37th District Democrats Blog

Sound Transit: Issues in the Legislature
Sun, Jun 11, 2017 - 01:13 PM
This article was written by John Stafford, the male KCLAC Representative for the 37th Democrats.

Sound Transit 3, the $54 billion, quarter century program to expand Sound Transit from Tacoma to Everett and from West Seattle and Ballard to Redmond and Issaquah, has been under scrutiny in the 2017 Legislature.  The primary source of concern has been financing.  

ST3 is funded from three sources -- property taxes, sales taxes and car tabs, and there is considerable controversy regarding the car tab portion.  ST3 calls for using an outdated and inaccurate automobile depreciation schedule developed in the 1990’s to calculate car tab fees.  This schedule values newer cars at an artificially high rate.  It appears that a number of lawmakers were unaware that this depreciation schedule was being used.  The Olympian Newspaper (April 15, 2017) reports that, “Several lawmakers said this week that they didn’t realize they were authorizing Sound Transit to collect car-tab fees based on an outdated formula from the 1990’s…”

There are several issues associated with now trying to change the depreciation schedule to better reflect actual used car values.  First, a change in the schedule will reduce funding for ST3.  Second, there are legal issues associated with retroactively changing the sources of revenue for state bonds.  Third, changing the depreciation schedule raises concerns about regressivity, as wealthier residents tend to own newer cars.  Fourth, it is unclear which depreciation schedule should be used.  

Indeed, two bills – each with a different depreciation formula -- have been introduced in Olympia.  The GOP proposal (SB 5893) calls for using the Kelley Blue Book or the National Automobile Dealers Association, whichever is lower, and would also reduce the amount of fees that Sound Transit can collect.  This approach would cost ST3 roughly $12 billion in revenue over 25 years.  The Democrat proposal (HB 2201) calls for using a 2006 state depreciation formula.  This approach would cost ST3 about $2 billion in revenue over 25 years.  Thus, the difference in the two approaches is considerable.  

Another issue that emerged in the 2017 Legislature involves Sound Transit governance.  Sound Transit is led by individuals appointed by elected officials.  SB 5001 was introduced to have Board members instead be directly elected.  Many observers (including myself) felt that this would likely lead to a significant decline in the technical expertise on the board.  This bill passed the Senate, but not the House.  

Naturally, both the financing debate and the issue of governance had a strong partisan dimension, with GOP lawmakers tending to favor larger decreases in transit funding and a change in the Board structure; while Democratic lawmakers tended to favor smaller decreases in funding and the continuation of the current Board structure.

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Tags: State Legislation

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