COUNTIES ‑- TAXATION ‑- MODIFICATION OF LOCAL SALES OR USE TAX FOR PUBLIC TRANSPORTATION
A county which has heretofore imposed a local sales and use tax for public transportation under the provisions of (former) RCW 82.14.047, with voter approval, may now reduce the rate of that tax while at the same time reserving the right and authority again to increase the tax at a later date, without further voter approval, so long as the increased tax does not exceed the rate originally approved by the voters.
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May 11, 1978
Honorable Curtis M. Janhunen
Grays Harbor County
P.O. Box 550
Montesano, Washington 98563
Cite as: AGO 1978 No. 18
This is written in response to your request for our opinion on the following two questions:
"1. May a county in which (a) a county public transportation plan has been adopted pursuant to RCW 36.57.070, (b) the voters of the county have authorized the imposition of a sales and use tax pursuant to the provisions of RCW 82.14.047, and (c) the tax authorized was levied prior to July 1, 1975, now lower the tax?
"2. If the answer is yes, may the tax subsequently be increased so long as the increased rate does not exceed the rate originally approved by the voters?"
We answer both questions in the affirmative for the reasons set forth in our analysis.
[[Orig. Op. Page 2]]
By its enactment of § 10, chapter 167, Laws of 1974, 1st Ex. Sess. (formerly RCW 82.14.047), the legislature provided that:
"Any county in which a plan has been adopted pursuant to section 7 of this 1974 amendatory act may by resolution, for the sole purpose of providing funds for the operation, maintenance or capital needs of county public transportation, submit an authorizing proposition to the voters and if approved by a majority of persons voting thereon, fix and impose a sales and use tax. Such tax shall be in addition to the tax authorized by RCW 82.14.030 and shall be collected from those persons who are taxable by the state pursuant to chapters 82.08 and 82.12 RCW upon the occurrence of any taxable event within such county. The proceeds of such tax shall be deposited in the transportation fund created pursuant to section 6 of this act. The rate of such tax imposed by such county shall be three‑tenths of one percent of the selling price (in the case of a sales tax) or value of the article used (in the case of a use tax). . . ."
Thereafter, in Grays Harbor County, you have informed us that the county transportation authority (which was also created pursuant to the same 1974 act) did, in fact, adopt a public transportation plan. Following this, in accordance with § 10,supra, it obtained voter approval of a proposal for imposition of a local sales and use tax, at the prescribed rate of three‑tenths of one percent which was thereby authorized.
Then, in early 1975, the legislature once again met and, by its enactment of chapter 270, Laws of 1975, 1st Ex. Sess., it did several things of significance. First, by § 28 of that act, it repealed § 10, chapter 167, Laws of 1974, 1st Ex. Sess. (RCW 82.14.047),supra. Secondly by § 6 of the same act, it amended RCW 82.14.045 (codifying § 2, chapter 296, Laws of 1974, 1st Ex. Sess.) in such a manner as to authorize certain described categories of counties and cities, again with voter approval, to impose a local sales and use tax for the support of public transportation at the following rate or rates:
[[Orig. Op. Page 3]]
". . . The rate of such tax shall be one‑tenth, two-tenths, or three‑tenths of one percent of the selling price (in the case of a sales tax) or value of the article used (in the case of a use tax) and shall not exceed the rate authorized in the proposition approved by the voters unless such increase shall be similarly approved."
And thirdly, in apparent recognition of its earlier, 1974, legislation, the 1975 legislature, also by another portion of its amendment to RCW 82.14.045,supra, provided that:
". . . Notwithstanding any provisions of this section to the contrary, any county in which a county public transportation plan has been adopted pursuant to RCW 36.57.070 and the voters of such county have authorized the imposition of a sales and use tax pursuant to the provisions of RCW 82.14.047, section 10, chapter 167, Laws of 1974 Ex. Sess., prior to July 1, 1975, shall be authorized to fix and impose a sales and use tax as provided in this section at not to exceed the rate so authorized without additional approval of the voters of such county as otherwise required by this section."
Chapter 270, Laws of 1975, Ex. Sess. became effective on July 1, 1975. In Grays Harbor County, however, no new action was taken in response. Instead, as we understand it, the county has simply continued, without interruption, to impose the same, three‑tenths of one percent, sales and use tax for the support of public transportation as was originally authorized by the voters in 1974.
Given this existing factual situation, your letter next advises us of the following basis for your immediate questions, as above set forth:
"It now appears that it may be possible to operate the local transportation authority on less than three tenths of one percent. However, the transit authority members are understandably reluctant to lower the tax unless it can subsequently be raised, if needed, back up to the rate originally approved."
[[Orig. Op. Page 4]]
In our opinion, the savings clause at the end of the first paragraph of RCW 82.14.045,supra, is fully dispositive of both aspects of your inquiry. By reason of that provision of the 1975 amendatory act, Grays Harbor County was permitted, without any further local action, to continue imposing the same local sales and use tax which it had previously been authorized by its voters to impose in accordance with § 10, chapter 167, Laws of 1974, 1st Ex. Sess. (RCW 82.14.047),supra. By that same provision, however, the legislature also added an element of flexibility to the earlier, 1974, system whereby that system was rendered more comparable (although not identical) to the new, 1975, scheme. Whereas the original, 1974, law had specifically pegged the local sales and use tax at precisely three‑tenths of one percent of the selling price (in the case of a sales tax) or the value of the article used (in the case of a use tax), the 1975 amendment not only allowed ". . . any county in which a county public transportation plan has been adopted . . . and the voters of [which] . . . have authorized the imposition of a sales and use tax . . ." to continue imposing that tax but, in addition, it further authorized any such county,
". . . to fix and impose a sales and use tax as provided in this section andnot to exceed the rate so authorized without additional approval of the voters of such county as otherwise required by this section." (Emphasis supplied)
Thus, while the tax rate may still not exceed that which was originally approved by the voters (i.e., in this case, three‑tenths of one percent) it may be less. In short, as a consequence of this amendment, it is now up to the county legislative authority to fix the rate of the tax at that rate which was earlier approved by the voters, or at a lesser rate without further voter approval. Given that underlying proposition, however, it logically follows not only (1) that the rate of the tax may be reduced, from time to time, but (2) that having been so reduced, the rate may then be subsequently increased as well‑- so long as the increase does not cause the tax rate to exceed the originally authorized maximum. For that reason, as above indicated, we answer both of your questions in the affirmative.1/
[[Orig. Op. Page 5]]
We trust that the foregoing will be of some assistance to you.
Very truly yours,
PHILIP H. AUSTIN
Deputy Attorney General
*** FOOTNOTES ***
1/In so concluding we should note, however, that in implementation of any such changes in the tax rate it will be necessary for the county to coordinate with the State Department of Revenue in order to effectuate whatever amendments are necessary to its existing contract with the department which, as we understand it, was initially formulated between the two in 1974 in accordance with the provisions of RCW 82.14.050.