Thursday, July 30, 2009

A taxing dilemma

The City of Sisters has a dilemma on its hands.

Its analysis of its street maintenance requirements shows a need for about $140,000 per year in maintenance. The street fund is funded to about $90,000, with additional funds subsidized by transfers from the general fund.

That’s not sustainable over the long haul.

Everybody knows that deferred maintenance creates greater costs in the long run and when it comes to street repairs, the costs accelerate tremendously as road conditions worsen.

So, the city is proposing a 3 cents per gallon gas tax. They figure it would cost the average driver who buys all their gas in Sisters about $21 per year. It’s acting now, because come September there will be a four year moratorium on local fuel taxes.

The idea isn’t real popular among the fuel dealers in Sisters and among some other local folks. They argue that such a tax unfairly burdens five local businesses, making them less competitive with stations in Bend and Redmond (Redmond, too, is reportedly considering a gas tax).

They believe that an extra 3 cents per gallon will lead people to fill up in Bend when they’re running errands in the big town.

The city council says it looked at other funding mechanisms — specifically a utility bill surcharge — but they say it’s too burdensome on city residents and property owners. They say a gas tax is more broadly distributed and captures money from people — outlying residents and tourists — who use city streets but don’t pay city taxes.

This isn’t the best time to add to anyone’s tax burden. But then again, it’s not good stewardship to defer maintenance and incur greater costs down the road.

So, what should the city do? Pass the tax? Wait four years and put it to a vote? Presumably the city would continue to subsidize the street fund out of the general fund for those four years. Should they go ahead with a utility bill surcharge — about $114 per year for each account? Do nothing?

If the answer is “take it from somewhere else in city government,” where should it come from?

We all want our streets to be decent to drive on. How do we pay for them?

Jim Cornelius, Editor


  1. Our family drives 35,000 miles at about 25 mph. 1400 gals a year. I will be doing more gassing up in Bend when doing Costco runs. And Bend gas is already 5 cents cheaper than Sisters. I expect that other Bend stores will be getting my shopping dollars. Too bad for Sisters businesses.

  2. So if the city passes a 3 cent a gallon gas tax, you are going to punish all the buisnesses in Sisters by shopping in Bend? Thanks a lot neighbor.

  3. Anonymous #2: Yep

  4. Anon2, yes my family is a higher priority than Sisters businesses, even though I would prefer to spend my scarce dollars locally.

  5. Everybody is missing the boat on this issue. This is not a question of this being a good tax or a bad tax; the relevant question is would this tax be lawful. Consider this:

    The Oregon Constitution at Article I, Section 32: “No tax or duty shall be imposed without the consent of the people or their representatives in the Legislative Assembly…”

    The city charter approved by the people has no words whatsoever granting the city authority to levy any tax without voter approval. I can't find any legislation resulting in law granting this authority and the city has not cited any such authority. Therefore, it would be unconstitutional for Sisters to implement a local gas tax without voter approval.

    Just because the charter has no specific language prohibiting the council from implementing a local tax doesn’t mean they can. Some charters have this provision but most do not.