Olathe council asked to consider new tax for streets

07/10/2013 12:20 PM

07/10/2013 12:20 PM

Olathe might soon be asking its residents to help fund city street improvements.

The city’s streets are declining and Olathe doesn’t have enough money to solve the problem before it gets worse, city staff told the council during a special study session on Tuesday evening.

The staff is urging the council to consider a mail-in election this fall to ask voters for a 10-year, three-eighths cent sales tax to fund street maintenance.

“We need to take fiscal responsibility and get on top of this issue,” said city manager Michael Wilkes. “The bottom line is if we don’t begin funding our street maintenance at a significantly greater level, in 10 years or less our taxpayers will be paying at least 10 to 15 times what is needed today for streets. It is our responsibility to make sure we don’t create that major burden for ourselves and future taxpayers if we can avoid it.”

He pointed out that the city maintains more than 1,200 lane miles, of which 148 require work. And street repair isn’t cheap. Local mill and overlay costs $118,000 per lane mile and major repair mill and overlay costs $185,000. City staff estimates an additional $9.26 million is needed each year to adequately fund street maintenance over the next decade. Right now, Olathe can afford to address only 43 percent of the need, he said, but a three-eighth cent sales tax could fund all of it.

Over the past several years, the city has been trying to invest as much general fund cash as it responsibly can into street maintenance, but that has meant making significant cuts to other programs and departments, Wilkes said.

“To dig deeper into the general fund would impact us extremely negatively,” he told the council.

Before it came up with the sales tax concept, the city had been mulling over other ways to come up funding, such as increasing the mill levy. But the staff felt that wouldn’t be fair to property owners.

Officials believe a sales tax is more sensible because it would apply to everyone who uses Olathe streets — including non-residents — and would require voter approval, so taxpayers in the city could have a direct voice.

City staff is asking the council to vote on the mail-in election by Aug. 6.

And although the majority of the council members agreed street maintenance needed to be funded, some were skeptical about the proposed tax and felt other options should be considered as well.

“If we were voting today, I’d say no,” said Councilman Ron Ryckman. “I wonder if we have cut enough in the current budget to offset some of this. I don’t think we have. I just have a lot of questions and want to review this information.”

Wilkes said the council should spend the next few weeks studying all the data and asking questions.

The council will vote on the issue at an upcoming meeting yet to be determined. If there is an election, ballots would be mailed to Olathe voters on Oct. 23 and be due on Nov. 12. The sales tax would go into effect in April 2014 and end March 2024.

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