The Commissioner of the Washington Supreme Court has granted a motion by Sound Transit to have a class action lawsuit filed against the ST3 motor vehicle excise tax (MVET) transferred to the high court. However, the decision does not approve an additional request by the regional transit agency to expedite the review by December of this year. Sound Transit has previously argued that a timely verdict is needed in order to secure lower interest rates for a federal loan it has applied for to cover a substantial portion of the Federal Way link project.
The class action suit filed last year concerns the new MVET as part of the ST3 transportation package approved by voters in 2016 and whether the MVET’s vehicle value calculation is legal due to the way the bill language was written and approved by state lawmakers in 2015. Article 2 Section 37 of the State Constitution has a “forth and full” requirement when amending a state law.
Although the case was initially dismissed in superior court, the plaintiffs in the lawsuit have appealed the decision. As part of the lawsuit, they are seeking a repeal of the MVET and to have more than $240 million in revenue collected for the tax returned.
Transfers to the state high court are typically done when the case concerns an issue with statewide application or significance, or the case is affected by a recent U.S. Supreme Court decision. In his June 10 decision, Supreme Court Commissioner Michael E. Johnston wrote that “this case involves an issue of substantial interest of some urgency, and because it seems likely that this case eventually will be resolved to finality in this court in any event, transferring the appeal to this court will ‘promote the orderly administration of justice.’
“This appeal is grounded on a significant disagreement on whether a statute affecting billions of
dollars of motor vehicle excise tax revenues earmarked for a major public works project affecting a vast number of Puget Sound commuters violates the state constitution,” he added.
However, Johnston wrote further that “there is no compelling need to accelerate review,” as requested by Sound Transit.
The transit agency claims that it needs to have the case resolved by Dec. 22 or risk paying higher interest rates for a $629 million loan from the US Department of Transportation (USDOT). They are also seeking a $790 million capital grant from the Federal Transportation Administration (FTA). One Sound Transit financial official has said even a minor adjustment in the repayment rate could add at least $429 million to project costs.
However, Johnston wrote that “even if there are underlying financial issues (and I am not concluding that there are), there is no compelling need to accelerate review. This court is still in the process of organizing its Fall 2019 oral argument docket, and this matter is timely enough to be set for argument early in the term. While there is no way to guarantee that the court will decide the appeal before December 22 (allowing time for reconsideration), the court certainly is aware of Sound Transit’s concerns.”