The passage of ST3 was one of the few joyous moments on an otherwise bleak November election night. Voters approved the proposal by more than a 10 point margin. Transit supporters declared victory and went home to plan for the long process of planning and building a massive expansion of the region’s transit network.

Unfortunately, it could all be in the process of unraveling. Transit opponents in the media and in the state legislature quickly seized on a few instances of driver complaints over higher car tabs to launch a renewed attack on the ST3 taxes. Republican and Democratic legislators have proposed bills to change the way that the motor vehicle excise tax (MVET) is calculated after the media rediscovered the fact that Sound Transit is bound by the legislature to use a process of valuing cars at rates higher than the common “blue book” value.

Transit supporters initially failed to take this attack seriously. They reasoned that because the motor vehicle excise tax could not be repealed or changed without running afoul of the courts, there was no need to be concerned. Rather than recognize this as the opening of a new political campaign, they treated it as sour grapes that could be brushed aside by relying on policies that were more vulnerable than they understood. This was a serious mistake.

As a result, ST3 now faces the loss of nearly $6 billion in revenue if the legislature lowers the amount of revenue Sound Transit can collect from the MVET by changing the way the state estimates car values. This could jeopardize ST3 projects, potentially including rail to Ballard or West Seattle.

All this was under way even before the Trump Administration proposed a federal budget that would slash funding for ST2 projects currently in the pipeline, including Lynnwood Link and Federal Way Link. Their budget proposal makes it clear that “future investments…would be funded by the localities that use and benefit from them.” In other words, if we want the remaining ST2 or any ST3 projects, we will have to pay for them ourselves.

As a result of Trump’s budget proposal, it is urgent to not only blunt the legislative attack on ST3 revenues–we must also begin working to get the legislature to give Sound Transit additional revenues to complete the projects voters approved in both 2008 and in 2016 without the benefit of federal matching dollars. The future of transit in Western Washington is at stake.

This experience provides urgent lessons for urbanists and transit advocates–they had better get ready for a long battle to preserve Sound Transit’s ability to raise the necessary revenues to build the ST3 projects.

Add More Progressive Revenues

Alongside the MVET, ST3 includes sales and property taxes, but does not specifically ask the state’s wealthiest residents or largest corporations to pay anything else. Viewed against the backdrop of the state’s regressive tax system, the ST3 revenue sources are vulnerable to the kind of public backlash we’ve seen with the MVET–even if that backlash is being overstated by a hostile media.

The MVET itself is a progressive tax, and the overall package remains highly progressive. The savings residents will enjoy from being able to ride cheap electric trains rather than drive expensive cars that burn expensive gas will more than make up for the relatively low average household annual taxes of $361. Even with the higher MVET, ST3 costs the average household less than a dollar a day–and builds out a transit system that will get people out of crippling traffic.

Ironically, the changes to the MVET that Senate Republicans are discussing could actually make it more regressive. Sound Transit’s initial analysis of switching to the 2006 depreciation schedule not only shows that it would cost taxpayers at least $6 billion, but that it would hit low-income car owners even harder. Sound Transit explains “owners of vehicles that are less than 11 years old would receive lower bills under the 2006 depreciation schedule while owners of vehicles older than 11 years old would receive higher bills.”

Despite these facts, the media has created the perception that voters are outraged about the MVET, and has provoked legislators into reacting. While advocates are right to fight back and protect the existing revenues, it would be wise to consider ways to extract concessions from legislators in the event they insist on changing the MVET valuation formula.

We should demand that legislators rebalance the ST3 funding package and take steps to accelerate project delivery in exchange for any change to the MVET valuation. For every dollar lost to ST3 from changes in the way car values are calculated, the legislature must restore those funds through the closure of corporate tax loopholes. Several Democratic legislators are exploring a low-income rebate for the ST3 taxes, modeled on Seattle’s low-income car tabs rebate. This is a solution worth exploring, but here too, the legislature must replace any lost revenue.

We should also prepare to drive a harder bargain, given the loss of federal funds for ST2 and ST3. The legislature needs to adopt progressive revenue sources that would ensure the ST2 and ST3 projects are fully funded even if the federal government never contributes another dime. A carbon pricing system, such as a carbon tax or a cap-and-trade system, would be an obvious and appropriate revenue source. So would higher taxes on the rich and on large corporations.

Counter the Media

Sound Transit’s ballot initiatives have passed by wide margins ever since Sound Move was approved in 1996. Transit ridership is growing and freeway traffic is as nightmarish as ever. Public support for passenger rail projects in the Puget Sound region will only grow over time.

Yet local media continues to treat rail projects with a far greater degree of skepticism than almost any other type of public infrastructure project. The same media outlets that treat a freeway widening project as natural and normal treat a passenger rail project as strange, unusual, and often frivolous. This attitude is particularly strong here on the West Coast, despite years of successful transit projects and growing ridership.

