Hearing the Voters
Growing Compliance with Referendum 47

by Paul Guppy, Vice President for Research
2001-15

Rising property taxes continue to be a major concern for the people of Washington state. Each time a statewide ballot measure has come before voters to cut taxes or curtail their rate of growth, it has passed. Yet another tax limitation measure, Initiative 747, is slated to appear on the ballot this fall.

As voters consider upcoming proposals for future tax limitation, it is important to know how past reforms have fared. Voters expect elected leaders to carry out their will faithfully. Yet once the excitement of a campaign has ended, institutional pressures from public agencies and persistent lobbying by groups that benefit from public spending combine to promote ever-growing government revenues. It becomes easy for elected officials to forget or ignore the message sent by the people.

For that reason the Washington Policy Center has conducted vigorous follow-up research on the fate of Referendum 47, major tax limitation passed by voters in 1997. We believe an objective assessment is essential so people will have the information they need to hold their elected representatives accountable.

Referendum 47 says that elected officials should not increase property tax collections by more than inflation (2.61% this year), unless they can identify a "substantial need" to raise taxes higher.

Referendum 47 was ignored by many local leaders for the first few years. But this year our survey finds they are finally getting the message. This Policy Note presents a quick summary of our findings. The full report is at our website, www.washingtonpolicy.org.

We found that 34 of Washington's 39 counties held their increases in property tax collections to 2.61% or less, representing a compliance rate of close to 87%, by far the highest since Referendum 47 passed. Two counties, Columbia and San Juan, actually reduced the amount they collected, thus lowering the tax burden of their citizens.

Six counties held their property tax increases to zero, providing valuable relief to local taxpayers. The survey result for each county is shown on the reverse.

Just holding the line on the growing cost of government results in major savings for taxpayers. The King County Council, for example, showed restraint by passing a 1.5% tax increase, well below the inflation level. The move saved county residents $2.4 million compared to an inflation-level increase, and over $9.8 million compared to the once-common 6% increase.

Still, some counties have not gotten the message. Five counties raised taxes by more than inflation, and three of these - Stevens, Pacific and Ferry - levied a 6% boost, the maximum allowed.

Voter frustration remains high. People reasonably expect a major property tax reform to take hold right away, not after four years. That explains much of the push behind Initiative 747. Given the slow response elected officials showed to Referendum 47, the popular support for passing an even stricter tax limit is not surprising.