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Understanding the impacts of Intiative 976
Contact: Logan Bahr, Shannon McClelland
What is Initiative 976 and how would it impact local and state transportation systems?
I-976 is an Initiative to the Legislature that was filed for consideration in the 2019 legislative session. The Legislature took no action on the initiative so it will be presented to voters during the next general election in November 2019.
If passed, the immediate impact to cities would be a repeal of the authority for city transportation benefit districts (TBDs) to impose a car tab fee. Under current law, cities have the authority to establish TBDs for the purposes of acquiring, constructing, providing, and funding transportation improvements. To date, over 100 cities have formed TBDs to fund local transportation projects, with 62 TBDs receiving revenue from vehicle license fees. Fifty-five of the 62 TBDs use vehicle license fees as their sole funding source. In fiscal year 2018, vehicle license fees raised $58.2 million in revenue to fund local projects.
In addition to repealing city TBD fees, I-976 would do the following:
- Lower motor vehicle and light duty truck weight fees (car tab fees) to $30;
- Eliminate the 0.3 percent sales tax on vehicle purchases;
- Lower the electric vehicle, snowmobile, and commercial trailer fees; and,
- Modify and reduce Sound Transit motor vehicle excise tax provisions.
These actions would reduce direct revenue to cities through TBDs, reduce revenue to Sound Transit, and reduce revenue to numerous state transportation accounts. These state accounts provide funding for the Washington State Department of Transportation and provide significant investment in transportation projects across the state. These projects include, but aren’t limited to the following: state and local highway construction, maintenance, ferries and support services; multimodal projects like public transportation, rail and bicycle/pedestrian projects; activities of the Washington State Patrol; and more. Below is a chart showing the potential fiscal impacts of the initiative over a six-year period.
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State accounts
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Six-year revenue loss (2020-25)
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Multimodal account
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$ 1,484,122,000
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Motor vehicle account
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$ 265,553,000
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WA State patrol highway account
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$ 88,573,000
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Transportation partnership account
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$ 45,685,000
|
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Other accounts
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$ 37,968,000
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Subtotal
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$ 1,921,901,000
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Local governments
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|
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Sound Transit
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$ 1,968,000,000
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City TBDs
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$ 349,121,000
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Subtotal
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$ 2,317,121,000
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Total
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$4,239,022,000
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Source: OFM Fiscal Impact Statement for Initiative 976
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Association of Washington Cities
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