Offering frequent news and analysis from the majestic Evergreen State and beyond, The Cascadia Advocate is the Northwest Progressive Institute's unconventional perspective on world, national, and local politics.

Wednesday, October 14, 2009

Thanks, Danny Westneat, for helping us reveal the ugly truth about Tim Eyman's I-1033

For the past few weeks and months, NPI and our good friend Steve Zemke over at MajorityRules have been trying to focus some attention on what we've been calling the most unfair aspect of Initiative 1033: its reverse Robin Hood wealth distribution fund, which takes the siphoned sales taxes that I-1033 prevents from being invested in essential services (thereby freezing services) and redirecting them to pay for a special property tax cut for the rich.

To date, we haven't had much luck getting the traditional press to tell the story, (although the Seattle Times editorialized a bit on it last week) but today, Danny Westneat has heroically come through with a fantastic column, one of his finest efforts ever, entitled, I-1033 a windfall for the rich.

Westneat not only takes the trouble to explain to Seattle Times readers how I-1033 eventually cancels out the state's school levy by redirecting sales taxes to pay rich people's property taxes, he provides dollar figures:
  • [I-1033 would] eventually give the richest man in the world, Bill Gates, up to a $571,000 break on the $1 million in annual property taxes he pays on his Medina mansion.
  • Slash the taxes on billionaire Paul Allen's waterfront home, on Mercer Island, by up to $150,000.
  • Over time eliminate $1.7 million of the annual property taxes that Bellevue mogul Kemper Freeman pays on just one of his malls, Bellevue Square.
That's due to a growing sense among tax experts that Eyman's measure, if approved in November and then left as is by courts and lawmakers, would over time drive the state's property tax and many county and city property taxes all the way down to zero.

Yep, zero. As in: Property tax for those entities, over the next decade or so, would cease to exist.
Westneat later explains that he obtained tax records for local "gazillionaires" from the King County Treasurer (which are itemized by level of government) to discern just how much of a special tax cut Initiative 1033 would give them.
Gates, for his 50,000-square-foot, $150 million mansion, is paying $294,000 into the state's school fund this year. He pays $165,000 to King County and $112,000 to the city of Medina. All or most of that would eventually stay in his pockets if I-1033 were enacted.

That's a nearly 60 percent property-tax cut for Gates. Same for Allen. For Freeman's Bellevue Square Mall, the estimated tax break is $1.7 million, annually. This doesn't include his Bellevue Place or Lincoln Square malls across the street, because I got weary adding up the enormous net worth of his shopping boutiques.
Westneat calls Tim Eyman's wealth redistribution fund "the rotten core" of Initiative 1033, which is precisely how we've been talking about it. He writes:
Forget all the caterwauling about spending cuts. At its heart this is a massive giveaway to the rich that does little to nothing for the poor.

To their credit, both Gates and Allen appear to know this. They are trying to defeat Eyman's initiative (Gates with a $100,000 donation, Allen through his company, Vulcan.) Even though it would mean huge tax windfalls to them if it passes.

I have a feeling it's because they actually believe that quote Gates repeats so much: "To whom much is given, much is expected."
Gates' father, it should be noted, served as the chair of the Washington State Tax Structure Study back in 2002. The study concluded that Washington's tax structure was incredibly regressive and in dire need of reform.

And as for that other guy:
Kemper Freeman? Not so much. He gave Eyman $25,000 for this, Eyman's 16th stab at an initiative. As near as I can tell, it's the one of all Eyman's schemes that benefits rich land owners like Freeman the most.

Twenty-five grand for a shot at $1.7 million a year. You gotta hand it to Freeman — if this passes, that's one helluva return on his investment.
Couldn't have said it better ourselves.

Big, big props to Danny Westneat for writing this column. We at NPI were so overjoyed by this column that we felt like shouting Hallelujah from the rooftops this morning. It was an immensely gratifying to open the paper this morning and read that column. The truth needs to be told: Tim Eyman's Initiative 1033 is not just dangerous; it's dangerously unfair. It would cancel out our state's schools levy and leave us on dependent on the sales tax to fund what's left of our essential public services after they've been eviscerated.

That's not, as Governor Gregoire has said, the future we want for Washington State. Vote NO on Initiative 1033.


Blogger OneLiberalVoice said...

While this commentary focuses on the effects of this initiative on the wealthy, I'd appreciate knowing how it affects the average homeowner. We're not all rich just because we own a home. Many of us are underwater on our mortgages, etc. etc.

October 14, 2009 12:49 PM  

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