Lawmakers press Sound Transit to change course on car tabs

OLYMPIA —State senators on Monday vented their frustration with Sound Transit’s soaring car tab fees, demanding the transit authority stop using a formula for valuing vehicles that has been rejected by voters.

In an hour-long legislative hearing, lawmakers pressed leaders of the regional transit authority to discard its method of calculation that overvalues vehicles and is contributing to significant hikes in the cost of re-registering vehicles.

“There’s a difference between right and wrong. This is clearly wrong,” said Sen. Dino Rossi, R-Sammamish, in the Senate Transportation Committee meeting. “It is blatantly unfair.”

Lawmakers say they want to ease the financial pain wrought by tax hikes approved by voters last year to help pay for a $54 billion expansion of light rail known as ST3. It passed in November on the strength of support in Snohomish and King counties. Voters in Pierce County rejected it.

To pay for the upgrades, the motor vehicle excise tax collected by Sound Transit went from 0.3 percent to 1.1 percent. Also, the sales tax is going up half a percent in the district and there’s a new property tax assessment of 25 cents for each $1,000 of assessed valuation.

The car tab fee hike took effect March 1. When bills started arriving in February, some owners realized that a nearly tripling of the rate resulted in them paying two to three times as much as they did a year earlier.

Lawmakers are angry because Sound Transit calculates its excise tax using a state-developed depreciation schedule drawn up in the 1990s in which the car’s value dips five or six percent a year. The Department of Licensing updated its depreciation schedule in 2006. It shows a car loses 19 percent of its value after one year, 55 percent after five years.

But under a 2015 law, Sound Transit isn’t expected to switch entirely to the newer schedule until 2029 when bonds from the first two phases of expansion are retired. Those were sold with an assumption of car tab collections tied to the older schedule.

Senators don’t want to wait that long.

“Let’s be fair. Let’s be reasonable,” said Sen. Curtis King, the committee chairman. “I’m hoping Sound Transit will go back and look at that and see if there isn’t some way they can can get an MVET that is based upon the real value of a car and not some inflated value that is out there in na-na-land.”

Under questioning, Sound Transit Chief Financial Officer Brian McCartan acknowledged it is difficult but theoretically possible to pay off or refinance those older bonds in order to facilitate a switch sooner.

“We are looking at this issue in depth. The financial impacts are complicated,” he said after the meeting.

One factor complicating a swift course correction is Sound Transit took advantage of low interest rates last fall to sell some ST3-related bonds and agreed to pay them off with revenue collections using the older depreciation model.

If the agency acted to pay those off in some manner relying on a new stream of dollars using the newer schedule, it could create a confusing situation for vehicle owners.

Because Sound Transit would still have those older bonds to retire, it would have to value the same vehicle in two different ways when collecting its excise tax. It would use the pre-ST3 rate of 0.3 percent combined with the 1996 depreciation schedule to cover the old bonds. Then it would use the 0.8 percent approved by voters and the newer depreciation model to pay off the ST3 bonds.

Adding the two payments would presumably result in a smaller overall increase than would occur without any change whatsoever. This would require explaining on tax bills.

McCartan told committee members there were discussions of such potentialities before ST3 and “it seemed cleaner and simpler to have a single valuation system” through 2028 when that 0.3 percent rate expires as well.

Switching sooner could mean the agency takes in fewer dollars and that could affect its ability to carry out the plan approved by voters, he said.

Sen. Steve O’Ban, R-University Place, who opposed ST3, isn’t sympathetic.

“I’ll let them figure it out,” he said. “That’s their problem.”

After the hearing, King said the only option for lawmakers may be to keep applying pressure publicly because bills to require Sound Transit use Kelley Blue Book or National Auto Dealer Association car values came in too late to be considered.

Sen. Marko Liias, D-Lynnwood, a committee member and ST3 supporter, said the hearing provided Sound Transit critics a chance to grandstand.

“This was just an opportunity to beat up on them some more. It didn’t feel like anybody was here to hear the answers,” he said. “This is a technical, complicated issue.”

“To me what’s not complicated and what’s not technical is we need light rail to Everett,” Liias said. “These bills jeopardize that.”

Jerry Cornfield: 360-352-8623; Twitter: @dospueblos.

Talk to us

> Give us your news tips.

> Send us a letter to the editor.

> More Herald contact information.

