Locke Against Court Appeal Of I-695, Fee Boosts

OLYMPIA - Gov. Gary Locke says he won't participate in a court challenge of the newly approved tax-revolt initiative and directed state agencies not to consider new fee increases.

The Democratic governor, who strongly opposed Initiative 695, notified his agency directors yesterday that the administration will promptly implement the wishes of the voters.

Locke's message came in the form of a memo to agency directors and budget officers, signed by Dick Thompson, the governor's outgoing budget director, and Marty Brown, his legislative director and Thompson's successor.

The initiative, approved by 58 percent of the voters Tuesday, eliminates the Motor Vehicle Excise Tax and substitutes a $30-a-year flat tax on each vehicle. It also requires a public vote on all future state and local tax and fee increases.

The car-tax cut will cost state and local programs $1.1 billion in the 18 months remaining in this budget period.

Locke said Wednesday he would ask the Legislature to come up with part of the lost revenue, primarily by using about half the state's $1 billion surplus. Legislative leaders have said they won't dip that far into the reserve.

Earlier, the governor acknowledged that there are some lawyers who foresee constitutional problems with the initiative, but said he does not have the expertise to say one way or the other.

Hugh Spitzer, a constitutional attorney in Seattle, said this week he will file legal challenges on behalf of local government

clients, as yet unnamed, later this month.

But the Locke administration won't be taking part, the memo makes clear.

"Neither the governor nor agencies under his control will go to court seeking to overturn the initiative," the memo said. "The governor has made it clear that the job of the Executive Branch is to implement the law . . . in a responsible and compassionate manner . . ."

Locke will try to clarify one legal question by asking the Legislature to pass a law continuing the property-tax exemption for vehicles. The Department of Revenue and legislative lawyers believe I-695 repealed that exemption.

The memo said Locke's bailout plans will fit within the spending limits of voter-approved Initiative 601. Under that cap, lawmakers can directly appropriate about $78 million, plus any savings they find in the current budget.

Using money from the reserves to pay for local government or transportation would not count as general-fund spending. But lawmakers would need to suspend I-601's requirement that such off-budget spending lower the general-fund spending capacity dollar-for-dollar.

The administration's memo says the state can't replace all the lost revenue from the reserves, so priority will go to "protect local government public-health and safety programs and providing `bridge' funding for some other key public services."

The memo does not specifically mention highway construction, ferry operations or transit aid.

"We are not planning on sending any tax- or fee-increase proposals to the voters" in 2000, and budget requests may need to be lowered in light of this, the memo says.

Any fee increases that were authorized before the election or are in the works right now can be implemented by Jan. 1, but "agencies should not initiate new fee proposals," the memo said.