This anti-rail bias extends to how stories are written and structured. The agency delivering the rail project is always painted as a dishonest, scheming bully. Those who raise criticisms about the project or the transit agency are always painted as scrappy heroes standing up against an uncaring, corrupt bureaucracy. Transit supporters are rarely ever given space to speak in these stories. It’s as if most reporters and editors learned about how to cover rail projects by reading The Hitchhiker’s Guide to the Galaxy. Sound Transit will always be reported on as if they were Vogons. Opponents will always be a lovable Arthur Dent.

Media bias hasn’t reduced public support for rail. But it does create pressure on skittish politicians to pass laws that undermine Sound Transit’s ability to deliver projects. Because the media gives breathless coverage to a few voters complaining about higher car tabs thanks to ST3–while rarely ever mentioning whether those complainers voted for it, or that it passed by a wide margin–legislators believe they are under pressure to cut the supposed burden of the ST3 taxes. (To his immense credit, Mike Lindblom of The Seattle Times has reminded readers that his paper provided extensive coverage of what ST3 would cost the average Puget Sound resident, including the MVET.)

Transit advocates will need to mobilize on social media to ensure that legislators as well as reporters hear routinely from voters who strongly support ST3–and the voter-approved revenues that will build those projects. They will also need to remind legislators and reporters that the only way out of the region’s crippling traffic woes is to build the ST3 projects as quickly as possible, and that reducing Sound Transit’s ability to collect the voter-approved ST3 revenues will make that traffic worse.

Solve the Pierce County problem

Although voters in King and Snohomish County approved ST3, voters in Pierce County rejected it. To make matters worse, the Democratic Party has been racking up losses in local and state elections, capped by the disastrous election of Republican Bruce Dammeier as Pierce County Executive. Many of the Democrats who voted for the bills to change ST’s governance structure are from Pierce County. It could become a hotbed of anti-Sound Transit attitudes if nothing is done to address the crisis.

Many Pierce County residents believe that ST3 does not benefit them enough. While it does extend Link light rail from King County to Tacoma via Fife, expands Tacoma Link, and adds additional Sounder service, this was not enough to win over Pierce County voters–particularly those who do not live in Tacoma or commute to Seattle. ST3 won in Tacoma, but lost badly in Puyallup and Sumner.

The result has been a fast-growing narrative in Pierce County that it is unfair to make residents pay the ST3 taxes, or that Pierce County is being taxed to fund Seattle’s rail projects (totally ignoring sub-area equity policies). Pierce County politicians are understandably influenced by this narrative, including Tacoma Democrats, who have voted for anti-Sound Transit bills.

Some transit supporters in blog comments have reacted to this by suggesting Pierce County be cut loose from Sound Transit and abandoned. Not only would that be seriously damaging from a transit and an environmental perspective, it’s also politically suicidal. Sound Transit needs Pierce County’s legislative delegation to help ensure that the agency survives and has the revenues and legal authority it needs to continue building projects. Solving the Pierce County problem is essential to Sound Transit’s long-term success.

The legislature must help solve the Pierce County problem by providing additional revenue authority to Sound Transit to allow them to help expand transit service in that region. This could include a restoration of Pierce Transit routes cut earlier in the decade. It could also include additional BRT and rail projects in the county, particularly outside of Tacoma. Those who wrongly argue these communities are somehow not deserving of better transit need to accept that without giving more to Pierce County, they will have little reason to help us defend ST3 and its revenues.

Treat Transit Like a Political Campaign

Finally, transit supporters need to engage in a permanent campaign to sustain and grow public support for transit. The ST3 vote shows that mass transit remains popular in the Puget Sound region as a whole. Opponents know this, and are instead attacking Sound Transit’s actions and its revenue sources as those are some of the only viable options they have.

It would be nice if the passage of ST3 had silenced the critics and ensured that Sound Transit would be left alone to continue doing excellent work delivering the projects voters approved. We now know it won’t be that easy. Transit supporters need to gird for a long war that will not end anytime soon. If we’re going to deliver the ST2 and ST3 projects, and be able to even think about eventually passing ST4, we’ll need to learn from recent mistakes and rapidly pivot to building a sustained campaign for transit that can overcome persistent opposition.

Right now, transit is viewed separately from other major issues. Trump’s attack on Obamacare has generated widespread outrage in Western Washington and caused constituents to flood Congressional town halls. Trump’s attack on Sound Transit is another serious threat to our way of life–but when it comes to transit, legislators are hearing more from transit opponents than supporters. This must change. Local transit advocates enjoy geeking out over policy details, but these do not win the political battles that must be won in order to build these projects in the first place.

