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Reflections on Sound Transit Reflections

August 14, 2016

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Recently I penned a guest blog post on Publicola outlining my reservations about the structural integrity of the $54 billion financing of Sound Transit 3.

I made the case that the poorly constructed financing plan negatively impacts public education by effectively transferring some key property tax authority from the state–currently not being utilized but still reserved for education–to the Sound Transit special purpose taxing district.

As I expected, the reaction to my thought piece has been overwhelmingly negative.  And understandably so.

I myself find it distasteful to peel away the layers of how we as a state with an economically inefficient and inequitable tax structure have chosen to finance $54 billion.  Aside from some exceptions of a few truly mean-spirited private Twitter comments, I will acknowledge that I have been generally comfortable with the harsh reactions because it shows a deep desire to do more for transportation and education outside of the tired constraints of a broken revenue structure.  We need to build the energy for responsible tax reform to be the global leader we envision.

Still, because so much of the Sound Transit conversation is about the exciting spending and investment side (who gets what and when), I believe the overall public dialogue is improved by raising tough issues of how we responsibly pay for it.

Following my post, in addition to Heidi Groover’s fair coverage at The Stranger, two insightful policy responses are The Urbanist guest post by community activist Robert Cruickshank and Seattle Transit Blog’s Zach Shaner.  Friendly reminders that we can engage in civic dialogue, battle over ideas and understand each others’ positions respectfully and substantively.

First, in reflecting on the response, I restate what was lost, in that I very much care about building a modern, 21st Century public infrastructure including rail, transit and an integrated network of transportation.  It’s core to quality of life.  I enjoy and support Sound Transit and I want it be successful and a robust part of our region’s future.  I’m thrilled that after years of promises Northwest Seattle is finally in line to receive direct service and not just pay taxes.

The idea from some social media comments that I’m “anti-transit” because I had the chutzpah to publicly ask serious financial questions about how we raise $54 billion is ridiculous.  Have we reached a point where a Democratic state legislator from Seattle–legally sworn to uphold the state constitution including the paramount duty clause–can’t openly question the accurate costs and bonding implications of a $54 billion financing plan because such probing could be seen as insufficiently progressive?  That strains credibility.  My district wants robust transit very, very much–and benefits enormously from this package–but our constituents also expect us to read the fine print of how to pay for it.  That’s why we’re paid the big bucks.

I don’t mean to be flippant in reminding us that we’re spending $1.2 billion on a controversial deep bore tunnel to replace the Viaduct that has easily received 1000 times the policy debate, media coverage and activist scrutiny than the financing details of a $54 billion borrowing plan that will permanently alter the landscape of our taxation scheme.

Second, I should have been clearer in my first post:  I am not in any way leading the charge to defeat the measure, I am not a warrior to start over, I am not joining any organized opposition, nor do I expect others to share my viewpoint.  I simply went public with my private reservations about what I consider an inferior $54 billion financing plan after advocates prodded me to take a public stand on ST3.  They were right to ask honestly and I think I was right to answer honestly instead of hiding behind obfuscation.

In deference to my constituents–among the most educated, engaged and thoughtful in the state–I believe I showed appropriate respect to my district to publicly share my financial concerns and not merely hide behind balloons and banners pretending there are no negative implications to this funding framework.  It doesn’t mean in any way that I’m right and others are wrong it merely means the financing side of the package matters and should be on the front page and not buried in the footnotes.

Third, when Sound Transit came to Olympia with their proposed financing plan, I was chair of the House Finance Committee and I specifically raised the predicament of using the state portion of the property tax–reserved for education–for transportation.  Here are some of my public positions outlining my strong and consistent opposition to redirecting the property tax away from education to Sound Transit here, here and here.

Understandably, Sound Transit would not, in any way, shape or form, enter into meaningful discussions with me about alternative financing options including my recommendation of a modest business and employee transportation fee with an exemption for small businesses of 50 employees or less.  I made the case privately that premier companies such as Boeing, Amazon, Microsoft, Expedia, Starbucks and others may actually view an employee transportation fee as having a relevant, direct nexus of value worthy of discussion.   If we are going to prioritize the spine in order to get people throughout the region, shouldn’t regional employers be a more robust part of the solution?  I think many of our business leaders would be open to that constructive discussion.  It’s not an entire solution but a modest link in a more progressive package.  I made the case that it was at least worth private discussions with the broader business community to assess the option and potential of a deal based on a strong nexus of value.

With due respect and deference, I believe a modest business employee fee–designed in partnership with the business community for transportation–shouldn’t be a holy untouchable revenue source.  Nor should additional targeted regional tolling.  Moreover, designing a 50-year revenue model is hard.  At a structural level, outside of the property tax, I think building 61% of the broader model on a sales tax base that is shrinking by the year (due to Internet, goods vs. services, etc.) is a mistake.  Philosophically, I have long advocated a more ‘pay as you go’ approach to government.

