SENATE BILL REPORT

EHB 1034

BYRepresentatives Fisher, Walk, Vekich, Madsen, Walker, Fisch, Spanel, Hine, H. Sommers, Jacobsen, Todd, Bristow, Cantwell, K. Wilson, Leonard, Lux, Unsoeld, Allen, Grimm, Winsley, Baugher, Nelson, Scott, Ebersole, Cole, Niemi, Sutherland, Brekke, Wang, Basich, Wineberry and P. King 

Establishing the rail development account.

House Committe on Transportation

Senate Committee on Transportation

Senate Hearing Date(s):April 2, 1987

Majority Report:  Do pass as amended.

      Signed by Senators Peterson, Chairman; Hansen, Vice Chairman; Tanner, Vice Chairman; Bailey, Barr, Bender, Conner, DeJarnatt, Garrett, Halsan, Johnson, Nelson, Patterson, Smitherman, von Reichbauer, West.

Senate Staff:Gene Schlatter (786-7316)

                  April 9, 1987

AS REPORTED BY COMMITTEE ON TRANSPORATION, APRIL 2, 1987

BACKGROUND:

Local governments may receive up to 1.0 percent of motor vehicle excise taxes collected from their jurisdiction, provided they levy a local option tax for the purpose of funding public transportation systems.  Of the 21 transit systems, 18 of them levy a local option transit sales tax.  The local option transit sales tax is imposed at a rate of up to 0.6 percent.  Currently, only King County imposes the full 0.6 percent.  The other counties imposing the tax are levying at 0.2 or 0.3 percent.

If a tax package passes the Legislature which substantially expands the base to which sales taxes are applied, transit districts will receive revenues in excess of what had been projected for the 1987-89 biennium.

SUMMARY:

The authority for transit districts to levy a local motor vehicle excise tax is reduced from 1.0 percent to 0.8 percent if an expansion of the sales tax base generates new sales tax revenues in excess of $347 million.

An amount equal to 25 percent of the 0.8 percent motor vehicle excise tax will produce about $34 million which is deposited in the State Rail Development Account.

SUMMARY OF PROPOSED SENATE AMENDMENT:

The local motor vehicle excise tax rate is lowered to 0.99 percent for transit systems within the counties of King, Pierce, Snohomish and Thurston.  An amount equal to 25 percent of the 0.99 percent is deposited into the Rail Development Account.  The 1.0 percent local option MVET may be levied in all other counties.

Fiscal Note:      none requested

Senate Committee - Testified: No one