Transit advocates fear it will cut funding for key projects

OLYMPIA (Jan. 26) -- The state

House of Representatives passed a bill

Jan. 24 that would reduce car tab taxes

that help finance regional transportation

projects.

The bill, HB 2201, would require

Sound Transit to change its formula for

valuing cars and, by extension, tab rates-

-a move that mass transit advocates

say will stymie the development of the

region’s transit infrastructure.

The Legislature’s move comes a year

after lawmakers complained that Sound

Transit uses a dated valuation formula

that sometimes inflates the value of

cars—and devalues others—and that

some vehicle owners were experiencing

“sticker shock” after tax hikes caused by

the agency’s massive $54 billion transit

expansion package that was approved

by regional voters in 2016 by almost

20 points.

Sound Transit estimated that the

tax hike would raise rates by $110 per

$10,000 in vehicle valuation, while reports

emerged early in 2017 noting steep

increases, such as from $90 annually to

more than $260.

The tax formula, which was approved

by the legislature in the 1990s,

calculates value based on vehicle type

and age, as opposed to market-value

rates determined by sources such as

Kelley Blue Book, resulting in some

vehicles being overvalued.

Since 1996, voters in the Sound Transit

taxing district—which includes the

densely populated areas of King, Snohomish,

and Pierce counties—have approved

three major transportation funding

packages, all of which were funded,

in part, by taxes generated through the

controversial valuation system. The

latest of these was Sound Transit 3,

which will build out the region’s light

rail network from Seattle to Issaquah,

Tacoma, Everett, and elsewhere.

The bill—which passed the House

60-37—is sponsored entirely by House

Democrats, but garnered many Republican

votes. It was originally introduced

during last year’s legislative session and

passed the House, but never made it to

the governor’s desk over disagreement

on how much to reduce the rate.

During the debate leading up to the

floor vote, proponents of the legislation

bemoaned the tax burdens on car owners

while railing against Sound Transit,

characterizing it as an unaccountable

and freewheeling public agency.

“It is past time to fix this issue and

replace it with the most current and

accurate valuation system that currently

exists,” said Rep. Mike Pellicciotti,

D–Federal Way, the primary bill

sponsor. “The public expects us to pass

this today, good government expects us

to pass this today.”

“When my constituents get their car

tab fees, it smacks them right in the face,”

said Rep. Mark Hargrove, R–Covington.

“We need to make much greater strides

to give more relief to our constituents.

I’ll support it but it’s a shame that we

didn’t go much further.”

“I think people are feeling that they

were lied to by the process, whether

that’s true or not,” said Rep. Morgan

Irwin, R–Enumclaw. “I think we need to

go after Sound Transit in other ways to

make sure that we’re holding it accountable

to the people that it’s supposed to

represent, because folks out there don’t

feel like it does.”

Rep. Christine Kilduff, D–University

Place, said that the legislature needed to

move fast to reduce the tax rate or risk

facing the wrath of the voters in their

districts. “There’s a ton of sticker shock

out there,” she said. “If we don’t take action

on this legislation, our constituents

are going to be even angrier.”

The bill now goes to the Senate

Transportation Committee for consideration.

Both Sound Transit staff and its

proponents argued in the run-up to

and aftermath of the vote that the tax

rate reduction will siphon off crucial tax

revenue for voter-approved projects and

increase the already long building timelines

for light rail expansion. The line

to Issaquah, for instance, was originally

slated to be finished by 2041 while the

lines to West Seattle and Everett were

projected to be finished in 2030 and 2036

respectively.

Geoff Patrick, a spokesperson for

Sound Transit, said that the bill, if signed

into law by the governor, would cut $780

million over the next 11 years from the

agency’s tax revenue, and could also cost

it more than $2 million in the long-term

if the agency was forced to take out more

bonds to finance projects.

“With the loss of that 780 million,

you would need to borrow more to balance

the financial plan,” he said in a

telephone interview. “That would carry

debt service cost beyond what we previously

assumed.”

Patrick added that, if the state Senate

doesn’t find a way to offset the revenue

decrease from HB 2201, that the

agency, which is also at risk of losing

federal grant funding from the Trump

administration, will definitely have to

elongate project timelines. “The only

real alternative if money does not come

in is slowing things down so that tax

revenue can come in to build projects.

That’s the risk.”

Some of the Democratic representatives

who voted for the bill paid tribute

to the financing issues posed by the tax

rate reduction while speaking on the

House floor prior to the vote.

“We’re going to make sure that the

Sound Transit tabs are fair when it

comes to car values. But we’re also going

to make sure that we fund those projects

because in the central Puget Sound area,

those projects are critical,” said Rep.

Judy Clibborn, D–Mercer Island.

“My district supported ST3 and my

district voters and the citizens expect

that light rail will reach Tacoma, just

as people in Snohomish County expect

that light rail will reach Everett,” said

Rep. Jake Fey, D–Tacoma. “780 million

dollars is a big gap.”

The biggest defense of Sound

Transit came from a Republican, Rep.

Jacquelin Maycumber of Republic, who

voted against the bill. “Seattle is a

world class city and it deserves a world

class transit system and that’s why the

people spoke,” she said. “This bill, it goes

against what the people requested and

what the people voted for.”

Seattle-based transit advocates were

livid after the vote. House Democrats,

“just sold us out on #HB2201 earlier

today,” read a Jan. 24 tweet from Seattle

Subway, a pro-mass transit group.

Other activists, however, are more optimistic

about Sound Transit’s financial

future. Abigail Doerr, advocacy director

at Transportation Choices Coalition—a

pro-mass transit advocacy group that

helped orchestrate the ST3 campaign

in 2016—said in a phone interview

that she is very “encouraged” by her

conversations with state senators who

are sensitive to the funding gap and

want to amend the legislation to find

additional revenue.

Bill that would reduce car tab rates passes in Senate