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AGC Weighs in on State’s Controversial Gas Tax Compact with Tribes

In an era of diminishing funds for infrastructure funding each year tens of millions of gas tax dollars are being siphoned out of the state highway fund and potentially used for non-transportation purposes in violation of the State Constitution’s 18th Amendment.

That’s the essence of AGC’s concern as it filed on behalf of itself and several other construction associations a motion and amicus brief. AGC requested amicus standing and for the State Supreme Court to accept direct review of the case of AUTO v. the State of Washington. On August 15 AGC and its construction industry partners were granted amicus standing in the case.width=200

In 2007 the Governor authorized to do so by legislation entered into agreements with Native American Tribes providing payments to the tribes of 75 percent of the state tax rate or approximately 28 cents per gallon for every gallon sold out of a tribal station. Since 2007 those payments to the tribes out of the Motor Vehicle Fund (MVF) have exceeded $70 million.

(Click Battle Explodes as Business Challenges Indian Gas-Tax Deal for a news article recapping the situation with quotes from AGC’s Rick Slunaker.)

Automotive United Trades Organization (AUTO) an organization of gas station operators filed suit. Members of the group are concerned that Tribes may be using the gas tax “rebate” to reduce the price of gas at Tribal stations undercutting other operators.

AGC’s concern is the potential loss of millions of dollars in infrastructure funding – and the amount of the loss could grow considerably in the future should Tribal gas station operations continue to expand.

“If the Tribes were putting the money into roads and highways that would be one thing” says AGC Legislative Counsel Van Collins who authored the amicus brief. “But there’s great concern that is not happening. The compact between the Tribes and the Governor precluded any real transparency. There are no independent audits conducted regarding the use of the funds and even the minimal reports that the Tribes are supposed to provide to the Department of Licensing are not always forthcoming.”

AGC is concerned not just because of the loss of transportation-related dollars in an era of already diminishing transportation dollars but also because of the distrust the lack of transparency creates.

“Clearly the State Constitution says the gas tax revenues are to be used for transportation purposes and people expect that” says Collins. “Future efforts to increase transportation revenues could be thwarted if the general public loses confidence that the taxes are being spent as promised.”

AGC is not a party to the lawsuit but the amicus motion and brief it filed requests that the State Supreme Court accept direct review of AUTO’s appeal. Collins filed the motion and brief on behalf of AGC of Washington as well as fellow AGC chapters Inland Northwest and Oregon-Columbia and the local chapters of MCA NUCA ACEC ABC WAPA NECA and WACA. Other business groups have filed their own amicus motions and briefs including NFIB the Association for Washington Business Washington Oil Marketers Association and the Washington Policy Center.

For more information contact Van Collins 360-352-5000.

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