The Seattle Monorail Project, millions of dollars behind in the car-tab taxes it had hoped to collect, is cracking down on suspected cheaters.

Thousands of people may be dodging the Seattle-only tax, according to the agency, by registering their vehicles outside the city. That has prompted monorail officials — charged with building the city's biggest-ever public-works project — to start comparing addresses on vehicle-registration forms with those on telephone records, driver's licenses and voter databases.

Among vehicle owners who had car-tab payments due in April, 800 received notices that the addresses on their vehicle-registration forms were being questioned and that they needed to show proof of address to state license clerks. About 50 of those owners switched their addresses back to Seattle.

The rest of the 800 cases apparently are legal, or the owners at least persuaded license clerks to renew the tabs.

Monorail finance director Jonathan Buchter said he doesn't know why the overwhelming majority kept their out-of-city addresses. They are not necessarily evading the tax, he said, which averages about $130 a year.

"Maybe they legitimately moved."

Nobody has been penalized, and the 50 who switched addresses weren't dunned for back taxes.

"We're kind of giving them the benefit of the doubt," the Seattle Monorail Project (SMP) spokeswoman Natasha Jones said.

The tax now brings in about $3.8 million per month — less than the SMP spends, and nowhere near the original projection of $6.1 million per month for 2005. One reason is evasion, figured to be in the 6 percent to 10 percent range.

To meet its financial plan, the SMP must plug the evasion leak and hope for an increase in the number and value of cars in Seattle.

Warning notices over the past four months were mailed to nearly 3,800 vehicle owners, most of whom will be renewing their car tabs this summer. A few thousand more warnings are likely later this year.

People who cannot show proof of their address won't be able to get new license tabs.

The SMP says its methods do not constitute an invasion of privacy, because telephone, driver and voter databases are culled from public sources. But project opponent Stefan Sharkansky called the SMP's practices "pretty creepy."

"It's Big Brother. It wasn't contemplated when the people of Seattle passed the measure in 2002," said Sharkansky, publisher of the conservative blog, soundpolitics.org.

The state law authorizing monorail taxes lacked an enforcement system. But last year the state issued a regulation requiring drivers to put their primary home address on vehicle-registration forms.

Questions have arisen — for instance, what if a student from Seattle attends college in Pullman, or if a city resident registers a car at a vacation home in the San Juan Islands.

Peter Sherwin, who sponsored two pro-monorail initiatives, compared the agency's data searches to the city's practice of sniffing out unpaid business taxes.

"It's not fair to people who are paying the tax for others to be registering out of town," Sherwin said.

Cash flow

City voters in 2002 narrowly approved a new tax of $140 a year per $10,000 of vehicle value to build the $1.7 billion, 14-mile Green Line linking downtown to Ballard and West Seattle. Still, because the taxes are calculated using a method that overstates the worth of most cars, many drivers are shocked at the size of the bill. New cars are exempt the first year.

When the tax began in mid-2003, revenues ran 33 percent under the agency's original cash-flow plan. Last year, the state closed a loophole that gave new Seattle residents a one-year break from the tax. The change gave SMP a 6 percent cash-flow boost.

Joel Paston, a Lake City resident who first alerted the public to the tax shortage two years ago, said the taxes still aren't growing as fast as needed. "The current collections are flat, or a little bit higher," compared with last year, he said.

Buchter, the Monorail finance director, said it's too soon to reach conclusions about whether income from the monorail taxes will grow fast enough.

His preliminary figures show new-car prices in Seattle are rising, but the number of cars has barely changed in the past year.

Widespread evasion would add years to the lifetime of the tax for everyone else, Buchter said.

SMP's anti-evasion effort is just getting under way because state software couldn't process address changes until January.

"We're still working on other ways to identify potential evaders," Buchter said.

Mike Lindblom: 206-515-5631 or mlindblom@seattletimes.com