King County Transportation District Sales Tax and Vehicle Registration Fee, Proposition 1 (April 2014)

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A King County Transportation District Sales Tax, Proposition 1 ballot question was on the April 22, 2014 election ballot for voters in the King County Transportation District in Washington, where it was defeated.

If approved, this measure would have authorized the district to increase the district's sales and use tax by 0.1 percent, from 0.9 percent to a full cent per dollar. It would have also imposed an annual vehicle fee of $60 per vehicle. Low income individuals could have applied for a $20 rebate on the annual vehicle fee. The revenue from this measure would have been used to fund bus service, road safety and transportation improvements in King County. The sales tax would have been set to expire in ten years.[1][2]

Estimated annual revenue that would have been generated by the sales tax amounted to $50 million. The vehicle fee was projected to bring in about $80 million, for a combined potential revenue of $130 million per year. Most of this revenue would have gone towards funding the Metro public transit system, which was experiencing a budget deficit. Officials said that, without the approval of Proposition 1, Metro would be forced to cut bus services. Forty percent of the revenue would have gone towards road repair and improvement.[2]

The Seattle Times reported that the King County Metro system would have a $75 million deficit if Proposition 1 failed, allowing the current $20 per year vehicle tab fee to expire in June of 2014 without being replaced or renewed.[3]

Aftermath

Once it became apparent that voters had rejected Proposition 1, Metro officials announced that they would be proposing a 16 percent cut in bus services, which amounts to 550,000 hours. This is slightly less than the 600,000 hours in cuts proposed during Proposition 1 campaigning.[4]

King County Executive Dow Constantine, after announcing the plan to cut service by 550,000 bus hours, said that he would continue to urge state legislators to approve more funding for the King County Metro system.[4]

Ed Murray, mayor of Seattle, expressed disappointment at the results of the election, saying, "If we care about the environment, then transit has to win. If we care about the economy, then transit has to win. We are going to win before this is done. We have no choice."

Bus riding voters had varying reactions to this outcome:[4]

Ellen Kildale said, "A cut in service could affect me and parking at my building in downtown Seattle costs $30 a day. It was probably rejected by people who don't ride the bus."

Cari Blount said, "I already ride the bus for 3 hours everyday, I don't want to be on it even more. It's a huge imposition."

Callista Marie Martinez, however, said, "I take the bus, but I'm not going to make people who drive go through ANOTHER tax hike. That's like building a bike lane and expecting people who drive cars to pay for it."

Seattle tax initiative

After Proposition 1 was defeated, a group of public transit proponents called Friends of Transit in the city of Seattle started an initiative petition to put a property tax of $22 per every $100,000 of assessed valuation on the ballot in November. If approved, this measure would fund public transit only in the city of Seattle in order to avoid the bus service cuts proposed by Metro officials.[5]

Election results

As of April 25, 2014, at 4:00 p.m. PST Prop. 1 election results were:

Proposition 1
ResultVotesPercentage
Defeatedd No237,42054.01%
Yes 202,162 45.99%
Election results from the King County elections office

Text of measure

Ballot question

The question on the ballot was:[1]

The Board of the King County Transportation District passed Resolution No. TD2014-03 concerning funding for Metro transit, roads and other transportation improvements. If approved, this proposition would fund, among other things, bus service, road safety and maintenance and other transportation improvements in King County cities and the unincorporated area. It would authorize the district to impose, for a period of ten years, a sales and use tax of 0.1% under RCW 82.14.0455 and an annual vehicle fee of sixty dollars ($60) per registered vehicle under RCW 82.80.140 with a twenty dollar ($20) rebate for low-income individuals.

Should this sales and use tax and vehicle fee be approved?[6]

Explanatory statement

The following explanatory statement was provided for Proposition 1:[1]

If approved, Proposition 1 would provide dedicated transportation funding available to preserve current Metro transit service levels and provide transportation improvements, including road preservation, safety and maintenance projects, by authorizing the King County Transportation District (KCTD) to levy a 0.1% sales and use tax and a $60 vehicle fee, each for up to ten years. Proposition 1 would also establish a low-income vehicle fee rebate of $20 and provide funding for a low-income Metro transit fare.

Sixty percent of revenues, net of administrative costs, would first be available to preserve Metro transit service, including a low-income fare program and the operation, maintenance and capital needs of the Metro transit system. After allocating funds to Metro transit service, any remaining revenue from the sixty percent would be distributed equally for Metro transit and unincorporated area roads purposes. The allocation of these funds will be made by the KCTD Board and guided by criteria contained in Resolution TD2014-03.

