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Seattle Subway’s focus is and has always been on rail, its right there in our name. Our mission is to fight for high-quality, fast, grade-separated, automated transit and to advocate that Seattle build it as soon as possible. For that reason, it may come as a surprise to some that Seattle Subway endorses and fully supports Move King County Now – the campaign to pass King County Proposition 1 – which will stop bus cuts as high as 17% and fund much needed (and too long deferred) maintenance on King County roads.

Our reasoning is twofold:

1)  Though Seattle Subway focuses on building high capacity trunk lines for our transit system, at this time buses are a critical component of the transportation infrastructure that helps keep our economy competitive, our city livable and charts the path for future subway lines. Here are more details on what is at stake for Seattle. Demand for buses is at an all time high and is rising as Seattle urbanizes. Cutting bus service now is exactly what we should not be doing.

2)  Proposition 1 must pass in order to clear the way for Sound Transit 3 (ST3) in 2016. Sound Transit needs additional funding authority from the state in order to run a ballot measure. Preserving bus service will be Seattle’s top legislative priority until the funding gap is closed. Therefore — passing this measure clears the way to make Sound Transit 3 the top local priority when state lawmakers go back to table to work on a transportation package.

Off cycle ballot measures tend to bring out more conservative voters in greater numbers as a percentage of the voting population (because more progressive voters tend to skip these votes.)  To win, we need to get everyone who supports transit, our economy, and the environment to vote. Many people don’t realize this vote is coming — we have to change that. We need you to join us in getting the word out! (sign up to volunteer here)

As part of our support on April 2nd from 5:30-7:30pm Seattle Subway is co-hosting a fundraiser at Hattie’s Hat in Ballard with Seattle Transit Blog* and Council Member Mike O’Brien. We hope you can make it and help us save our bus service and build a Seattle Subway.  Details/RSVP here.

*This will be an official Seattle Transit Blog meetup.

26 Replies to “To Build a Seattle Subway We Must Restore Stable Bus Funding.”

  1. Thanks for the post and rally to get out the vote for Prop 1.
    Short term, this is the only thing on the table to stave off cuts in bus service.
    Long term, ratcheting up the sales tax another 1/10th and looking for MVET as that stable funding source is both regressive and proven to be unstable.
    I hope this conversation is not forgotten after April 22, and the Puget Sound begins some serious dialog in Olympia about how to fund transit in the future.
    I’ve pointed out in recent posts how Portland finances its transit system with an employee payroll tax, fares and grants from the state and feds. When you think about it, transit shines brightest during the daily commute hours, and it seems logical that those commuters should be the most motivated and able to keep a vibrant alternative transportation mode well oiled. The employment based taxes are both progressive and more stable than our current sales tax, or MVET begging for another round of cries for $30 tabs from you know who.

    1. Mic – Agreed, we need stable funding sources that are progressive to fund transit and everything else. We are still a low tax state but the constant small ball gives voters the opposite impression.

      Broadly, we need to get rid of the state sales tax and replace it with a progressive income tax. Unfortunately, there isnt currentlu political will to move that. I hope that changes soon.

      Regarding payroll tax – On its faceit makes sense, It certainly sounds worth looking into.

      1. Don’t replace all of the sales tax with an income tax — just part of it.

        Oregon, heavily reliant on income tax, has experienced the same volatility we have — just at slightly different times.

        The way to keep tax revenues stable is to rely on a broad array of taxes, all low to moderate in quantity. Chop 1/2 to 2/3 off the sales tax. Slightly raise our low property taxes. Impose an income tax. Add an employer-based commuter tax. And make sure that all of them together don’t grow to the point that we are another New York or New Jersey.

      2. If we shifted the state sales taxes of 6.5 percent to income taxes (especially passive income, like capital gains) dollar for dollar we’d have a good start. Payroll taxes works until the economy tanks, but still a good idea.

        Also voting Yes on Prop 1 seems like the only logical thing to do, we need to have Prop 1 passed in order to be in a much much better negotiating position in the Legislature. But we also have to hold our delegation much more accountable on negotiating a good deal for urban transit. Transit (along with public education) is what makes cities livable for people and families of all income levels.

      3. David – I agree, but I can’t help but do a little political calculus when thinking about it. “Lets keep all the taxes and add a tax but we promise not to raise them too high” is probably even less popular than: lets replace the 8.9% sales tax with a graduated income tax. And the latter will still be pert near impossible to pass.

