Olympia income tax initiative likely to remain on November ballot

A state appellate court commissioner issued a stay Friday that effectively means a ballot measure to create an income tax for some city of Olympia residents will appear on the Nov. 8 election ballot, even as legal questions over its constitutionality are argued on appeal.

Court of Appeals Commissioner Aurora Bearse ruled Friday to stay — a legal term for “halt” — a portion of a decision by Pierce County Superior Court Judge Jack Nevin last month that would have kept the initiative off the ballot.

The Opportunity for Olympia initiative seeks a 1.5 percent tax on household income in excess of $200,000 to raise an estimated $3 million a year for a public college tuition fund.

If the intiative is approved by voters and holds up in court, it would become the first income tax in Washington.

Nevin ruled Aug. 24 that the initiative extends beyond the city’s powers and conflicts with the state law that prohibits income taxes. Opportunity for Olympia’s attorneys filed an appeal that day.

In response to Friday’s decision, the city will file a motion Sept. 6 with the full appellate court to modify the ruling and request that it be reversed. Opportunity for Olympia and the city would both need to file responses Sept. 7 and 8, respectively, then await a decision.

The appeal allows the initiative to appear on the November ballot, but it does not address the initiative’s validity, said City Attorney Mark Barber. The city argues that the initiative is full of inconsistent legal language and loopholes — such as a lack of enforcement and penalty provisions — that would fail to withstand an inevitable and costly court challenge if it passes in November.

“It doesn’t resolve those critical issues,” Barber said of Friday’s appeal. “That was not a decision on the merits of the initiative.”

Opportunity for Olympia issued a statement Friday on the decision.

“We applaud today’s appeals court decision affirming Olympia voters’ right to have their voices heard on this initiative,” according to the statement. “We are excited to bring this voter-initiated college grant fund to the fall election ballot. We hope the city will not waste anymore taxpayer money on further appeals.”

The city has estimated that its legal fight against the initiative will cost between $50,000 and $60,000.

This story was originally published September 2, 2016 at 2:42 PM with the headline "Olympia income tax initiative likely to remain on November ballot."