Tax Increases Will Cost Washington Businesses, Consumers $6.7 Billion Next 10 Years
July 15, 2010
The well-documented lack of transparency and suspension of voters’ rights by Washington state lawmakers in the 2010 legislative session will soak taxpayers an additional $6.7 billion over the next 10 years, according to a new study by the Washington Policy Center (WPC).
“State lawmakers raised taxes at the worst possible time – in the midst of a recession with record-high unemployment levels,” says Dann Mead Smith, WPC President. “We compiled this report to help give taxpayers a clearer picture of the details and cost for each tax increase.”
The respected think-tank’s study is comprised of 12 pages of data, which includes an explanation of each tax increase and details of how each tax increase encumbers businesses and consumers for the next 10 years.
As it has done repeatedly over the years, the Legislature suspended the protections voters passed in Initiative 960, which required transparency and a two-thirds legislative majority vote in order to hike taxes. The Legislature passed SB 6130, which suspended the voter protections against unwanted new taxes.
“The bill temporarily repeals provisions of voter-approved Initiative 960 until July 1, 2011,” states WPC’s report at www.washingtonpolicy.org. “Washington voters passed Initiative 960 on November 6, 2007.”
The $800 million in new taxes include:
- Business and Occupation taxes
- Canceling Real Estate Excise Tax exemptions
- Increasing taxes for Public Utility Districts
- Hiking the 911 excise tax
- Hospital Bed taxes
- Bottled water, soft drink, beer, candy and gum taxes
- Tobacco taxes including a 500 percent increase on cigars
“Lawmakers increased total state spending by 43 percent in the last five budget cycles, a period in which state population grew only 11 percent, and inflation increased just 19 percent,” states the Report on 2010 Tax Increases in Washington State.
“By repealing the non-binding advisory votes, lawmakers expected their names would not appear in the official voters’ pamphlet for 2010 next to a description of the tax increases they had enacted,” the study notes. “The purpose of this report is to provide much of the information the public would have received in the official voters’ pamphlet if the legislature had not repealed the public disclosure provisions of Initiative 960.
Well, if you’re unsure how your legislator voted on taxes and other issues, visit: www.washingtonvotes.org.
Meantime, here’s a tip of the Biz Coach cap to Washington Policy Center for its usual fine work.
From the Coach’s Corner, you might be interested in the results of these polls:
- More Voters Say Washington State is Headed the Wrong Way
- Big Surprise in Washington State Race for U.S. Senator
If you want to do something about these tax increases, you might also want to consider these organizations:
- Association of Washington Business, www.awb.org
- Enterprise Washington, www.enterprisewashington.org
Why Proposed Washington Income Tax Will Kill Jobs
Updated April 26, 2010 9:12 a.m.
When Bill Gates Sr. last proposed a Washington state income tax in 2002, he was chair of the Washington State Tax Structure Committee that was created by the Legislature. Comprised of academics and legislators, the committee studied how the tax system could be altered in the 21st century.
The committee was charged with studying “fairness, stability, adequacy and the effect of the tax system on Washington’s economic vitality.” However, the idea failed to get any traction. It was not perceived as fair, stable, and adequate. And it would have hindered the state’s economy as it emerged from the economic hangover from 9/11 and the dot-com bust.
Mr. Gates’ new income-tax proposal, Initiative 1077, won’t work either. On the surface, it sounds feasible. But the state’s unemployment rate is 9.5 percent. An income tax would discourage investment in the creation of jobs, and it emboldens more bad behavior by spend-and-tax legislators.
Already, Washington ranks among the worst states in sales and business taxes. Consider states like California and New York with their high sales and business taxes. They also have an income tax, and they’re nearly bankrupt.
Moreover, there are many reasons why an income tax is not to be trusted in Washington state.
After waiting out the two-year time limit to for overturning initiatives in 2010, Washington lawmakers jumped at their chance to suspend the transparency provisions of the Taxpayer Protection Act, Initiative 960.
Never were there serious discussions about reducing the footprint of government or even prioritizing the core services of government in the $2.8 billion shortfall. We are still saddled with unnecessary, expensive services including state retail liquor stores, the state printer, and the associated employee payroll costs and unfunded state-worker pensions.
Instead, with unlimited chicanery, the legislators violated the will of voters in a variety of ways:
- They passed a ghost tax bill with just a title and literally no text – a blank bill.
