Why the gas tax was DOA

The following is my preliminary report on the basis for the success on the I-912 (Gas Tax Repeal) effort. While the contents may not be, in their entirety, factually correct, we must all remember that the issue is that the perception is the reality.

Remember… I am but the messenger.

The Number One issue:

Voters rejected a gas tax increase in 2002 of 9 cents per gallon.

Since then, the legislature has ignored that will by increasing gas taxes 14.5 cents per gallon.

This has infuriated a huge block of the center and right.

Voters are increasingly angry that their government ignores their expressed will. Backlashes like this will continue to come with the territory when the government insists on what amounts to flipping off the people they would govern.

The people want to know: “What part of NO don’t you people understand?”

When combined with the gutting of I-601, this is a recipe for rage on the part of the people of this state and, in the end all the Legislature has accomplished is to strengthen Tim Eyman, et al, in their shadow government efforts.



Number Two Issue:

The use of the “Emergency Clause” was inexcusable and uncalled for. It is clearly seen as a Legislative ploy to keep the people from having a direct voice in their government because of the now clear fact that the people did NOT want a gas tax increase, particularly without their say so.

Because of the "contingencies" contained within the bill, specifically the reapportionment in the event the voters refuse to increase local taxes needed to complete the as yet undecided projects, I believe that the emergency clause was used improperly (and arrogantly). Even though an audit provision was in the bill, there are no real teeth in that process. Again, how “unsafe” are some of these projects since the State could reprioritize the funds if the contingencies aren’t met? To me, it says that the politicians are only using the word “safety” for news sound bites and not because they really mean it.

Do you know when and why the State stopped putting the amount of tax on the pump? I think they should restore it. The people should be able to see how much goes to the government. It also reminds them that they need to keep an eye on how well that money is spent. At our current tax rate, we are now at 31 cents a gallon, State, and 18.4 cents a gallon, Federal – 49.4 cents a gallon. At 2.3999 a gallon, that is a 20.6% tax on fuel. Once we reach 37.5 cents, we’ll be paying over 24% tax per gallon (including federal).

The current 23 cents is allocated as such:

State 10.96 cents 47.6%
Ferries 1.08 cents 4.7%
TIB 3.04 cents 13.2%
CRA 1.03 cents 4.5%
Counties 4.42 cents 19.2%
Cities 2.46 cents 10.7%

Boy, I missed SB-5969. The worst part is that it was virtually unanimous in both houses. Cities and counties receive 29.9% of the gas (23 cent) tax revenue. How much of that is affected by this bill?

For funds distributed to unincorporated cities and towns, this whole section was gutted: "...to be used exclusively for: The construction, improvement, chip sealing, seal-coating, and repair for arterial highways and city streets as those terms are defined in RCW 46.04.030 and 46.04.120; the maintenance of arterial highways and city streets for those cities with a population of less than fifteen thousand; or the payment of any municipal indebtedness which may be incurred in the construction, improvement, chip sealing, seal-coating, and repair of arterial highways and city streets; ..."

It would seem to me to be a violation of the 18th amendment since the money, in effect, was not distributed solely for “roads” as defined in the Constitution. But it won’t be overturned without a lawsuit.

The new tax has 1 cent going to local governments – $602 million. I wonder how much of this money is affected by SB-5969?



Number Three Issue:

Voters are convinced that government wastes money. As one wrote:

“Now, I would be happy if the same crowd did a ballot initiative for a regional gas tax to fix 520, and expand I5. I would be MORE than happy to pay for a targeted bill WITHOUT:

Prevailing wage

public arts funding in it

more public transit dollars in it

a third going to pushing EIS paperwork

sales tax on the materials used in the projects

And if we could get this done right, I would pay yet AGAIN to improve 405, and then maybe, just maybe the Viaduct (though my dreams of it falling upon Ron Sims in an earthquake would then be crushed--pun intended).

Posted by dano at July 7, 2005 01:26 AM”



Number Four Issue:

The perception, right or wrong, that the gas tax money is not used entirely for road construction.

