OFFICES AND OFFICERS ‑- STATE ‑- URBAN ARTERIAL BOARD ‑- CITIES AND TOWNS ‑- MOTOR VEHICLES ‑- HIGHWAYS ‑- FUNDS ‑- BAY FREEWAY
The city of Seattle may not use moneys in its arterial street fund to repay the urban arterial board for state funds expended by that city in the purchase of right-of-way for the now abandoned Bay Freeway project.
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April 3, 1974
Honorable Paul Kraabel
State Representative, 46th Dist.
7728 29th N.E.
Seattle, Washington 98115 Cite as: AGLO 1974 No. 41
By recent letter you have made reference to a pending request by the Urban Arterial Board that the city of Seattle repay funds originally expended by it in the purchase of a right-of-way for the now abandoned Bay Freeway project. You have informed us that the city has suggested using moneys in its arterial street fund in order to make that repayment, but has been advised by representatives of the state highway department that such a use of those moneys would be improper. Thereupon, you have asked for our opinion on this matter.
Under RCW 82.36.020, an excise tax of nine cents per gallon is imposed upon the sale of motor vehicle fuel in this state. Designated portions of this tax are then allocated by the statute for various purposes, consistent with the requirement of Article II, § 41 (Amendment 18) of the state Constitution that such special excise taxes as may be imposed by the legislature upon highway users shall be used for "highway purposes" only. Among other such allocations, RCW 82.36.020(3) provides that:
"Five‑eighths of one cent shall be paid into the motor vehicle fund and credited to the urban arterial trust account created by RCW 47.26.080."
RCW 47.26.080, to which reference is thus made, reads as follows:
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"There is hereby created in the motor vehicle fund the urban arterial trust account. All moneys deposited in the motor vehicle fund to be credited to the urban arterial trust account shall be expended for the construction and improvement of city arterial streets and county arterial roads within urban areas, for expenses of the urban arterial board, or for the payment of principal or interest on bonds issued for the purpose of constructing or improving city arterial streets and county arterial roads within urban areas."
The Urban Arterial Board, in turn ‑ a state agency established pursuant to RCW 47.26.120 ‑ has defined as direct costs which will be eligible for urban arterial trust account participation, the following: Preliminary engineering, construction engineering, acquisition of right-of-way and actual construction activities. See, WAC 479-20-013. In addition, it has established a system of "stage payment" in accordance with the provisions of RCW 47.26.260(2), which states that:
"The urban arterial board may adopt regulations providing for the approval of payments of funds in the urban arterial trust account to a county or city for costs of construction of an approved project from time to time as work progresses. These payments shall at no time exceed the urban arterial trust account share of the costs of construction incurred to the date of the voucher covering such payment."
The factual situation giving rise to your request involves the now abandoned Bay Freeway in Seattle. This was an urban arterial project of the city of Seattle which, when presented to the Urban Arterial Board, was found to be eligible for funding from the urban arterial trust account. Accordingly, the board began to make stage payments to the city to cover portions of its preliminary engineering, construction engineering, and right-of-way acquisition costs. Later, however, the project was discontinued because of voter disapproval and the Urban Arterial Board then asked the city to refund to it those portions of the previous urban arterial trust account distributions for this project which had been used for right-of-way acquisition. In other words, the board has not requested a refund of all of the stage payments previously advanced by it to the city but only those which were advanced and used for that one particular purpose ‑ apparently seeking to recoup those expenses which are salvagable from the abandoned project. Obviously, the city's expenditures for preliminary and construction engineering are not salvagable, but the board's assumption is that the acquisition costs for the right-of-way may be salvaged since the property rights thus acquired can, themselves, be resold if they are not to be used for an urban arterial street.
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This brings us, then, to the legal problem involved in Seattle's proposal to use moneys in its arterial street fund to make the requested repayment. That fund, as we understand it, is a fund maintained by the city with gasoline tax revenues distributable to it under another subsections of RCW 82.36.020; namely, subsection (5), which reads as follows:
"One‑half cent shall be distributed to the cities and towns directly and allocated between them as provided by RCW 46.68.110, subject to the provisions of RCW 35.76.050: Provided, That the funds allocated to a city or town which are attributable to such one‑half cent of the additional tax imposed by this 1961 amendatory act shall be used exclusively for the construction, improvement and repair of arterial highways as that term is defined in RCW 46.04.030, or for the payment of any municipal indebtedness which may be incurred after June 12, 1963 in the construction, improvement and repair of arterial highways as that term is defined in RCW 46.04.030. All such sums shall first be subject to proper deductions for refunds and costs of collection as provided in RCW 46.68.090."
Therefore, as with urban arterial trust account moneys themselves, the gasoline tax revenues in this municipal fund can only be used for the "construction, improvement and repair of arterial highways," along with the payment of municipal indebtedness incurred after June 12, 1963, for such construction, improvement or repair. But if Seattle were to use these moneys to repay the Urban Arterial Board for the city's Bay Freeway right-of-way acquisition costs, it would thereby be able to put itself in a position of having acquired real property rights paid for with gasoline tax revenues that now, potentially, might be used by the city for some other purpose than that of an arterial highway or street facility.
It is for this reason, then, that we must concur with the position of the state highway department that the city of Seattle may not legally use the moneys in its arterial street fund for that purpose. It may only use those moneys for the purposes listed in RCW 82.36.020(5), supra, and the acquisition of real property for nonarterial highway uses is simply not one of them.
It is hoped that the foregoing will be of some assistance to you.
Very truly yours,
EDWARD B. MACKIE
Deputy Attorney General