- Lawmakers refused to remove their disingenuous exemption from the state’s public records law.
- Public hearings were scheduled without 24 hours notice.
Then, the legislators passed more than $808 million in new taxes in their unsustainable budget. They relied heavily on federal government funds to balance the budget, and it’s already well-known that the next biennium budget also faces billions in red ink. What will they do then?
Was the Legislature’s dysfunction a surprise? No. For years, the Legislature has circumvented the will of the people.
State’s pattern of ignoring voters
In 2006, state officials were proven guilty in Superior Court – their secretive, incriminating government e-mails were part of a shell game that circumvented spending limits. They included state officials and employees – including members of the Legislature, Office of Financial Management, Expenditure Limit Committee, the governor, and even the attorney general appeared to oppose the will of voters on state spending.
A coalition of business and consumer watchdog groups took them to court for violating the state spending limits of Initiative 601. The coalition included: The Washington Farm Bureau, the National Federation of Independent Business, the Washington State Grange, the Building Industry Association of Washington, the Washington Association of Realtors, and the Evergreen Freedom Foundation.
Snohomish County Superior Court Judge James Allendoerfer ruled the state’s collection of certain taxes was illegal and that the Legislature improperly increased the state’s spending limit in 2005 by $250 million.
The incriminating e-mails showed budget writers knowingly violated the law and shifted funds around to artificially increase the spending limit. Other e-mails also revealed a furtive dialogue involving Office of Financial Management strategies that manipulated funds for new spending in the 2006 supplemental budget.
The losing side sarcastically poked fun at a coalition’s complaint that the spending increase was approved after just 25 minutes of consideration by the state’s Expenditure Limit Committee, which has authority to increase the state’s spending limit.
The committee was comprised of Victor Moore, director of the Office of Financial Management; Maureen Hart, the Attorney General’s representative; Sen. Margarita Prentice, chair of the Senate Ways and Means Committee; and Rep. Helen Sommers, chair of the House Appropriations Committee.
Minutes from the committee’s meeting on November 25, 2005 illustrate why the coalition was concerned. The meeting ran short because all the substantive discussions took place earlier, which the incriminating e-mails demonstrated. With Hart recusing herself, the brief meeting concluded with a unanimous vote to increase the state’s spending limit in I-601.
Why did voters pass I-601? Times were tough in 1993. Figuratively, Washington voters erected a big red stop sign at the state capitol and passed I-601 to halt skyrocketing tax increases. Voters were concerned about public-sector indifference.
Even the Washington State Association of County Assessors took note of voter attitudes. In late 1994, the group invited me to advise them on strategy to persuade the Legislature to reduce property taxes. As I sat down following my pro bono seminar, I’ll never forget my disappointment when I heard Scott Noble, who was the then-interim King County Assessor, sitting across the table, refuse to participate in the effort.
“It will never work,” he said. But most assessors were receptive to lowering property taxes and they successfully persuaded state lawmakers to reduce property taxes in the ensuing 1995 session. And we know what happened to Mr. Noble, who was forced to resign in disgrace following his drunk-driving accident that resulted in injury to others.
Income tax – another $1 billion burden
The new income-tax proposal, in this uncertain economy, would dump another $1 billion in tax burdens on many of the very businesspeople who are capable of creating thousands of badly needed jobs.
It would be an additional 9-percent tax on income of $500,000 or more and a 5-percent tax on income of more than $200,000. They are already paying exorbitant fees for unemployment insurance and workers’ compensation.
In economic development and job creation, the great equalizer has been the lack of an income tax.
Proponents of I-1077, perhaps unknowingly, are instigating class warfare in claiming they want to lower taxes on most people while taxing the rich. But I-1077 would not eliminate the sales tax, which indelibly hurts the livelihoods of low-income people.
It would lower the state’s portion of the property tax by 20 percent. But that would only slightly reduce a property owner’s taxes – 96 percent of the property tax would remain. The slight reduction, of course, would be negated by the ever-increasing property assessments. So it’s a disingenuous argument.
Micro businesses, the self-employed, would not be liable for the business and occupation (B&O) tax. Larger businesses would receive a $4,400 tax credit. However, as any entrepreneur knows, $4,400 is a negligible amount as a business cost in the hiring an employee in salary and benefits.