Costs associated with construction, including the economic slight of hand involved in shifting gas tax funds to the general fund (Assuming $8.5 Billion for construction, around $600 million of that goes to the general fund in the form of the sales tax) combined with the following breakout of the funds distribution:

Under RCW 46.68.090, only 44.387% of the fuel tax will actually go towards "Highway Purposes". 2.3283% goes towards Ferries, 10.6961% gets distributed to Cities and Towns based on population (and thanks to SBS 5969, it's no longer required to go towards transportation), 19.2287% goes to the counties with no provisions that it be used for transportation.

Of the 8+ billion in this tax package, 4 billion will go to pay back loans (bonds), leaving 4 billion for the actual construction. Of that, a large amount will actually slide into the general fund through sales tax on construction materials.

An even larger amount will be shunted off for environmental mitigation. How much will actually be left over for any real steel and concrete?

Reduce the environmental mitigation.

Eliminate sales tax on construction materials.

Do everything possible to maximize the money going to steel and concrete.

Under these conditions, I don't have an issue with extra taxes. Over the last 6 years, the legislature has not done anything to meet these conditions. In the end, they just increased the tax.

I did the numbers off the top of my head. If you go to http://hdc.leg.wa.gov/issues/transportation/2005_transpo_summary_final.pdf Page 4 is where I'm getting my numbers.

Actually, the new tax package is planned to raise almost 12.5 billion over 16 years. Almost 4 billion will go to pay off the bonds, leaving 8.5 billion for the rest. The gas tax itself is expected to raise 5.5 billion over 16 years.

According to the State, about 2.3 billion will go to ferries, rail, local government, fish, noise barriers and a few other odds and ends. 757 million is allocated to bridge replacement and safety projects. Roughly 5.5 billion goes to roads and congestion relief. 2.5 billion go to the viaduct and 520, which are basically safety replacements not necessarily additional capacity.

I-405 and projects specifically designated for congestion relief amounts to 2.9 billion.

The new tax has 1 cent going to local governments – $602 million. I wonder how much of this money is affected by SB-5969?

I think we could expect to spend upwards of 340 million in sales tax (4.4 billion * 8.2%). That's enough to fund almost all the bridge replacements or the saftey projects AND Seismic retrofit of bridges.

The plan states that the money for I405 will combine with our "nickel" tax of just two years ago to complete the projects early. What can we expect of the state in a few years? Will they be low on money again and need to raise taxes even more?

After the mismanagement, blown promises and huge cost overruns of ST and the monorail, we need to have more than empty promises.

This money is not being spent wisely. Get a better handle on that first and then we'll feel better about paying more.

Thus, in the minds of many, this amounts to bait and switch.



Number Five Issue:

This gas tax doesn't really do anything, in and of itself, to fix the viaduct or 520. If the people in the region do not vote for an additional tax package by 2007 to fund the balance, the money allocated could be used on other projects.

Thus, the idea that it is for the viaduct and 520 carries very little weight.



Number Six Issue:

Gregoire campaigned against a non-voter approved gas tax increase during her campaign. She then signs into law the very thing she claimed to oppose during her campaign.



Number Seven Issue:

The perception of the following:

The utter lack of REAL accountability in how it gets done.

The ferry system under the WADOT cannot give an accurate accounting of where the fares go;

Those in the RTA district already pay $50.00 per year/vehicle registered for people to ride heavy rail at a cost of over $60,000/yr. per head;

This additional gas tax throws another 800 million into the black hole called Sound Transit;

WADOT is not audited by any agency WITH THE TEETH to correct it;

Just what part of NO does Olympia not understand?



Number Eight Issue:

That no project is actually “funded.”

I would be more inclined to support this if there was actually a PLAN to replace the viaduct. But no, they just dedicated 2+ billion for a project that does not even exist yet.

Also, the viaduct is a Seattle issue. Y'all seem to love financing multi-billion dollar boondoggles - so you do it! Why should Spokane have to help?


Anger is a deep well to act from. And these people perceive that their government is ignoring them and fiscally abusing them in the process.

With the success of this effort, I can expect to see many more to follow.