In close vote, Lynnwood council plans to end $40 car-tab fee

LYNNWOOD — In a couple of years, drivers living in Lynnwood could see lower car-tab costs.

On Monday the Lynnwood City Council voted 4-3 to stop collecting $40 vehicle license fees that fund city road work, starting in 2023. Drivers will still pay other vehicle registration costs.

The vote drew a battle line between the two candidates for the mayor’s office, both council members, who split over the issue.

Reducing taxes, including the car-tab fee, has been part of Councilmember Jim Smith’s mayoral campaign. At the council meeting Monday, he said the city isn’t taking care of sidewalks and streets. He said he hopes to change that by moving more general fund money to public works.

Councilmember Christine Frizzell said the city was already behind on road maintenance, replacing signals and improving sidewalks and curb ramps that meet Americans with Disabilities Act standards.

“I think it’s extremely shortsighted to just, by the stroke of our pen, slash a million dollars from our budget,” said Frizzell.

She is running to be Lynnwood’s mayor and has the endorsement of Mayor Nicola Smith, who is not seeking re-election.

In a statement after the vote, the mayor said the ordinance was done beyond the city’s normal budget process and bypassed the council finance committee. She also criticized the lack of a plan to replace the lost revenue.

“Our roads and sidewalks are critically important to our community, and this directly impacts our ability to maintain and build our critical infrastructure,” Mayor Smith said. “This process was short-sighted and leaves many unanswered questions.”

The ordinance now goes to the outgoing mayor, who had 10 days to sign the measure, veto it or let it take effect without her signature. The mayor was considering each option.

Lynnwood, like many cities and counties, has a Transportation Benefit District that allows it to add fees to car tabs. In Lynnwood, the fees amount to about $2 million each biennium budget for street maintenance, preservation and capital projects.

Statewide voters repeatedly have approved initiatives for a flat car-tab fee. But those measures have been reversed through legislation or rejected by courts, such as Initiative 976 in 2019.

Frizzell was joined by Councilmembers Ruth Ross and Shannon Sessions, who said she was concerned about the pandemic’s possible hit to revenue and wanted to tackle delayed road work.

Councilmember Julieta Altamirano-Crosby voted to stop the car-tab fee “to give relief” to families.

Ending the fees honors the will of voters, Council President George Hurst said. It also follows through on his pledge from 2016, when the city asked voters for a 0.1% sales tax increase to fund road projects over a decade, he said.

“At this time, I think the vehicle fee can be eliminated,” Hurst said.

On Monday, car-tab initiatives promoter Tim Eyman told the council he supported the fee’s elimination.

“It will show that at least one city council in the state of Washington was willing to listen to voters, not ignore voters and insult the intelligence of voters,” he said during a public comment period.

On Wednesday, Eyman sent an email gloating about the vote. The headline: “HUGE CAR TABS VICTORY.”

A Thurston County Superior Court judge ordered Eyman last April to pay $2.9 million for violating campaign finance laws.

Per the ordinance, the fees will be collected next year. But starting in 2023, people who renew their vehicle registration won’t see the extra $40 charge.

Last year, the city collected $1.3 million in vehicle registration fees. Combined with interest, as well as sales and use tax for road work, the Transportation Benefit District had $3.7 million in revenue, according to city documents.

Projects funded by the special district cost $2.5 million in 2020.

City leaders considered scrapping the car-tab fee in 2018 but ultimately kept it, in a unanimous vote.

Next year, three new members could join the Lynnwood City Council, depending on Tuesday’s election results.

Ben Watanabe: bwatanabe@heraldnet.com; 425-339-3037; Twitter @benwatanabe.