From expanded shuttles and transit subsidies to new garages and improved grade crossings at the rail tracks, Palo Alto has no shortage of projects on its transportation wish list.

But on Monday night, the City Council abruptly backed away from one proposal that would have paid for some of these projects: a business license tax that the council has been contemplating for well over a year.

By a unanimous vote, the council agreed with a recommendation from City Manager James Keene not to move ahead with its original plan to appoint a stakeholder committee that would help construct a potential tax measure and evaluate the projects that the measure would fund. While members acknowledged the plan may still be worth pursuing, they also agreed that now is not the time.

The shift was prompted by Keene's warning that city staff does not have the capacity to perform the demanding public-engagement work that the new tax would require. The planning department is now in the early stages of an intense community process for exploring grade separations along the rail tracks. It is also setting up new parking-permit programs in residential neighborhoods; negotiating with the Santa Clara Valley Transportation Authority over funding from Measure B; evaluating an expansion of the local shuttle system; and reforming the city's parking system, which may soon shift to paid parking.

Even though the council had agreed last fall to move ahead with the new committee, which was charged with exploring the new tax (as well as other funding options), Keene asked council members to reconsider that decision, which followed months of meetings by the specially appointed committee and a series of surveys.

Keene noted that other revenue opportunities have emerged since that time. County voters overwhelmingly approved last November Measure B, a sales tax to pay for transportation improvements. More recently, staff and consultants completed a downtown parking study that recommended parking meters and pay stations on downtown streets and lots -- a proposal that is expected to generate more than $2 million in annual revenues after about two years of capital investment.

Keene told the council Monday night that while he has not concluded that the tax would be a bad idea, the process the council established is "potentially inefficient."

"It would take a lot of time and effort to define even what we want through an engagement process. That will take away from some of these other committed projects we have," Keene said.

The council isn't exactly abandoning the business tax, which may yet re-emerge as the most promising funding option. But after hearing from Keene, Vice Mayor Liz Kniss said she was concerned that the council would be "overreaching" if it were to move ahead with a citizen committee at this time. The council agreed and voted unanimously to defer discussion of the new committee until fall.

"Maybe in the future, but at this point it looks to me as though staff has taken on just about what they could take on," Kniss said.

While the council followed Keene's recommendation, several members acknowledged that backing away from the proposed tax just raises more questions about how the city plans to pay for its traffic-reduction efforts. Councilman Tom DuBois supported delaying the formation of the committee but proposed returning to the subject in a few months, after the Planning and Transportation Commission has a chance to vet a potential funding plan. Otherwise, the city would only be delaying work on projects that it has repeatedly identified as a top priority.

"I understand the staffing concern, but I don't understand how we're going to fund what we're going to fund," DuBois said.

Others shared his concern. Councilman Eric Filseth and Councilwoman Karen Holman both warned that the city's General Fund -- which pays for most city services (not counting utilities) -- would have to absorb much of the cost for the projects. Filseth said that while he sees no problem with the residents paying for valuable transportation services, like shuttling seniors to Avenidas, employers also have a role to play in creating programs that reduce the city's rate of single-occupant vehicles.

"I don't think residents should be buying (Caltrain) Go Passes for Amazon employees," Filseth said.

For others, the plan for a business tax was too hazy. Mayor Greg Scharff and Councilman Adrian Fine both characterized it as a "solution looking for a problem." Kniss called moving ahead with a tax, before figuring out exactly what projects it would fund, "putting the cart before the horse."

Councilman Cory Wolbach agreed with DuBois that the city's planning commission can play a useful role in shaping the measure. Ultimately, however, the council stopped short of delegating this task to the commission. Rather, the council asked staff to return in the fall with an analysis of the city's transportation needs, its available revenues and ways to address the gap between the two.

"There are these other options that I do think we need to explore, even though my personal preference has been throughout this a business license tax," Wolbach said. "I don't think we've done the work to eliminate the other options."