      4. I’m having a hard time seeing how an employee tax is a good idea. Is this per employee? Is so, that is really regressive and discourages hiring. Does it apply to certain areas (like a city limit)? Then it discourages employment in the city (might as well move operations to the suburbs). An income tax just makes more sense.

        That being said, we will probably have an employee tax eventually, just because this state is trying really hard to have the worst tax structure in the country. We have a really high sales and B & O tax because we don’t have the guts to add an income tax. Speaking of which, it always cracks me up when people say we don’t tax income in this state. We do; it is called a B & O tax. Not everyone notices it, of course, but if you are small business, or especially a sole proprietor contractor, you do.

        So, I would do what David suggested, with a little modification. Chop the sales tax; chop the B & O tax; slightly raise our low property taxes; impose an income tax and call it a day.

      5. The commuter tax is a bit of a vague idea. It would be a per-employee tax going to transportation, with exemptions for employees who “aren’t commuting” — exactly what that means to be determined. Many East Coast jurisdictions have sought, usually without success, to impose various types of commuter taxes. They are intended to solve two problems. The first is that commuters rarely pay any taxes to the jurisdiction they are commuting to, while they mostly use the transportation infrastructure of that jurisdiction. The second is a broadly held, if not that logical, perception that “businesses don’t pay their fair share” of transportation costs in a world where a significant amount of transportation costs are paid through gas taxes and vehicle fees.

      6. Also, you can deduct either sales or income tax on your federal taxes, not both. So, for a given split tax level, we will end up shipping even more money out of state than we currently do.

      7. @RossB,

        Complaining about the B&O tax is dumb and Tea Partyish. The maximum rate is 1.4% these days, and that’s for “service” sales which for sole props and partnerships is roughly a proxy for “income” because service providers have relatively few deductible expenses. Certainly, they have no COGS (Cost of Good Sold).

        For enterprises that do have COGS, the rate is typically 1/2 percent or less. If a business does not generate enough gross margin to pay a tiny tax like that, it’s not going to last long is it? In fact, it’s very likely some sort of Federal Tax avoidance scam and deserves to be put out of its fraudulent misery.

      8. Anandakos, the B&O tax is a terrible idea, and complaining about it isn’t dumb in the least. You are correct to identify net income (profits) as the measure of success of a business. So why on earth don’t we base the corporate tax on that? Instead we have a tax that kicks struggling businesses while they’re down, applies to charities (!), and doesn’t take advantage of the success of the state’s most successful businesses.

        I left it out of my original comment as an oversight but should have included it. It should be replaced by a corporate income tax yesterday. (Or, even better, replaced through a more progressive personal income tax that treated earned and unearned income the same — but that would need Congress to act first before it would make sense at a state level.)

      9. The B&O tax also imposes a high regulatory burden. The best kinds of taxes are harmonized taxes: one institution (the federal government) creates the mechanism, and subdivisions (states and cities) just make small policy adjustments.

        The model system is Canada’s HST; provinces can piggyback on the federal GST without adding any administrative costs. Income tax in the US isn’t as good, but it’s still close, in that you can generally fill out your state return based on your federal return. But the B&O tax is completely different, and so it needs to be filled out from scratch.

      10. The problem with taxing companies based on income is they can cook the books to come up with any income number they like. Look at how many US companies manage, on paper, to have no taxable income.

      11. That’s a problem with bad policymaking in Congress, not the concept of income taxation. Companies can’t “cook the books.” They can take advantage of a variety of deductions and credits, which are set forth in the tax code. If the tax code allows profitable companies to avoid having taxable income, then we need to change the tax code.

      12. What Orv said…..

        Income is WAY too manipulable. A small gross revenues tax is perfect because it’s extremely hard to avoid and still do business conveniently — unless you’re a Medical Marijuana dispensary and have to use cash for everything anyway.

        Seriously. You guys can spin any “ideal tax” scenario you want but IT.WILL.NOT.PASS. The people of Washington State are nearly all Tea Partiers on this, regardless of what their stance on gay marriage, full school funding, and pot legalization might be.

      13. I’m not down with a tax that’s imposed equally on banks and small charities. Perhaps my day job is skewing my perspective, but I think the gross revenues tax is self-evidently absurd. It hits small businesses — especially ones struggling to get off the ground — and nonprofits the hardest, while being no burden at all to profitable larger businesses.

