Taxes may still be on deck after Safeco Field paid off

When state lawmakers passed a controversial plan to raise taxes for a new Mariners stadium in 1995, they said the taxes would expire when the stadium bonds were retired.

But with Safeco Field set to be paid off this year, lawmakers are pushing to keep some of those taxes alive to pay for other favored causes, including a $600 million convention-center expansion, low-income housing and the arts.

A proposal that recently cleared the state House would extend a 0.5 percent tax on King County restaurant meals until 2015. It also would extend a 2 percent car-rental tax permanently. Absent legislative action, both taxes would end this year.

Supporters of HB 1997 say the taxes, collected only in King County, should keep flowing to pay for other local priorities. They are touting the expansion of the Washington State Convention Center, in particular, as a way to create construction jobs in a down economy.

"This is a really important bill to get people from my district back to work," said Rep. Tina Orwall, D-Des Moines, the main sponsor of the bill.

But critics say lawmakers will only fuel public distrust by extending taxes that were sold as temporary.

"When the tax was introduced, our customers were promised these taxes would expire. The promise comes due this fall," said Shane Skinner, business manager for Enterprise Rent-A-Car in the state.

Skinner said the Seattle area has the fifth-highest car-rental taxes in the country, with a rate of more than 19 percent. And the business no longer is tourist-driven, Skinner added, citing an industry survey that found more than 60 percent of car renters are local.

In addition to car-rental and restaurant taxes, Orwall's bill would redirect hotel taxes now devoted to paying off Safeco Field, Qwest Field and the Kingdome. (The hotel tax was not scheduled to expire.)

All told, the plan would raise nearly $1 billion over 24 years without adding new taxes, according to a legislative staff estimate.

A broad coalition backs the idea, including business, labor, arts and housing groups.

When the bill passed the House on a 55-42 vote, it enjoyed overwhelming support from King County lawmakers, with most of the opposition and speeches about keeping tax promises coming from Republicans who live elsewhere.

The convention center would receive the biggest chunk of money under Orwall's proposal — enough to issue about $150 million in bonds toward an expansion.

But to get enough votes, the bill also calls for setting aside money for other causes dear to key lawmakers.

It would devote $3 million a year for affordable-housing groups, jumping to $10 million in 2021. That's a nod to House Speaker Frank Chopp, D-Seattle, a longtime ally of advocates of low-income housing.

The bill also would give $1 million a year to an obscure Seattle public-development authority focused on Pioneer Square and the Chinatown International District. That's a pet project of Rep. Sharon Tomiko Santos, D-Seattle.

The bill is only the latest in several years of fruitless efforts to divvy up tens of millions in stadium-related taxes.

It began with King County arts and heritage groups, which have been trying for seven years to persuade lawmakers to grant them a long-term funding source. The groups receive about $9 million a year from a county hotel tax but stand to lose it next year as the money is shifted to pay off the remaining debts on the Kingdome, then Qwest Field.

A proposal in the state Senate, SB 5834, would try to deal with the arts issue without including any money for low-income housing, the convention center or other interests.

The bill, which passed the Senate, would not extend the restaurant or car-rental taxes. After the stadium bonds are paid off in 2020, it would shift some of the county hotel taxes to the arts, solving their long-term funding needs. The rest of the money would be available for other purposes.

Sen. Ed Murray, D-Seattle, said his bill simply is "an attempt to get arts out of this food fight" — referring to several years of entanglements between arts groups, pro sports teams and others seeking a slice of the lucrative stadium taxes.

Previously, the owners of the Sonics — first Howard Schultz's local partnership then Clay Bennett's Oklahoma City group — unsuccessfully demanded money to build a new arena. In 2009, University of Washington boosters tried to snag some of the money for a Husky Stadium renovation.

Lawmakers, weary of public anger over taxpayer funding of stadiums, have killed various stadium-tax bills every year since 2005.

It's not clear whether this year will be any different. Some basketball fans hoped Orwall's bill could provide money for an NBA arena to lure a new franchise to Seattle or Bellevue.

But HB 1997 explicitly prohibits any of the tax money from being used to pay for new sports stadiums or even renovations to collegiate stadiums.

County Executive Dow Constantine's office said he has no plans to try to use that money for an NBA arena.

Jim Brunner: 206-515-5628 or jbrunner@seattletimes.com