Two new quarterly taxes were proposed at the May 3 North Bend City Council meeting, both intended to help fund the city’s road repair needs. The first, a 25-cent-per-square-foot Business and Occupation (B&O) tax, was unanimously approved. A second tax, proposed at 30 percent of gross proceeds of commercial parking, was unanimously sent to a future council workshop, instead of a vote.

The B&O tax is projected to raise about $170,000 for the city annually. The tax will apply to all the floor space of any organization doing business in North Bend, with a three-tiered rate based on total square feet in a business.

Exemptions from the tax are provided for businesses, other than storage facilities, with less than 10,000 square feet of space. Vacant businesses will also be allowed to claim exemptions for two years.

City finance manager Dawn Masko noted that few cities offer an exemption for vacant buildings.

“The hope is that buildings will be utilized at their highest and best use and not remain vacant,” she explained.

B&O taxes are paid to the state monthly, quarterly or annually. The first collection that will include the new tax is due July 31.

The second tax proposal was preceded by an apology from City Administrator Londi Lindell, who said the item was mistakenly put on the consent agenda, for items requiring council approval without review.

The parking tax, she explained, was proposed as a funding source for city street work, like the B&O tax, but unlike the B&O tax, it hadn’t been discussed with the full council for more than the past year. No vote was expected on the issue at the meeting.

“We never want to rush any public discussion,” she added. “We want you to take whatever time you need, hear the staff presentation, ask all your questions, make sure the public has an opportunity to comment.”

Nearly all members of the public who attended the council meeting were there to discuss the proposed tax, too.

As proposed, the new ordinance would impose a 30 percent quarterly tax on the gross proceeds of commercial parking fees collected in the city. The TA truck stop near Exit 34 of Interstate-90 is the only business listed in the ordinance and Lindell said it is currently the only business that would be affected by the ordinance.

However, she said, “We’re a very popular place to come hike.” Recreational visitors are causing traffic impacts, too she noted and “It’s very probable that we’re going to have paid-for parking in the future.”

Several citizens urged the council to reject the proposed tax and to become more supportive of the truck drivers who use the TA center.

TA representatives speaking at the meeting also asked the council to abandon the proposal. Further, TA attorney Larry Costich indicated in a written statement to the city that the tax would not apply to TA.

“The truck stop’s position is that they don’t charge for parking… they use a reservation system, and so this ordinance would be inapplicable to them.”

Reservations are for a 23-hour window at the TA center and the cost varies with how far in advance the 140 spaces are booked, said TA manger Primus Jayakody; the further in advance a space is reserved, the less expensive it is. Prices ranged from $6 to $10 on average, he said.

Lindell told the council that “we have more work to do with truck town…. The idea really is that everyone contributes fairly to the impact the create on the streets.”

After a lengthy discussion, Councilman Jonathan Rosen suggested the council send the proposed parking tax to a work study meeting, in a motion that was unanimously approved.

Both taxes were proposed as means of funding the city’s street maintenance costs, projected at more than $400,000 annually. North Bend implemented a .02 percent sales tax, approved by voters, in 2011 to raise additional funds for street repairs. That tax was projected to bring in $100,000 annually. The B&O tax is projected to raise another $170,000 annually. City staff could not project the revenue from the proposed parking tax without more specific data about how many paid stalls are used at the truck stop and what rate the truck stop charges.