Chapter § 12.3 Washington State Department of Transportation Real Property Interests

• Jurisdiction: Washington

§12.3 WASHINGTON STATE DEPARTMENT OF TRANSPORTATION REAL PROPERTY INTERESTS

The Washington state transportation system is a network of highways, roads, airports, railroads, ferries, and transit systems. To manage this system, the legislature created the Washington State Department of Transportation (WSDOT) in 1977 as the successor agency to the Department of Highways, the Highway Commission, the Toll Bridge Authority, the Aeronautics Commission, the Canal Commission, and the transportation function of the Planning and Community Affairs Agency. RCW 47.01.011. As such, the legislature vested WSDOT with all powers, duties, and functions of the state highway program, ferries program, toll facilities program, aeronautic/aviation program, freight and passenger rail programs, and navigational canal program. RCW 47.01.031, .260; RCW 47.76.210. WSDOT manages a broad variety of real property interests ranging from permits and leases to easements and fee title. The properties include operating state highway rights-of-way (about 7,000 miles), wetlands, maintenance facilities, pit sites, ferry terminals, aviation emergency airstrips, and access rights. See http://www.wsdot.wa.gov for information about WSDOT.

(1) WSDOT's general authority

Separate statutory authority governs each WSDOT program. WSDOT's real property interests vary from program to program. This chapter is not intended to provide a detailed analysis of the multitude of statutes pertaining to the various transportation programs, but rather to provide a summary of the most relevant laws that relate to acquisition and use of WSDOT-owned real property. For further discussion of the state's eminent domain authority, see Volume 4, Chapter 13 (Eminent Domain), of this deskbook.

(2) State constitutional restrictions affecting WSDOT's management of land

Restrictions on WSDOT's management of property under the Washington Constitution are discussed below.

(a) Motor vehicle fund restrictions

A fundamental principle underlying the acquisition, use, and disposal of WSDOT real property interests is the distinction between real property acquired with funds from the motor vehicle fund account and real property acquired with funds from other accounts, such as the multimodal transportation account, aeronautic account, or essential rail assistance account. Real property acquired with funds from the motor vehicle fund account is subject to the restrictions of the 18th Amendment to the Washington Constitution, Wash. Const. art. II, § 40, which significantly limits the use and conveyance of such property.

The citizens of Washington adopted the 18th Amendment in 1944 to prohibit the practice of diverting gas tax monies from the construction and maintenance of city streets, county roads, and public highways to other purposes. The 18th Amendment ensures that the motor vehicle fund "would be used exclusively for highway purposes." Freeman v. Gregoire (Freeman I), 171 Wn.2d 316, 331, 256 P.3d 264 (2011) (A valuation performed in anticipation of the transfer or lease of highway property benefits the highway and serves a valid highway purpose under the 18th Amendment.); Auto. Club of Wash. v. City of Seattle, 55 Wn.2d 161, 166, 346 P.2d 695 (1959) (citing State ex rel. Bugge v. Martin, 38 Wn.2d 834, 339-40, 232 P.2d 833 (1951)). The people intended the state to use certain fees and taxes for roads, streets, and highways on which the people could drive. State ex rel. Heavey v. Murphy, 138 Wn.2d 800, 810-11, 982 P.2d 611 (1999) (quoting State ex rel. O'Connell v. Slavin, 75 Wn.2d 554, 559, 452 P.2d 943 (1969)). The people also intended to limit expenditures from the motor vehicle fund to those things that would benefit the roadway systems, either directly or indirectly. Heavey, 138 Wn.2d at 810-11 (quoting Auto. Club, 55 Wn.2d at 168). The 18th Amendment accomplished this by creating a special fund in the state treasury, the motor vehicle fund, the proceeds from which are "to be used exclusively for highway purposes" as defined in the 18th Amendment. See RCW 46.68.070. In contrast, the nonhighway functions administered by WSDOT (e.g. rail, aeronautics) are not subject to the "highway purpose" limitation, and in fact WSDOT cannot use properties acquired with motor vehicle funds for these or other nonhighway functions unless the motor vehicle fund receives compensation (e.g., lease or conveyance with fair market consideration).

The 18th Amendment defines "highway purposes" as including:

(a) The necessary operating, engineering and legal expenses connected with the administration of public highways, county roads and city streets;

(b) The construction, reconstruction, maintenance, repair, and betterment of public highways, county roads, bridges and city streets; including the cost and expense of (1) acquisition of rights-of-way, (2) installing, maintaining and operating traffic signs and signal lights, (3) policing by the state of public highways, (4) operation of movable span bridges, (5) operation of ferries which are a part of any public highway, county road, or city street....