Of course, Sound Transit knew that redirecting the state’s portion of the property tax was still preferable to other options for their internal needs:  1) using local property tax authority that would have been felt by their own city and county members; 2) risking upsetting the business community essential to support and funding of a pro-Sound Transit 3 campaign;  3)  risking upsetting the more volatile Republican-led Senate and the deals needed to get authorization in the first place.  Finally, they had other senior Democratic legislators on board so my complaints about the property tax component were, understandably, more of an outlier nuisance.

In fairness, in their shoes, I may have taken the same political position and I harbor no ill will toward individuals or the institution.  In designing this package, they did what was in their best financial interests to keep ST3 moving forward.

Finally, there is a hippocratic oath in politics as in medicine:  do no harm.  I lost the battle in Olympia and I respect the broader desire to move forward with the current spending and revenue plan.

The teachable moment for me is a profound–and deeply powerful–reminder that in the end we at the state level don’t have the same passion, spirit, energy and drive to build a world-class education system that has been displayed in Seattle to build a 21st Century transportation system.

Your partner in service,

Reuven.

 

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6 Comments leave one →
  1. moocaliets permalink
    August 15, 2016 8:24 am

    You are right to raise the issue of funding.

    Bev Isenson

    Steilacoom

    In Germany in the 1920s and early 1930s, the far left political forces and center left political forces could never get together. Eventually, they did meet. In Dachau.

    ________________________________

  2. Joe Cote permalink
    August 17, 2016 10:25 am

    A rather long post. Too long actually. I got bored 1/4 the way through and quit reading.
    I close with the same thought I had when ST3 first came to surface. NOT ONE DIME. Pierce County has been subsidizing ST for long enough with minimal change to service and not one inch of track toward a long ago promised light rail line from Tacoma to the airport. We pay way too much now for the nothing that we’ve received. NOT ONE DIME MORE.

  3. Scott Gifford permalink
    August 18, 2016 6:12 am

    I would much rather see you are actually fix our idiotic tax system instead of just attacking lower levels of government that have to make do with the scraps you give them.

    That’s nice you had other ideas for how it could work, but if you aren’t actually going to use your authority to try and make those ideas a reality, then why should anyone care? We all have ideas, we don’t all chair the finance committee.

    I am so sick of hearing nothing but whining and empty talk from legislators. There is always some excuse for why you can’t actually do the things you claim to want to do. I heard them when the democrats had a super-majority and I hear them now. You’ll talk a good game to get votes, then fold like a house of cards the moment things get rough.

    Chutzpah isn’t asking questions, it’s pointing to the ‘state constitution including the paramount duty clause’ when you and your colleagues ignored it for years and are currently in contempt of court for your refusal to take it seriously. Why should anyone take you or anyone else in the legislature seriously on this?

    Either do your jobs and take a real stand or get out of the way because all this dithering nonsense is hurting our state.

  4. William C. permalink
    August 18, 2016 6:32 am

    @Joe – What about the express bus service, Tacoma Link, and Sounder that Pierce County is already getting?

  5. Michael Henderson permalink
    August 18, 2016 6:50 am

    Well said Scott Gifford!
    Mr. Carlyle, I voted for you when I lived in your district. I appreciate your willingness to consider other ideas and to have a non-adversarial discussion. The financing plan should be scrutinized, but I’m not seeing any better solutions in your diatribe. An investment in infrastructure is exactly why property taxes exist, property owners directly benefit from that investment and therefor should pay for proximity to said investment. Adding an employee tax only adds to the premium businesses are already paying to be close-in to the city. I don’t think disincentivizing a large payroll is especially progressive is smart in a state where unemployment is at 5.8%. If the sales tax is diminished due to loopholes (like the internet) then close those loopholes. Though I think we can all agree that sales tax is absolutely not how this measure should be funded, but what choice is left? I think we all know what the solution really should be (income tax?), but perhaps we need some legislators that have the chutzpah to put their political career on the line to propose it and work toward making it happen.

  6. Patrick McArdle permalink
    August 20, 2016 4:06 am

    Senator Carlyle,

    Having recently moved back down to Belltown after years on Capitol Hill, I became a citizen in your constituency hoping for leadership on issues such as transportation. Your recent statements on this topic have not validated that hope.

    No one has objected to your right to question how ST3 will be funded; indeed, it is your job to do so. Our objections originate in your blatantly dishonest presentation of a false choice to us.

    Although you grandly blame Sound Transit for not working with you on other funding options, the fact remains that only you in our legislature had the power to allocate funding mechanisms; Sound Transit is simply playing the hand you collectively dealt it.

    I really wished you had chosen to be honest with us. Yes, there is a connection between local funding of ST3 and state funding of education. That connection is we taxpayers in King, Pierce, and Snohomish Counties, who provide over 60% of Olympia’s tax revenues, as I’m sure you’re well aware. That leaves our state’s other 36 counties paying an average of 1.3% each — while their inhabitants receive far more than that in state spending. So long as Republican-led counties receive much while paying little, their elected legislators will have no incentive to work with you on the reform of our tax system which you claim (sincerely, I believe) to desire.

    If we pass ST3, as I will vote to do, please feel free to inform your Republican colleagues that your constituents have voted to end their gravy train from central Puget Sound, and thus your colleagues must consider new revenue sources. This would be an additional benefit to our passage of ST3.

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