Covington officials say revenue is going where it’s needed $480,974 from utility tax so far

It’s been nearly six months since the city of Covington began collecting its utility tax.

It’s been nearly six months since the city of Covington began collecting its utility tax.

At the time it was authorized, the City Council and city officials had a few items to take care of with the money coming from the tax, including hiring additional staff and expanding existing programs.

City manager Derek Matheson explained what has happened thus far as a result of the adoption of the utility tax, which is 5.5 percent.

“We have collected $480,794 in utility tax revenue through June,” Matheson said. “Our adopted budget assumes we will collect $962,500 by year’s end. The $480,974 number is for five months only (since the tax took effect Feb. 1), and it doesn’t include payments from Comcast’s cable TV business and Verizon’s wireless business.”

Matheson said the city has received calls and e-mails from citizens about the rebate program that the City Council added by ordinance on March 25. Those eligible for the rebate program must meet income and age requirements as well as must live within Covington’s city limits. Covington will reimburse qualifying individuals an amount equal to the utility tax for all utility bills billed to and paid for by a qualifying resident during a calendar year for utility service charges from any utility company who is subject to the utility tax of the city.

In order to qualify for the rebate, an individual must have a qualifying disability or be at least 65 years old this year, and have a maximum gross income of $42,050 if living alone.

The city has also received inquires from non-residents asking for help in removing the tax from their bills.

Matheson clarified that this isn’t a direct tax on Covington residents.

“It’s worth noting the tax is on utility businesses, not utility customers,” Matheson said. “However, most utilities get permission from the Washington Utilities and Transportation Commission to pass the tax along to their customers. The city doesn’t have jurisdiction over how utilities pass along the tax, but we try to help non-residents remove the tax from their bills because it was never the City Council’s intent for non-residents to pay the tax.”

Matheson said that the city is making the most of the extra dollars flowing into city coffers thanks to the utility tax.

“The tax is directed toward increasing the city’s level of service in police, parks and streets, which Covington residents have consistently identified as top priorities in surveys,” he said.

It funds:

• Two new police officers and additional police overtime.

• A new parks and recreation director, a parks capital improvement program, and a small, non-athletics recreation program (including funds for Covington Days, the annual community festival).

• Two new maintenance workers for streets, parks, and stormwater infrastructure.

• A street overlay program and transportation plans.

• An economic development manager, Shalini Bansai, who is scheduled to begin working Aug. 11.

• And an information technology position.

Scott Thomas, the new parks and recreation director, was hired in early July and began working July 28. He will focus on development of the city’s parks, including acquisition and construction of new facilities, as well as expanding recreation programs.

Staff writer Kris Hill can be reached at (425) 432-1209 (extension 5054) and