Wash. Const. art. II, § 40.

The Washington Supreme Court uses the following rules to interpret the 18th Amendment. The words "highway purposes" are "free of ambiguity." Heavey, 138 Wn.2d at 811 (quoting O'Connell, 75 Wn.2d at 558). The enumerated items do not limit the scope of "highway purposes" but enlarges and extends it beyond the ordinary meaning of what is considered a "highway purpose." State ex rel. Bugge, 38 Wn.2d at 840. "[T]he express mention of one thing implies the exclusion of another which might logically have been considered at the same time." O'Connell, 75 Wn.2d at 559. The construction of the meaning and scope is exclusively a judicial function. Wash. State Hwy. Comm'n v. Pac. Nw. Bell Tel. Co., 59 Wn.2d 216, 222, 367 P.2d 605 (1961). Constitutional limitations adopted by the people are "to be understood as their words used in their ordinary meaning and not in any technical sense." Auto. Club, 55 Wn.2d at 167; see also O'Connell, 75 Wn.2d at 557. The 18th Amendment "should be read according to the natural and most obvious import of its framers, without resorting to subtle and forced construction for the purpose of limiting or extending its operation." Heavey, 138 Wn.2d at 811 (quoting O'Connell, 75 Wn.2d at 558). Finally, "[i]t is not for the court to engraft an exception where none is expressed in the constitution, no matter how desirable or expedient such an exception might seem." O'Connell, 75 Wn.2d at 558 (citing State ex rel. O'Connell v. Port of Seattle, 65 Wn.2d 801, 806, 399 P.2d 623 (1965)).

Based on these interpretive rules the Washington Supreme Court has concluded that the people passed the 18th Amendment to secure the administration, building, and maintenance of highways, roads, and streets on which the people could drive motor vehicles. O'Connell, 75 Wn.2d at 558-59. A highway, road, or street is a "way" open to the public at large for motor vehicle travel or transportation. Id. at 559 (quoting State ex rel. Or.-Wash. R.R. & Nav. Co. v. Walla Walla Cnty., 5 Wn.2d 95, 100, 104 P.2d 764 (1940)). The purposes listed in the 18th Amendment pertain only to motor vehicles and not to any other mode of transportation, including buses, trains, or other carriers, or the purchase or maintenance of any type of vehicle for public transportation purposes. O'Connell, 75 Wn.2d at 558-59. Although the implementation or expansion of a public transportation system (such as transit) might benefit the highway system by taking traffic off the highway, such a purpose is not the type of highway benefit the constitutional framers intended. Id. at 560. The planning of a public transportation system (such as transit) does not serve a highway purpose. Id. Diverting traffic from the highway is not a highway purpose. Id. at 563. Facilities, such as park and ride lots, that are an integral part of the highway system and are directly related to a more efficient and safer operation of the system constitute a highway purpose. State v. O'Brien, 83 Wn.2d 878, 883, 523 P.2d 190 (1974). The state can use motor vehicle funds for purposes that indirectly benefit the highway system when such purposes contribute to the safety, administration, or operation of the highway system. Id. at 882-83 (quoting O'Connell, 75 Wn.2d at 561).

The Supreme Court's conclusions are clear that the state must use monies obtained from the motor vehicle fund exclusively for highway purposes. Therefore, when WSDOT conveys, transfers, or leases any property acquired by WSDOT with motor vehicle funds to any party for nonhighway purposes, the agency requires consideration from the purchaser, transferee, or lessee, and WSDOT then deposits the monies into the motor vehicle fund. Freeman I, 171 Wn.2d at 331(citing O'Brien, 83 Wn.2d at 882)).

(b) Prohibition of gift of state funds

The Washington Constitution provides that the "credit of the state shall not, in any manner be given or loaned to, or in aid of, any individual, association, company or corporation." Wash. Const. art VIII, §5. This provision prohibits the state from giving or lending the state's credit to private parties, but does not apply to corporations or entities whose functions are wholly public. Anderson v. O'Brien, 84 Wn.2d 64, 66-67, 524 P.2d 390 (1974). This mandate applies to WSDOT and governs the way in which it manages and disposes of land under its jurisdiction. Wash. State Hwy. Comm'n, 59 Wn.2d at 224. As a result, WSDOT cannot give to or allow the use of any of its real property by private entities or individuals without receiving some form of consideration.

(3) Federal law restrictions affecting WSDOT's management of land

The federal government in part funds Washington's transportation programs and projects. Real property acquired with such funds is often subject to additional use and disposal restrictions and requirements. With...