Incidentally, an income tax was thrown out in 1933. Voters have since refused income-tax proposals five times. Seemingly, voters have known an income tax would be increasingly burdensome. Taxes never go away. Government incessantly grows bigger.
The B&O tax was introduced as a temporary measure in the 1930s, but you guessed it. Businesses have been saddled with it ever since. The B&O tax is grossly unfair. It does not tax profits. It taxes revenue. Even if a business loses money, it’s subject to the tax.
It’s especially regressive on new businesses. Imposing B&O taxes on a startup makes it harder for it to succeed. And it’s a major factor why Washington is a leader in startup failures. We don’t need failures. We need entrepreneurs to be successful to create jobs.
In essence, Washington state government has a documented propensity to trample on the economic freedom and political freedom of businesspeople and voters. There is not a voter-approved agreement regarding the state’s core services.
Until there is agreement, state government shrinks significantly and voter wishes are upheld, here’s a resounding no to an income tax. An income tax would threaten more danger for the state because it chases ill-economic health. The proposed income tax won’t work – because it won’t put Washingtonians to work.
From the Coach’s Corner, do you need more evidence why the Washington State Legislature cannot be trusted?
See this blog from Jason Mercier of the Washington Policy Center regarding transparency.
Small Business Success Is Key for Washington’s Sustainability
April 6, 2010
Washington state’s small business owners are getting a first-hand look at ways to improve their economic environment, thanks to the Washington Policy Center (WPC). The think tank is taking 24 ideas on the road and sharing them in 24 locales around the state.
“Small businesses are the backbone of Washington’s economy,” wrote Carl Gipson, director of WPC’s Center for Small Business. “We are committed to helping improve the small business climate in our state, and going on a tour of Washington is a great way to get the conversation started.”
The topics in the WPC tour range from unemployment insurance to state taxes. They’re included in the WPC report, Lead the Way: Small Business and the Road to Recovery. The ideas were provided by small business owners throughout the state in late 2009.
Mr. Gipson provides this ominous reminder: “Recent data shows Washington’s small business failure rate is the second-highest in the nation.”
To be candid, this Biz Coach site has long voiced concerns about government behavior – the theft of economic freedom and political freedom — so I really appreciate Mr. Gipson’s observation:
“The proper function of taxation is to raise money for core functions of government, not to direct the behavior of its citizens,” he wrote.
“This is true whether government is big or small, and this is true for lawmakers at all levels of government,” he added. “Many lawmakers think of the tax code as a way to penalize ‘bad’ behaviors and reward ‘good’ ones. They have sought incessantly to guide, micromanage and steer the economy by manipulating the tax laws.”
Then, there’s this reminder: “The State Auditor has conducted 23 audits as of December, 2009, ‘identifying billions of dollars in unnecessary spending, potential cost savings and economic benefits and recommending numerous ways to improve state and local government operations’,” he wrote.
“Too often, policymakers act without considering or measuring the impact of their decisions on the owners of mom-and-pop businesses, even though those are the very businesses that are disproportionately hampered by the regulations and taxes they impose,” wrote Mr. Gipson.
And he shares some history about the impact of small business.
“During the 2003-2004 recovery period from the recession from the early 2000s, businesses with fewer than 500 employees hired almost 1.9 million workers, while businesses with more than 500 employees laid off over 200,000 workers,” he wrote. “In Washington, using both the state government’s and Washington Policy Center’s definition of small business (fewer than 50 employees), small businesses make up 96 percent of all registered businesses while employees of small businesses account for 41 percent of the state’s workforce.”
Here is the WPC tour schedule: www.washingtonpolicy.org/leadtheway
WPC’s Web site: www.washingtonpolicy.org
From the Coach’s Corner, a reminder if you need business counseling at no charge, consider the Small Business Development Center nearest you (SBDC).
Why Not Transparency for Good, Open Government in Washington State?
March 24, 2010
Even after concluding its regular 2010 legislative session and after nearly two weeks of a special session, there is no balanced budget. There are no efficiencies. Worse, there is little transparency about taxpayer assets. The Legislature hasn’t learned to stop chasing ill health.
By extension, it’s clear that Senate Majority Leader Lisa Brown is not passing the transparency test of good, open government. She has failed to spearhead passage of a balanced budget and has largely ignored efficiencies, such as the Opportunities for Washington, recommended by a prominent member of her own party – State Auditor Brian Sonntag.