        Income is not easily manipulable at all unless the corporation involved is really “cooking the books,” which is a pretty serious violation of all sorts of laws (not to mention professional standards for the accountants). Most things that people see as “manipulation of income” are special laws for special interests. And the very structure of the B&O tax is the biggest special-interest sop of all.

        I think everyone here is perfectly aware that tax reform in Washington is nearly impossible. That’s the only reason Prop 1 is remotely defensible. But that doesn’t mean we should never mention the obvious solutions.

      14. Look at how many US companies manage, on paper, to have no taxable income.

        You mean like Boeing paying zero federal income tax? They also manage to skate on most of the Washington B&O tax because they can say, “fine, I’ll take my airplane factory and move to another State.” My problem with taxing businesses or corporations is that they don’t really exist. They are a construct which shields the owners from liability. So in an ideal world every real person would just pay 10% of their income and call it good. That said, when businesses create a burdon, like DT companies needing expensive transit infrastructure to function, then it should be a cost of doing business. But it’s splitting hairs to call something a fee vs a tax.

      15. Opposing the income tax is not nearly as radical as the Tea Party. I opposed it for most of my life until a few years ago, even while voting for transit and libraries and schools and parks and I don’t remember what else. The opposition comes out of a fear that even if the Legislature initially lowers the sales tax to compensate, after a few years it will start treating it as additional revenue and the sales tax will come back up and we’ll end up with a situation like California, with a high sales tax and an income tax too.

  2. Just out of curiosity, has any formal polling been done on Prop 1 yet to gauge where people are sitting on this? I haven’t seen any polling as of now..

  3. Tsk, tsk I don’t think this is the time to be talking tax reform…

    Either you want transit and a better bargaining position w/ the rest of the state (that would include me) or you don’t.

    Some of you guys – including in the above comments – did not support compromise packages that came out of Olympia. Even considered those packages putting King County in a hostage situation.

    Either you want out of the hostage situation or not. 100% up to you. Decision time is now. Ballots will be in the mail very soon.

    1. I was merely responding to the title of the article: “To Build a Seattle Subway We Must Restore Stable Bus Funding.”
      Being in or out on this one has something to do with long range funding of bigger and better things, but not much.
      TriMet collects about 1/4 Bil a year from employee taxes. It’s worth exploring how they do that, and as David suggest start balancing our portfolio of incomes. Investors do it all the time.

      1. Thanks mic for clarifying. I just don’t think this is the time or place to have that debate.

        A debate that needs to be had after King County Metro is rescued because this is bullpuckey that the state legislature would put the state’s biggest city at risk of more gridlock. Tax reform is something both Rs & Ds should champion.

  4. Re: subway and buses: Granted my years with the Downtown Seattle Transit Project makes Bill O’Reilly fairer and more balanced than me. Of course I support Seattle Subways, same as KC Prop 1. Really hope Larry Phillips understands that savage criticism from this quarter stems from desperate need to eliminate any malfunction that the enemy can use for propaganda.

    But really I wish I could convince the subway project to grant me one favor: build the subway so that we can start operations with dual-power buses that don’t come from Breda, and then go through a human driven railcar stage for brief period between now and the time I’m dead. In Seattle transit time, a long lifetime would still be brief for any phase of a project.

    Like the song about John Henry: “Before I’ll let your computer beat me down, I’ll die with my controller in my hand, (Lord, Lord!) die with my controller in my hand!”

    Re: taxes: Can’t speak first-hand about Business and Occupations tax because my business has never made enough money to pay any, but resent even having to fill out the form to the State that. Of all the regressive taxes conceivable, it’s hard to imagine one worse than taxing a business for money that doesn’t even make it a profit. Somebody tell me what I’m missing here.

    An income tax would definitely be more progressive. Would be interested to know the history of exactly when it got written out of or not written into the law. It’s strange that there’s so long been so much automatic opposition to a tax that would be so much fairer than the ones we’ve got. I know about corporate greed and power, but over time, we the people still outnumber them the corporations. Especially over this amount of time.

    Know this is repetitive, but for me, a motor vehicle excise tax based on the value of the vehicle, like we used to have except adding fairer value evaluation and demanding that everybody, including me, pay something. Reasoning:

    The better the transit, the less money I have to spend on running and maintaining my car, which I really do love. 140 grand isn’t a lot of miles for a Prius with a new hybrid battery, but I plan on keeping it ’til Prius adds enough side-windows for the shoulder-check I learned in high school driver-ed to a new car. So to me, MVET is fairest and most relevant tax for transit.

    Mark Dublin

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