Voters say, 'No new taxes!'
 

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posted Friday, November 5, 2010 - Volume 38 Issue 45

Voters say, 'No new taxes!'
Governor says, 'Everything's on the chopping block!'

by Mike Andrew - SGN Staff Writer

While Democrats will remain in control of the state legislature, they may wish that someone else was in charge when they try to solve the state's ongoing budget problems.

Washington state voters certainly didn't help them on Election Day.

This year, voters killed a proposal for a state income tax on individuals earning more than $200,000 or couples earning more than $400,000 per year.

I-1098 would have brought in an estimated $1.7 billion in additional revenue, according to the Washington State Budget and Policy Center. About 45% of that total would have been allocated to education, 21% for property tax relief, 19% for healthcare funding, and 15% for tax credits to businesses.

Nevertheless, voters turned it down two to one.

Voters also killed a tax on candy and soda enacted by the legislature this year. I-1107 was estimated to cost the state $352 million, and local governments $83 million over five years.

I-1107 also passed by almost two to one.

Finally, voters passed the latest Tim Eyman production - I-1053.

An attempt to revive Eyman's I-960, which was passed by voters in 2006 and suspended by the legislature in February, the measure requires a two-thirds supermajority in both houses of the legislature to increase taxes.

Under state law, the legislature may suspend or repeal initiatives at least two years after they pass. I-960 was suspended so the legislature could vote new taxes - including the candy and soda tax - to cope with a projected $2.6 billion budget shortfall.

Although opponents argued that the measure would make it impossible for the legislature to raise revenues to balance the state budget, voters approved I-1053 by almost two to one.

A glum Gov. Chris Gregoire said on election night that voters had created a very difficult situation for state officials.

'I wish the voters had helped us out,' Gregoire said.

'Everything in on the chopping block,' she added, even Washington Basic Health and higher education.

'I don't have a path forward, to be honest with you. I am heart wrenched over the fact that we are cutting hospice care and children's health care and education,' said Gregoire. 'We are going to have to work together in a bipartisan way if we are going to get some solutions.'

Absent the ability to raise taxes to balance the budget as she is required by law to do, Gregoire said, all state programs are in danger of cuts.

'We are currently closing a $520 million budget gap and going into the next biennium we face at least a $4.5 billion shortfall,' Gregoire said in a statement the day after the election. 'The additional cuts we will have to make due to this loss of revenue will have significant consequences.

'I am committed to transforming the budget as Washington moves forward. We know we can no longer afford many of the programs and services that Washingtonians rely on. I look forward to working with elected leaders of both parties, as well as the public, on finding solutions to our budget crisis.'

Legislators echoed the governor's concerns, but said there might be a way out of the crisis if voters will consent to raise taxes for specific programs.

Sen. Ed Murray (D-43), chair of the Senate Democratic Caucus, said that voters don't want new taxes, but he believes they still want services the state provides.

'What I worry about is we are in danger of cutting in such a way that we'll hurt the economy of this state' by cuts to education, Murray said.

He added that he'd like to see the Legislature go back to voters next year with tax proposal initiatives to fund specific state services.

Rep. Jamie Pedersen (D-43) told SGN that the legislature finds itself 'at the point where things that are mandatory take up the whole budget - things that are mandated by the constitution or by federal requirements.'

'The math is bad,' Pedersen continued. 'There's not much question of adjusting the budget. We'll have to put together a proposal to put to the voters on how to avoid the worst cuts.'

'I've never been under the illusion that this would be an easy job,' Marko Liias (D-21) told SGN. 'For the legislature, there are very, very, very few options.'

'We have to govern with the values we expressed in the campaign - with compassion. We have to make sure that the most vulnerable are cared for,' Liias added.

Pedersen agreed. He was glad Democrats retained their majority in the legislature, he told SGN - even in spite of the challenges - because, 'Honestly, there is a big difference in values' between Democrats and Republicans.



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