Eighteen years ago, anti-tax activist Tim Eyman decimated funding for public transit with his first $30 car tab initiative, which eliminated the motor vehicle excise tax (MVET).
His latest initiative, I-947, once again proposes to replace the current MVET with a flat $30 car tab fee. The initiative is estimated to cost Sound Transit between $6.9 billion and $8.1 billion. By Permanent Defense’s count, this is Eyman’s sixth attempt to kill funding for transit.
Currently, car owners pay several different fees depending on where they live when renewing vehicle tabs. The Department of Licensing provides a calculator to estimate vehicle tab fees.
- Everyone in the state pays a standard fee of $38.75 plus a weight fee which helps fund highway maintenance and construction projects, the Washington State Patrol and the Washington State Ferries.
- Local jurisdictions have the option of charging car owners an additional fee by forming a transportation benefit district. These districts are allowed to collect up to $20 a year without voter approval, or up to $100 if approved by voters. Approximately 50 cities have established transportation benefit districts around the state. Seattle collects an $80 fee to expand bus services and distribute bus passes to middle and high school students through the Youth ORCA program.
- Car owners living in the Sound Transit taxing district pay an additional fee. With the approval of the ST3 package, the MVET rate increased from 0.3% to 1.1% of the assessed value of the car.
If I-947 passes it would roll back the standard fee to $30 and eliminate all MVET. It would end weight fees imposed by the state government, transportation benefit districts fees and all car tab taxes helping to fund Sound Transit, according to the initiative’s website. Under the initiative, car owners would pay a $30 annual fee. Weight fees and TBDs could be restored by voter approval.
The initiative would also eliminate a 0.3% tax on retail car sales that funds the state’s multimodal account. This account provides grants for regional mobility, rural mobility, special needs, and vanpools.
Although I-947 eliminates the only MVET in the state, it also requires any future MVET to use the Kelley Blue Book value to compute the tax. As Rep. Joe Fitzgibbon explained on STB, this technique cannot be bonded against and effectively rules it out as a funding tool for major capital projects.