After weeks of discussions, the Lynnwood City Council voted Monday night to eliminate the city’s $40 car tab fee effective January 2023. The council then agreed to consider using federal COVID-19 relief money to fill a gap in the city’s road maintenance budget left by the loss of the tax revenue.

In 2019, Washington voters approved I-976, which would cap car tab fees at $30 across the state. However, the measure was overturned last year by the Washington State Supreme Court, which ruled it unconstitutional. For the past three weeks, the council has been weighing the pros and cons of eliminating the tax, which helps fund the city’s road maintenance programs.

At its Oct. 25 business meeting, the council voted 4-3 — with Councilmembers Christine Frizzell, Ruth Ross and Shannon Sessions opposed — to adopt an ordinance removing the city-imposed vehicle tax. The ordinance was presented by Council President George Hurst, who said there would be plenty of time to find an alternative way to fund road repairs.

“The elimination of the fees will not take effect until 2023, which provides ample time during the 2022 budget discussion to get a priority for the roads put into the budget,” he said. “At this time, I think the vehicle fee can be eliminated.”

For the past 20 years, the city has allocated approximately $1 million to road repairs. The rest comes from the city’s Transportation Benefit District, which uses sales tax revenues and car tab fees to fund street maintenance programs. During recent council meetings, city staff — including the city’s finance director — urged the council to keep the tax because the street maintenance programs are already underfunded.

However, Hurst has said eliminating the tax will send a message to Lynnwood residents — who believe city leaders don’t care about them — that the council is listening. Hurst also pointed out that 54% of Lynnwood voters supported I-976 in 2919.

The deciding vote was cast by Councilmember Julieta Altamirano-Crosby, who initially voted against the measure. She said she changed her mind after speaking to community members who said the $40 could be used for things like gas, food or entertainment. During the Monday meeting, Altamirano-Crosby read several comments she said she received from residents.

“‘Forty dollars means different things for me and my family (like) we can buy more food,’” she read. 

During the council’s public comments, anti-tax activist and I-976 sponsor Tim Eyman said residents have repeatedly voted in favor of lower car tab fees and praised the council for their efforts to eliminate the tax.

“I think this is something that is really important,” he said. “I’m very pleased you’re moving forward with this.”

While agreeing that the council should review the city budget to include more funding for roads, Councilmember Shannon Sessions — who voted twice against the measure — said that removing the tax will not bring any significant tax relief to the community. Instead, she said that the council should look at other taxes to cut.

“I think it’s disingenuous to think $40 a year is helping anybody,” she said.

Sessions also pointed out that the city was still dealing with the economic uncertainty surrounding the COVID-19 pandemic and that the council should not be eliminating much-needed funding for the city’s roads and sidewalks.

Councilmember Christine Frizzell said the council shouldn’t eliminate the Transportation Benefit District charge while the city is behind on maintenance for roads, traffic signals and sidewalks. She also suggested the council delay voting until they had more information from city staff with suggestions on how to fill the budget gap. 

“I think it’s extremely shortsighted to just by the stroke of a pen slash $1 million from our budget while we are behind on our road maintenance, our (traffic) signal replacement and our ADA ramps and our sidewalks,” she said.

Later in the meeting, Altamirano-Crosby made a motion to use $3 million in federal pandemic relief to pay for road repairs.

Lynnwood was allocated $10.9 million in America Rescue Plan Act (ARPA) funds to be paid over two years. An initial request from staff identified the city’s “immediate” needs and the council authorized spending $882,000 to fill city staff vacancies, fund technology upgrades to stream public meetings online and purchase police-worn body cameras. 

Some councilmembers — like Sessions — have said the council should not rely on one-time funds to pay for ongoing city expenses. However, Altamirano-Crosby said other cities have used the money to fund street repairs and Lynnwood should do the same.

“I know it’s a one-time fund but it helps a lot,” she said.

Frizzell said the council should not make decisions on the ARPA funds until they had heard all of the proposals from city staff. Ultimately, the council decided to bring the topic back to a future work session meeting for further discussion.

–By Cody Sexton