordinance on Business License Tax on Motor Vehicle Fuel Dealers

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RELATED CITY POLICIES The council’s Vision and Goals Statement with respect to Fair, Stable and Adequate Financial Resources reaffirms commitment to “a local government whose ongoing financial resources are based on a fair and equitable system of taxation and other revenue sources and are adequate to maintain and deliver municipal services.” In January 2007, the council identified a new council goal to “Develop mechanisms to adequately fund our transportation system for cars, trucks, bikes, and pedestrians including maintenance and preservation and capital reconstruction.” Additionally, the City’s Financial Management Goals and Policy, A.4, states that the City’s municipal service priority Level 2 (second only to the preservation of the public safety system) is to “maintain and replace the City’s fixed assets, which includes… infrastructure…so as to optimize their life.” COUNCIL OPTIONS The Eugene City Council has the following options with regard to the proposed code amendments: ?Option 1: The council could decline to take action on the ordinance, choosing to make no changes to the Eugene Code and effectively allowing the City’s motor vehicle fuel tax rate to revert to three cents per gallon after February 28, 2011; ?Option 2: The council could approve the proposed code amendment as shown in Attachment A to repeal the sunset provision enacted in 2005, and extended in 2008, effectively leaving the fuel tax rate at five cents per gallon for an indefinite period, or ?Option 3: The council could choose to extend the sunset for an additional three years to February 28, 2014 (beyond the four-year moratorium period), after which time any additional extensions on the two-cent tax would need to be referred to the voters, with the attendant election costs. CITY MANAGER’S RECOMMENDATION The City Manager recommends Option 2 for the adoption of these proposed amendments to the motor vehicle fuel tax code to repeal the sunset provision and preserve the council’s ability to keep the local City gas tax at the five-cent level. SUGGESTED MOTION Move to adopt an ordinance concerning motor vehicle fuel dealers’ business license tax and repealing Section 3 of Ordinance No. 20337. ATTACHMENTS A. An Ordinance Concerning Motor Vehicle Fuel Dealers’ Business License Tax and Repealing Section 3 of Ordinance No. 20337 B. Memo on Engineering Overhead on Capital Projects from City Engineer Mark Schoening Z:\CMO\2009 Council Agendas\M090727\S0907274.DOC