Instead of focusing on successfully ending the special session, The Seattle Times reports she sent a letter to Washington State Attorney General Rob McKenna demanding that he stop his health-care efforts and accused him of being “far outside the mainstream interests” of the state. But my straw poll of businesses and consumers shows a majority in favor of his position.
Meantime, here’s a news flash: There is furtive, dubious activity under her leadership – everything from secretly raising taxes; gutting The Taxpayer Protection Act, Initiative 960; and passing ghost tax bills. There are no efforts to create a good economic environment and private sector jobs.
Actively highlighting the disingenuous behavior has been Jason Mercier, director of the Center for Government Reform at the Washington Policy Center (WPC), the nonpartisan think tank.
After seeing this TVW video posted on the Washington Policy Blog in which Speaker Brown denies knowing why Mr. Mercier has repeatedly raised concerns about legislative transparency, how could she be so disconnected?
Most state newspapers have commented to no avail, such as The Seattle Times in Gov. Gregoire: Use veto to keep transparency and in The Washington State Senate and the age of hubris.
When Gov. Gregoire failed to honor the request, the newspaper ran this editorial, Governor, Legislature should have kept two-thirds rule on taxes.
Even The Olympian commented in A bad example of legislative ‘transparency’.
There are plenty of other indications about the absence of transparency. How could she not have noticed any of WPC’s analysis? See for yourself at www.washingtonpolicy.org.
Plus, I’ve written numerous Biz Coach columns on the issue.
I cited $65 million in waste in this column, “Will Government Policies Ever Promote Economic And Political Liberty?” State employees are allowed to carry forward and cash out their unused sick leave.
You see, the state paid $65.3 million in unused sick leave from 2007 to 2009. And state workers have received millions of dollars in this budget cycle. This is a perk you will rarely, if ever, see for taxpayers in the private sector.
The largest employer in Washington, 17.6 percent of the workforce, is government. The retail sector is second with 10.8 percent. In the state’s 2009 comprehensive annual financial report, government expenses outgrew revenue.
Another eye-opener in the report: “Governmental activities resulted in a decrease in the state of Washington’s net assets of $2.2 billion.”
Because of the extravagant spending, the gap in unfunded Washington’s retiree health benefits is $7.9 billon.
Meantime, ranking member of the Senate Ways and Means Committee, Sen. Joe Zarelli, has unsuccessfully argued in favor of transparency with Committee Chair, Sen. Margarita Prentice. This TVW video illustrates violations of legislative transparency standards.
All of this employee pork, unnecessary spending, and violations of transparency standards are why WPC is advocating a constitutional amendment for transparency:
BE IT RESOLVED, BY THE SENATE AND HOUSE OF REPRESENTATIVES OF THE STATE OF WASHINGTON, IN LEGISLATIVE SESSION ASSEMBLED:
THAT, Transparency and public disclosure in the legislative process is vital to a representative democracy. THAT, At the next general election to be held in this state the secretary of state shall submit to the qualified voters of the state for their approval and ratification, or rejection, a new section amending Article 2, an amendment to Article 2, section 19, and an amendment to Article 2, section 22 of the Constitution of the state of Washington to read as follows:
Article II, new section. No bill shall be eligible for a public hearing until 72 hours after introduction. No bill shall be eligible for legislative action of any kind unless it has first been subject to a public hearing in the same session of consideration. No bill shall be eligible for legislative action on the floor of either house until 72 hours after it has been placed on the floor calendar. This section may be suspended with two-thirds of the members elected to the house in which it is pending suspend this requirement, and every individual consideration of a bill or action suspending the requirement shall be recorded in the journal of the respective house.
Article II, section 19. No bill shall embrace more than one subject, and that shall be expressed in the title. No bill shall be eligible for public hearing or legislative consideration of any kind unless the bill shall lay forth in full the changes to any act or sections of law. Title only bills shall be prohibited.
Article II, section 22. No bill shall be eligible for final passage in either house unless copies of the bill in the form to be passed shall have been made available to the members of that house and the public for at least twenty-four hours, unless two-thirds of the members elected to the house in which it is pending suspend this requirement, and every individual consideration of a bill or action suspending the requirement shall be recorded in the journal of the respective house. No bill shall become a law unless on its final passage the vote be taken by yeas and nays, the names of the members voting for and against the same be entered on the journal of each house, and a majority of the members elected to each house be recorded thereon as voting in its favor.
