LOS ANGELES -- Washington State's Supreme Court will hear a challenge to the constitutionality of tax-revolt Initiative 601, a lawyer familiar with the case said yesterday.

No date has been set for oral arguments, but the court indicated it would hear the case before November, said Hugh D. Spitzer, a partner with Foster Pepper & Shefelman. The Seattle law partnership is preparing a friendof-the-court brief challenging the initiative's constitutionality.'

Initiative 601 ties the growth of state spending to the rate of population growth, plus the rate of inflation. It curtails the state legislature's ability to tax and limits how much lawmakers can spend. The measure was approved by 51.2% of the voters last Nov. 2.

In June, the nine-member court panel heard arguments on whether the case should first be heard at the trial court level and then work its way through appeals to the high court.

The justices indicated they would not issue an opinion on that procedural issue until after they hear oral arguments covering substantive issues related to the initiative's constitutionality.

Legal wrangling over Initiative 601 began in February, when a lawsuit was filed with the high court on behalf of several citizens and two legislators.

That suit asked the court to block enforcement of the initiative, and the suit also requested that the initiative be declared unconstitutional because it "infringes on the sovereign taxing and appropriation power of the legislature."

The high court agreed to bear the suit, but split arguments into separate hearings -- the procedural matters argued in June, and substantive issues, which will be presented later, Spitzer said.

However, a hearing related to Initiative 601 has not been placed on the court calender for the upcoming fall term, Ronald Carpenter, a Supreme Court deputy, said yesterday.

The fall session calendar "is full, but that is a relative term," Carpenter said. "The court can decide to set oral arguments" whenever it wants.

Under Measure 601, tax increases approved by legislators before July 1, 1995, require a public vote. After that date, lawmakers can increase taxes to bring revenues up to the spending limit, but they need two-thirds majorities in both legislative houses. To exceed the spending limit, new taxes require two-thirds majorities in both houses, and voters must also approve them.

At the heart of the anti-Initiative 601 argument is the claim that the measure cannot be implemented as a statute under the state constitution, Spitzer said.

"The way Initiative 601 is structured, it requires automatic referendum on certain types of financial measures passed by the legislature," he said. "It also requires that certain other financial measures passed by the legislature be passed by a super-majority vote.

"Both of those requirements are in the nature of a constitutional change and cannot be put into effect through a statute, which is all that an initiative is in Washington State," he said. Washington State does not allow initiative efforts to change the state constitution; the initiative process can only be used to make changes in the law. "In our state, the people through initiative, and the legislature through passage of a bill, constitute two equal ways to enact a statute," Spitzer said. "But we don't think it is constitutional to allow either group to require a super-majority vote by the other. That is the core of this challenge."

State Treasurer Daniel K. Grimm is working to put the measure in place, Peter Rex, a treasurer's spokesman, said Tuesday. Grimm and other officials are required to put provisions of the initiative in effect.

"We are required to enforce the spending limitation according to a formula" calculated by the state office of financial management, Rex said Tuesday. The financial management office is the budget arm of Gov. Mike Lowry's administration.

"The office of financial management and legislative committees are going forward with implementation of Initiative 601 ," state solicitor general Narda Pierce said yesterday. "But there is always that uncertainty hanging over" proceedings until the litigation is resolved.

Spitzer said he hopes the Supreme Court "can make its decision in 1994. It will make life much easier for the legislature in the upcoming session because they will have more information, and that's a good position to be in for budget planning."

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