Forty percent of revenues, net of administrative costs, would be allocated by population to cities for transportation improvements and to the county for unincorporated area road purposes.

All transportation improvements must be projects contained in adopted transportation plans, as updated by the jurisdictions. Selection of specific improvements would be made by the individual cities and the County consistent with the requirements of Resolution TD2014-03. KCTD would annually review the funded projects and programs and issue an annual report to the public on costs, expenditures, revenues, and schedules.[6]

Full text

The full text of the ordinance that would have been enacted by the approval of Proposition 1 is available here.

Support

Supporters

See also: King County Transportation District Sales Tax and Vehicle Registration Fee, Proposition 1 (April 2014), Supporters
Yes on Prop 1 campaign logo

Move King County Now was the name of the official campaign in support of Proposition 1.Cite error: Closing </ref> missing for <ref> tag[1]

In the arguments supporting Prop. 1, Hayes, Ortega and Marchione said that the following individuals and organizations endorsed the measure:[1]

  • County Council
  • Executive Dow Constantine
  • League of Women Voters
  • Senior Services
  • OneAmerica
  • El Centro de la Raza
  • Seattle Human Services Coalition
  • Downtown Seattle Association
  • Labor Council
  • Virginia Mason
  • SEIU
  • King County Democrats
  • Machinists 751
  • Sierra Club
  • Federation of Blind

According to Move King County Now, the mayors of the following cities also endorsed Proposition 1:

YesProp1King.png
  • Seattle
  • Redmond
  • Kent
  • Shoreline
  • Burien
  • Mercer Island
  • Tukwila
  • Des Moines
  • Auburn
  • Kenmore
  • SeaTac
  • Issaquah
  • Snoqualmie
  • Duvall
  • Renton
  • Maple Valley
  • Sammamish
  • Federal Way

The Seattle Chamber of Commerce and the King County Municipal League were also advocating a "yes" vote on Prop. 1.[7][8]

A full list of supporters of Proposition 1 is available here.

Arguments in favor


"Yes on Prop. 1" Campaign video

Move King County Now, in response to allegations of mismanagement and poor budgeting, argued that the Metro system had faced state funding cuts, revenue shortfalls from the recession, and had tried to reduce operating costs through many different avenues. They said that, ultimately, in order to continue providing extensive transit service, revenue from Prop. 1 was necessary. Proponents also argued that, if Proposition 1 was rejected, bus service would decrease, forcing more cars onto the streets and causing greater traffic congestion and road deterioration. The Move King County Now website featured the following statement:

King County Metro has gone through an elaborate multi-year process to save money and keep our buses running. By implementing audit recommendations, reducing employee benefits, reorganizing service to increase productivity, and other efficiencies, the agency has managed to save resources and keep our buses running. Now the only choice is to cut vital service or pass Proposition 1 on April 22nd. [6]

—Move King County Now, [9]

Chuck Sloane, Chairman of the King County Municipal League Foundation, issued the following statement in support of Proposition 1:[8]

We believe that our growing region needs to make investments in its transportation infrastructure, both transit and roads. We must ensure that the economy can thrive, people can move about, our urban areas can support the density that our comprehensive plans envision, and our environment can be protected.

Our recommendation to voters is made with some reluctance. We have repeatedly urged Metro to do more to control its operating costs and to address its long-term structural issues of unsustainable cost growth and inadequate revenues to meet expenses. However, we acknowledge that the agency has taken many actions to meet the challenges of the great recession and a volatile funding source.

We encourage Metro to continue to work on issues of efficiency and cost control and to use peer benchmarking to do so. The Municipal League intends to continue to monitor Metro’s progress on these issues. [6]

—Chuck Sloane, Chairman of the King County Municipal League Foundation, [8]


Campaign video made by Prop. 1 supporter Mark LaFalce

Official arguments

The following was submitted as the official argument in favor of Proposition 1:

Chamber of Commerce "Yes on Prop. 1" logo

Yes on Proposition 1: Save buses, fix roads throughout King County

Our growing region can’t afford more traffic gridlock and deteriorating roadways. With 400,000 daily rides, Metro keeps us moving. Proposition 1 protects bus service and fixes our roads and bridges - an affordable, needed investment in our economy, environment, and quality of life.

Proposition 1 replaces expiring Metro funding - preventing planned cuts that will affect 80% of bus riders, put 30,000 cars back on congested streets, and leave some seniors, students, people with disabilities, and working families stranded.

