What is a Transportation Benefit District (TBD)?

A Transportation Benefit District is an independent taxing district that can be formed by cities and counties in Washington. They can be used for acquiring, constructing, improving, providing, and funding transportation improvements within the area of the district. Projects may also include operations, preservation, and maintenance of transportation facilities.  Chapter 36.73 RCW contains the rules and regulations for forming and operating the district. Friday Harbor's Transportation Benefit District is governed by the Town of Friday Harbor Council.  Any funds raised by the district are used within the town.

Overview

The Friday Harbor Transportation Benefit District was established on July 17, 2014, to improve the Town's transportation infrastructure. Its boundaries are the same as the town's boundaries.

The Transportation Benefit District was formed to help support the Town's street fund.  Unlike other Town utilities, the street fund does not have a guaranteed revenue stream. Instead, it is funded by taxes and grants. This tax generated $3,144,551.45 in revenue received from June 2015 to August 2024. With the tax, the Town has been able to maintain existing streets, curbs, and sidewalks and upgrade other areas.  

Tax Increase Measures

Transportation Benefit District (TBD) tax is incorporated into local sales tax rates and may be up to 0.3%. Voter approval is required for the first 0.2%. An additional percentage of up to 0.1% may generally be approved by legislative body pursuant to RCW 82.14.0455, 36.73.040(3)(a), 36.73.065(1).

In 2014, voters approved a 0.2% sales and use tax within the District. On December 7, 2023, the Town Council approved a 0.1% increase to the tax. As of January 1, 2024, the TBD sales tax rate for the Town is 0.03%.

The TBD sales tax has a maximum duration of 10 years unless used for repayment of debt and may be renewed with voter approval.  In November 2024, voters approved renewal of the .02% tax, maintaining the .03% TBD tax rate for the Town for another 10 years.

Use of Revenues for Transportation Improvements

The revenues may be used for eligible “transportation improvements” listed in a local, regional, or state transportation plan in accordance with Chapter 36.73 RCW. Improvements can range from roads and transit service to sidewalks and transportation demand management. Construction, maintenance, and operation costs are eligible.

The District uses proceeds from this tax to acquire, invest in, construct, improve, provide, operate, preserve, maintain, and/or fund the following transportation improvements:

1. Projects identified in the Town's Six-Year Transportation Improvement Program. 
2. Expanded projects identified in accordance with RCW 36.73.160.

Examples of uses of these funds include: 

• Curbs
• Gutters
• Sidewalks
• Storm drains and/or streetlights
• Marguerite Place and First Street 
• Grover Street
• Tucker Avenue
• Upgrade to the Spring Street/Mullis Street intersection and crosswalk with high visibility lighting
• Annual asphalt overlay to upgrade and maintain street and safety conditions