Initiative 695 Haunts State Government In Washington

By: - April 3, 2000 12:00 am

OLYMPIA, Washington — Election year for Washingtons part-time Legislature normally means a short session, just enough time to tweak the biennial budget, pass a few bills, and create an issue or two for the campaign.  But this year would hardly qualify as normal.

Unable to agree on budget adjustments within the constitutionally mandated 60 days, the Legislature is now embroiled in the fourth week of a special session — with no end in sight. The cause of the stalemate: Initiative 695, the voter approved measure that eliminated the state’s car tax, and, in one fell swoop, wiped out about 7 % of the state’s tax revenues.

Since the measure passed last November, I-695 has dominated state politics as no other issue has. Its impact has reached far beyond the mere replacement of lost tax money. It has raised serious questions about the nature and size of Washington’s state government, and the role of direct democracy in a representative system.

The situation was further complicated two weeks ago when a lower court judge struck down the measure as unconstitutional. The case is now headed for the state Supreme Court, scheduled to hear arguments in June.

Initiative 695 was the brainchild of Tim Eyman, a 30-something watch salesman from Mukilteo, a city of 17,000 just north of Seattle. It was a two-pronged assault on taxes: one, a direct blow against the widely despised car tax; the second, a far more sweeping attack on government’s capacity to raise money.

I-695 eliminated the motor vehicle excise tax, which extracted from motorists 2.2 percent of a vehicle’s value, and replaced it with a flat $30 flat. But it also required voter approval to raise taxes, fees and any other “monetary charge” by government.

The measure passed with 56 percent of the vote.

Transit workers, ferry riders and cities immediately challenged I-695. They feared disabling cuts in transit, ferry and local services, all of which had been supported by the car tax. Also joining the suit were other cities, port districts and municipal utilities, which asked the court to decide when they would have to go to the voters to raise any number of charges.

Would they have to schedule an election to raise sewer and water fees? Bus fares? The price of a school lunch?

It was the the linking of the tax cut with the voter approval provision that spelled trouble for I-695. Washington’s constitution restricts legislation, including initiatives, to one subject. King County Court Judge Robert H. Alsdorf found that I-695 violated that constitutional requirement, as well as others.

Of particular significance, he ruled the voter approval provision was unconstitutional because it created an automatic or “universal” referendum. The constitution requires voters to sign petitions to challenge laws through referendum, but specifically exempts taxes and other laws necessary to support the government from such challenges.

Alsdorf immediately blocked the voter approval provision, but let the tax cut stand until the Supreme Court rules.

Enter Gov. Gary Locke, a Democrat who opposed the initiative, and lawmakers from both parties. They decided not to wait. Paying homage to the “will of the people” they proposed, and the Legislature passed, a bill to put the I-695 tax cut into statute. Locke signed the bill into law last Friday.

That has left the Legislature with the same problem it had when it convened in January: a gaping $750 million-a-year hole in the budget. Complicating the solution are a state spending cap law, which makes it exceedingly difficult to tap into the state’s $1.3 billion surplus; a 49-49 partisan split in the House of Representatives, which makes it tough to pass anything; and a rush to cut taxes further to head off new initiatives to slash property taxes.

Lawmakers, meanwhile, are not likely to deal with the voter approval provision of I-695 before the Supreme Court rules and the Legislature adjourns. Although Republicans moved to write the provision into the constitution, Democrats, who control the Senate, blocked it.

What’s left is a campaign issue. Come November, it looks like voters will be asked once again at least indirectly to decide the future of Initiative 695

Our stories may be republished online or in print under Creative Commons license CC BY-NC-ND 4.0. We ask that you edit only for style or to shorten, provide proper attribution and link to our web site. Please see our republishing guidelines for use of photos and graphics.