See Also: Index of all Measures

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The Law As It Presently Exists

The State levies a motor vehicle excise tax on the privilege of using a motor vehicle in the state. The tax is payable each year and is based on the value of the vehicle. For passenger vehicles, motorcycles, and trucks weighing up to 6000 pounds, the value is based on the manufacturer's suggested retail price, gradually depreciated over the life of the vehicle according to a schedule set forth in statute.

The law provides a percentage formula for the distribution of revenue from the motor vehicle excise tax to various state funds and accounts. These funds and accounts include: the motor vehicle fund; the Puget Sound capital construction and the Puget Sound ferry operations account in the motor vehicle fund; county and municipal sales tax equalization accounts; the state general fund; the transportation fund; county and municipal criminal justice assistance accounts; and the county public health account. There is also a distribution to cities and towns for police and fire protection. The law sets maximum amounts that may be deposited in the criminal justice assistance accounts, with any excess revenue deposited in the violence reduction and drug enforcement account.

Initiative 601, enacted by the voters in the 1993 general election, created a state expenditure limit and, with certain exceptions, requires that revenues received in excess of the limit be placed in reserve accounts and not spent. One provision of Initiative 601, codified as RCW 43.135.035, would require the expenditure limit to be lowered to reflect any transfer of money from the general fund to other funds or accounts. Another provision of Initiative 601, codified as RCW 43.135.060, provides that local governments shall be fully reimbursed by specific appropriation by the state for the costs of responsibilities imposed on local governments for new programs or for increases in service levels under existing programs.

Certain municipalities that operate transit agencies may levy a local motor vehicle excise tax which is credited against the state tax. To obtain a distribution from the revenues generated, these municipalities must match the distribution with other revenues. Local sales taxes specifically imposed to support public transportation systems may not currently be used as matching funds.

The Effect Of The Measure If Approved Into Law

The measure would reduce the motor vehicle excise tax; reallocate the revenue from this tax and other revenues; provide for the issuance of $1.9 billion in state general obligation bonds to finance state and local highway improvements; and make other changes in state and local government funding provisions.

The motor vehicle excise tax would be reduced by a $30 credit against the tax for each personal-use motor vehicle, truck weighing up to 6000 pounds, or motorcycle. In addition, the statutory depreciation schedule would be changed so that the taxable value of a vehicle would be lowered in the second and third years of its use.

The distribution of revenues from the motor vehicle excise tax to various state funds would be changed in a number of ways. The allocation to the state general fund would be reduced from 57.644% to 13.573% through June 30, 1999, and after that date would be entirely eliminated. The portion allocated to the transportation fund would be increased from 5% to 43.605% through June 30, 1999, and then to 51.203%. The motor vehicle excise tax revenue allocated and distributed to other funds would be increased or decreased by varying amounts. The measure would require transfers from the general fund into two of these funds, the county criminal justice assistance account and the municipal criminal justice assistance account. Beginning with Fiscal Year 2000, the limits on distributions into these accounts would be removed. Part of the reallocated motor vehicle excise tax revenue would be distributed to economically distressed counties through a new account in the treasury.

The measure provides for the issuance and sale of up to $1.9 billion of general obligation bonds to pay for the location, design, right of way, and construction of state and local highway improvements. No bonds could be offered for sale without additional legislative action. The measure provides that the bonds shall pledge the full faith and credit of the state for payment of the principal and interest when due. The proceeds from the sale of the bonds would be deposited in the motor vehicle fund, and the principal and interest on the bonds would be first payable from revenues from the motor vehicle fuel and special fuel excise taxes.

The measure would modify Initiative 601 (RCW 43.135.035) to provide that the transfer of moneys from the general fund to other funds or accounts as authorized in this measure would not reduce the state expenditure limit. The measure would also modify Initiative 601 (RCW 43.135.060) to allow the state to reimburse local governments for the costs of new programs or increased service levels through increases in state distributions of revenue to local governments.

The measure would authorize certain cities owning and operating municipal public transportation systems to use local public transportation sales tax revenues to match their local motor vehicle excise tax revenues. This authorization would be implemented over a four year period beginning July 1, 1999. After July 1, 2002, 100% of the revenues generated from the local motor vehicle excise tax could be matched by local public transportation sales tax revenues.