More in Local News

A view of one of the potential locations of the new Aquasox stadium on Monday, Feb. 26, 2024 in Everett, Washington. The site sits between Hewitt Avenue, Broadway, Pacific Avenue and the railroad. (Olivia Vanni / The Herald)
20 businesses could be demolished for downtown Everett stadium

Some business owners say the city didn’t tell them of plans for a new AquaSox stadium that could displace their businesses.

Kathy Purviance-Snow poses for a photo in her computer lab at Snohomish High School on Tuesday, Feb. 27, 2024, in Snohomish, WA. (Annie Barker / The Herald)
To ban or embrace ChatGPT? Local teachers fight AI with AI — or don’t

“It has fundamentally changed my teaching in really stressful and exciting ways,” an EvCC teacher said. At all levels of education, ChatGPT poses a tricky question.

In this Feb. 5, 2018, file photo a Boeing 737 MAX 7 is displayed during a debut for employees and media of the new jet in Renton, Wash. (AP Photo/Elaine Thompson, File)
FAA gives Boeing 90 days to develop plan to fix quality, safety issues

The agency’s ultimatum comes a day after a meeting with CEO Dave Calhoun and other top Boeing officials in Washington, D.C.

Two troopers place a photo of slain Washington State Patrol trooper Chris Gadd outside WSP District 7 Headquarters about twelve hours after Gadd was struck and killed in a collision on southbound I-5 about a mile from the headquarters on Saturday, March 2, 2024, in Marysville, Washington. (Ryan Berry / The Herald)
State trooper killed, 1 arrested in crash on I-5 near Marysville

Authorities said Trooper Chris Gadd had been stopped along the freeway around 3 a.m. near 136th Street NE. A Lynnwood driver, 32, was arrested.

A man walks by Pfizer headquarters, Friday, Feb. 5, 2021, in New York. Pfizer will spend about $43 billion to buy Seagen and broaden its reach into cancer treatments, the pharmaceutical giant said. (AP Photo / Mark Lennihan, File)
Pfizer backs out of Everett manufacturing plant after $43B Seagen deal

Pfizer finalized the acquisition of the Bothell-based cancer drug developer in December.

Madi Humphries, 9, Rose Austin, 13, and Eirene Ritting, 8, on Thursday, Jan. 25, 2024 in Bothell, Washington. (Olivia Vanni / The Herald)
No grades, no teachers: Inside a Bothell school run by student vote

Each day at The Clearwater School, 60 students choose their own lessons. It’s one vote per person, whether you’re staff or student.

SonShine Preschool inside First Baptist Church Monroe is pictured Friday, March 1, 2024, in Monroe, Washington. (Ryan Berry / The Herald)
SonShine preschool in Monroe to close at the end of the year

The preschool, operated by First Baptist Church, served kids for 25 years. School leadership did not explain the reason behind the closure.

Providence Hospital in Everett at sunset Monday night on December 11, 2017. Officials Providence St. Joseph Health Ascension Health reportedly are discussing a merger that would create a chain of hospitals, including Providence Regional Medical Center Everett, plus clinics and medical care centers in 26 states spanning both coasts. (Kevin Clark / The Daily Herald)
Following lawsuit, Providence commits to improved care for Deaf patients

Three patients from Snohomish County sued Providence in 2022 for alleged Americans with Disabilities Act violations.

Cars drive through snow along I-5 in Snohomish County, Washington on Thursday, Jan. 11, 2024.  (Annie Barker / The Herald)
In March, 7 p.m. sunsets are back for Western Washington

Washingtonians will finally start seeing more sun starting March 10. But a little more winter could be on the way first.

One of the parking lots at Stevens Pass Thursday afternoon on December 30, 2021.  (Kevin Clark / The Herald)
Stevens Pass to charge $20 for parking reservations on busy days

Two-thirds of spaces will remain free for early arrivers on weekends. Cars with four or more occupants can also park free.

Days after shootout with Lynnwood police, suspect checks into hospital

Police learned the 18-year-old was in a hospital in Portland, Oregon. His alleged role in the shooting remained unclear.

Snohomish County pharmacy tech accused of stealing 2,500 opioid pills

Rachel Langdon stole oxycodone while working at a Snohomish County pharmacy, according to state Department of Health allegations.

Support local journalism

If you value local news, make a gift now to support the trusted journalism you get in The Daily Herald. Donations processed in this system are not tax deductible.