Residents spoke out against a potential car tab fee during a Federal Way City Council meeting, Tuesday.

At the meeting, city staff held a public hearing and first reading of an ordinance to create a Transportation Benefit District – a taxing district run by the mayor and council that allows them to raise revenue for specific transportation projects, usually through vehicle license fees or sales taxes.

Although council members didn’t vote on any type of fee structure Tuesday night, the 2017-18 biennial budget, approved in December, included implementing a Transportation Benefit District, increasing admissions fees and a staggered increase of business registration license fees to help pay for nine additional police officers over the next two years.

Mayor Jim Ferrell proposed the additional police officers after the city incurred its eighth murder in 2016. Many in the community also expressed a need for a deeper police presence after Federal Way was hit with three murders in 48 hours last May.

“The city needed funds in the general fund to accomplish other things, and so there are general fund monies being used right now to fund transportation items,” Desiree Winkler, the city’s deputy public works director and street systems manager, said when asked how a transportation district could help fund police. “Those funds could be used for other general fund items if we had Transportation Benefit District revenue be used for transportation items.”

Funding those transportation projects could come from a $15-$20 fee tacked onto residents’ annual car tabs, although many different options are possible, such as a voter-approved .2 percent sales- and use-tax increase, general obligation bonds, a border area fuel tax, impact fees on commercial and industrial development, vehicle tolls, excess property taxes or local improvement districts.

A $20 vehicle license tab fee would generate about $1.2 million, with a net revenue of $1.1 million.

Winkler said more than 90 cities and towns have formed transportation benefit districts with more than half utilizing a $20 license tab fee. The fee could rise to $40 after two years and $50 after another two years. Any fee more than $50 must be approved by voters, she said.

A second reading of the ordinance and vote of the Transportation Benefit District is scheduled for Feb. 7. Details on the fee structure or scheduling won’t be determined until March 21.

But some residents say adding any type of fee, even a $20 one, could pose a financial burden.

Linda Kochmar, a former state legislator who also served on the City Council for 14 years, testified that the hypothetical fee would be in addition to other car tab fees and taxes, such as the money Sound Transit collects on car renewals — $110 after the passing of Sound Transit 3.

“… You need to look at it from the needs of your taxpayers,” Kochmar said to the council.

She said residents are going to have “sticker shock” when they renew their license fees, and Federal Way is going to have “some pretty unhappy people.”

Federal Way resident Dana Hollaway is one of them.

“I feel like I can’t afford it … I know it’s going to be a lot of money,” Holloway, who was in tears, said. “I have multiple vehicles, and I don’t like the way you’re managing the budget, and there’s people that are middle income, not poor income, but they may lose their homes just because of everything that’s going on here. Please help us.”

Residents Julie Cleary and Matthew Jarvis questioned the city’s transparency on how the funds will be spent.

“You’ve blown the city budget on the performing arts center, on your parks, on the Target building and then somehow you run out of money for streets and you run out of money for police,” Jarvis said, adding that city officials should have the integrity to say they need the car tab fees for the Performing Arts and Event Center’s $1 million operations budget once it is open.

Cheryl Hurst, a resident of the nearby unincorporated King County, was the sole testifier in favor of the fees, stating that if residents want services, they have to pay for them.

“Money doesn’t come out of the sky,” she said. “We have to have a tax for this, and we have to have a tax for that.”

After the public comment period, council members instructed city staff to look at whether fee exemptions were possible for low-income individuals. In a following discussion, Ferrell and Councilman Mark Koppang explained that the city is being transparent in where the funds would go, and that they want to increase public safety.

“It’s not about the Performing Arts and Event Center. It’s about safety in the community,” Ferrell said, noting that the operation budget for the arts center is $570,000 in year one, $140,000 in year two and less than $100,000 in the third year.

While returning Councilman Bob Celski said he does not like the idea of raising taxes, during his time studying the budget, he realized the city has grown by 5.5 percent.

“I just don’t think a city of 95,000 can operate on a budget of 90,000,” he said. “I just can’t see how that math pencils out.”

If the council does approve a Transportation Benefit District on Feb. 7, the soonest the district would go into effect is this summer, with fee collection beginning in September.