TAXATION ‑- STATE ‑- CITIES AND TOWNS ‑- COMPUTATION OF MOTOR VEHICLE EXCISE TAX REVENUES TO BE DISTRIBUTED TO CITIES AND TOWNS
Even though no portion of the local motor vehicle excise taxes provided for by RCW 35.58.273 is, itself, to be distributed to cities and towns under RCW 82.44.150(2) through (4), the state treasurer, in computing the amount of motor vehicle excise tax to be distributed thereunder, is to include that local tax in his calculations.
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February 9, 1976
Municipal Research Council
4719 Brooklyn Ave. N.E.
Seattle, Washington 98105 Cite as: AGLO 1976 No. 11
Attention: Dr. Ernest H. Campbell
We are in receipt of your letter dated January 29, 1976, in which you have requested an opinion from our office (within a week, if possible) on a question which we paraphrase as follows:
In computing the amount of motor vehicle excise tax revenues to be distributed to cities and towns under RCW 82.44.150(2) through (4), is the state treasurer to include a percentage of the local motor vehicle excise tax revenues imposed by certain municipalities under RCW 35.58.273?
We answer this question in the affirmative for the reasons set forth in our analysis.
RCW 82.44.020 provides for the imposition of an excise tax upon the operation of motor vehicles in an amount equal to two percent of the fair market value of each such vehicle. In addition, RCW 35.58.273 authorizes certain municipalities to impose a one percent motor vehicle excise tax upon their own residents for the support of public transportation. That local tax, however, constitutes a credit against the state motor vehicle excise tax so that, in reality, as far as the vehicle owning taxpayer is concerned, he simply pays an annual excise tax of two percent of the fair market value of his vehicle.
With a limited exception not here relevant, all of the taxes which are thus paid go into the state general fund. See, RCW 35.58.276 and 35.58.277 together with RCW 82.44.110. However, if the taxes are paid by a person who [[Orig. Op. Page 2]] resides within a municipality which has elected to impose a local motor vehicle excise tax under RCW 35.58.273, and if that municipality also generates other tax revenues for public transportation purposes in an annual amount equal to that produced by the one percent excise tax, the proceeds of that tax are to be distributed to the municipality. Accord, RCW 35.58.278 which provides that:
"Distribution of the special excise taxes paid into the general fund on behalf of any municipality shall be made to such municipality as provided in RCW 82.44.150, as now or hereafter amended."
RCW 82.44.150, in turn, provides, in subsection (5) thereof, as follows:
"(5) The amount required to remit to a municipality the proceeds of the tax authorized under RCW 35.58.273 shall be remitted to the municipality levying such tax. The amount required to be remitted by the state treasurer to the treasurer of any municipality levying such tax shall not exceed in any one calendar year the amount of locally generated tax revenues other than the excise tax imposed under RCW 35.58.273, which shall have been budgeted by such municipality to be collected in such year for any public transportation purposes including but not limited to operating costs, capital costs and debt service on general obligation or revenue bonds issued for such purposes."
Your question, basically, involves the relationship between this last quoted subsection of RCW 82.44.150 and the provisions of subsections (2) through (4) thereof. Those three subsections read, in material part, as follows:
"(2) On the first day of the months of January, April, July, and October of each year, the state treasurer based upon information provided by the department of motor vehicles shall make the following apportionment and distribution of motor vehicle excise taxes deposited in the general fund. A sum equal to seventeen percent thereof shall be paid to cities and towns in the proportions and for the purposes hereinafter set forth: . . .
[[Orig. Op. Page 3]]
"(3) The amount payable to cities and towns shall be apportioned among the several cities and towns within the state ratably, on the basis of the population as last determined by the board.
"(4) When so apportioned, the amount payable to each such city and town shall be transmitted to the city treasurer thereof, and shall be utilized by such city or town for the purposes of police and fire protection and the preservation of the public health therein, and not otherwise. In case it be adjudged that revenue derived from the excise tax imposed by this chapter cannot lawfully be apportioned or distributed to cities or towns, all moneys directed by this section to be apportioned and distributed to cities and towns shall be credited and transferred to the state general fund."
The specific issue raised is whether the seventeen percent distribution provided for by RCW 82.44.150(2), supra, is to be computed on the basis of all motor vehicle excise tax revenues, including the special one percent motor vehicle excise tax which is authorized by RCW 35.58.273, supra, or whether, instead, it is to be computed on the basis of that designated percentage of state motor vehicle excise tax revenues alone; i.e., after deducting the special one percent local tax.
While your indication of an urgent need for an immediate answer to this question has not given us the full opportunity to ponder it as we would ordinarily like to before issuing an attorney general's opinion, we are not totally unfamiliar with the applicable statutes in view of our recent involvement inMetro of Seattle v. O'Brien, 86 Wn.2d 339 (1976). In that case, as you know, the supreme court held that locally generated motor vehicle excise tax revenues under RCW 35.58.273 may be returned to the taxing municipalities in accordance with RCW 82.44.150(5), supra, without a specific legislative appropriation pursuant to Article VIII, § 4 (Amendment 11) of the state constitution. Moreover, one basic message to be gleaned from the court's decision is that, to the extent that they have been locally matched as required by the latter statute,all of the proceeds of such local motor vehicle excise tax revenues belong to the municipality by which the tax was imposed.1/ As explained by the court at p. 346:
[[Orig. Op. Page 4]]
". . . it is the municipality which is authorized tolevy andcollect the special excise tax. RCW 35.58.273. The legislature utilized the existing scheme of collecting this tax through the county auditor, but directed the auditor to 'remit the special excise taxescollected for the municipality' and to credit this amount 'collected and paid over on behalf of the municipality' against the amount which he would otherwise be required to pay over to the director of motor vehicles. . . . RCW 35.58.277. Further, '[d)istribution of the special excise taxes paid into the general fund onbehalf of any municipality shall be made to such municipality as provided in RCW 82.44.150. . . .' . . . RCW 35.58.278. Note that the legislature directed distribution as provided in RCW 82.44.150. That statute is the ultimate expression of legislative intent which convinces us that these are not state funds, for it mandates that this tax 'shall be remitted to the municipality levying such tax.' . . ." (Emphasis supplied by the court.)
