Image by Oran
Image by Oran

[UPDATE: Rep. Eddy, in the comments, points out that the bill does not require a public vote in King County to raise the tax.  Corrected below.]

The battles over Sound Transit aren’t the only thing going on in Olympia.  For supporters of transit, SB 5433 is a definite step in the right direction, and better yet, has passed the Senate.  HB 1147 is the companion bill, and it’s currently sitting in the House Rules Committee, the last obstacle to going to a floor vote.  The Striker by Rep. Ross Hunter (D-520 Corridor) is the relevant document (pdf).

The bill is titled “Modifying provisions of local option taxes” and specifically increases the taxing authority that King County can dedicate to transit by allowing existing (unused) Ferry District taxing authority to be used for buses and streetcars instead. Andrew discussed the topic here before.

The current ferry district taxing authority is a property tax equal to 0.075% the value of the house.  That’s a huge potential revenue source, equal to approximately $250m a year for King County, and well in excess of any ferry plans the county has.  (This very high tax rate is actually in place for rural counties with smaller tax bases).  The current King County ferry tax rate is 0.005% – one fifteenth of its authority.

The bill would reduce the ceiling for counties with over 1.5m people (ie, King) to 0.0075% for ferries. (Sec. 7).  However, it would also create a new 0.0075% taxing authority for King County which could be applied to transit. (Sec. 8).  King County expects that this would generate approximately $25m in revenue, which would plug about a third of the hole in 2010.

Oddly, 13 1/3% of this levy would be reserved for adding bus service along the SR520 corridor.  I emailed Rep. Hunter about this, and he responded that Rep. Judy Clibborn (D-Mercer Island) is behind this provision.  As House Transportation Chair, she is trying to grab federal “urban partnership” dollars.  If early tolling on SR 520 passes, the Feds may buy us some buses and establishing a funding source will help in that effort.  However, it’s unclear how a requirement for new service would interact with the general climate of cuts likely to impact all service areas.

It’s important to note that this bill would not actually impose the tax, but allow the King County Council to vote to impose the tax, in turn, to put such a tax increase to a public vote.  The sources I’ve spoken to are pretty optimistic that this bill is going to pass, and it’s reasonable to expect the County Council will use the authority.then send it to the ballot this fall.

43 Replies to “Metro Tax Update”

      1. True that… but it would be good to get him “on record” with that. Dow hasn’t been enthusiastic about the idea, but I wonder what he’d say if Larry went on record in support. And, Fred, well… I’d expect him to be opposed, but who knows?

      2. I’m going to repeat this truth: There is NO reason that any candidate for King County exec to oppose this bill. Now that there is a Republican in the race (Susan Hutchinson), I can’t vouch for her point of view. BUT FRED JARRETT would be completely in support … now, and historically. So I don’t know why Michymse would expect him to be opposed. Any basis for that opine?

      3. I don’t think anyone is on record other than Larry, but I see no reason Fred Jarrett would oppose such a measure. Indeed since he currently serves in the Legislature any votes or other actions he takes on the bill will be on record. He may be a former republican but that doesn’t mean he has much in common with today’s Washington State GOP.

      4. I don’t think Jarrett would oppose it, but I bet Susan Hutchinson might, with her discovery institute association, he’s pretty anti-transit.

  1. Why such a low ceiling? It’d make sense to just put the ceiling to at least where the budget hole is so there’d be no cuts at all?

  2. The county council doesn’t have to put it to a public vote. In this state, all revenue authority comes from the legislature; there is no constitutional authority in subdivisions of government without legislative sanction. We’re just giving them new authority.

    I cannot imagine any situation in which a seroius candidate for King County executive would be against us extending this authority. And I don’t think the exec would have any control over it (other than spending the money). It’s a county council decision.

    1. Right, The first use of the ferry authority by the County was done without a public vote (and without much public input if I remember) in November 2007.