BE IT FURTHER RESOLVED, That the secretary of state shall cause notice of this constitutional amendment to be published at least four times during the four weeks next preceding the election in every legal newspaper in the state.
Let’s have a discussion about WPC’s suggestion. Implementing transparency is the right thing to do and will promote good, open government in Washington state. Stop chasing ill health.
From the Coach’s Corner, courtesy of Enterprise Washington, click here to find your legislators’ phone number and email address.
Transparency and Why WA Unemployment Rate Jumps to 9.5 Percent
March 16, 2010
Universal criticism of the Washington State Legislature’s failure to be transparent is validated once again as the state’s unemployment rate continues to climb – now at 9.5 percent.
The increase stems from another 8,300 lost jobs, including 3,200 in construction and 2,100 in business services.
The timing couldn’t be more symbolic during this national Sunshine Week. The unemployment rate dovetails with the declining transparency at the Washington State Legislature. It’s in a special session to finalize the state budget with seemingly countless tax increases following years of over-spending.
If it weren’t for the watchdog efforts of people like Jason Mercier, Washingtonians would be in the dark regarding the chicanery of the Legislature. Lawmakers have refused to implement efficiencies at the expense of a suffering electorate and business community. They’ve passed ghost tax bills and made many decisions in private, but have not accomplished anything to improve the state’s economy. Mr. Mercier, who is the director of the Center for Government Reform for the Washington Policy Center, has issued countless updates from Olympia.
As a result of the secrecy in passing numerous unnecessary tax increases and other dubious legislation, newspapers across the state are clamoring for good, open government in Washington state.
Here’s a sample:
A bad example of legislative ‘transparency’, Olympian
“In the waning days of the regular legislative session, Senate Majority Leader Lisa Brown, a Democrat from Spokane, claimed the Legislature is much more transparent than it was when she entered the Legislature. Brown is wrong . . .”
Sunshine and Clouds in Olympia, Kitsap Sun
“The bad news is that public access to information and hearings about legislation has been … challenging. There’s been a flurry of ‘title-only’ bills introduced and set for hearings, sometimes on short notice, and with no timely public information on their content. Members of the public deserve better than that — and if they want to get it, they’d better say so this fall to those who seek to represent them in the Legislature.”
It’s National Sunshine Week, but state’s transparency forecast remains cloudy, Longview Daily News
“Shutting down the Sunshine Committee less than three years after it was formed is as difficult to justify as that legislative exemption from public disclosure. It proved too much for legislators to pull off in the light of day. The Sunshine Committee was taken off the bill’s termination list — less than a week ago. Sadly, that remains this legislative session’s single accomplishment on behalf of government transparency.“
State government clings to double standard, News Tribune
“Is it any wonder that city and county officials clamor for relief from open meetings and records laws when they see their counterparts in state government behave as they do? State officials profess a belief in public disclosure. They’re just not sure it always applies to them. Lawmakers in particular hold themselves apart from the state’s sunshine laws. They caucus in secret for any reason and insist that their correspondence is somehow constitutionally protected from public dissemination. They also apparently reserve the right to skip public process in the interests of expediency.”
Public input? Who cares?, Everett Herald
“With increasing audacity, key state legislators are taking control from the people and seizing it for themselves. Amid the difficult process of closing a $2.8 billion budget shortfall, they’ve skirted, waived or ignored the public’s right to know what they’re up to and comment on it.”
And there others we can cite.
Meantime, Mr. Mercier offers some excellent solutions for transparency and the Legislature’s practice of passing ghost tax bills.
“Add the preamble of the state’s public records act to Article 1,” he writes. This would help re-enforce this transparency intent for any wayward court.” (See the preamble about the voters’ sovereignty.)
“Add a new section to Article 2 which would require 72-hour public notification before any bill could receive a public hearing, he adds. “While the requirement currently exists in legislative rules, it is often waived.”
Amend Article 2, Section 19 to prohibit title only bills. No public hearing or vote should occur on a “ghost bill.”
Amend Article 2, Section 22 to prohibit votes on final passage until the final version of the bill to be approved has been publicly available for 24-hours.”
