OPPOSES

Position on Initiative 776 

2002 General Election Ballot Measure

Position and Rationale

The Municipal League of King County opposes Initiative 776. I-776 is a tax-cutting measure. It calls for a statewide vote on local transportation funding, allowing voters with no stake in the outcome to overturn local citizens’ decisions on transportation issues. If passed, the initiative would further constrain local governments’ already reduced transportation budgets and create greater pressure to divert money from county and city general funds to transportation needs in a time of economic recession. In addition to its damaging effects on current operations of several local transit systems, the measure also appears intended to disrupt the development of the voter-approved high-capacity transportation system in Pierce, Snohomish and King counties.

Summary of Measure

Initiative 776 requires license tab fees for cars and light trucks to be limited to $30.  The measure would repeal certain state and local motor vehicle excise taxes (MVET) and vehicle license fees:

• State combined license fees for light trucks weighing less than 8,000 pounds are limited to $30.  (Under current law these trucks pay a combined license fee between $35 and $55, depending upon vehicle weight.) 

• Local MVET authorized for high capacity transportation (Sound Transit) is repealed.  (Sound Transit currently imposes a voter-approved MVET equal to 0.3 percent of vehicle value.) 

• The local option vehicle license fee of $15 is repealed.  (This tax is currently imposed in four counties for road projects: Douglas, King, Pierce and Snohomish, and is distributed to cities based on a population formula.)

This measure follows up on Initiative 695, which eliminated the statewide MVET and cost local and state governments over $800 million per year.  The new measure would affect Sound Transit and Puget Sound County governments the hardest, costing them over $100 million per year in funds that are dedicated to transportation purposes. 

Sound Transit would lose 20% of its annual revenues that are spent on Sounder commuter rail service, Regional Express bus service, the development of Link light rail in Seattle and Tacoma, as well as more than 40 other capital projects such as park-and-ride lots, transit centers and HOV ramps.  Some revenue from the MVET is currently obligated to pay debt on bonds issued by Sound Transit, which would have to be repaid from other sources. 

Revenue for county and city governments would be reduced $32 million annually through the repeal of the $15 local option license fee.

Revenue reductions for major Puget Sound area cities would include: Bellevue $1.1 million, Everett $819,000, Federal Way $783,000, Tacoma$1.45 million, and Seattle $5.3 million.

The Washington State Department of Transportation estimates that the reduction of the licensing fee for light trucks would create a loss of $36 million biannually for WSDOT and the State Patrol. 

Fees for typical vehicles in a Puget Sound household could be lower by $90 to $100 per year. 

Proponents of the measure have advanced these and other arguments IN SUPPORT:

• Initiative 776 implements the will of the people that was expressed in I-695 by truly limiting vehicle taxes to $30 per year per vehicle.

• This sends an important political message to politicians to respect voters’ desire to limit taxes.

• The measure would force Sound Transit to call for a revote on its bus, commuter rail and light rail plan before going ahead with plans to spend money. 

• The impacts to county governments would be “scraps on the table” compared to their overall transportation budgets.

Opponents of the measure have advanced these and other arguments AGAINST:

• I-776 allows voters statewide to overturn local voter and elected official decisions.

• The measure will interfere with local and regional transportation improvements and will actually stop services and capital projects that are underway.  Sound Transit would lose 20% of its annual revenues, affecting bus, commuter rail and light rail services.  County and city governments would lose almost $32 million annually from their road funds.

• I-776 raises legal issues about use of the initiative process to invalidate local voter decisions.

• The measure would be the fourth initiative in four years to affect transportation funding and local government budgets.  The revenue losses together with the economic recession are already causing severe cuts in budgets for public safety, parks and natural resources and general government services.