Informative Research on Taxing Districts

Editor’s Note:  Betsy Schneider has researched some of the issues and complications surrounding the establishment of a ferry taxing district in the attached document (see below).  Like all-things-ferry, there is nothing simple about it….

From: Michael/Betsy Schneider
Date: Tue, Jan 11, 2011 at 6:17 PM
Subject: ferry taxing districts

Hi Wynne and Colleen,
I noticed that the discussion on the Ferry Forum has turned to the topic of ferry taxing districts.  A couple of months ago I did some research on special purpose districts and taxing districts and wrote up a (looooooong) article about it.  I was especially interested in the question of a county ferry taxing district for the Lummi Island ferry.  I was, and still am, disturbed by the fact that the County is looking to establish a ferry taxing district under a statute which appears to limit such districts to ones that operate “passenger-only” ferries.

Anyway, I am sending you the article I wrote, to post or not post, as you see fit.  As always, I need to repeat that I am not licensed to practice law in Washington State, so my thoughts should not be taken as a legal opinion.

In conjunction with this issue, Michael made a couple of phone calls to the Public Works Directors of Skagit and Pierce Counties, which also operate car ferries.  The Skagit County Director told him:  Skagit County has no special taxing district for ferry funding; they are running a $700,000 deficit; they might look into a taxing district because they thought the law had changed to allow this; in Skagit County ferry docks come under the road fund;  and they treat dock repairs, such as replacement of “dolphins,” as capital costs, not operating costs.

The Pierce County Director told him:  they don’t have a ferry taxing district; they consider ferries to be “roads”; and they treat repairs to docks, such as “dolphin” repairs, as capital expenditures, not operating costs.

That’s all the news from Lake Wobegon.
Betsy Schneider

To read her article: A Discussion of Taxing Districts (by Betsy Schneider)

5 thoughts on “Informative Research on Taxing Districts

  1. Tuesday evening rant:

    Someone should, quick, tell our Governor, who just announced that the WSFerry system ought to be subdivided into regionally funded services. Maybe she has some other statutes in mind? Maybe she wants to get rid of car ferries altogether? New laws might be necessary and welcome.

    End of the day, however, WS statutes govern only ferries within WS counties and between WS counties. For instance, if another state were involved, their laws would also apply. At issue is whether Whatcom County has any authority to operate a ferry upon a separate sovereign nation. That is the most doubtful element of Lummi Island’s ferry dilemma.

    It gets us ( well, me at least) back to the issue of the DOI approval of a ROW to Hales Pass, the edge of federal navigable water, where federal authority of navigational servitude might begin to apply, where federal approval of a landing on the disputed tidelands might tacitly limit the tribes tideland rights, and where the enrollment and licensing of the Whatcom Chief as a US vessel under the authority of Congress – and its role as a common carrier – might help invoke the Commerce Clause or prevent the “obstruction of navigable capacity” under the Rivers and Harbors Act.

    Of course, leasing is enabled under the statute (for passenger ferries), but hasn’t leasing proved to be the problem, not the solution? What could is a lease if it is not honored?

    Truly, Congress and the President remain the only authorities empowered to grant a ROW over tribal lands. Maybe a petition is in order? 😉

    Of course, with federal representatives taking so much casino cash for their campaigns, raising Slater Road to keep the Casino accessible during floods is much more likely to happen than anything that could help get islanders home at night.

    Brutal, but true.

  2. The Council is talking about using tax district funds for a new ferry boat. Even Public Works would call a new boat a capital expense. We have NEVER had to pay capital expenditures (until recently when the gray line separating repairs and capital expenditures has shifted a little toward repairs). A new boat could not be construed by anyone as a “repair” or “operating expense”. It is definitely a capital expenditure and whether it is legal or not to use a taxing district for that purpose, it would be a MAJOR shift in Council policy to charge us for capital expenditures.

  3. Does anyone understand the County legal advice that the taxing district notion, despite the language Betsy quotes, doesn’t REALLY apply only to passenger ferries?

  4. All the mischief makers are assembled in Olympia.
    Is anyone keeping an ear to the ground for a little ‘quickie’ tweak to the RCW’s being referred to. It would only take a couple of words here and there, and presto, all is OK.

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