The multimillion-dollar debt accumulated by the failed Seattle Monorail Project is expected to be paid off by next fall, so the Monorail Board voted to terminate the motor vehicle excise tax paid by Seattle residents sometime between August and October of this year.
Board members faced a choice between continuing the motor-vehicle excise tax at its existing 1.4 percent rate until this fall or lowering the rate to 0.3 percent and continuing it for more than a year. The board voted 5-2 to stick to the higher rate and end the tax collection sooner.
Not all of the monorail debt will be cleared by revenue from the motor vehicle excise tax. The Monorail Project also hopes to collect millions from the sale of property purchased for construction of the Green Line. The deadline for submission of bids to buy the property was March 17.
Seattle residents paid approximately $3.9 million last January and $3.4 million in February to the motor vehicle excise tax. At the current rate of 1.4 percent, enough revenue could be collected by sometime between August and October of this year to pay off much of the remaining debt, said Jonathan Buchter, director of what's left of the Seattle Monorail Project.
West Seattle resident Vlad Oustimovitch, among the newer members of the Monorail Board, voted to lower the tax rate because he thinks it's unfair. Residents who renew their vehicle registration from June to October will end up paying the motor vehicle excise tax four times, while those who renew from November to May will have paid the tax just three times.
Joining Oustimovitch in favor of reducing the rate but lengthening the collection time was another new board member Don Covey.
Reducing the rate and collecting the tax longer would've cost about $525,000 in additional interest costs. Beth Goldberg, chairwoman of the Monorail Board, said she'd lost sleep worrying about how to vote on the tax issue. However she cited the additional interest as one of the reasons she voted to keep the status quo.
"It's been a contentious issue for this community," Goldberg said. "Let's put this chapter behind us and move on."
The Seattle Monorail Project started collecting the motor-vehicle excise tax from Seattle residents in June 2003. The rate was 0.85 percent.
The Monorail Board voted to increase the rate to 1.4 percent in June 2004 and that rate continues today.
At its next meeting scheduled for April 20, the Monorail Board plans to consider bids submitted to purchase the defunct project's properties.
Tim St. Clair can be reached at tstclair@robinsonnews.com or 932-0300.
