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"Judge blocks I-722Round 1 goes to the city, which got an injunction in superior court."
"City officials are breathing easier, after a judge's decision that blocks the tax-slashing Initiative 722 from taking effect while the courts consider its constitutionality.Thurston County Judge Christine Pomeroy agreed that the city of Bainbridge Island would be irreparably harmed if it had to comply with the various provisions of the initiative immediately, and entered an injunction Thursday blocking the voter-passed initiative until a final court decision.The really difficult thing would have been refunding taxes we have already collected, Mayor Dwight Sutton said Friday. If the initiative is eventually upheld and we have to make refunds later, we won't have done any additional damage.Initiative 722, sponsored by Mukilteo fraternity-watch salesman Tim Eyman, was aimed at reducing property taxes through a number of different provisions.It rolled back property valuations to 1999 levels, limited valuation increases for tax purposes at 2 percent per year, limited annual revenue increases to 2 percent per year, and rescinded tax increases since July 1999, when Eyman-sponsored Initiative 695 qualified for the statewide ballot.Bainbridge Island and a number of other cities brought actions to have I-722 declared unconstitutional, for many of the same reasons that the Washington Supreme Court declared I-695 unconstitutional.We felt from the outset that I-722 contained illegal components, Sutton said. You would think Mr. Eyman would figure out that you can't draft initiatives containing multiple topics the way he has done.Full implementation of I-722 would have cost Bainbridge some $4.5 million in fiscal 2001 - about 45 percent of operating revenue. That would have caused cancellation of all discretionary services, compromised police protection and could have caused the city to default on its general-obligation bonds, city officials said.Bainbridge Island was particularly hard-hit by I-722. Because the city has a relatively limited retail base that produces modest sales-tax receipts, the city relies more on property taxes that do many other cities.A statewide equalization fund that helped cities like Bainbridge with a small retail base was itself funded by the Motor Vehicle Excise Tax, and was wiped out when the MVET was repealed first by the passage of I-695 then by the Legislature.By its terms, the injunction applies only to those governmental entities that were actually named as parties to the court case. But Kitsap County Auditor Jim Avery said Friday that as a practical matter, the injunction will have statewide effect.We cannot recompute the tax base, because Kitsap County has been enjoined, Avery said.A press release from Avery's office said that the injunction would permit taxing districts to increase their 2000 collection level by as much as 6 percent for 2001 as what the law allowed prior to the passage of I-722.In effect, the injunction against the assessor's office gives those Kitsap County taxing entities such as the school and fire districts the benefits of the injunction, even though they were not part of the suit.Mayor Sutton said he has not detected among islanders the level of anti-tax sentiment that prompted passage of I-722.Whenever I ask constituents what services they want us to reduce or do away with, I get no answer, he said. This is a growth community, and the demands are for more, not less service.Precinct breakdowns showing how Bainbridge Island voted on the measure were not available Friday.The injunction does no more than maintain the status quo until the validity of I-722 is finally determined, and there is some chance that the courts will ultimately uphold the measure. But Sutton does not intend to put city projects on hold during the interim.It's not fair to the citizens for the next 10 months to say, 'Don't do anything,' he said. For example, if we don't rebuild High School Road next summer, it will continue to deteriorate, plus we will lose our place in line for state and federal funds. "