Sound Transit joins suit challenging I-776

Sound Transit will join a lawsuit challenging Initiative 776, the voter-approved measure intended to reduce car-tab taxes to $30 per vehicle.

The agency's executive board voted 15-1 yesterday to participate despite the likelihood the agency will be accused of suing the voters.

"It's time to move and have the guts to stand up and take the flak," said board member Claudia Thomas of Lakewood, south of Tacoma.

The initiative passed statewide in the Nov. 5 election but failed within the Sound Transit taxing district, which covers the urban portions of Snohomish, King and Pierce counties. Sound Transit collects an annual car-tab tax that would be canceled by I-776. The Sound Transit tax is $30 per $10,000 of vehicle value and provides one-fifth of its local revenue. I-776 urged Sound Transit to abort its $2.5 billion light-rail project from Seattle to Tukwila.

King and Pierce counties have already challenged I-776, which also seeks to eliminate a $15 car-tab tax for road projects in both counties. Snohomish County and Douglas County, east of Wenatchee, also collected the $15 tax but dropped it after the vote.

King County Superior Court Judge Mary Yu last week granted an injunction directing the state Department of Licensing to keep collecting the car-tab taxes until a Jan. 31 hearing. The money will be held, but not spent, until the constitutionality of I-776 is decided.

The board's arguments

Pierce County Executive John Ladenburg, a member of the Sound Transit board, said the initiative is unconstitutional because it deals with multiple subjects.

I-776 also violates the principle of local control, allowing voters in Spokane, Yakima or other areas to meddle in the transit programs of urban Puget Sound, said Sound Transit officials.

Sound Transit is funded almost entirely by its own local taxes — and its light-rail project is to be paid for mainly by residents of Seattle, Shoreline and Lake Forest Park.

"It is absolutely despicable to sue the voters and to spend our own tax dollars to pay for it," Tim Eyman, the initiative's sponsor, said yesterday. Sound Transit board chairman and King County Executive Ron Sims "is spitting on the voters," Eyman said.

Bond debt paid by car-tab fee

Sound Transit sold $350 million in bonds in 1999 and maintains that because those bonds are backed partly by car-tab taxes, those fees must continue until bonds are retired in 2028.

However, the bond agreements also allow the agency to set aside enough other money to pay bondholders. Critics urge the agency to pay off the bond debt with some of its $847 million in unspent cash and by dropping the light-rail project.

But Sound Transit says it has no intention of halting light-rail construction, which could begin by summer if $409 million in federal funding is provided.

Agency officials said that if I-776 is upheld, the ability to finance future projects would be impaired.

Sound Transit expects to file court documents today or Monday. Other groups, including the Sierra Club, 1000 Friends of Washington, the King County Labor Council, city of Kenmore, Amalgamated Transit Workers Union and Aerospace Machinists Union have declared support for the anti-776 suit.

The only board member opposing legal action was King County Council member Julia Patterson, D-SeaTac, whose constituents voted for I-776.

In other business, the board passed a $749 million budget for 2003, about one-third more than this year's projected $548 million in spending. Reasons for the increase include startup of a downtown Tacoma streetcar line, construction of Seattle light rail and bus ramps.

Sound Transit is also adding a researcher and a Web-site editor to its public-relations staff, to counter what officials call misinformation from critics. The $215,000 expense is in addition to a $6.6 million communications budget that includes advertising, lobbying and printing costs for posters and schedules.

Mike Lindblom can be reached at 206-515-5631 or mlindblom@seattletimes.com