City of Chehalis officials hope residents will vote to extend an existing local sales tax that funds road repairs and other transportation projects if it reaches the ballot later this year.
The Chehalis City Council on Monday, March 23, set a date for an upcoming public hearing to discuss a local sales tax to fund the Chehalis Transportation Benefit District.
The council will hold the hearing at 5 p.m. Monday, April 13, during its regular business meeting before voting on whether to add the proposal to an upcoming ballot for approval by voters.
During the same meeting, city staff presented the council with an annual report on the Transportation Benefit District, including revenue taken in by the existing sales tax in 2025 and projects completed the same year using district funds.
Proposed tax
The sales tax proposition to be considered is a “two-tenths of 1 percent,” or 0.2%, sales and use tax to be collected for a 10-year period on sales within the Chehalis city limits. The tax is allowed under state law, but only as part of the Chehalis Transportation Benefit District, which is only permitted to spend the money on transportation projects outlined in the city's six-year transportation improvement plan approved by the city council.
The tax proposal is the maximum allowed by the state to be collected in this way and for this purpose. The state allows transportation benefit districts to collect revenue through a variety of ways, including four that require voter approval. A city can collect a maximum two-tenths of a percent on local sales, levy a property tax, charge a fee for vehicles registered in the district or collect vehicle tolls.
The City of Chehalis already benefits from this sales tax, but passage of the new proposal would mean that the revenue keeps flowing.
It would extend the tax for another 10 years, going into effect as the previously approved tax expires. Chehalis voters last approved a 10-year two-tenths of a percent local sales tax for the transportation district in 2017. The city established the transportation benefit district three years earlier in 2014 and took full control in 2015.
The public hearing for the ballot proposal scheduled for April is an opportunity for residents of Chehalis to offer input on the tax proposal. After the public hearing, the council will have a chance to vote on bringing the local sales tax proposal to the voters of Chehalis. During the Monday meeting, Chehalis Capital Projects Manager Sheena Woods said she had planned to propose the tax proposal for the November 2026 ballot.
If the council does choose to place the proposal on the ballot, it can be approved by a simple majority of the voters living within the Chehalis city limits.
Residents of Centralia approved the same 10-year local sales tax for its own transportation benefit district in November 2025. Much like the Chehalis proposal, the vote renewed a local sales tax that had been approved years earlier. It passed with more than 70% of voters in support.
The transportation benefit district
An annual report on the Chehalis Transportation Benefit District during the Monday meeting gave councilors a glimpse at how much money the local sales tax brings in for the city and what projects the money supports.
Woods and Chehalis Public Works Director Lance Bunker included in their presentation an overall financial briefing on the state of the Chehalis Transportation Benefit District.
The district started off 2025 with nearly $6 million in the bank and throughout the year brought in approximately $2.73 million in revenue while only spending around $1.2 million. About $1.5 million of the district's revenue came from the local sales tax being proposed for renewal. Another approximately $950,000 came from grants, and nearly $300,000 in interest. The district closed out the year with almost $7.5 million in the bank.
Exact priorities for which projects receive funding from the district depend on the availability of outside money. Woods said priorities and timelines for projects included in the improvement plan may be pushed back or moved forward depending on grant funding from the state and federal governments.
“It's not necessarily set in stone,” Woods said. “Every year we can reevaluate those projects, and even before the year is up if I see a grant that I want to go for, I can bring it to council and add that project.”
In 2025, the district funded six projects, either contributing to a major phase of each project or completing them entirely. The two highest cost projects, which are both awaiting a final declaration of completion, were the work one on Northwest Louisiana Avenue to repave the road and add accessible ramps and other features and the SW 13th Street Sidewalk Phase II project, which improved sidewalks near Recreation Park.
The 2025 funding also contributed a small sum to the early stages of the Chehalis Downtown Rejuvenation Project. The city is poised to invest a lot more into that project this year. During the Monday meeting, the city council approved a consulting agreement with Harper Houf Peterson Reshellis Inc. for engineering on the project. The city expects to spend just over $1 million for the engineering with roughly half of that cost covered by the state.
