Politics & Government

Sound Transit 3 car-tab fee calculations are unconstitutional, lawsuit contends

Riders come and go at the Tacoma Link light-rail platform at the Tacoma Dome Station, December 14, 2016.
Riders come and go at the Tacoma Link light-rail platform at the Tacoma Dome Station, December 14, 2016. News Tribune file photo

Republicans have tried time and again in the Legislature to slash car-tab fees that were increased to pay for the $54 billion Sound Transit 3 construction package.

With little luck at the Capitol, some affected by the tax hikes, cheered on by GOP lawmakers, are trying another venue: the courts.

Two attorneys and a group of residents filed a class-action lawsuit on Tuesday over the controversial way Sound Transit calculates those car-tab fees, which leads to inflated costs for some.

“They have exhibited a wanton lack of fiscal responsibility and thumbed their noses at citizen accountability,” said Sen. Phil Fortunato, R-Auburn, of Sound Transit in a Tuesday news release.

Attorneys Joel Ard and David DeWolf contend in the lawsuit that Sound Transit’s use of an older method to measure vehicle value rather than a new, more accurate one approved by lawmakers in 2006 was unconstitutional, based on the mechanics of how the ST3 legislation was written. The claim also was raised in a GOP-led Senate investigation last year.

Fortunato on Tuesday took credit for spurring the lawsuit and recruiting Ard and DeWolf, claims disputed Wednesday by Ard. Fortunato said Wednesday he has been pushing for a lawsuit on the issue due to legislative inaction.

Sound Transit spokesman Geoff Patrick rejected the argument, saying in a prepared statement the agency is "confident in the validity of the law." Sound Transit intends to use the older method through 2028 when existing bonds are retired.

The vehicle-valuation schedule has drawn the ire of the GOP since The Seattle Times highlighted it in a 2017 report. The method overestimates the value of newer cars compared to Kelley Blue Book.

Many lawmakers said they were surprised Sound Transit was using the older vehicle-valuation schedule considering they implemented a new one in 2006. Efforts from both sides of the aisle to offer rebates and tax cuts based on more accurate vehicle valuations have been dragged down by internal divisions and partisan fighting.

The lawsuit argues the ST3 legislation incorrectly and incompletely referenced the older vehicle-taxation schedule and therefore should be ruled invalid.

Ard said in a Wednesday interview the state constitution requires lawmakers to "spell out the change" when they amend a statute. It is a way of keeping citizens informed about what's in a bill.

Ard said he is motivated by the constitutional question and less by the policy debate over the cost of car tabs.

"We have to make sure we monitor those guard rails," he said.

Patrick, the Sound Transit spokesman, did not directly address the question of whether the older law was referenced correctly but said there was no misinformation.

The 1990s-era vehicle valuation schedule used for ST3 "has been in place for two decades," he said, and the lawsuit is aimed at hurting the agency's ability to collect taxes despite the fact ST3 was vetted in the Legislature and by the public.

"Since voters’ decisive approval of ST3, highway congestion has only worsened, and it will continue to worsen," Patrick said. "Any reduction of MVET revenues would delay or kill voter-approved transit alternatives."

While the ST3 package was approved by a majority voters in 2016, most in Pierce County rejected it. It is paid for by a combination of increased sales taxes, car-tab fees and property tax hikes.

Sound Transit plans to expand light rail in King, Pierce and Snohomish counties and boost bus service and commuter-rail lines as part of the package.

The lawsuit seeks more than $240 million in damages, which Ard and DeWolf say in legal filings is the amount of car-tab fees collected for ST3 so far.

Walker Orenstein: 360-786-1826, @walkerorenstein