by Katie Wilson
On Tuesday, January 10, Governor Gregoire released a 10-year transportation revenue proposal (posted on the Seattle Transit Blog here). Less than 5% of the package is dedicated to transit – not nearly enough, although this should come as no surprise to anyone. Two items bear directly on local public transit:
1. “Grant funding for transit to mitigate potential service cuts to passengers that would affect their ability to get to work, school and other destinations – $150 million”
Direct state funding for public transit is sorely needed; unfortunately this $150 million in grant money is a one-time (not an annual) deal, and would presumably be spread across the state, so the amount that would reach Metro over the next ten years is likely to be rather small.
2. “Either allow local governments the option, through councilmatic [sic] approval, to impose a 1 percent increase in the Motor Vehicle Excise Tax, with proceeds to be dedicated to local road and transit needs, or allow transportation benefit districts the option, through councilmatic approval, to adopt up to a $40 vehicle license fee for local road and transit needs.”
A 1% MVET increase isn’t a great funding tool, but at least it would be more progressive than a flat car tab fee – a welcome reminiscence of the days before Eyman’s Initiative 695. But Martin H. Duke’s post on the Seattle Transit Blog suggests that in King County that 1% would end up going “to address traffic diversion from the tunnel.” And if the $40 VLF were approved, even much of that would likely be consumed at the city level, rather than being funneled to King County Metro.
Which leaves us with… not much.
As politically impossible as it seems right now, it’s worth thinking about some more progressive funding measures we might demand of the state once we have built up the people-power to do so effectively. The Economic Opportunity Institute’s fact sheet, “$2 billion in progressive annual revenue for Washington,” contains several transit-related items. For instance, a state-wide 10% luxury tax on motor vehicles, vessels, and aircraft valued over $50,000 would raise $70 million annually; and repealing the sales tax exemption on trade-ins would raise $114 million. EOI has this to say about trade-ins:
“Trade-ins – When someone trades in a car (or boat or appliance) while purchasing a new one from a dealer, no sales tax is charged on the value of the trade-in. In private party sales of used cars, the purchaser pays sales tax on the purchase price when registering the vehicle. Typically, sellers get a better price by selling a used vehicle themselves, so trading-in is primarily a convenience, and especially benefits those who frequently buy a new car. Eliminating this exemption would primarily affect upper income people. Because a portion of sales tax goes to local governments, eliminating the exemption would provide $35 million in additional revenue to local governments.”
Of course, there’s also no good reason why transit funding should come only from transit-related taxes.