I work for a large company in Washington State and I am a salary employee. 3 times a year we have a work function outside of normal business hours that we are required to attend. We are now being told that if we do not attend our PTO will be deducted for the time we miss at the function. Normally we do not put this event on our time sheet, so if I don't go I would need to put this on my time sheet so my PTO could be deducted, meaning I would then be paid for it. Is this legal?
Also since this event takes place further away than my place of work shouldn't I then be paid mileage? I was told I couldn't be reimbursed for parking because it's a Sunday and I could park on the street for free.

If the boss says do it, then do it the bosses way. Make sure you got the instructions right. If he says NO to the mileage, don't push it.

If it is in the same city and not really that far, payment for travel is not always done. How you are paid, depends on your payment method, salary, hourly or how?
For parking, no, if street parking is available, why would they give lot parking fee. In fact, I worked for a Company in St. Louis, they would never pay for parking fees, they wanted us to park illegal at meter without paying, they would pay a fine if we ever got one. They had estimated that it was cheaper to pay a fine, now and then, than to pay daily parking all the time.

Companies decide many rules, it appears this is a infrequent event.

PTO (Paid Time off)?

Companies are not required to give paid time off. Therefore, they can set the rules for how they deal with it. They do have to apply those rules equally to everyone without discrimination. They should also be published as part of the PTO policy. So it is not, necessarily, illegal.

As for the parking, again, if they feel that, since street parking is available, it is your choice to pay for parking so reimbursement is not applicable.

One thing I don't get, though. You said: "if we do not attend our PTO will be deducted". I took this to mean that your PTO allotment would be reduced. Not that you would have to apply the time towards PTO. As a salaried employee. You wouldn't necessarily get extra pay for this time. So it appears that the company is requiring attendance and is using this as punishment for non attendance.