Prop 1 dedicates 40% of revenue to roadway safety, preservation, and maintenance - critical funding for every city and rural area.

Prop 1 addresses affordability, creating $1.25 low income bus fare and partial rebate for low income car owners.

Through efficiencies and fare increases, Metro has saved $130 million annually while still meeting record pre-recession ridership levels.

Because Prop 1 replaces expiring funding, we'll pay only $40 more each year for our cars ($20 for low income car owners); with 40% of funding dedicated to local road improvements.

Cutting Metro stalls our economy, increases congestion, and disproportionately hurts seniors, students, and the working poor. [6]

—Denis Hayes, Estela Ortega and John Marchione of Move King County Now, [1]

Opposition

Opponents

No on Prop 1 campaign logo
NoProp1King.png

Families for Sustainable Transit was running the "no on Prop. 1" campaign.[10]

Will Knedlik, Dick Paylor and Jerry Galland of Families for Sustainable Transit (FAST) submitted the official arguments in opposition to this measure.[1]

Arguments against

Opponents argued that the metro system was badly managed and relied mostly on tax revenue to continue service, instead of operating under sustainable bus and train fares. They also pointed out that, since 2000, King County voters had approved six revenue increases for the Metro system, none of which resulted in the promised increase in public transit services. The Families for Sustainable Transit committee presented the following argument against Proposition 1 on its website:[10]

Since 2000, Metro’s tax revenue has increased by 56 percent and their operating costs by more than 80 percent. Added revenue streams in 2000, 2006, 2010 and 2011 have not been enough to off-set Metro’s out-of-control spending. Recently, Pierce County voters forced Pierce Transit to re-evaluate similar out-of-control costs by voting no on new tax increases. As a result of spending reforms, Pierce Transit will actually expand operating hours by 3 percent or 427,717 hours this year. [6]

—Families for Sustainable Transit, [10]

Families for Sustainable Transit also argued that the metro system gave certain county residents an unfair advantage. According to FAST:[11]

  • East King County residents pay 35% of Metro’s sales tax revenue, but receive only 17% of services.
  • South King County residents pay 31% of Metro’s sales tax revenue, but receive only 22% of services.
  • West King County residents pay 34% of Metro’s sales tax revenue, and receive 61% of services.

[6]

—Families for Sustainable Transit, [11]

Opponents also stressed that Proposition 1 only contained increases in regressive forms of taxation, arguing that it would have been toughest on the poor. They proposed that a $60 per year car tab or a one dollar tax increase on every thousand dollar purchase would have been a significant loss to a poor person or an elderly person on a fixed income, but would have meant almost nothing to a wealthy individual.[12]

Some who opposed Proposition 1 criticized county and Metro officials and other proponents of the regressive tax for using scare-tactics to push voters into approving the measure. They argued that the Metro system was in much better financial shape than its administrators admit. Metro officials originally threatened to cut bus routes by up to 17 percent, which amounted to nearly 600,000 hours of service, if Proposition 1 failed. They announced before the election, however, that, due to larger than expected tax revenues, the service cuts might be less significant. Opponents of Proposition 1 argued that officials put off announcing specifically how much smaller the cuts might be until after the Prop. 1 election in order to trick voters into believing that there were dire consequences to voting "no" on the measure. Opponents accused officials of withholding precise information so they could make the misleading and exaggerated "cut vital service or pass Proposition 1" argument.[12][13]

The Seattle Times editorial board published an article criticizing King County officials for not giving voters important information about the higher than expected tax revenue and diminishing budget deficit experienced by the transportation district. The editorial said:[13]

THE campaign for King County Proposition 1 says 600,000 hours of Metro bus service would be cut if voters don’t approve the measure.

At best, that’s disingenuous. The facts matter when asking voters to increase car tabs from $20 to $60 and to raise the sales tax 0.1 percent on the April 22 ballot.

[...]

The yes campaign is based on the-sky-is-falling rhetoric, and the truth is not so politically convenient. The truth is that Metro’s budget deficit is shrinking. That diminishes, even incrementally, the need for Proposition 1’s $1.6 billion, 10-year tax package.

King County needs to be straight with voters. [6]

Seattle Times editorial board, [13]

Official arguments

The following was submitted as the official argument in opposition to Proposition 1:

Your “No” vote will send the essential message that King County taxpayers no longer accept Metro Transit’s refusal to deal with its primary financial problem: excessive operating costs.

