Analysis of Ref 51 by the Washington Policy Center

Will Referendum 51 Solve Our Traffic Problems?


by Eric Montague
October 2, 2002


The need for increasing the capacity of our state's 80,000-mile network of roads, highways and bridges is clear. Over the past 30 years Washington's road system has not kept pace with the needs of a population that has grown nearly 75% during that time. While there are many opinions about how to keep up with growing roadway demand, few will argue that seemingly endless congestion and hazardous safety conditions severely hamper the state's social and economic development.

Attempts to ease congestion through higher public transit spending and strict Growth Management rules have failed. Despite the efforts of planners to alter people's preference for auto travel, people in Washington continue to choose the freedom of a car for more than 93% of daily trips. After all, at no point in history have people wanted less mobility. So in November the governor and legislature are asking voters to decide if Referendum 51, or some future alternative, is the best solution for meeting the state's increasing transportation needs.

Referendum 51 is a statewide ballot measure that raises taxes and fees to pay for road building improvements. Money from the referendum would be distributed to a list of about 100 projects approved by the legislature. Here is a brief summary of what the referendum says. (A full, plain-English description is in our study "An Overview of Referendum 51," available at www.washingtonpolicy.org under "publications," or by calling (206) 937-9691.)

The measure has five parts. Part one would create a Transportation Accountability Board, with nine members appointed by the governor and confirmed by the legislature, to assist in monitoring the new spending. Part two would increase truck and license fees by 30% over two years, bringing in an estimated $232 million.

Part three would increase the gas tax by nine cents over two years, raising $3 billion. The current gas tax is 23 cents a gallon, the thirteenth highest state tax in the nation. The federal government imposes an additional 18.4 cents per gallon. Referendum 51 would increase the state gas tax to 32 cents per gallon, making our state tax the highest in the nation.

New and used auto sales are now subject to a 6.5% sales tax. Part four of the referendum would raise the tax to 7.5% beginning April 1st, bringing in $1.16 billion more, most of which would be used for subsidized mass transit.

Part five of the referendum authorizes the state to sell $4.5 billion in bonds. Proceeds would be used to pay for highway construction and maintenance. This section also authorizes a separate sale of $100 million in bonds, most of which would be spent on mass transit.

An additional source of funding not mentioned in the referendum would be the interest earned on new revenue, which would bring in about $78 million over ten years. Total revenue from all sources under Referendum 51 is estimated at $7.8 billion. Here's a summary of the new revenues.

Summary of New Revenues Under Referendum 51
9-cent gas tax phased in over two years
$ 3,039,269,000
30% increase in vehicle weight fees $ 232,989,000
1% sales tax increase on new and used autos $ 1,160,178,000
Sales tax on transportation construction $ 165,204,000
Interest earnings $ 78,106,000
Bond proceeds
$ 4,600,000,000
Less debt service $(1,460,805,000)
Total new revenue $7,814,941,000

If voters approve Referendum 51, the new tax money would be spent on projects across the state. The projects fall into twelve categories.


Referendum 51 Planned Spending
% of Total
Roads - GP $4,292,776,000 53.2%
Roads - Improvements $ 299,781,000 3.7%
Roads - HOV $ 733,531,000 9.1%
Public Transit $ 819,900,999 10.2%
Planning $ 25,315,100 0.3%
Freight Mobility $ 133,000,000 1.6%
Safety $ 92,622,160 1.1%
Environmental Retrofit $ 26,253,000 0.3%
Ferries $ 711,192,000 8.8%
Rail - Passenger $ 809,938,000 10.0%
Rail - Freight $ 96,940,000 1.2%
Economic Development $ 30,000,000 0.4%
Total Planned Spending: $8,071,249,259 100.0%

Definitions for Figure Above

· Roads - GP: These are General Purpose (GP) lanes open to all traffic.
· Roads - Improvements: These are upgrades of existing roads, such as better surfaces, road widening, adding climbing lanes on steep grades, etc.
· Roads - HOV: New High Occupancy Vehicle lanes.
· Public Transit: Government operated transit services.
· Planning: Planning includes engineering, environmental studies and other regulatory requirements that must be completed before road construction can begin.
· Freight Mobility: Projects designed to improve the movement of freight.
· Safety: Projects designed specifically to improve the safety of certain roadways and transportation corridors.
· Environmental Retrofit: Upgrades to meet current environmental regulations.
· Ferries: Dock improvements and new ferries for the State Ferry System.
· Rail - Passenger: Rail projects designed for passenger rail improvements, primarily high-speed commuter rail corridors in the Puget Sound region.
· Rail - Freight: Projects designed to improve the movement of freight by rail.
· Economic Development: Projects intended to spur economic growth in certain areas.

You might notice there is a $257 million difference between the revenue projections and planned spending. That is because some projects will take longer than ten years to complete, and because budget planners assume the federal government will provide money for passenger rail service.

Referendum 51 would fund major new projects and would help transportation spending keep up with inflation, but by itself it would not allow us to build our way out of traffic congestion. Determining whether Referendum 51 offers the best solution, or whether legislators will have to tackle the issue afresh when they meet in January, will be up to
Washington voters on Election Day.