A yes vote is a vote for less congestion on our roads, less taxes on our cars and more dollars to fight crime in our communities.

VOTE YES TO REDUCE YOUR LICENSE TAB FEES AND TAXES BY $30 PER CAR.

Referendum 49 will reduce the license tab fee on each auto by $30. Your car will no longer be taxed at 100% of new value in your second year of ownership.

VOTE YES TO ALLOCATE MORE OF YOUR LICENSE TAB FEES TO TRANSPORTATION IMPROVEMENTS.

Only about one-half of your license tab fees now support transportation projects. R-49 will dedicate most of your license tab fees to transportation - where they belong.

VOTE YES TO PROVIDE MOST OF THE FINANCING FOR A $2.4 BILLION PLAN TO REDUCE TRAFFIC CONGESTION, MAKE OUR HIGHWAYS SAFER AND MOVE WASHINGTON GOODS TO MARKET.

By dedicating more of our license tab revenues - part of the $800 million budget surplus - to transportation, $2.4 billion will be available for transportation improvements. No new taxes are needed to provide these funds.

VOTE YES TO HELP COMMUNITIES FIGHT CRIME AND CREATE JOBS.

Local governments face rapidly rising costs for courts and jails. R-49 provides substantial surplus funds to communities for criminal justice. It also provides new funds to counties with high unemployment to help them with transportation and other economic development needs.

Vote yes because we need transportation solutions now to get our state moving again. Our freeways are dangerously congested. Traffic congestion is so bad, we can't wait any longer. R-49 will get us moving again.

• It demands a blank check without saying how it will be spent.
• It takes money that could be spent on schools.
• It will make congestion worse by cutting funds for transit.

Vote no on Referendum 49!

Advisory Committee: ED HANSEN, Mayor, City of Everett; MIC DINSMORE, Executive Director, Port of Seattle; LOWELL LANCASTER, Chair, Washington State Horticulture Assn.; KEN SMITH, President, WaferTech; ROB HIGGINS, Executive Vice President, Spokane Association of Realtors.

VOTE NO ON 25 YEARS OF DEBT FOR 5 YEARS OF PROJECTS

Referendum 49 will plunge the state into the deepest debt in history - credit card debt that will take a generation to pay off. Taxpayers will pay billions of dollars in interest that should be spent on roads and transit! In fact, transit spending will be cut by millions. Burdening taxpayers with decades of interest payments for only five years of projects makes no sense.

VOTE NO ON MONEY WITHOUT A PLAN

Referendum 49 says nothing about the projects the money will be spent on. No one knows what projects future legislatures, governors, and the Transportation Commission will approve.

VOTE NO ON A PLAN THAT WON'T FIX YOUR STREET'S POTHOLES

Referendum 49 won't ease congestion. It provides only pennies to fix potholes on your city streets and county roads! It cuts transit funding now and in the future.

VOTE NO ON JEOPARDIZING OUR CHILDREN'S FUTURE

This plan endangers our schools and colleges. If the economy slows, we'll need the state's budget surplus to pay for education. Referendum 49 means that surplus will pay the interest on our road debt instead.

Referendum 49 makes false promises to relieve traffic congestion, fund local criminal justice and provide a tax cut without harming other programs. Don't believe it! We cannot risk our future with a plan that is too expensive, hurts schools and doesn't fix the problem.

Vote no on Referendum 49.

Like R-49, other options would use traditional, low-interest bonds to finance transportation projects. Instead of raising taxes, R-49 simply directs more license tab revenue toward transportation.

R-49 will fund a bipartisan plan to relieve congestion, increase safety, and get Washington moving again!

Advisory Committee: PAUL SCHELL, Mayor, Seattle; ELIZABETH PIERINI, President, League of Women Voters, Washington State Chapter; VALORIA LOVELAND, State Senator; DR. TERRY BERGESON, Superintendent of Public Instruction; DALE NUSSBAUM, President, Amalgamated Transit Union Legislative Council, Spokane.