From this it necessarily follows, in our opinion, that none of the proceeds of the local motor vehicle excise tax imposed by a municipality under RCW 35.58.273 are to be included in the distribution of the motor vehicle excise tax revenues to all cities and towns under RCW 82.44.150(2) and (3), supra, for the purpose set forth in subsection (4) of that statute. Instead, as we view it, in accordance with the supreme court's ruling all such locally imposed motor vehicle excise tax revenues are to be distributed to the municipalities which imposed the tax that produced those revenues to the extent and in the manner prescribed for by RCW 82.44.150(5).
This, however, does not mean that your present question must be answered in the negative. There is a distinction between distribution and computation as we read the overall statute. RCW 82.44.150(2) does not purport to say that the treasurer is to distribute seventeen percent of all motor vehicle excise tax revenues to cities and towns for police and fire protection ‑ meaning seventeen percent of the state tax revenues and a like percentage of local tax revenues coming in under RCW 35.58.273, et seq. Rather the statute says that the treasurer is to so distribute "a sum equal" to seventeen percent of all such revenues.
[[Orig. Op. Page 5]]
For illustrative purposes let us assume a receipt into the treasury during a given period of $100,000 in motor vehicle excise tax revenues of which $40,000 represents local revenues levied and collected under RCW 35.58.273. Without question, the municipalities which imposed the taxes that produced the latter will be entitled to receive the full amount thereof, subject only to the matching requirements of RCW 82.44.150(5). But this may still be accomplished even if, first, $17,000 (17% of $100,000) rather than $10,200 (17% of $60,000) is distributed to all cities and towns under subsections (2) through (4). In other words, it is possible tocompute the amount to be distributed under the latter subsections on the basis of the full amount of motor vehicle excise taxes received during the period to be covered by the distribution and still honor the distribution requirements of subsection (5) without any compromise or reduction.
InSchneider v. Forcier, 67 Wn.2d 161, 163, 406 P.2d 935 (1965), the court in addressing itself to the question of how legislative intent is to be ascertained, said:
"Our first resort is to the context and subject matter of the legislation, consistent with the recognized canon of statutory construction and interpretation that the legislative intent is first to be deduced, if possible, from what it said. Martin v. Aleinkoff, 63 Wn.2d 842, 844, 389 P.2d 422 (1964). . . ."
In the case of RCW 82.44.150(2), what the legislature originally said, long prior to its authorization in 1969 of the local motor vehicle excise tax provided for by RCW 35.58.273,2/ is that seventeen percent ". . . of all moneys . . . in the motor vehicle excise fund . . . shall be paid to cities and towns . . . for the purposes of police and fire protection and the preservation of the public health therein. . ." Section 12, chapter 175, Laws of 1957, recodified as § 82.44.150, chapter 15, Laws of 1961. Then, however, in 1969, when the local tax wax authorized, this was changed to read:
"A sum equal to seventeen percent thereof shall be paid to cities and towns . . . for the purposes hereinafter set forth . . .";
[[Orig. Op. Page 6]]
i.e., still police and fire protection and the preservation of the public health therein. Section 15, chapter 255, Laws of 1961, Ex. Sess., supra. And, of course, as we have seen that remains (insofar as is material) the language of the statute today.
In enacting this 1969 amendment to the statute the legislature must be presumed to have intended to change the law. Allen v. Employment Sec. Dep't, 83 Wn.2d 145, 516 P.2d 1032 (1973). Moreover, in ascertaining the purpose of that change it is appropriate to relate it to other provisions of the act in which the amendment was contained. State ex rel. P.U.D. Etc. v. Wylie, 28 Wn.2d 113, 182 P.2d 706 (1947). Here, because it was enacted as a part of the same act as authorized the local motor vehicle excise tax (chapter 255, supra) it is logical to assume that the purpose of the 1969 amendment to RCW 82.44.150(2) was to acknowledge the existence of that new tax and to avoid any inclusion of its proceeds in the seventeen percent distribution to cities and towns, generally, while at the same time continuing to require the same overall amount of money as before (a sum equal to seventeen percent of all motor vehicle tax revenues) to be covered by that distribution. Recall, again, that the total amount paid in taxes by a given vehicle owner was not increased by chapter 255, supra, because the local tax constitutes a credit against the state motor vehicle excise tax. RCW 35.58.273, supra.
In accordance with this analysis of the statute we therefore here answer your question in the affirmative. Even though no portion of the local motor vehicle excise tax itself is to be distributed under RCW 82.44.150(2) through (4) the state treasurer, in computing the amount of money to be distributed thereunder, is to include that tax in his calculations.3/
We trust that the foregoing will be of assistance to you.
Very truly yours,
PHILIP H. AUSTIN
Deputy Attorney General
*** FOOTNOTES ***
1/Accord, AGLO 1973 No. 31 [[to R. Frank Atwood, State Senator on February 28, 1973 an Informal Opinion, AIR-73531]], copy enclosed, at pp. 4-5.
2/See, § 8, chapter 255, Laws of 1969, Ex. Sess.
3/See, again, the above stated hypothetical case for our illustration of how this is to be done.