The Ridgefield City Council made good on its promise to eliminate a $30 car tab fee Thursday after voters passed a ballot measure to replace the fee with a sales tax increase in the November general election.
The new vehicle licensing fee schedule goes into effect April 1.
Proposition 1 passed with 59.3 percent of voters in favor and 40.7 percent opposed. Instead of collecting the $30 car tab fee, the sales tax rate will increase by 0.2 percent, putting the city’s tax rate at 8.6 percent. The new tax rate will also go into effect April 1.
Funds from the tax increase will be used to pay for pavement-preservation projects included in the city’s six-year capital improvement plan. This includes upgrading substandard roads, improving pavement conditions and improving ADA accessibility.
The city says keeping up on scheduled maintenance extends the life of streets by 50 percent and is less expensive in the long run.
The retail sales tax rate applies to goods and services, such as buying household items or getting your car serviced. It also applies to new construction, but revenue from new developments cannot be used to maintain existing streets. However, developers also pay sales tax on construction materials purchased in or delivered to Ridgefield, which can be used for that maintenance.
The sales tax increase is expected to generate more than $7.5 million over 10 years, with $3 million coming from new construction and $4.5 million from general retail sales.
“By replacing the vehicle license fee with a 0.2 percent increase to the sales and use tax, Ridgefield voters and council have spread the tax burden for pavement preservation to all who shop in Ridgefield, drive on our streets and develop here, rather than resting solely on Ridgefield residents,” Mayor Don Stose said in a statement Friday.