      1. Yep, I sure didn’t vote to pay for the Elliot Bay Water Taxi with my property taxes. Of course the County will tell you they can only increase property tax revenue 1% a year (violins in the background). Yeah right, I’m surprised they haven’t tried to sell us the Brooklyn Bridge as a 520 replacement ;-)

        Since there’s no money to extend Link to Redmond maybe we can start barge traffic on the Sammamish Slew. Should be about as cost effective as the Kirkland to UW route which the PSRC study penciled in at around $50 per person for that portion of their daily commute.

      2. Yeah it’s pretty crazy, with no parking on either side of the lake, not a lot of people are going to be taking that UW-Kirkland ferry, at least not until U-Link opens.

  3. Okay, quick update: Reservation of $$$ along SR520 corridor. I appreciate your email to Hunter, as Finance chair, but we should note that it’s been a group effort over here on the SR520 front, trying to ensure that we see some better transit service – especially as it’s THIS SR520 corridor that’s going to bear the brunt of early tolling.

    Life is not always perfectly fair, and I know that there will be questions about how this whole thing is going to work. We just wrote a letter to the Regional Transit Commitee, asking them to consider the policies necessary to deal with what is an increasingly extraordinary and stressful situation — cutting transit routes via one formula, while another formula would guide add-backs.

    Sitting in a meeting, so sorry if this isn’t artfully written — but I did want you to know that the set-aside was thoughtfully arrived-at and not knee-jerk. It turns out to be just about HALF what some of our transit planners think would be appropriate to back up the best east-west routes in the corridor.

    1. I haven’t read the bill, so let me know if there’s a sunset, but can you imagine in 30 years that the same percentage should go to SR-520 corridor?

      1. No sunset, but that’s a good idea. Ideally, authority should be completely w/in county’s purview … but we’ve been battling issues w/bill titles, the fact that the earlier authority was to a NEW district (geesh) instead of existing county authority.

  4. HB 1147 is dead, the cutoff for considering bills in their house of origin was a few weeks ago. So SB 5433 is the one to watch. Looks like it will have to pass the House pretty soon, and it has amendments so it will have to go back to the Senate before it goes to the Governor’s desk. But it looks like a great bill, I hope it goes through. How long could this solve Metro’s budget woes?

    1. Alex,

      The relevant text in 5433 is the same, but your point is taken.

      $25m a year is a significant chunk of the deficit, but not nearly all of it. Scroll down 5 posts to compare it to budget projections.

  5. The legislature is in a tough spot to fully fix anything (as our revenues are down, you might have noticed) but we can try to soften the pain. And that is certainly true with Metro.

    Education, public safety, children’s issue, parks and recreation, environmental protection and/or clean up … everything is going to suffer from the current recession, guys. Everything. But we are trying to do it at least somewhat intelligently. And transit is one of those services that really, really needs some support, as – and you have highlighted this truth — the more the economy tanks, the more people rely on transit.

    1. Rep. Eddy
      Thank you for your hard work this session. Especially where it has helped transit. ;-)

      Call me crazy but allowing counties and transit agencies to use a mix of sales and property taxes to fund transit (bus, rail, ferries) would seem to provide a somewhat more stable revenue base in the long term.

    2. Well not everything seems to be feeling the pain. The ferry system has the strongest funding mandate in several biennium. The deep bore tunnel which wasn’t even on the table a year ago gets more state funding than SR520.

      As the economy tanks transit ridership also goes down. Higher unemployment means less people commuting to work. Inevitable, as we’ve seen, an economic downturn means less demand for crude oil and lower gas prices. With less people on the road (noticably less around here) and lower gas prices the people lucky enough to still have jobs are more likely to fall back to driving (I see it where I work).

      1. Actually, ridership is up throughout the state and continued to increase even as gas prices receded. This is a national trend as folks have to travel farther from home to find work. The New York Times did a wonderful article on this trend in February. King County had a link to it on their website.