He points out it would not be a stretch for the Legislature to be transparent and give the voters adequate notice before passing bills that affect their livelihoods.
“Florida’s Constitution (Article 3, Section 19) requires a 72-hour public review period for appropriations bills before they can be voted on,” Mr. Mercier explains. “Hawaii’s Constitution (Article 3, Section 15) requires a 48-hour review period before any bill can be voted on for final passage.”
Is transparency too much to ask? No. So, why don’t we tell lawmakers how we feel? Otherwise, the unemployment rate and the economic climate will remain unnecessarily unacceptable. Not to mention the theft of Washingtonians’ economic and political freedoms.
From the Coach’s Corner, here’s a link from Enterprise Washington to find your legislators’ phone number and email address.
Idaho Governor Recruits Washington and Oregon Companies – Thanks to Legislatures
March 9, 2010
Call it brazen. Call it economic development. Whatever your preference, Idaho Governor C.L. “Butch” Otter is an opportunist.
In the wake of out-of-control policies and behavior by public officials in Washington and Oregon, he’s issued a press release to recruit companies to his business friendly Idaho.
That’s right, dated Monday, March 8, 2010, the headline reads:
“LOVE LETTER TO OUR NEIGHBORS: IDAHO IS OPEN FOR YOUR BUSINESS.”
No joke. In capital letters complete with the word “YOUR” in italics, I’ve cut and pasted the headline verbatim.
Here’s an excerpt from his combination “love letter” and news release:
“We now are reaching out to hundreds of Oregon businesses, and will do the same with those in Washington if the legislature there follows Oregon’s lead. We aren’t offering many bells and whistles, but what we can offer is a business-friendly State government, a highly qualified and motivated work force, and communities where people understand that while government cannot be the solution to their problems it can and must be a champion for their own solutions.”
Here’s his salient comment about the Washington State Legislature:
“Legislators in the state of Washington are talking about even bigger tax increases to tackle a budget deficit that figures to be as big as Idaho’s entire State budget. Businesses in both states are like those in Idaho; they are facing the most challenging times in decades, and even incremental cost increases can mean the difference between surviving and closing up.”
About Oregon, he writes:
“The problem in Oregon is that folks were convinced that state government was what needed to be shored up rather than the jobs- and revenue-producing private sector for which state government is supposed to work. As a result, they’re chasing some of their cash cows to the border. And I welcome those businesses with open arms.”
People have stopped asking me why I write about public policy so much or why I’ve created an Op-Ed category on this Web site. They know significant action is needed for a strong economic climate and the creation of jobs.
The record is clear. At all levels, government is hindering economic growth and job creation with unproductive policies and behavior.
My hope for Washington state is that voters wake up and smell the coffee for a revolution in this November’s elections and successfully demand government reform – reminiscent of 1994 after the Washington State Legislature imposed huge tax increases on business in 1993. You might recall countless politicians were swept out of office.
Even the Washington State Association of County Assessors took note of the voters’ angst. In Nov. 1994, the association invited me to advise them on media strategies to lower property taxes. Only then-interim King County Assessor Scott Noble opposed me. As a result in the ensuing legislative session, lawmakers lowered property taxes by 4.7 percent. (Mr. Noble later became the permanent assessor but was driven from office in 2009 after his drunk-driving accident injured two female motorists.)
The 2010 legislative session has grossly increased taxes and destroyed standards of government transparency instead of implementing efficiencies. As a management consultant who performed services at two state agencies, I’ve witnessed the state of Washington is sorely lacking in best-practices management and performance. And as I’ve often warned, this is resulting in more theft of our economic and political freedoms.
From the Coach’s Corner, see for yourself. Here’s the link to Gov. Otter’s invitation.
My thanks and appreciation go to Jason Mercier of the Washington Policy Center for distributing it.
Washington State’s Last Chance for Good Government
Feb. 18, 2010
Instead of focusing on economic growth and the creation of jobs, the 2010 Washington state legislative session has largely been a huge disappointment and insulting to business and consumers. That’s mainly because of the bills to increase taxes and violate standards of transparency as disingenuous ploys to balance the budget.
One of the few bright spots: Rodney Tom, a Washington state senator (D-48, Bellevue) understands it’s possible to save money by eliminating an unwarranted state service and going green, too. He’s introduced a bill to eliminate the state printer.
