Seattle, WA – A March 12 ruling by Judge Marshall Ferguson lifted the injunction on Initiative 976. The initiative can largely take effect March 27, unless the judge takes further action. Link to ruling.

Washington voters passed statewide Initiative 976 in the November 2019 General Election with 52.99% of the votes. The ballot measure was overwhelmingly approved by Snohomish County voters with 58.21% of the vote.

Impact of Ruling

For vehicle owners in the 36 counties outside the Puget Sound, all vehicle taxes and fees targeted by I-976 may be illegal for the government to take from you. So any vehicle fee imposed by any city (transportation benefit district car-tab-fee) is eliminated, any weight fee imposed by the state government is eliminated, and a state sales tax surcharge on the purchase of a vehicle is eliminated. With the injunction lifted, these taxes and fees may no longer need to be paid.

For vehicle owners in Pierce, King, and Snohomish counties, these taxes and fees on vehicles are eliminated now: any vehicle fee imposed by a city (transportation benefit district car-tab-fee), except Burien, weight fees imposed by state government, and a state sales tax surcharge on the purchase of a vehicle. With the injunction lifted, these taxes and fees may no longer need to be paid.

Sound Transit must determine how it will handle the vehicle tax and vehicle valuation schedule imposed on vehicles according to Section 12 of I-976. Section 12 specifically states that Sound Transit “must fully retire, defease, or refinance” any car-tab-tax-backed bonds. Once the bonds go away, then the vehicle tax and valuation schedule goes away. 

Summary of Initiative 976

• Limit annual license fees for vehicles weighing under 10,000 pounds at $30 except voter-approved charges;
• Base vehicle taxes on the Kelley Blue Book value rather than 85% of the manufacturer’s base suggested retail price; and
• Repeal authorization for certain regional transit authorities, such as Sound Transit, to impose motor vehicle excise taxes.

The measure was set to take effect on December 5, 2019, but was on hold pending the resolution of legal challenges.

Legal Challenges

On November 13, 2019, nine plaintiffs, including the governments of Seattle and King County, filed a legal complaint to block Initiative 976 as violating the Washington Constitution. The complaint also argued that Initiative 976 violated the single-subject rule, the separate subject-in-title requirement, the requirement to disclose the repeal of statutes, and other constitutional provisions The complaint named the State of Washington as the defendant.

On November 26, 2019, Judge Marshall Ferguson blocked Initiative 976 from taking effect on December 5, pending the conclusion of the case.

On December 4, 2019, the Supreme Court affirmed that the measure would remain on hold pending the resolution of the case.

On February 12, 2020, Judge Marshall Ferguson ruled that the plaintiffs did not demonstrate that the ballot summary was misleading and that the measure violated the state’s single-subject rule. However, Judge Ferguson declined to rule on whether the initiative was unconstitutional because it interfered with the contracting authority of the city of Burien and favored one private company by requiring the Kelley Blue Book valuation of cars.

The Lynnwood Times will keep you updated as more develops.