By Gene Johnson / Associated Press

SEATTLE — A King County Superior Court judge on Wednesday rejected most of a legal challenge to Tim Eyman’s Initiative 976, a measure that would steeply discount the price of car registrations while gutting transportation budgets across the state.

Judge Marshall Ferguson said King County and a coalition of Washington cities had failed to carry the heavy burden of demonstrating that the $30 car tab measure was unconstitutional on most of their claims. Those claims included that the description of the initiative on the ballot was misleading and that the measure violated the Washington Constitution’s rule that initiatives be limited to one subject.

However, the judge declined to rule yet on two other issues: whether the initiative unlawfully impairs the contracting authority of the city of Burien, and on whether a requirement that car valuations be based on Kelley Blue Book values illegally favors a private company.

I-976 will remain blocked from taking effect while the sides gather information and make arguments to the court about those issues, Ferguson said. The case is expected to wind up before the state Supreme Court.

The judge blocked the measure in late November, saying he was concerned that the initiative’s ballot title was misleading because it said the measure would “limit annual motor-vehicle-license fees to $30, except voter-approved charges.”

That suggested that fees approved by local voters for local projects would survive. In reality, only fees approved by voters in the future would be allowed, and the authority of local jurisdictions to seek such measures to begin with would also be curtailed. The challengers argued that that language enticed voters to support it because they were reassured — falsely — that local projects could still be approved.

But upon further arguments and further review, the judge wrote in his order Wednesday, it’s possible that the Legislature could approve, or voters could pass, measures creating new avenues for raising vehicle fees. Thus, he said, the ballot language was not “palpably misleading.”

“I am thrilled this judge reversed himself and no longer thinks voters were confused — we never were,” Eyman said in an emailed statement. “Voters have 3 times demanded $30 tabs and 3 times repudiated this dishonest tax. Their vote should be implemented immediately.”

Sen. Steve O’Ban, R-University Place, an ardent initiative backer, lauded the ruling but acknowledged there will be more rounds of legal fighting.

“This is good news for taxpayers and for Pierce County,” he said. Pierce County voters overwhelmingly backed the measure and county lawyers took part in the defense of the ballot measure. “It’s certainly not the last word. Ultimately this will be before a higher court.”

Sen. Steve Hobbs, D-Lake Steven, chairman of the Senate Transportation Committee, who also thinks the case will go to the state Supreme Court, said the ruling will not change anything for lawmakers. They must still assume they will not get up to $454 million in revenues in this budget cycle if the initiative is ultimately found to be legal.

“My job is to go with the assumption that the initiative passed and I have to make the necessary cuts to the transportation budget,” he said.

A coalition of cities, King County, and Garfield County’s transit agency brought the lawsuit, saying it would eviscerate funds they need to pay for transit and road maintenance. It would cost the state and local governments more than $4 billion in revenue over the next six years, according to the state Office of Financial Management.

Seattle said it would have to cut 110,000 bus hours. Garfield County said it would have to halve the transportation services it provides to help seniors and disabled people get to the grocery store, the doctor and other appointments. Another part of the initiative attempts to force Sound Transit to retire or refinance bonds early, which the challengers say would cost the agency at least $521 million.

“We’re disappointed in the judge’s decision,” said Dan Nolte, a spokesman for the Seattle City Attorney’s Office. “We’re assessing the order and evaluating options for next steps.”

The initiative’s sponsor, Eyman, is a longtime antitax initiative promoter who is running for governor. His $30 car tab initiative first passed 20 years ago. It was struck down in court before being enacted by lawmakers. The fees have crept up as lawmakers allowed them and voters in some places approved them.

The Washington attorney general’s office is defending the constitutionality of I-976, as it typically defends state laws. Eyman, however, is facing legal action from the attorney general over campaign finance issues, and he has twice been held in contempt of court for refusing to cooperate with court rules. He wanted the office recused from the case and he accused the state’s lawyers of deliberately making bad arguments to sabotage the initiative.

The attorney general’s office rejected that assertion, noting that Eyman is not a lawyer and that the legal arguments he suggested making were “terrible.”

“We appreciate the court setting aside the antics of Tim Eyman, which made our job defending the will of the voters more difficult,” Attorney General Bob Ferguson, a Democrat, said in a written statement. “I’ve said from the start that this case will ultimately be decided by the state Supreme Court. My office will continue working to uphold the will of the voters every step of the way.”

AP Correspondent Rachel La Corte contributed from Olympia.

Herald writer Jerry Cornfield contributed to this report.