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Construction crews work on North First Street in May in Yakima.

Yakima city officials are bracing for voters’ decision on an initiative that potentially could gut funding for street projects, including a massive one on North First Street now underway.

Initiative 976 on the Nov. 5 ballot aims to cap car-tab fees at $30 for vehicles weighing under 10,000 pounds and eliminate an additional $20 fee imposed by many cities statewide, including Yakima, to help fund transportation projects.

Funds collected through the additional registration fee go into a transportation benefit district for cities. Yakima alone receives about $1.6 million a year from the benefit district the initiative would take away. Those funds are used to secure loans and bonds on large projects.

The TBD money is needed to finish the remaining two phases of the $15.5 million North First Street project and other projects, said city spokesman Randy Beehler.

The city has several additional street and sidewalk projects, some part of the Safe Routes to School program, totaling more than $4 million that are dependent on TBD funding, he said.

“Without the TBD funds, those projects don’t happen for the foreseeable future,” he said. “We wouldn’t have that funding source. Those projects on the TBD list would be either significantly delayed or possibly canceled.”

Tim Eyman, author of the initiative, calls the fees “dishonest taxes” and says the state has more than enough in surplus taxes to fund such projects.

“As I’ve said in every interview, every column, every debate, and in the voter’s pamphlet: The state’s $3.5 billion tax surplus is more than enough to easily backfill any affected program,” he said.

Some cities across the state have already committed to bonds and loans for large transportation projects that were secured through anticipated TBD money. Those cities will be scrambling to find ways to repay the debts if the initiative is approved.

Yakima has avoided such a dilemma by taking the North First Street project, and funding sources, one step at a time, Beehler said.

The North First Street project includes rebuilding the road bed and installing a new road surface, sidewalks, lighting and utility infrastructure.

The first phase will be complete in about a week with the second phase scheduled to begin this spring and the final phase in spring 2021. The city has yet to commit to any bonds or loans for the remaining phases, Beehler said.

“Thankfully we’re not in that position,” he said.

This isn’t Eyman’s first attempt to limit vehicle licensing fees. In 1999, the former West Valley resident rolled out his first-ever effort with voter-approved Initiative 695, which capped auto licensing fees at $30. But the initiative was struck down by the state Supreme Court as unconstitutional.

State lawmakers subsequently drafted and approved legislation capping fees at $30.

The cap gutted a state fund that assisted smaller cities with limited tax bases. Cities began assessing taxes on water, sewer and garbage services to backfill the losses.

Now residents in the poorest cities such as Wapato, Toppenish and Mabton pay the most for water, sewer and garbage services with monthly bills ranging from $150 to more than $220.

Sen. Curtis King, R-Yakima, blames what he describes as exorbitant voter-approved fees assessed by Sound Transit in Seattle for sparking the initiative.

Eyman has keyed in on that throughout his campaign.

The average assessment was estimated at about $80 a year per vehicle when presented to Puget Sound voters. But Sound Transit is using a calculation method that inflates vehicle values and leads to skyrocketing taxes and fees collected, said King, the ranking Republican member of the Senate Transportation Committee.

“Sound Transit had choice of what system to use, Kelley Blue Book, and they used the system that generated more money for them and I think people are fed up with it,” he said.

Voters in King County and primarily in Seattle largely supported Sound Transit, King said.

“It’s going to be interesting to see the vote in King County and in Seattle itself,” he said.

So far, initiative opponents have raised $4.4 million and spent $3.1 million on the campaign, with large contributions from Microsoft, Amazon and Vulcan Inc., according to the Public Disclosure Commission.

A campaign supporting the initiative so far has raised $63,586 and spent $34,826, with contributions from a Eyman-associated PAC and smaller donors. Local financial supporters of the measure include state Rep. Jeremie Dufault, R-Selah, and Charles Cripps of Yakima, according to the PDC.

King said he’s having discussions with other lawmakers now in the event voters approve the initiative.

“I think it’s incumbent on the Legislature to be prepared and make adjustments to where they have to be made,” he said.

Reach Phil Ferolito at pferolito@yakimaherald.com or on Twitter: @philipferolito