Oak Harbor may join suit against I-695
July 3, 2008 · Updated 12:26 PM
"Oak Harbor, one of the cities in the state hardest hit by Initiative 695, might be joining other cities in a lawsuit that challenges its constitutionality and asks for a legal clarification of the controversial law.Glenna Malanca, the city attorney of Bremerton, invited the city to join in the lawsuit at the council meeting Tuesday night. So far, Bremerton, Bainbridge Island and Lakewood are participating.After Malanca's presentation, council members unanimously passed a motion to direct city staff to explore participation in the lawsuit and negotiate a monetary contribution.Malanca suggested the city contribute the cost of a special election to the suit, but will accept just about anything. A special election in Oak Harbor would cost between $10,000 to $13,000. Malanca said the amount was symbolic of the problems with I-695.Under the Initiative 695, passed in November by a wide margin of voters, government has to hold an election - possibly a costly special election - and get public approval for any raise in taxes or fees. The better-known part of the initiative ended the Motor Vehicle Excise Tax and replaced it with a flat $30 fee.Malanca said the lawsuit challenges the initiative on three major points: Initiatives are supposed to be limited to a single subject. The lawsuit argues that the replacement of the car tab tax with a $30 fee and the requirement of a vote on any tax increase constitutes two distinct subjects. The initiative amends the state constitution without going through the proper and exclusive amendment process. The language of the initiative is not fully explained, particularly the word tax. The lawsuit asks if all types of taxes - library late fees, dog licenses and utility rates - are covered under the initiative.It's the responsibility of the court to clarify this, Malanca said.Because of the passage of I-695, Oak Harbor loses $770,000 a year, or 10 percent of its annual budget (although the first year was softened by a final $140,000 in 1999 fourth quarter MVET money). The city, which is sales-tax poor, previously got MVET money from the state in the form of sales tax equalization as well as law and justice funding.City officials still haven't been able to balance this year's budget, though they have had several workshops on the subject. To help offset the budget shortfall, the council increase utility taxes by 7 percent, or a total of $367,500 a year, at the end of 1999. Yet the tax increase ends next year if the voters don't approved it in November.Even under a new cost-cutting budget proposed by the city administration, there's still a $45,000 overrun.But even with the budget problems, a press release from Oak Harbor Mayor Patty Cohen states that the primary reason the city is interested in joining the lawsuit is because of the impact the initiative has on the Navy, which is the major employer and economic force in North Whidbey.According to Cohen, Navy officials have said that the initiative may greatly impact its personnel and the ability of the Navy to complete missions because of the potential loss of transportation facilities, especially ferries and buses.By joining the lawsuit, Interim City Supervisor Doug Merriman said the city will be able to tell its story in court, adding to the case evidence.A King County judge will hear the cities' argument for summary judgement, along with six other lawsuit against I-695, on March 6. Malanca said the other lawsuits were brought by a port district, a transit union, a planned urban development, and others affected by the initiative.An assistant attorney general and attorneys for the initiative supporters will work together to defend the initiative against the attacks. It should be interesting to watch, Malanca said. They may contradict each other."