Washington state Supreme Court to decide on ‘car tab’ caps

The fate of more than $4 billion in transportation revenue could soon be settled in Washington state.

The state Supreme Court heard oral arguments earlier this summer on the legality of a voter-approved initiative.

In 2016, voters in the state approved a ballot question to boost transportation revenue via an increase in “car tabs,” vehicle sales taxes and other fees.

According to a fiscal analysis, the fees totaled $58 million over one year for state and local transportation work.

The money is used for projects that include highway construction, county roads and bridges, commercial vehicle enforcement, and pedestrian projects.

Initiative 976 to roll back car tabs

One year ago, voters in the state reversed course and approved Initiative 976 to roll back the higher taxes and fees collected on vehicles weighing under 10,000 pounds.

King County, the city of Seattle, and other transit-oriented groups responded by filing an injunction claiming the initiative is unconstitutional. The coalition says the initiative violates the single-subject rule, and it would do “irreparable” harm to the state’s transportation budget.

A King County Superior Court Judge ruled to temporarily block the initiative from taking effect. The state Supreme Court acted by a simple majority to uphold the decision while the litigation challenging the initiative’s constitutionality is ongoing.

Transportation work in limbo

The issue remains unsettled. In the meantime, uncertainty about the legal challenge’s outcome resulted in
Gov. Jay Inslee instructing the Washington State Department of Transportation to curb projects yet to get underway. The governor cited an anticipated budget shortfall due to the cap on taxes and fees.

Critics have said capping fees will strip state and local governments’ ability to move forward with needed projects. Specifically, they said I-976 will result in $2.3 billion in lost funding for local governments. The state will lose out on $1.9 billion over the same time period.

In addition to the cap on car tabs at $30, commercial trailer fees are set to be reduced from $34 to $30, and an electric vehicle fee is to be trimmed from $150 to $30. Additionally, authorization will be repealed for certain regional transit authorities to impose motor vehicle excise taxes.

The Washington Supreme Court continues to review the case.

More Land Line coverage of news from Washington is available.