WSTA ANALYSIS OF INITIATIVE 745

ANALYSIS OF THE TRANSIT IMPACTS OF INITIATIVE 745
an Act Relating to improving traffic; adding a new section to chapter 47.01 RCW; adding a new section to chapter 46.68 RCW; adding a new section to chapter 43.09 RCW; adding a new section to chapter 82.08 RCW; adding a new section to chapter 82.12 RCW; adding a new section to chapter 36.70A RCW; adding a new section to chapter 44.40 RCW; and creating a new section.

BE IT ENACTED BY THE PEOPLE OF THE STATE OF WASHINGTON:
IMPROVING TRAFFIC BY MAKING ROAD CONSTRUCTION AND ROAD MAINTENANCE THE TOP PRIORITY OF THE STATE TRANSPORTATION SYSTEM
(+ NEW SECTION. +) Sec. 1. Anew section is added to chapter 47.01 RCW to read as follows: New road and lane construction and road maintenance shall be the states top priority for transportation system improvements.

ANALYSIS: Mandates that the top priority of the state shall be new construction and maintenance of roads.

IMPROVING TRAFFIC BY REQUIRING 90% OF TRANSPORTATION FUNDS BE SPENT ON ROAD CONSTRUCTION AND ROAD MAINTENANCE

(+ NEW SECTION. +} Sec. 2. A new section is added to chapter 46.68 RCW to read as follows:
(1) The legislature, in consultation with local governments, shall adopt implementing legislation which requires a minimum of 90W of transportation funds to be spent on construction of-new roads, new lanes on existing roads, improvements to the traffic carrying capacity of roads, or maintenance of roads.
(2) For the purposes of this section, "transportation funds" are government funds spent for transportation purposes, including, but not necessarily limited to, the transportation fund, the highway fund, public transit and ferry operating accounts and reserves, public transit and ferry capital accounts and reserves, local government transportation accounts, public transportation authorities, transportation benefit districts, and the account established in RCW 81.100.070.
(3) For the purposes of this section, "transportation funds" do not include federal funds which the federal government requires to be spent on purposes other than construction of new roads, new lanes on existing roads, improvements to the traffic carrying capacity of roads, or maintenance of roads.
(4) For the purposes of this section, "transportation funds" do not include transportation vehicle funds used for school districts or funds used by airports or port districts, or public ferry and public transit fares.
(5) For the purposes of this section, "roads" includes all publicly owned roads, streets, and highways.
(6) For the purposes of this section, a regional transportation authority created pursuant to chapter 81.112 RCW shall make expenditures of transportation funds for projects, programs, and services within the area boundaries of that regional transit authority.
(7) The office of financial management shall provide a report detailing transportation expenditures beginning August 1, 2001, and every year thereafter, to ensure compliance with this section.

ANALYSIS: This section directs the legislature to adopt Implementing legislation requiring a minimum 90% of transportation funds be spent on roads. There is no prescribed deadline. The definition of transportation funds clearly includes transit sales tax and reserves. It does not include fares or federal dollars. There are two ways of implementing the split; how the money would be redistributed is unclear.

1. Require each local and state agency (including transit) to spend 90% of its funds on roads. This would leave transit systems with 10% of their sales tax revenues and any accumulated federal and fare dollars. It is assumed that the federal dollars would cease because local matching capability would be eliminated. Also, all service (and fare revenues) would cease because the remaining 10% of sales tax would be prioritized to meeting obligations and actually shutting down the systems.

2. Aggregate all transportation dollars statewide and divide them 90/10. The best estimate of the current statewide ratio is 80% roads and 20% transit (this is pre-695). Reallocation of funds in this manner would result in at least a 50% reduction of transit sales tax. It is uncertain if this would allow systems to continue any service or how much, given the need to meet incurred obligations first.

Several questions are raised by this section: 1. What is the constitutionality, given the constitution requires that any tax raised for a specific purpose must be spent on that purpose only? Also,the current statute authorizing the transit sales tax says systems can ask the voters to approve the tax for the sole purpose of providing transit service. 2. Subsection (3) exempts federal DSHS transportation dollars. What about state matching dollars, especially in light of section 8 of this initiative? 3. Does subsection (4) exempt all school transportation dollars or just their vehicle funds (section 8, once again). 4. Subsection (6) requires that Sound Transit spend its funds 90/10 within its service area. Does the inclusion of this section require by implication that all transportation dollars be split and spent within each local area?

IMPROVING TRAFFIC BY REQUIRING PERFORMANCE AUDITS OF TRANSPORTATION AGENCIES

(+ NEW SECTION. +} Sec. 3. Anew section is added to chapter 43.09 RCW to read as follows:
The state auditor shall conduct a performance audit on each transportation agency, account, and program, including, but not necessarily limited to, the department of transportation, the state ferry system, and all public transit agencies in the state. Transportation funds shall be used for the cost of each audit. The first audit report for each transportation agency, account, and program shall be submitted to the legislature and made available to the public on or before December 31, 2001. Subsequent performance audits shall be conducted when determined necessary by the state auditor.

ANALYSIS: Requires the state auditor to conduct performance audits of all transportation agencies, accounts, and programs. How would performance be measured? Fiscal efficiency and proficiency? Effectiveness of the agencies' services toward improving traffic? The state auditor currently does not conduct performance audits and they are not set up to do so.

IMPROVING TRAFFIC BY EXEMPTING ROAD CONSTRUCTION MATERIALS AND LABOR FROM SALES AND USE TAXES

{+ NEW SECTION. +} Sec. 4. Anew section is added to chapter 82.08 RCW to read as follows:
The taxes levied by RCW 82.08.020 shall not apply to materials and labor used in the construction or maintenance of publicly owned roads, streets, and highways.
{+ NEW SECTION. +} Sec. 5. A new section is added to chapter 82.12 RCW to read as follows: The taxes levied by RCW 82.12.020 shall not apply to materials and labor used in the construction or maintenance of publicly owned roads, streets, and highways.
ANALYSIS: Sections 4 and 5 exempt materials and labor for road construction projects from sales and use taxes. IMPROVING TRAFFIC BY UPDATING TRANSPORTATION PLANS

{+ NEW SECTION. +} Sec. 6. A new section is added to chapter 36.70A RCW to read as follows:
The traffic element of comprehensive plans developed under RCW 36.70A.070(6)(a) and development regulations shall be updated to reflect the provisions and priorities of this act.
{+ NEW SECTION. +} Sec. 7. Anew section is added to chapter 44.40 RCW to read as follows: Comprehensive plans developed under RCW 44.40.070 shall be updated to incorporate the funding priorities established by this act.

ANALYSIS: Sections 6 and 7 require comprehensive plans be updated to reflect this initiative.

CONSTRUCTION' CLAUSE

{+ NEW SECTION. +} Sec. 8. The provisions of this act are to be liberally construed to effectuate the policies and purposes of this act.
ANALYSIS: Liberal construction means the broadest possible interpretation must be used to meet the purpose of the initiative. Since the clear purpose is to reallocate non-road funding to roads, this section requires that the 90/10 split at the local level be the implementation method, because this would move the most transit dollars. It also means that DSHS state transportation dollars and school non-vehicle related transportation dollars would be included in the 90%.

SEVERABILITY CLAUSE
{+ NEW SECTION. +} Sec. 9. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.

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For more information, contact Dan Snow, Washington State Transit Association 360-786-9734;
dan@watransit.com.