Seattle leaders are not wasting any time to stymie a statewide ballot measure voters approved on Tuesday, announcing a lawsuit to block Initiative 976, which could drain tens of billions in transportation funding across the entire state by reducing annual vehicle registration fees.
King County Executive Dow Constantine along with Seattle Mayor Jenny Durkan and City Attorney Pete Holmes said they'll try to stop the voter-approved initiative because, they claim, it is unconstitutional and would be detrimental to the region's mass transit systems and its economic growth.
“The passage of I-976 underscores the ongoing need for comprehensive state tax reform, but in the short term we must clean up another mess that Tim Eyman has created for our state, our region, and our economy. The impact of I-976 to transportation is – in a word – devastating,” Constantine said in a statement Wednesday, referring to the initiative's champion.
Evergreen State voters approved the measure reducing the so-called "car tabs," this time by a 55 to 45 percent margin. The annual car tab fees vary based on a vehicle's weight, local taxes, and transit taxes added on from the $43.50 minimum it takes to renew a passenger vehicle to $1,500 for a Tesla in the Seattle area. Fees have spiked in recent years after voters in 2016 approved Sound Transit's light rail expansion by raising the motor vehicle excise fee by 0.8 percent based on a car's value.
But the reduction of those vehicle registration fees comes with a steep price. The initiative could ultimately cost $175 million in state transportation funding this fiscal year and $302 million the following year plus an additional $58 million local governments expect to receive. All told, state and local governments could see $4 billion in lost revenue over the next six years.
Tellingly, voters in King County, whose reliable transit system is the beneficiary of some of the highest car registration fees in the state, rejected the initiative by a resounding 57 to 43 percent. Nearly a quarter million ballots in Seattle remain uncounted, but officials said it was unlikely the results would change.
Durkan will announce the city's lawsuit on Thursday, calling the cuts to transit that will result "potentially catastrophic." If the measure went into effect with no additional revenue, Seattle would be forced to reduce 100,000 bus hours, eliminate transit passes for middle and high school students, limit free bus access for low income residents, slash its pothole repair budget, and reduce street repaving, crosswalk and street cleaning budgets, she said.
"Seattle votes for transit at the ballot and we vote every day with our ridership,” Durkan said in a statement. “I will continue working with my team at the Seattle Department of Transportation to prepare for the impacts of this law being enacted and to consider all our options to vindicate the will of Seattle voters.”
City and county officials did not detail their legal arguments but their case would likely involve whether the ballot initiative violates transit agency bond contracts which use car tab revenue to repay investors and concern how state and local authorities can raise tax revenue from the public.
The car tab initiative was the brainchild of conservative tax activist Tim Eyman who launched his $30-car tab campaign in July 2017 following spikes in vehicle fees and collected nearly 300,000 signatures to get the measure onto the November ballot. Eyman fought bitterly over the past year with a coalition of transit advocates, corporations including Microsoft and Amazon, and labor groups who waged a $5-million publicity campaign over the state's ability to tax drivers for transit improvements.
On Tuesday Eyman soaked in his unlikely electoral victory and earned comparisons to Donald Trump among the local media.
"Super cool. Declaring victory. It’s over. You can stop counting, it’s over," Eyman told supporters in Bellevue."Those are tremendously positive numbers. It's inconceivable they will go against us. ... I will officially declare victory for the taxpayers of the state of Washington.”
The results seemed to take the state's political establishment by surprise.
Democratic Gov. Jay Inslee had mounted a quixotic climate change-themed presidential campaign that kept him traveling between March and August. He announced Wednesday he would direct the state Department of Transportation to postpone all projects that were not underway and other agencies to defer spending while his office reviews the budgetary effects of the measure.
“Washingtonians recognize the need to support a safe and reliable transportation system which includes buses, light rail, and ferries and is essential to support our robust economy, ease congestion and fight climate change," he said in a statement. "I will work with legislators, agency leadership and stakeholders on how best to respond to the impacts of this initiative. I remain committed to finding solutions to meet Washington’s growing and urgent transportation needs.”
Transit agencies were also scrambling to adjust to the new fiscal reality dawning on the state this week.
King County Metro, which runs bus, rail and water taxi service across the county, could lose $119 million in state funding over the next six years and $36 million for bus service in Seattle. A Metro spokesman said policymakers will determine how the revenue loss translates to service cuts and postponement of transit projects and its next steps are "pending."
Sound Transit, which runs light rail, train, and express bus service throughout the Seattle metropolitan area, could lose $328 million a year or roughly 11 percent of its annual revenue according to a state analysis. That could add up to $13 billion in losses over the next 20 years thanks to borrowing costs and project delays. Officials said they would discuss how to respond to the car tab measure at the transit authority's next board meeting on Nov. 21.
"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,” Sound Transit Board Chair John Marchione said in a statement.
Meanwhile transit advocates were left wondering what went wrong after a lively campaign to encourage Washingtonians to embrace their responsibility to fight climate change and be less dependent on their personal vehicles floundered outside Seattle.
"It's extremely hard to fight a simple, seductive, and deceiving idea that you can get something for nothing," Transportation Choices Coalition executive director Alex Hudson told Streetsblog. "Next steps will likely include litigation and a desire for local communities to find a new source to replace the lost revenue. Litigation has a strong case — this is a massive rollback of local control."
