Noting that “Puget Sound residents have voted to tax themselves to address their own transportation needs,” the Seattle City Council unanimously approved a resolution Monday to oppose Initiative 976, Tim Eyman’s latest car-tab-cutting measure on the November ballot. Councilmembers M. Lorena González and Mike O’Brien were absent.
I-976 would cap annual vehicle license fees, known as car tabs, at $30 for standard vehicles and repeal certain taxing authority for local governments. That could cost $4 billion in local and state transportation funding over six years, according to a state estimate.
Among the potential cuts: funding for Seattle street maintenance, King County Metro bus service and Sound Transit light rail construction.
“The people have voted affirmatively to invest in transportation, yet this initiative is framed as a money-saver,” said Councilmember Debora Juarez, who sponsored the resolution. I-976 “would in fact reverse the will of the people” and worsen congestion, Juarez said.
Eyman, who made an appearance in City Council chambers Monday, is embroiled in a campaign-finance lawsuit brought by Attorney General Bob Ferguson in which Eyman has twice been held in contempt and faces a potential lifetime ban on directing the finances of political committees.
Eyman objected to the council taking up the resolution, calling it an “arrogant, improper use of tax dollars.”
As part of its transportation benefit district, Seattle charges an $80 car-tab fee. Of that $80, $20 funds pothole repair, bike lanes and other basic programs, and $60 pays for bus service and transit passes.
Seattle voters approved the $60 fee in 2014 after a countywide measure failed and Metro planned to cut service. Without additional revenue, the loss of that money under I-976 would mean service cuts largely affecting Seattle and possible layoffs, according to Metro.
In 2016, voters in Sound Transit’s taxing district, which includes parts of King, Pierce and Snohomish counties, approved the $54 billion Sound Transit 3 light rail expansion measure. That package relied in part on a car-tab tax increase. But once the increase took effect, some vehicle owners were shocked by the cost and the formula used to calculate those taxes. The formula overvalues some vehicles compared to the commonly used Kelley Blue Book.
Eyman argues anger over those and other car tab taxes will drive support for his initiative. “People are getting ripped off,” he said Monday. “Everybody knows it and the politicians aren’t doing a thing about it.”
Councilmembers Kshama Sawant and Teresa Mosqueda said frustration over car tabs is linked to Washington’s regressive tax system, which requires poor people to pay a larger share of their income in taxes than people with higher incomes. Sawant called the initiative’s effects “absolutely unconscionable.”
Voters in Washington have twice passed measures to lower car tabs, but those were either fully or partially struck down in court later.
“Passage of I-976, even if it might eventually be repealed by the courts, could tie up funding for local bus service, light rail expansion, and state programs for several years,” the resolution said, “grinding to a halt progress on addressing Washington’s growth, safety, equity, climate, and traffic needs, delaying projects and potentially creating financial turmoil for Sound Transit with bond markets.”
Sound Transit would lose about $328 million a year in car tab tax revenue if the initiative took effect, according to the state analysis, but the agency says it would lose much more over the long term due to higher borrowing costs.
Monday’s vote was the latest instance of the Seattle City Council taking a stance on a statewide initiative. The Council has in recent years endorsed initiatives addressing police reform, gun safety, carbon fees and raising the minimum wage.