The federal government isn’t coming to save us. We are on our own. If we are to successfully resist Trump and build resilient, sustainable cities, it’s time for legislators to tackle Washington’s broken tax system and ensure our transit projects are fully funded.

22 COMMENTS

  1. “the overall package remains highly progressive”

    That’s just wrong – it’s nothing less than fake news. Annual car taxes based on car value are not progressive. A household with $500K income only pays a couple of hundred bucks more a year on their $60K BMW than a household with $50K of income pays on its Camry. Moreover, only about 20% of the tax impositions by Sound Transit are of car taxes – the lion’s share is sale tax revenue (the most regressive type of taxing).

    Worst of all, the Sound Transit taxing is excessive, by any metric you choose. After the ST3 vote Sound Transit’s finance team estimated the tax rates would not be reduced until the mid-2050’s, due to the bond sale contract terms. This year Sound Transit expects to haul in about $1.4 billion of (predominantly regressive) tax revenue. Assume a tax revenue growth rate of 5%. Basic algebra allows an estimate of the aggregate of the annual tax revenue figures over that four-decade stretch. It’s a straightforward calculation: the sum of a 40-term geometric series, with a common ratio of (1.05), where the initial value is 1.4 BLN equals $169 billion. A calculator at the following link provides the answer: ( http://keisan.casio.com/exec/system/1234231998 ). No peer taxes that heavily, or that regressively.

    • There are plenty of good ways to finance transit. Little or no regressive taxing was used for the construction of the new light rail lines in the Twin Cities, Portland, and western N.J. Sound Transit already has statutory authority to impose an employer tax, to issue fare revenue backed bonds, to create LIDs for assessing benefited property owners (and issuing debt secured by such assessments), obtaining TIFIA loans backed by future fare revenues, seeking grants of the type LACMTA obtained from the feds after Trump became president (for its Purple Line extention), etc. The incessant regressive tax hikes here are unnecessary, and frankly immoral.

      • The Twins Cities rely on a regional sales tax to fund their transit projects and operations are funded in part by a motor vehicle sales tax. Sales taxes tend to be regressive. Nonetheless, the Twin Cities overall tax structure is MUCH less regressive in large part due to Minnesota’s income tax. Washington state has perhaps the most regressive tax structure in the country but that’s not because of the car tab fee. It’s because we don’t have a state income tax. http://www.seattletimes.com/business/economy/washington-suffers-most-regressive-tax-system-in-u-s/

        • The initial line built in the Twin Cities runs from St. Paul to the airport via Mall of America, and it includes a tunnel. It is comparable in length to Link. Capital and financing costs were far less, construction took a quarter as long, and no new taxing was needed. It was called the Hiawatha Line, and built 1999 – 2004. The sales tax there you reference is only .5% and imposed by several counties — it started after the rail operations began. Around here the transit sales tax rate is 2.4% — multiples of how high it is for transit elsewhere, plus we have several annual car value taxes and property taxes for transit. The heavy regressive taxing here is far worse than in the Twin Cities, and the management blows by comparison.

          • Well, if you happen to find out that the state bought a bunch of flat right-of-way for a highway that was never built somewhere around here that ST can use, they can have a go at replicating the blue line’s cost!

          • RoW costs do not justify the new general tax costs. Estimate those here. It’s okay, nobody will care. My estimate is $169 billion, based on the little data relating to that subject that has leaked from the silo so far. If you’ve got a better estimate I’d like to know how you derived it.

          • That’s an interesting attitude: the underlying project costs have nothing to do with the associated tax burden? I’d say one directly follows from the other. You’re citing other jurisdiction’s projects you believe are better managed and cost less, and I’m pointing out that they’re not good comparables. Estimating total tax costs is a mug’s game with so many variables in play, the real question is what are capital costs per mile and what sort of mobility benefits and ridership do you get for the $

          • Neither Sound Transit taxing authority nor its tax imposition ordinances bear any relation to capital spending budgets. Those budgets aren’t developed until years after the taxing laws are adopted. Moreover, one of the best ways to rank the quality of government leaders is how well they structure and manage tax burdens. Here the leadership has proven itself the worst of the worst, in spades. That’s why you’re refusing to quantify the regressive tax costs of the RTA’s financing plan — and it’s why those tax cost estimates are kept from the public. They’re a dark secret. In contrast, all peers behave responsibly, and show on their websites all the material terms of their financing plans.

          • The tax levels follow directly from the adopted plan we all voted on and its anticipated capital budgets, O&M costs, bonding costs, etc. All the financial models are posted publicly. You, my friend, are dealing with alternative facts.

