There is a lot of talk today about how state and local governments will respond to the passage of I-976. In the Seattle Times, Heidi Groover and Mike Lindblom have a thorough story on the issue.

The fiscal impact statement for the initiative estimated that it would reduce state revenue by $478.1 million in the current biennium. (A House Transportation Committee work session on Nov. 21 will consider the budget implications of the initiative.)

Policymakers are already searching for ways to address the substantial impacts to state and local transportation funding that come with I-976. So far, the potential responses fall in these categories:

• Lawsuits
• Cut spending and/or delay projects
• Use other funds to maintain spending
• Legislative override of initiative

Lawsuits: Melissa Santos reports in Crosscut that Mary Kay Clunies-Ross (spokesperson for the No on I-976 campaign) “said many agencies are probably looking at how I-976 might affect bonds tied to their existing car-tab revenues — and whether those bond agreements could form the basis for a lawsuit.”

Several plans for lawsuits have already been announced. King County Executive Dow Constantine “has asked the King County Prosecuting Attorney’s Office to prepare a lawsuit to challenge the constitutionality of I-976.”

According to the Times, “Seattle Mayor Jenny Durkan’s office called the measure ‘unconstitutional’ and said ‘the city will pursue litigation to block’ it.” Reporting on a press conference held by Seattle Mayor Jenny Durkan today, Heidi Groover notes that City Attorney Pete Holmes said “the suit will make multiple arguments, including that the initiative violates the single subject rule.”

The Times also reports, “Sound Transit Board Chair John Marchione said that agency is likely to sue, too. The strongest legal argument, he believes, will be that the agency’s bond contracts, to borrow money for construction, pledge the car-tab tax income as a source of funds to repay investors.” Further, “‘Defeasement of bonds is irresponsible; it would delay the program and increase the cost of the projects dramatically,’ Marchione said.”

Finally, former Attorney General Rob McKenna talked to KIRO Radio about possible grounds for lawsuits, including the single subject rule and impairment of contract. I-976 tried to avoid the possibility of impairment of contract lawsuits by conditioning its repeal of Sound Transit’s authority to impose a motor vehicle excise tax on whether Sound Transit is able to “fully retire, defease, or refinance any outstanding bonds.” To that point, McKenna says, “it isn’t clear that you can require that in a statute or in an initiative.”

Cut Spending and/or Delay Projects: Melissa Santos reports,

State Rep. Jake Fey, who chairs the Transportation Committee in the state House, said he wasn’t trying to sue on behalf of the state at this point.

Rather, the Tacoma Democrat said he was focused on finding ways to close what is shaping up to be a $458 million hole in the state’s current two-year transportation budget.

Similarly, Gov. Inslee said, “I have directed the Washington State Department of Transportation to postpone projects not yet underway. I have also asked other state agencies that receive transportation funding, including the Washington State Patrol and Department of Licensing, to defer non-essential spending as we review impacts.”

The Times reports that some Sound Transit projects will go ahead:  

Sound Transit has already awarded construction contracts to build three lines by 2024 — to downtown Lynnwood, to downtown Redmond and to the Federal Way Transit Center. Marchione signaled those remain full speed ahead. The eight-mile Northgate-to-Lynnwood line, for around $3 billion, is actually a Sound Transit 2 project passed in 2008, while the other two lines were approved in Sound Transit 3 in 2016.

“Any project that we have construction projects for, needs to go ahead and be completed, otherwise they’ll be very expensive,” he said. It’s the next wave of projects that are at risk, he said.

Use Other Funds: According to King County Executive Constantine,

There are also on-going conversations about the possible use of one-time funding as a bridge until the Legislature acts or a replacement revenue package is presented to voters. To be clear, using capital funds for operations – funds that should go to buying buses and building bases – is not good policy. If we spend it on operations, it is gone for good.

(I wrote about the potential use of the state rainy day fund here.)

The initiative will also impact local transportation benefit districts that impose license fees, including Seattle. The Times reports,

Seattle City Council members, currently in the middle of crafting their 2020 budget, are still mulling over how they could replace about $33 million of city car-tab dollars that currently fund road maintenance and King County Metro bus service. That funding is expected to be wiped out by the initiative.

Seattle City Councilmember Lisa Herbold floated the idea of using money from a proposed new tax on Uber and Lyft rides to replace the lost car-tab money.

In Crosscut, David Kroman reports that any rearranging of spending done by the Seattle City Council due to I-976 “is likely to be self-contained within the city transportation department.”

Legislative Override: Under Article II, section I of the state constitution, within two years of the passage of an initiative, the Legislature may only amend it with a two-thirds vote. (After two years, a simple majority suffices to amend or repeal initiatives.) Melissa Santos writes that “neither Fey nor Hobbs, the Senate transportation chair, were considering that as a serious option as of Wednesday. ‘I don’t see how there are the votes to do that,’ Hobbs said.”

Ultimately, as Opportunity Washington notes,

It takes a while to count votes in our state. And, in the case of I-976, it will take even longer to resolve the legal challenges. Longer still, perhaps, to come to grips with how we fund, maintain, and improve the transportation infrastructure necessary to move people and goods safely and efficiently.