Redmond City Council approves 12.5% rental car tax, starting March 1, to help fund transportation projects
REDMOND, Ore. (KTVZ) – The Redmond City Council has unanimously approved implementing a 12.5% rental car tax that’s due to take effect March 1, to help fill a funding gap on needed transportation projects, beginning with the Eastside Arterial Project.
The city’s recent five-year Transportation Capital Improvement Program identifies $64 million worth of projects, and existing resources estimated at $37 million, leaving a 42% funding gap.
The new citywide car rental tax of $12.5% of gross rental fees, including at the Redmond Airport, is designed to have visitors to the community help fund the needs for its streets, staff said. At least three other Oregon jurisdictions – Medford and Lane and Multnomah counties – have fees of 12-17% on gross rental fees. It’s expected to bring in about $2 million in revenue.
As an example, a three-day rental of a mid-sized car in Redmond costs about $51 a day, or $154, before other taxes or fees. The 12.5% rental car tax would add about $19, or $6 a day to that cost.
The city did exempt some rentals, specifically of RVs and rental trucks, from the new fee.
Before Tuesday night's vote, city councilors Tobias Colvin and Cat Zwicker were among those surprised such a tax already wasn’t levied by the city, to have visitors help pay for street needs.
