Washington car tabs cut to $30, road projects in peril

Washington

Could cost state, local governments $4B in revenue over 6 years

SEATTLE (AP) — State and local governments could end up scrambling to pay for road paving and other transportation projects as a Washington state measure that would cut car tabs to $30 was passing in early returns Tuesday.

Sponsored by Tim Eyman, the measure would cap most taxes paid through annual vehicle registration at $30 and largely revoke the authority of state and local governments to add new taxes and fees without voter approval.

Initiative 976 was being approved by a 56% to 44% margin after the first votes were tallied in the all mail election. King County, the state’s most populous, was rejecting I-976 but most other counties were approving it by healthy margins. Vote counting will continue for days.

“I voted against it,” said Vancouver resident Heidi Masunaga. “We need the money for transportation and I am willing to pay the money, higher taxes and better affordability and infrastructure.”

Washington statewide/county-by-county results

The measure would also repeal taxes and fees that were already in place, which could cost the state and local governments more than $4 billion in revenue over the next six years, according to the state Office of Financial Management.

“That’s not worth it, it’s not a good trade-off for me — we need the money,” said Masunaga.

But Eyman says people are fed up with rising car tab costs.

Just before the first votes were tallied, Eyman claimed victory, saying just getting the initiative on the ballot was a win.

However, a large group of businesses including Microsoft and Amazon, as well as labor unions, waged a nearly $5 million campaign in opposition, saying the state needs car tab dollars to maintain a safe and effective transportation system.

Barry Bandenburg of Richfield voted no on I-976.

“Obviously I don’t want high taxes and I don’t want to overpay but I don’t know who is going to pay for the infrastructure,” he said. “The government is going to have to figure out another source of revenue so we will have to tax ourselves in some other regard or our bridges will fall apart. I don’t think it’s a victory for any of us.”

More than 60 cities use car-tab fees to pay for road construction, bus service and sidewalks. The state also charges fees to help pay for programs including Washington State Patrol traffic enforcement, highway maintenance, ferry operations and maintenance of county roads and bridges.

Seattle Mayor Jenny Durkan and other government leaders have been vocal in their opposition and over a half-dozen city councils passed resolutions against it. The city of Olympia also sent a mailer urging people to vote no which the state Public Disclosure Commission said it would investigate because state law prohibits city councils from using public resources to promote or oppose measures.

Washington voter Carol Dickey said she was disappointed by the early tallies showing the measure passing because she voted against it.

“Nobody likes their taxes raised but at some point, we have to bite the bullet and we have to find the money,” Carol said.

Eyman is also using the initiative to try and undo a car-tab fee hike collected by Sound Transit in the Puget Sound region, which uses a method of vehicle valuation that inflates some car values. Voters approved the increase as part of a light-rail expansion package in 2016 for King, Snohomish and Pierce counties.

If I-976 passes, the agency stands to lose about $328 million a year, or about 11% of its annual revenue, according to the state analysis. Sound Transit said it could lose about $13 billion more over 20 years because of higher borrowing costs and possible project delays.

“For a two-year period, this is a 16% cut which is about $10 billion every two years,” said House Transportation Committee Chairman Jake Fey.

Fey told KOIN 6 News the gas tax can only be used on roads and ferries so I-976 will affect some existing road projects, rural and urban transit areas and Amtrak.

“I am hoping this is a one-off situation and that we can recover from this,” Fey said.

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In a statement Wednesday morning Sound Transit Board Chairman and Redmond Mayor John Marchione said the board would hear from its finance staff and lawyer at its Nov. 21 meeting.

“The Board will consider Sound Transit’s obligations to taxpayers who want their motor vehicle excise taxes reduced, as well as how to realize voters’ earlier direction to dramatically expand high capacity transit throughout the Puget Sound region,” Marchione said.

Eyman’s $30 car tab initiative first passed 20 years ago. It was struck down in court before being enacted by lawmakers. The fees have crept up in recent years as lawmakers allowed them and voters approved them.

Eyman’s latest measure comes as he fights a campaign finance lawsuit filed against him by Attorney General Bob Ferguson. Eyman has been held in contempt of court for refusing to cooperate with court rules while a judge has ordered a for-profit signature-gathering firm to pay over $1 million for deceiving state residents by funneling their campaign donations to Eyman for his personal use.

KOIN 6 News contributed to this article.

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