Eyman fumes as Gregoire signs tax bill - Governor gives local governments power to add $20 fee to car tabs

By David Ammons
Associated Press/The Daily Herald

May 5, 2007

OLYMPIA, WA- Gov. Chris Gregoire on Friday approved legislation to allow Washington cities and counties to impose a vehicle fee of as much as $20, without voter approval, to help finance transportation projects and transit.

Tim Eyman, sponsor of the initiative that brought $30 car tabs, said the measure disregards voters' clear demand for a public vote whenever an increase is proposed. He crashed the bill-signing ceremony at the Capitol, standing near the governor. He grimaced and gave a thumbs-down gesture to the TV and still cameras as Gregoire signed the measure.

Afterward, the governor asked Eyman if he wanted a souvenir pen like the bill backers were getting. He said yes, and she gave him one, along with a big smile. He departed, still frowning. Later he said he'd use the pen to gather signatures on his latest initiative, to make it harder for state lawmakers to raise taxes.

The new law is an expansion of a 2005 law that allows local transportation benefit districts to ask their voters to approve increases in the sales, property and gas tax, tolls, bonds, transportation impact fees, and vehicle fees of as much as $100 per car per year - either singly or as part of a package.

A district in King, Pierce and Snohomish counties is planning a vote, probably this fall, on a package currently estimated at $16 billion.

The new law will allow city councils and county councils and commissioners to impose impact fees or the first $20 of the vehicle fee without voter approval.

"Cities and counties often struggle to maintain their transportation systems in the face of escalating costs and limited revenues," the governor said. "This bill encourages local governments to partner with each other to invest in local transportation infrastructure, providing cities and counties with an additional tool to improve transportation."

The measure passed the Legislature on a largely partyline vote, and both supporters and critics had speculated that Gregoire might veto it. During her 2004 campaign, she had promised to resist tax hikes, but later supported a transportation tax package and taxes to close a spending gap in 2005, including "sin taxes" and restoring the estate tax on large estates.

But Gregoire said in an interview that she had no qualms about signing the measure, viewing it as strictly a local-option tool for strapped governments to consider.

"It's not Olympia imposing taxes, it's allowing local governments to do what they want to do for local roads," she said. "It's not me imposing taxes. I've always had an attitude that Olympia ought to allow local governments more authority.

"I've said to the cities and counties, 'Come to us with proposals for more options to use at the local level, closer to the people.' I don't think you should have to constantly come to Olympia for more authority. So this is in keeping with that."

She said Vancouver is the only local government that has expressed interest so far.

Vancouver, Kirkland and the state associations of cities and counties testified in favor of the bill, which was sponsored by Rep. Bill Fromhold, D-Vancouver, and the Vancouver delegation.

Fromhold said that Vancouver is one of the few cities without a business and occupation tax and was searching for a revenue source to help fill an $11 million gap for road projects.

"Cities in particularly don't have adequate authority as local elected officials to deal with some of these important issues," he said. "This tax isn't mandated, it's an option, without going to the voters every single time."

Eyman said lawmakers quietly slipped it through without much public awareness that it was even pending. Voters have said repeatedly that they want $30 car tabs and that any proposed increases should go to the people for a vote, he said. He noted that the 2005 legislation specifically requires a vote for any of the revenue options.

"We've been working for 10 years for $30 car tabs and with one stroke of the pen, it's gone," he said.

Eyman said he'll use this new bill as "the poster child" for his Initiative 960, which would require broad public notice for all tax increases proposed in the Legislature.

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The signing upset professional initiative promoter Tim Eyman, who led the Initiative 776 campaign to repeal the previous local car tax.

Eyman accused the governor and the Legislature of ignoring the wishes of the people.

“It’s a really, really, bad, bad, bad bill because it totally breaks faith with what the voters were promised and what the voters said twice,” Eyman said, referring to initiatives that voters passed in 1999 and 2002.

Eyman crashed the bill-signing ceremony and posed with the governor and local government and union officials who want the taxing option. Eyman was photographed wearing a green I-776 campaign shirt in a thumbs-down pose, and he later accepted a souvenir from the governor.

“Do you want a pen?” Gregoire asked.

“I’d appreciate it,” Eyman replied.

The governor told reporters she signed the bill because Clark County officials asked for a way to take care of their street and road problems.

“I’m not imposing taxes,” she said. “It allows local governments to do what they want. I think there will be a lot of counties that won’t use it.”

Since 2003, cities and counties have had the authority to collect as much as $100 a year from a local car tax, but the tax request had to be put on the ballot and win public approval. None of the 39 counties did so. The measure Gregoire signed Friday lets a county council or a city council levy a $20 fee.

The measure takes effect July 22.

However, Pierce, King and Snohomish counties and the cities within its borders can’t impose the $20 fee until after May 22, 2008. That delay is designed to let Sound Transit and the Regional Transportation Investment District in those three counties go to voters first.

The two agencies plan to put an $18 billion regional tax package for road, rail and bus projects on the November ballot.

Rep. Bill Fromhold, D-Vancouver, who sponsored the new bill, said he wanted to give local officials an option to raise money for transportation projects.

“You can’t expect every single decision you make to go before the public for a vote,” he said. “We’re elected to make decisions on behalf of those who elected us.”

Pierce County lobbyist George Walk said County Council members haven’t talked much about the taxing option because Pierce is one of the counties that can’t act until next year.

But it’s something they would give more attention if the joint ballot issue in November is defeated.

Then the discussion likely would be whether to impose a $20 annual fee or seek a larger amount from voters, Walk said.

“Nobody’s got their eyes on it right now,” he said.

Pierce, King, Snohomish and Douglas counties collected a similar $15 annual fee until the passage of I-776. A $20 annual fee would raise about $2 million a year for Tacoma and slightly more for Pierce County.

Voters last fall turned down Tacoma’s request for a property tax increase to raise $48 million for street repairs over six years.

HB 1858 gives county councils first crack at deciding whether to go with a countywide car tax.

If a county council opts not to impose the annual fee, each city council could then make its own decision. A coalition of cities, counties, Realtors, building industry and general contractors lobbied for passage of the bill.

Joseph Turner: 253-597-8436

joe.turner@thenewstribune.com

Originally published: May 5th, 2007 01:24 AM (PDT)