Publicola reported this week about potential fundamental shifts in thinking about our state’s revenue system. Towards the end Josh Feit quotes grumbling from Sen. Ed Murray (D-Capitol Hill, Wallingford) and a collection of environmental and transportation organizations about the State Constitution‘s Section 40, which says that gas tax funds can only be used for roads. In Feit’s words:
Consider: The current working transportation budget for 2009-11 puts only 4.4 percent of the $5.9 billion total into transit. And even if legislators were more-transit friendly, the rules governing transportation funding — Constitutionally, the gas tax cannot be used on transit— would have only permitted them to put about 7.3 percent of the money into transit.
Given that 10 percent of all work trips in the Puget Sound region are transit (and 57 percent of all trips are non-single occupancy vehicle—60 percent in Seattle during morning rush hour); and given that vehicle miles traveled has remained flat in the last few years while transit ridership across the state has spiked by 15 to 20 percent, the fact that transit spending is in a straight jacket doesn’t fit our state’s changing profile.
Combine these transit numbers with the new state mandates and goals about reducing global warming (particularly by reducing vehicle miles traveled), and the transit funding equation seems as unsustainable are the general fund.
Of course, I would be ecstatic if applications of the gas tax were broadened through a constitutional amendment. At the same time, I understand that amending the constitution is hard. Meanwhile, I think there are two important points to make:
- As Feit points out, the budget’s transit funding is $171m below what is Constitutionally allowed, so the attitude of legislators is currently more relevant than Constitutional restrictions.
- If there was sufficient interest in boosting transit funding but not enough to change the Constitution, there are pretty simple maneuvers available. For instance, the Legislature could lift the sales tax exemption on gasoline and reduce the gasoline tax by an equivalent amount, and sales tax revenue has fewer strings attached.
Even if the tax revenue were “blown” on schools or something, Metro and ST would capture about 20% of the revenue in their respective districts thanks to their sales tax authority.
The biggest criticism here is that sales tax per gallon varies wildly with the gas price, making for a volatile revenue stream. However, gas prices are probably near bottom, so it’s unlikely that programs funded with these streams will be left high and dry. Furthermore, the sales tax is roughly indexed to inflation, whereas the fixed gasoline tax often faces declining purchasing power.