Public transit is an important part of our transportation system, but Metro’s current shortfall of $75 million, annually, results from its expenses long increasing at over twice the rate of inflation despite its own stated commitment to reduce those costs to or below inflation.

This is why Sound Transit stopped purchasing services from Metro for several bus routes within King County and, instead, substituted Pierce Transit in order to save nearly 30%. Pierce Transit has worked to reduce costs while Metro’s continue rising.

Proposed new taxes would burden low-income and transit-dependent individuals, through highly regressive impacts, while unjustly skyrocketing taxes on motorists from $40 for every vehicle over two years to $600 each over 10 years: an unacceptable 1,500% increase.

For taxpayers living in east-and-south county – who already pay 65% of transit taxes but receive just 37% of transit services – piling on these added taxes would make this unfairness even worse.

Sustainable transit requires real financial controls, not Metro’s repeatedly broken promises.

Please vote “No” to save transit from Metro’s ongoing mismanagement.

Stop Prop 1's tripling of the car tabs tax annually. Reject Metro's regressive tax increases on the poor for the third time in 10 years. Don't bail out the politicians unwilling to reduce excessive transit operating costs in Metro's budget. Don't be fooled by more of Metro’s false promises. End bus subsidies for wealthy riders at the expense of the transit dependent. Vote No on unnecessary and excessive tax hikes. [6]

—Will Knedlik, Dick Paylor and Jerry Galland of Families for Sustainable Transit, [1]

Editorials

  • The Seattle Times published an editorial advocating a "no" vote on proposition 1. The editorial board of the Seattle Times wrote:[3]

VOTERS should weigh the regressive tax request embedded in King County Proposition 1 against history.

The pattern is clear. As in previous rounds of asking taxpayers for more money, Metro sees its shortfall as a revenue problem, rather than thoroughly confronting its well-documented unsustainably high operating costs.

[...]

Saying no to Proposition 1 is not a message that transit does not matter. It does. The region, particularly job-dense downtown Seattle, needs reliable bus service. Nor should a no vote be read in Olympia as a sign the state Legislature does not need to pass a transportation package that includes less regressive transit tax options. It does.

Vote no on Proposition 1, and send King County government a message that Metro has more work to do on righting its cost structure before asking voters for more revenue. [6]

The Seattle Times Editorial board, [3]

Background

The King County Metro Transit system was created in 1972. In 2014, Metro, which provides bus, vanpool and train service throughout King County, operated under a budget of about $670 million, with a capital budget of $55 million. It employed approximately 4,505 workers, operated over 1,500 vehicles and regulated 131 park-and-ride lots.[12]

Cost increases

County officials pledged to add 575,000 hours in bus service in 2000 when voters approved a 0.2 percent increase in the sales tax rate and 700,000 hours of new bus service in 2006 when voters approved 0.1 percent increase in the sales tax rate. As of January 2014, Metro had added a total of only 450,000 hours of new service since 2000. Metro officials blamed the recession in 2008 for delivering only one third of promised service increases. Critics, however, pointed out that Metro had steadily increased its spending. In 2008, the Municipal League of King County reported:[12]

There is no doubt that factors outside of King County’s control have driven some elements of rising transit costs. While these factors offer some explanation for the recent cost trends, they must not be used to justify continuing high rates of cost growth.

The closer total cost growth can be held to annual inflation rates, the more likely that resources can be directed into improving service quality and adding service to meet ridership demand. [6]

—Municipal League of King County, [12]

The League stated later in 2013 that it was essential for the Metro system to control its operating costs in order to keep its growth in expenses lower than the rate of inflation. Despite this warning, Metro had boosted spending by more than both its revenue increases and the inflation rate over the last decade.[12]

From 2000 to 2012:[12]

  • Metro spending went up by 83 percent
  • Metro sales tax revenue increased by 67 percent
  • Inflation only rose 33 percent

The following is a chart, provided by the Washington Policy Center, showing the change in the operating costs of the Metro system compared to the change in the number of riders from 2000 to 2012:[12]

CostsincreaseKC.png

Revenue increases

Chart provided by the Washington Policy Center showing Metro revenue over three years

Metro officials announced in March of 2014 that the public transit system had received greater than expected tax revenue in 2013 and that increased revenue was expected to continue.

