Management & Operations

Newly approved tax increase saves Washington transit agency

Posted on March 1, 2002

Pierce Transit in Tacoma, Wash., will be able to preserve its current services and financial structure thanks to a 0.3% sales tax approved by Pierce County voters. The agency will recover a substantial portion of tax revenue that was lost when voters repealed the state motor vehicle excise tax (MVET) in November 1999. The MVET had comprised about 40% of Pierce Transit’s revenue. The agency lost the funding at the same time that its ridership had been climbing and it was preparing for expansion. Pierce Transit was forced to reduce service and start pulling from reserve funds. Bus fares and monthly bus passes were increased at the beginning of this year to help cover the cost of inflation, but the fare increases alone would not have paid for the services Pierce Transit wanted to provide over the next few years. Without additional revenue, Pierce Transit would have substantially reduced services in 2003. The sales tax increase will raise roughly $27 million annually for the agency, which has a 2002 operating budget of $63.9 million. The money will allow the agency to increase vanpools from 200 to 300, bus service by 5% to 10%, shuttle ridership by 17%, park-and-ride stalls from 4,100 to 4,950, bus stop shelters from 230 to 450 and ridership by 6%. Kevin Desmond, vice president of operations, said the immediate use of the tax revenue will be to maintain the current level of service. The long-term strategy will be to work with the public to figure out how transit planning can fit into local land use developments and new road projects. “Our focus will be on improving services for people, mainly commuters, who want a transportation alternative,” said Desmond. The initiative required only a simple majority to pass, and it received 54% of the votes. The tax will most likely be levied starting July 1, and the agency can anticipate seeing the monies in September. The tax increase will give parts of Pierce County the highest sales tax in the state — up to 8.8 cents on every dollar. Pierce Transit’s ridership was 14.6 million in 2000. The agency owns 162 buses, 137 shuttle vans for riders with disabilities and 210 vanpool vans, for 509 vehicles overall.

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