      2. Not a chance. When quarterly ridership spikes Ron Sims smiling face is on a article telling us how ridership has spiked. You’re never going to see an article saying “ridership is down, no need to send us as much money.” Employment drives ridership. High gas prices drive ridership. It’s a direct relationship and the inverse is also true.

        Go to the King County website. Last year when ridership was up the numbers hit the “front page” immediately. Try to find 1st quarter numbers for 2009. You’ll be lucky to find them by summer 2010.

        Wait until Link opens. I’m betting ridership will be below projections and the explanation will be the bad economy; and they’ll have a valid point.

      3. Bernie’s right. Metro is projecting a fall in ridership over the next year or so.

      4. Well, anecdotally, we’re NOT seeing a drop in ridership yet on some of the most crowded routes inside Seattle.

      5. The ferry system needs the money for new ferries or it won’t be a ferry system for much longer. 11 ferries are more than 35 years old, 4 are more than 50 years old. Considering vessel lifetime is about 60 years planning for replacement needs to happen now. If a new ferry is built every 2 years for the next 22 years we’ll just keep up with the replacement needs. Hopefully we’ll be able to avoid having any ferries forcibly retired by the Coast Guard in the mean time.

        Good point about transit ridership, though the buses in Seattle are still pretty packed much of time.

      6. The King County Ferry System has nothing to do with Washington State Ferries, which is what I believe you’re referring to.

      7. Yes I was talking about the Washington State Ferries. Bernie mentioned a few areas where the legislature was able to find additional transportation money (ferries, AWV tunnel). I was saying a sane capital budget for the ferries is sorely needed or we soon won’t have a ferry system.

      8. sane capital budget for the ferries is sorely needed

        Yes, the emphasis needs to be on sane. A new boat for Sydney/Anacortes is insane. Turn this route over to Black Ball and limit State financial commitment to free use of the dock at our end. Then see if the Canucks are willing to make the same commitment.

      9. And the “buy Washington” clause is another example of insane policy. At least WSF seems to have learned that buy high, sell low lesson with passenger only ferries… now we have KCFD to do that for us.

  6. Martin

    I don’t understand this paragraph:

    “The bill would reduce the ceiling for counties with over 1.5m people (ie, King) to 0.0075% for ferries. (Sec. 7). However, it would also create a new 0.0075% taxing authority for King County which could be applied to transit. (Sec. 8). King County expects that this would generate approximately $25m in revenue, which would plug about a third of the hole in 2010”

    In the previous paragraph to this one, you said that the property tax going to the ferry district in King County was 0.005% – isn’t that lower than 0.0075% so isn’t the legislatature then raising what can be collected in King County and from the rest of the paragraph above, are you saying that King County would be able to collect two sets of 0.0075% property taxes – one for the ferries and one for Metro?

    If so, this seems excellent idea to me.

    One idea, I discussed with Rep. Judy Clibborn (D-Mercer Island) when I met her on Monday in Olympia was having an ‘opt-in clause’ on our annual license tab fees so that those of us outside of the ST taxing district but who use ST buses (and even those who do not) could opt in with an additional fee for Sound Transit. As Olympia was thinking about this idea for State Parks, the possibilities are endless for having lots of opt in boxes for all of our favorite causes. I, for one, would opt in to pay for ST? I have no idea how logistically possible that this would be, but Rep. Clibborn said I could bring it up again at the next legislative session in 2010.

    By the way, when exactly are we going to see any ferries plying Lake Washington and the Puget Sound as part of paying this ferry property tax?

    Bernie, I think you are wrong on the water taxi – running this year round is an excellent use of tax dollars (I assume this is part of the ferry district taxing authority, right)

    If someone could clarify the above paragraph for me, I would be grateful. Apologies in advance for sounding stupid.

    Tim

    1. The current tax rate going to the ferry district is 0.005%. The tax ceiling, the amount they could tax for ferries, is 0.075%. The current tax being collected is not at the ceiling, The bill would lower the ferry district tax ceiling and create a new tax authority that could be levied to help pay for transit. Hope this helps clarify, and I hope that I understand it correctly.

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