Collected and projected revenue:

  • 2013 - $442,731,128
  • 2014 - $471,000,000
  • 2015 - $496,000,000

Critics of Proposition 1 insisted that with this revenue increase amounting to an estimated 12 percent over two years - twice the projected rate of inflation - metro officials should have been able to continue service and control costs to avoid requiring the imposition of more taxes.[12]

Proponents of Proposition 1 said that these increases, while giving the system a little bit of slack, did not eliminate the budget deficit and did not leave the Metro system any reserves, which were used up because of the recession in 2008.[14]

Tax rate increases

Since its beginning in 1972, Metro had imposed six different tax increases until, as of 2014, most of its funding came from:

  • a 0.9 percent sales tax - 52% of funding
  • car tab fees - four percent of funding
  • a property tax of $6.5 per $100,000 of assessed valuation - three percent of funding

These taxes were supplemented by state and federal grants, which made up ten percent of Metro funding. Only about 18 percent of the system's budget came from bus and train fares.[15]

At the beginning of 2014, the sales tax rate was triple what it was in 1972. The following chart, provided by the Washington Policy Center, shows the increases in tax rates for King County transportation since 1972, as well as the increases proposed by Prop. 1:[12]

TaxincreasesKC.png

Service reduction proposal

NOTE: Officials announced that the proposed service reduction plan was larger than necessary and that the actual reduction would be less than shown below.

Metro and county officials stated that without the approval of Proposition 1, the public transit system would be forced to cut services and routes by up to 17 percent - 600,000 hours - throughout the county. The following chart shows transit routes that could be affected by the proposed transit cut plan proposed by Metro officials in case Proposition 1 was defeated:[16]

KingTransitCuts.png

Kshama Sawant, the Seattle City council member elected on November 5, 2013, was a supporter of Proposition 1. She said, "The cuts to Metro will be devastating, and we are completely opposed to [them]. We have to do everything we can to ensure that the cuts don’t see the light of day—that much is clear."[16]

Critics of Proposition 1 said that these service cuts were exaggerated scare-tactics and that, due to recent windfall tax revenues, the actual affect on the public transit service in the county would be much more minimal. Officials admitted that the proposed service reduction proposal was likely to be an overestimate of the cuts public transit users would see if Prop. 1 failed. While still warning that the Metro system had no reserves and could easily see another fiscal turnaround, Metro General Manager Kevin Desmond admitted that the increased revenue was causing the proposed service cuts to be reduced, saying, “Whether it’s 550,000 hours or 500,000 or 450,000, time will tell.”[13]

See also

Articles

External links

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Basic info

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Additional reading

References

  1. 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 King County Elections Department website, "April 22, 2014, Proposition 1 ballot information," archived April 10, 2014
  2. 2.0 2.1 Kirkland Reporter, "King County proposes April ballot measure for Metro funding," January 23, 2014
  3. 3.0 3.1 3.2 The Seattle Times, "Editorial: King County Metro Transit still has work to do; vote no on Prop. 1," April 5, 2014, archived April 11, 2014
  4. 4.0 4.1 4.2 King5.com, "Voters reject King County transportation measure," April 22, 2014
  5. Q13 Fox, "After voters kill Prop. 1, group drafts tax plan to save Seattle bus routes," April 24, 2014
  6. 6.00 6.01 6.02 6.03 6.04 6.05 6.06 6.07 6.08 6.09 6.10 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributed to the original source.
  7. Seattle Chamber of Commerce website, "Advocacy," accessed April 15, 2014
  8. 8.0 8.1 8.2 Shoreline Area News, "Municipal League recommends 'Yes' vote on April 22 Metro transit and roads ballot measure," March 15, 2014
  9. Move King County Now website, "Frequently Asked Questions," archived April 11, 2014
  10. 10.0 10.1 10.2 Families For Sustainable Transit website, accessed April 11, 2014
  11. 11.0 11.1 Families for Sustainable Transit website, "Get the facts," accessed April 11, 2014
  12. 12.0 12.1 12.2 12.3 12.4 12.5 12.6 12.7 12.8 12.9 The Washington Policy Center, "Citizens’ Guide to Proposition 1," archived April 14, 2014
  13. 13.0 13.1 13.2 13.3 The Seattle Times, "Editorial: King County needs to provide new numbers for Metro bus-service cuts," April 13, 2014
  14. Cite error: Invalid <ref> tag; no text was provided for refs named MKCN
  15. The Seattle Times, "Prop. 1: Isn’t there a better way to fund transit?" April 19, 2014
  16. 16.0 16.1 Seattle Met, "The Left Wing of the Progressive Movement: Sawant Supports Metro Measure," February 24, 2014