Saturday, March 13, 2010

Time to Breakup the King County "Stadium" Taxes

Last Wednesday, March 10th, David Brewster wrote a story lamenting the failure of the state legislature to pass a bill for arts funding taxes that currently fund the arts and stadiums, and are set to expire.
His story at, Olympia about to renege again on funding King County arts groups, expresses frustration with failure of the current process.

4Culture, the nonprofit successor to the old King County Arts Commission, has long received some of this hotel-motel sales-tax, so it has a good place in line for its continuation. They've played ball with the Sonics in some years, letting arts give a high-minded cover for the sports barons. Speaker Frank Chopp holds the key to these fund, and he wants to pledge about $10 million a year of that money for low-income housing. (Chopp's demand is a political problem, since it is a serious stretch of the nexus established between taxing hotel visitors and providing benefits, like stadiums and arts, that bring more visitors.) Others like the UW, wanting a different pot of visitor money, the 0.5 percent tax on restaurants, for a remodeled Husky Stadium, further muddying the waters.

Speaker Chopp likes to keep all the supplicants waiting to the last minute, so he can then cut the deal. Last year he set a new record in cleverness by giving 4Culture a promise of the funds — expiring in a year. And he reportedly assured the arts groups that he would definitely come through this year, so long as he also got, dollar-for-dollar, his low-income housing. Now it appears he has stepped on a Senate version of the bill that gives him the money he wants but not until 2020.

The complicated bill for the visitor taxes has passed the House, stripped of Husky Stadium money, and now appears heading for defeat in the Senate. If it does make it through the Senate, it has a chance of going to the House for concurrence. Don't hold your breath. A key advocate calls it "a long shot." The nub of the problem is that a bill that funds stadiums loses about half the Democratic caucus, and one that doesn't help the jocks loses the other half.

David Brewster was referring to HB 2912. I preferred the simplicity of SB 6051, though the error of leaving Yakama short spelled doom. Attempting to right that wrong with the committee striker Ed Murray looked like he was going to try to get that done. The fact of the matter is that an "arts" only bill has as much chance of passing as a "sports" only bill now, at least when it comes to these taxes. So, Ed Murray threw everything back into HB 2912 where Senator Rodney Tom piled on 12 amendments.
At least one of Rodney Tom's amendments may help solve part of this conflict, I'll explain later.

David Brewster's observations are similar to a report form Jim Brunner, Seattle Times story, Stadium & arts tax bill dies for sixth time.
Arts groups in King County say they're facing huge budget problems in a few years if lawmakers can't make up their minds.

"We feel like arts and heritage are being held hostage to stadiums," said Jim Kelly, executive director of 4Culture, King County's arts and culture agency.

Most legislators don't seem to have a problem with funding for the arts. But Kelly said their funding has remained tied down by its connection to the stadium fights.

"With stadiums you're damned if you do or damned if you don't," he said. "Some people, if you take the stadiums out, they won't support the bill. Other people won't vote for it if you leave the stadiums in."

Murray said he's still working the proposal to see if it can be revived in the last couple days of the session, or during the special session lawmakers now say they'll need to finish the state budget.

What comes through both reports is the sense of entitlement from the arts community. To a degree they are entitled, as are the "jocks" (as Brewster referred to them), as are the smaller communities within King County that want money for infrastructure. The reality is that no one faction has been able to champion a solution for just their cause, and throwing everything into a bill invites reasons for everybody to dislike something.

Is the bill a Christmas Tree, or a pile of somebody else's garbage?

One other thing that each faction has in common is this strange desire to keep what they are doing as silent as possible. This year, as they did last, arts backers attempted a broader approach to collect some tax in more than one county, to spread the effort, failing both times. This year it has been a challenge for outsiders like me to glean information on bills like HB 2912 since every faction, other than 4Culture, has been pretty silent, again.

A development that I think could help the situation in the near future is the eventual passing of HB 3027.
The Seattle hoteliers have taken the state to court and it looks like HB 3027 is a description of the settlement (see Sec 8 of that bill). In modifies a Public Facilities District law, and creates a new Public Facilities District in King County. The primary function of this change is to isolate the Convention Center revenue from the state (after they charge a giant "fee"). The new PFD would have the authority the construct other kinds of facilities, like arenas or stadiums, if it had a funding source.

The amendment on HB 2912 by Rodney Tom that taxes athletes (#316) appears that it could have those funds go to the PFD as described in HB 3027 (assuming HB 2912 passed with such amendment).
(see the amendment on HB 2912 listed here)

Sure, it turns out the Rodney Tom was just "messing with other people's bills, but he may have actually helped.
It's not just the budget vote, Prentice said. Tom also has "messed" with fellow Democrats' bills by tacking on unwanted amendments.

"We're there to help the system work, not to knife people in the back and screw up their bills," she said.
(Seattle Times, Sunday, 3/14/2012

If/when the settlement bill is passed (maybe next session, it has a June 2011 freshness date of June 2011) then a stand alone bill similar to Rodney Tom's amendment (or the amendment) could pull the pro sports demands away from bills like HB 2912 (and HB 2252, SB 6116, etc).

There is no good answer for the Husky Stadium demands on those taxes. Either every university has that form of revenue available to them, or none (that goes for the WSU athletic dep operating funds, too).

The "workforce housing" demands on those funds are out of line. Maybe Frank Chopp didn't notice how Seattle did this, but we had a levy vote, we did not skim money off a sales tax credit, or off rental cars. I fail to see a connection between a tax intended to fund facilities that promote tourism and workforce housing in and around transit stations. A worthy goal, but is this the appropriate revenue stream for this?
I don't think so.

For what it is worth, one of the amendments (#314) Rodney Tom piled on HB 2912 for stormwater runoff treatment looks like a disconnect too, until you see it is drawn from the car rental tax.

See Section 8 for who all is settling of HB 3027. Btw, still think this is bill is an underreported story IMO.

So, on with the Special Session in Olympia!
All Floor Calendars have been cleared.

Sports Facilities referred to the law RCW 35.57.030, that RCW includes sports facilities. This is where the law is defined. Any bill that refers to this RCW, and funds a "Reional Center", but does not include/exclude a type of "Facility" could have its funds spent on almost anything defined in that RCW.

The vote in 3027 refers to, and limits, the hotel funds to a vote beyond anything described in the bill.
The voting power has been given to the county and the PFD board.
This keeps somebody in the future from using the funds for something else. You may notice that Seattle is being given 2% sometime in the future when the original Convention Center debt is paid off. Seattle could vote to impose that tax, and seek a sales tax credit from the state (via the county).

I think that a bill that taxed athletes and dumps the money into the PFD could be used for a new stadium, or arena. I think it could be done with the amendment from 2912, that revises the chapter of the RCW 82.04 (taxing authority) and gives authority to the PFD through RCW 36.100.020 to use those funds, RCW 36.100.020 is amended by... HB 3027.

The amendment on HB 2912 only taxes athletes that make 10 times more than a public school teacher's first year base wages (storm players are off the hook, as are most Sounders, and the jr league hockey players, and the Rat City Roller Girls :).

I would be happy to have HB 3027 pass as is, and HB 2912 with the athlete tax amendment (#316). It is both great politics, and perminent solution.
4Culture could have the county hotel tax to split with the new Federal Way building, and professional sports would tax itself to fund its palaces.

[I will edit this story, into a story, for now it is what it is]
Have a great day,
Mike Baker

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