          • A) the voter’s pamphlet isn’t intended as an encyclopedic source; B) the full text of the measure tells you exactly what taxes are being imposed at what rates; and C) it tells you the total inflation-adjusted cost of the proposed projects. The combination of B and C is enough for most people’s purposes, but those who want more could’ve looked at the detailed financial plan on the ST3 website. Guess what? It tells you total tax collections over the project lifetime. It’s 27.7b, plus the surplus ST1 and 2 taxes of 8.6b.

          • The taxing at the maximum rates will continue for forty more years — it will not terminate in 2041 as you say ( the construction period — what you refer to there as “the project timeline” – is expected to end in 2041). Staff expects the taxing at the maximum rates to continue fifteen years after that, as is stated in this report:

            http://www.soundtransit.org/sites/default/files/Resolution%20R2016-36.pdf

            Are you ignorant of the financing plan’s basic outlines, or just playing stupid about them?

          • That’s not a report, it’s a financing agreement with the feds. It doesn’t indicate staff “expects”anything. The board could direct them to complete the ST2/3 projects and pay the bonds off ASAP, and roll the ST3 taxes and some of the ST1/2 taxes back in 2048.

            https://www.documentcloud.org/documents/3117849-Defeasance-Dashboard-9-21-16.html

            Of course, that’s unlikely to happen, as people see the value in what ST is doing, and I expect they’ll go back to the voters in 2020 when a surge of voters come out to deny trump a second term and ST4 will use that tax capacity to fill in the gaps in the system.

          • Read what that report says:

            “The TIFIA Master Credit Agreement pledges to the payment of the TIFIA loans the total agency Sales Tax, MVET and Rental Car Tax, including the ST3 taxes [ ]. . . . The final maturity of the loans is expected to range from 2055 to 2059.”

            That report says the expectation is for the rates to remain at the max for forty more years, not expire in 2041 as you indicated.

          • My mortgage instrument says it’s going to mature in 2040, but if i pay extra on the principal that date is now a shifting target. It’s a little more involved with bonds, but the same principle (pun intended).

    • Worst of all, the Sound Transit taxing is excessive, by any metric you choose.

      The metric I choose is this: “Did the voters find the tax burden too excessive?” The answer, clearly and resoundingly, was “no.”

      • Half the truth is a lie, David.

        The voters only were told half the truth, what the tax rate increases would be. The were not informed anywhere in the ballot measure how long the combined (Sound Move + ST2 + ST3) rates would last. Any ideas different voters could have had with respect to the amounts of taxing the RTA would impose necessarily were the product of pure speculation. I explained above how i derived a tax cost estimate of the current financing plan — $169 Billion. What’s your estimate, David? Explain to everyone how you derived it.

        • Don’t be ridiculous. Voters were never misled. With respect to the MVET depreciation schedule, which is the proximate cause of the current unrest, ST 1 MVET voters have been paying for years uses the same depreciation schedule as ST III. ST provided an accurate tax calculator, using the depreciation schedule they used. Any voter interested in the nuts and bolts of the taxes that were part of the plan could easily discover it. I knew it; my anti-ST neighbor, who thought the depreciation scheme unfair, knew it too. The effort to paint this as underhanded in some fashion is just bog-standard anti-tax/anti-transit agitprop.

          As to how long until the bonds are retired, I sincerely doubt anyone is voting based on whether they’ll get a tax cut in 30 years or 35. This is not the source of the angst, and I don’t recall any promises being made about that, either.

  2. One comment on the Seattle reddit re: the car tabs is, I think, emblematic of the opposition… he complained that his car tabs had risen several hundred dollars, which one instinctively has some pity for, and then capped it with “and that’s not even talking about my motorcycles!”

    Motorcycles. Multiple.

    Together with the uncovering by STB that the law as-is happens to dictate that car tabs are higher for people with newer cars – y’know, the richer people – the elitism of this “populist” movement staggers me.

    • You being a failure at life does not entitle you to the right of calling those that are successful elitists. I work incredibly hard for what I make. 80 hour weeks, long commutes, late nights. I put in effort beyond that of my coworkers, friends, family. Ive chosen these life choices and im rewarded monetarily because of it. Youve chosen alternative paths. While youre not as financially sound as some, im sure you have more than enough free time on your hands. Youre entitled to nothing in life. Ill do everything in my power to make sure this is overturned and you get nothing. Enjoy your walk to work.

  3. “Ironically, the changes to the MVET that Senate Republicans are discussing could actually make it more regressive.”

    I chuckled mordantly at this. If Republicans redistributing wealth upward is ironic, this country is the land of irony.

  4. Sound transit does not benefit any one that doesn’t live along the 1-5 corridor. I live in Renton and work in Kent. The RTA tax is beyond excessive. Last year I paid $111 to the tax and this year I paid $386. My car was brand new last year and it is kia’s soul electric. They are saying that my car is worth $35,000. Kelley blue book would say it is worth $15,000. How is this tax fair?

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