Buried in his bill is this statement: “…printing is not a core state service and would be better handled within the private sector.”
There are other examples of non-core state services, such as the liquor-selling agency that employees nearly 1500 state workers.
Click here for other examples of a bloated state workforce and non-essential services. Per capita, Washington has more employees than California.
A $2.8 billion shortfall is a lot of red ink. The state spending in recent years greatly exceeded the potential revenue pie. There were red flags everywhere. Administrators and lawmakers ignored repeated valid suggestions in order to be good stewards of taxpayer assets. I’ve cited numerous solutions.
Washington’s unemployment rate of 9.5 percent should be a deterrent for tax increases. But it isn’t. Ask the Association of Washington Business (AWB), www.awb.org, about the impact of a proposal to hike unemployment insurance taxes.
Here’s more about the Washington State Legislature’s spending and taxes:
There was a Washington Supreme Court case in recent years over incriminating e-mails in the shell game to circumvent the state’s spending limit.
So, this year we’ve seen a blank, ghost tax bill. That’s right, no text.
We’ve been aghast at the elitist suspension of the transparency safeguards in the Taxpayer Protection Act, Initiative 960, which was passed by voters in 2007.
We’ve seen proposals for sin tax increases as high as 500 percent and a tax on candy, which adversely impacts a heritage employer, Brown and Haley, which has been struggling.
There’s a tax on oil companies that will hurt businesses and consumers. Supporters of the 300 percent increase are either naïve or disingenuous in their claims that oil companies will not pass the tax to purchases at the pump.
And Gov. Chris Gregoire promoted her $605 million in tax increases.
My apologies if there are any omissions. But you get the picture.
The bottom-line: The tax proposals are unwarranted and Gov. Gregoire has an opportunity to exercise a line-item veto of the legislature’s repeal of the two-thirds vote requirement for tax increases.
Language in I-960 includes:
“Our state constitution guarantees to the people the right of referendum. In recent years, however, the legislature has thwarted the people’s constitutional right to referendum by excessive use of the emergency clause . . . The people find that, if they are not allowed to vote on a tax increase, good public policy demands that at least the legislature should be aware of the voters’ view of individual tax increases. An advisory vote of the people at least gives the legislature the views of the voters and gives the voters information about the bill increasing taxes and provides the voters with legislators’ names and contact information and how they voted on the bill. The people have a right to know what’s happening in Olympia.”
In all candor, reporting on the legislature’s excesses is a full-time job – precious time I don’t have in writing business-coaching columns.
Fortunately, the Washington Policy Center (WPC), an authoritative and trusted non-partisan think tank does an excellent job of tracking bills and feeding valuable information to reporters and columnists like me.
“By repealing for two years the non-binding advisory votes, lawmakers that vote for a tax increase will be spared from having their names show up in the voter’s pamphlet next to a description of the tax increases they supported as required by RCW 29A.32.070,” says WPC’s director for government reform, Jason Mercier.
“Short of a change of heart in the Senate, the only thing that can ensure the non-binding tax advisory votes as intended by the voters remains in effect is the governor’s veto pen,” he adds. “The Constitution provides the governor line-item veto authority which means she could approve the two-year repeal of the two-third’s vote requirement while maintaining the non-binding tax advisory vote provision.”
Otherwise, businesses and taxpayers will only have one option – the November elections – which has a precedent in Washington state. That’s the massive voter rejection of incumbents in 1994.
Following widespread protests over massive business-tax increases in 1993, the Washington State Association of County Assessors invited me to advise the 60 assessors on how to get legislative approval to reduce property taxes. I conducted a special seminar for the assessors.
It was unprecedented and gratifying when assessors persuaded state lawmakers to reduce property taxes by 4.7 percent in the ensuing 1995 session.
Let’s hope, it won’t get to that point again. You can make a difference by contacting your lawmakers (http://apps.leg.wa.gov/rosters/).
Economic and political freedoms are at-risk.
From the Coach’s Corner, a nonpartisan organization is working behind the scenes and doing something positive – very positive – to insure businesses have a voice:
Enterprise Washington, www.enterprisewashington.org.
I’ve met with the Enterprise Washington folks and I believe they’re nonpartisan, effective and passionate about their work.