Olympia gets direct hit from passage of I-976. Other governments await state impacts

With Initiative 976 passing in the state, Thurston County and its cities are bracing for direct impacts and more uncertainty to come.

The initiative limits car-tab fees to $30 for vehicles that weigh 10,000 pounds or less. Many fees in excess of $30, which vary based on where a car is registered and the type and weight of vehicle, will be eliminated or reduced.

The most obvious hit will be to Olympia’s Transportation Benefit District. The district relies on a $40-per-year car-tab fee for 40 percent of its budget for street reconstruction and repair, according to a mailer from the city. Passage of I-976 means Olympia would no longer be able to collect its fee and would experience a $1.5 million loss of street-repair money per year as a result.

But money from car tab fees also goes toward state and local transportation projects, Washington State Patrol, ferry operations, and highway construction and maintenance. The Office of Financial Management projects the initiative will result in a loss of $1.9 billion in state revenue over six years, and that local governments will lose $2.3 billion over the same time period.

As of Friday, election results from the Secretary of State showed I-976 getting almost 53 percent of votes statewide. The last day for the Secretary of State to certify election results is Dec. 5. But the campaign against the measure put out a statement last week saying “the indication right now is that I-976 will pass.”

Gov. Jay Inslee, King County, Seattle, and the Washington State Transit Association have already responded:

  • Inslee released a statement Wednesday saying he directed the state Department of Transportation to postpone projects that hadn’t yet started, and that he directed other state agencies that receive transportation funding to “defer non-essential spending” as impacts are reviewed.
  • King County Executive Dow Constantine has asked the King County Prosecuting Attorney’s Office to prepare a lawsuit challenging the initiative’s constitutionality. The City of Seattle announced it’s also filing litigation.
  • On Friday, the Washington State Transit Association announced its board of directors had ”authorized legal action” to challenge the initiative’s constitutionality as well.

Thurston was among six counties across the state where voters were rejecting the measure as of Friday returns. In Thurston, 33,155 voters had voted no on the measure and 31,424 had voted yes so far.

Kellie Purce Braseth, a spokesperson for the city of Olympia, said the impact of the initiative’s passage would be felt in the 2020 budget. Olympia plans to pursue assessments and evaluations, Braseth said; and she called an upcoming public outreach period for its Transportation Master Plan “coincidentally well-timed.”

The plan will look at potential transportation projects over the next 20 years, Braseth said, and public input on what projects are important could help the city prioritize and balance what’s important to the public with “what’s critical.”

Other area Transportation Benefit Districts are funded by voter-approved sales taxes and won’t be affected. Cities other than Olympia, as well as the county and Intercity Transit are all watching the state to see what happens next.

“We’re not taking any action at this time,” Assistant Thurston County Manager Robin Campbell said in a prepared statement. “We will continue with projects that are underway and funding is secured. We need to wait and see what the state will do before we can assess the impacts to our projects.”

Lacey Public Works Director Scott Egger wrote in an email to The Olympian that the city should be able to proceed with all projects it currently has planned.

“I-976 could impact the availability of future transportation grants, but that is not something that we can act on at this time,” Egger wrote.

In a written statement, spokesperson Andrew Kollar said the city of Yelm is concerned the initiative could impact transportation projects such as the state-funded Yelm Loop project.

“We were concerned this initiative would impact transportation projects, and just as we feared, WSDOT was directed to postpone all projects that are not ‘underway,’” Kollar wrote.

Kollar said the city reached out to Gov. Inslee’s office for clarification on what “underway” means, and that it’s also waiting for the state Department of Transportation to provide a list of impacted projects.

Other projects in the city’s six-year Transportation Improvement Plan require grant funding that also could be affected.

“With a significant cut to revenue, we can expect to see a considerable reduction in grant funding opportunities for infrastructure improvements in Yelm and throughout the South Sound region,” Kollar wrote.

Before the vote, Intercity Transit identified more than $12 million in specific projects and services — including a transit program for customers with disabilities — that rely on at-risk state revenue.

Development Director Eric Phillips told The Olympian this week that there are no immediate effects on local services or staffing. The authority is waiting for the final vote certification and what the state Legislature’s response will be, Phillips said.

“Like everyone else, we’re in the formal wait-and-see mode, kind of wondering what that’s going to mean and starting to think of some of those options we might need to put together,” Phillips said.

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Sara Gentzler joined The Olympian in June 2019. She primarily covers Thurston County government and its courts, as well as breaking news. She has a bachelor’s degree in journalism from Creighton University.