In anticipation of a budget shortfall, either a payroll tax or an increased property tax are proposed for the local public transportation system.

In anticipation of a budget shortfall, either a payroll tax or an increased property tax are proposed for the local public transportation system.

The Rogue Valley Transportation District board of directors has outlined some revenue producing options in its draft 2007-2017 long-range plan.

"We just don't have a lot of other choices," said Alan Hudson, finance manager for RVTD.

The district board could go to voters in 2008 to have the revenue available in 2009, he said.

Increasing the district's property tax rate from 17 cents per $1,000 to 25 cents per $1,000 (or to $50 annually for a $200,000 home) would generate approximately $1.8 million annually.

The increase, which would have to be approved by voters, would help balance the budget, but it would not expand services.

Payroll tax proposals are also under consideration. The payroll tax rate has a cap of $.007 per $1,000 in payroll. A $.001 rate per $1,000 payroll tax would generate $1.4 million annually. A rate of $.003 would cost employers $90 on a payroll of $30,000. If the tax were set up to increase annually, it would allow service expansion. A payroll tax could either go to voters or it can be adopted by an ordinance if the local transportation district transitions to a mass transit district, the draft document states.

A $250,000 budget shortfall is predicted for RVTD next year, said Hudson. Within three years the district, which currently has a $10 million budget, will come up $1 million short each year if it doesn't come up with more revenue, he said.

RVTD, which serves Ashland, Central Point, Jacksonville, Medford, Phoenix, Talent and White City, released its preliminary 10-year plan Monday and is requesting comments from local governments. The agencies have until the end of September to respond. There will be several open houses for the public in October and November.

In 2006, RVTD doubled fares to $2 and eliminated Route 5 in Ashland and Route 4 in Medford that serves Rogue Valley Medical Center. RVTD made the cuts to deal with a $1.2 million shortfall in its 2006-07 budget. The plan states that the service cuts resulted in lower ridership, lower paid passenger fares and a lower federal operating subsidy — so cutting service to balance the budget was not a good approach.

Mike Montero, a member the Chamber of Medford/Jackson County's transportation committee, said the Chamber raised concerns when the district first began talking about a payroll tax because it had not outlined a strategic plan or capital plan.

He said the Chamber can't support anything without hearing the analysis and planning.

He did not want to comment on the proposed taxes specifically because he had not yet reviewed the draft plan.

"I think it all depends on how big it is and what the mix of the revenue streams is," he said, adding that the Chamber would support a viable transit district.

The draft document also proposes making the Valley Lift program, a service that picks up disabled and elderly riders, more efficient.

Proposed changes include modifying the qualification requirements and getting cities to build more sidewalks. Lack of sidewalk connection to a bus stop partially determines if someone qualifies for Valley Lift, so more sidewalks could alleviate the demand on the more costly Valley Lift.

A final proposal could be developed by the end of the year.

Reach reporter Meg Landers at 776-4481 or e-mail mlanders@mailtribune.com.