Editorial: Voters knew approving ST3 would bring tax increases

By The Herald Editorial Board

The reports of sticker shock were to be expected as vehicle owners in Snohomish, King and Pierce counties began receiving their license tab renewals following November’s passage of a Sound Transit tax measure.

Also to be expected was a raft of legislation in Olympia aimed at capitalizing on the discontent.

Voters in Sound Transit’s taxing district in the three counties approved funding in November for ST3, which will extend light rail and expand other transportation improvements between Everett and Tacoma. In approving ST3, voters agreed to a package of tax increases that will provide funding for the estimated $54 billion project over the next 25 years.

Along with an increase in the sales tax equal to 50 cents for a $100 purchase and a 25-cent increase in the property tax for every $1,000 of assessed value, as of March 1, the package increases the motor vehicle excise tax from 0.3 percent to 1.1 percent of a vehicle’s value. That’s a significant increase, and one that’s plainly noticeable to motorists as their renewals arrive in the mail.

A Tesla driver in Seattle pointed out the $1,500 bill he received, while a Renton driver of a 2009 Hyundai Sonata held up his $270 car tab bill for TV news cameras. (Both drivers, by the way, said they voted to approve ST3.)

Lawmakers are now considering a bill regarding how the motor vehicle excise tax (MVET) is calculated as well as others that would allow cities and whole counties to opt out of the MVET increase or all three tax increases.

Criticism of the car tab increase centers around how each vehicle’s value is assessed and its annual depreciation, as The Herald’s Jerry Cornfield reported Monday. Sound Transit is using a depreciation schedule that the state had used since the 1990s, in which the vehicle value decreases only 5 percent to 6 percent a year, a much slower rate than the schedule the Department of Licensing has used since 2006, for which a 5-year-old vehicle is worth only 55 percent of its purchase price.

Lawmakers are now pressuring Sound Transit to adopt the updated depreciation schedule and are threatening to pass legislation requiring it, if it doesn’t.

But Sound Transit has two obligations that could complicate a switch.

One is to the the voters, who approved the car tab increase and the depreciation schedule it’s based on. Easing the car tab increase could also have a negative impact on the amount of money raised for ST3, potentially delaying or limiting parts of the project, including the extension of light rail to Paine Field and downtown Everett, now expected in 2036.

Voters didn’t make their choices blindly, or at least they didn’t have to; Sound Transit offered an online calculator that allowed voters to see how their taxes would likely increase, and reports in the media also attempted to show the likely cost to voters.

The other obligation is to those who have invested in bonds for the project. Sound Transit already has sold some bonds for ST3 on the expectations that it will generate the tax revenue that voters approved. The state constitution requires that agencies honor their bond obligations. A legal review should be conducted before such a switch is considered.

Even more dubious are two bills that would allow cities or entire counties to opt out of the MVET increase or all three tax increases, a suggestion popular in Pierce County, where voters were less supportive of ST3. The measure was rejected by 56 percent of Pierce County voters, but carried district-wide with 54 percent approval on the strength of 58 percent support in King County and 51 percent in Snohomish County.

These proposals ignore the shared benefit and obligation in building a regional transportation system, and sound more like the whining that has come from those who want to break the West Coast states away from the nation based on the results of the presidential election. It also ignores the fact that any money raised from the tax increases on a county’s residents will stay in those counties for Sound Transit projects.

As everyone is reminded nearly every day now, elections have consequences.

It’s condescending to assume that voters didn’t understand the tax increases they were being asked to approve. They weighed the costs and benefits and made their choice as a region.

Lawmakers should honor that decision.