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INFORMATIONAL MEMO <br />Page 2 <br />varies with zoning or location of the facility, the duration of the parking, the time of entry or exit, <br />the type or use of the vehicle, or other reasonable factors." <br />Staff is recommending that the ordinance be modified to set the tax rate at 5% for commercial <br />parking facilities operated by nonprofit agencies on City owned properties. Changing the tax <br />rate for Star -fire would result in a reduction in projected revenue of approximately $10 thousand <br />in 2019, $21 thousand in 2020, and $36 thousand in 2021. <br />Another option to consider would be to increase the parking tax rate in two steps rather than <br />three. Effective January 2019 the rate could increase to 10% and January 2020 the rate could <br />increase to 15%. This would replace revenue lost if Starfire is capped at 5% and would <br />increase funding available for roadway projects. The following chart shows possible parking tax <br />revenue under different scenarios. <br />Potential Parking Tax Revenue (Based on 2017 revenue) <br />2019 2020 2021 <br />Current tax rate of 5% $ 214,000 $ 214,000 $ 214,000 <br />Proposed 3 step increase (8%, 11%, 15%) <br />(Starfire not capped at 5%) 343,000 472,000 643,000 <br />Proposed 3 step increase (8%, 11%, 15%°) <br />(Starfire capped at 5%) 333,000 451,000 607,000 <br />Proposed 2 step increase (10%, 15%) <br />(Starfire not capped at 5%) 429,000 643,000 643,000 <br />Proposed 2 step increase (10%,'15%) <br />(Starfire capped at 5%0) 411,000 607,000 ` 607,000` <br />The City currently collects parking tax revenue from the following parking establishments: <br />SeaTac Hotel Embassy, CHA Tukwila Doubletree Int'l Gateway E, Courtyard by Marriott, RT <br />Hotels Econo Lodge, RT Hotels SeaTac NE, Washington Towers, CHA Tukwila, Starfire Sports, <br />Republic Parking (Sounder stations), Republic Parking (154th), Shuttle Park Two, Diamond <br />Parking Svcs. <br />FINANCIAL IMPACT <br />The following projected revenues are based on 2017 tax revenues collected at the 5% rate. <br />2017 Actuals <br />$ 214,493 <br />Projected Annual Commercial Parking Tax Revenue <br />January 2019, 8% 2020, 11% 2021, 15% <br />$ 343,189 $ 471,885 $ 643,479 <br />RECOMMENDATION <br />The City Council is being asked to give policy direction on the options described above for <br />incorporation into the draft ordinance for Committee of the Whole review. <br />54 W:12018 Info Memos\Parking Tax 8.15.18.docx <br />