Big Challenges face lawmakers returning to Olympia
Washington lawmakers are sharpening their pencils and their battleaxes today as they descend upon Olympia for the start of a most likely heated 2009 legislative session. During the 105-day period legislators must figure out a way to maintain necessary state services and create new jobs, while not raising taxes. With a $5.7 billion projected budget deficit, something will have to give.
On the table right now is Governor Gregoire’s proposed budget which makes drastic cuts to health and social services, education and state employee salaries. Sadly enough, the governor has received the most praise for the budget that she calls “ugly” from Republicans. They are relishing this opportunity to decrease the size of state government and to push for less regulation.
If lawmakers want to create jobs the best method they have is by investing in people and infrastructure. Unfortunately, many of the cuts planned by the governor will have the opposite effect, and the state will probably decrease its own payroll by up to 2,600 workers over the next two years. Gregoire and many lawmakers are banking on a share of Obama’s stimulus plan to fund state infrastructure improvements. Senate Majority Leader Lisa Brown would like to see this money go to transportation projects like roads and bridges, and technology improvements like electronic medical records and improved broadband access to rural communities.
Only spending cuts have been officially proposed so far, but what other revenue options are available to the legislature?
Taking on more debt won’t be an option, even though, contrary to popular belief, Washington isn’t required to pass a balanced budget. The governor is required to submit a balanced budget (as she did) but the legislature doesn’t have to approve one. Despite this fact, most lawmakers will agree that taking on debt to pay for daily operations isn’t good fiscal policy and the final budget will probably be balanced.
Gregoire ran her 2008 campaign on her pledge of no new taxes and she seems prepared to stick to that, but that doesn’t mean that the legislature will. In fact, Democrats are mumbling about a variety of ways that they can raise a little more cash, from a temporary increase in the state sales tax to a tax on services from doctors and lawyers. Some Democratic voters would like to see some legislative chutzpah on a state income tax, a more progressive and steady source of income than Washington’s tax current system contains. Unfortunately, it will take an enormous grassroots effort to make any progress on that front.
A great option that Gregoire has been heard to reject but that NPI advocates is to eliminate state tax loopholes and exemptions that have overstayed their welcome. From The Olympian:
It will be March before we know what sort of revenue options the legislature will try. By that time we will know how much federal stimulus money we will get and the latest state budget forecast will be out. Until then, let the games begin!
On the table right now is Governor Gregoire’s proposed budget which makes drastic cuts to health and social services, education and state employee salaries. Sadly enough, the governor has received the most praise for the budget that she calls “ugly” from Republicans. They are relishing this opportunity to decrease the size of state government and to push for less regulation.
If lawmakers want to create jobs the best method they have is by investing in people and infrastructure. Unfortunately, many of the cuts planned by the governor will have the opposite effect, and the state will probably decrease its own payroll by up to 2,600 workers over the next two years. Gregoire and many lawmakers are banking on a share of Obama’s stimulus plan to fund state infrastructure improvements. Senate Majority Leader Lisa Brown would like to see this money go to transportation projects like roads and bridges, and technology improvements like electronic medical records and improved broadband access to rural communities.
Only spending cuts have been officially proposed so far, but what other revenue options are available to the legislature?
Taking on more debt won’t be an option, even though, contrary to popular belief, Washington isn’t required to pass a balanced budget. The governor is required to submit a balanced budget (as she did) but the legislature doesn’t have to approve one. Despite this fact, most lawmakers will agree that taking on debt to pay for daily operations isn’t good fiscal policy and the final budget will probably be balanced.
Gregoire ran her 2008 campaign on her pledge of no new taxes and she seems prepared to stick to that, but that doesn’t mean that the legislature will. In fact, Democrats are mumbling about a variety of ways that they can raise a little more cash, from a temporary increase in the state sales tax to a tax on services from doctors and lawyers. Some Democratic voters would like to see some legislative chutzpah on a state income tax, a more progressive and steady source of income than Washington’s tax current system contains. Unfortunately, it will take an enormous grassroots effort to make any progress on that front.
A great option that Gregoire has been heard to reject but that NPI advocates is to eliminate state tax loopholes and exemptions that have overstayed their welcome. From The Olympian:
The budget policy center [the Washington State Budget and Policy Center] wants lawmakers to take a close look at eliminating some of the 100 tax breaks passed by the Legislature between 1995 and 2007. Combined, they will cost the state $1.6 billion in the 2009-11 budget period, the center says.Eliminating these loopholes one hundred percent would cover over a quarter of the projected $5.7 billion deficit. It is certainly worth serious consideration.
It will be March before we know what sort of revenue options the legislature will try. By that time we will know how much federal stimulus money we will get and the latest state budget forecast will be out. Until then, let the games begin!
# Posted by Kathleen : 3:21 PM
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