Posts published in October 2011

In times good, not everyone benefits equally, and in times bad, not everyone suffers the same - sometimes, not at all. Not everyone has been faring badly these last few years, just a lot of people.

In the Tacoma News Tribune today, columnist Peter Callaghan writes about Governor Chris Gregoire, who has proposed a mass of big spending cuts in state government, and is angry about it. Angry among others, it turns out, at local government.

Many local governments, she indicated, have been doing much better than state government, and have even been raiding state government for key employees.

Callaghan: "I asked staffers for some examples. A chief information officer for a state agency was hired by King County for a $115,000 pay raise. That person’s assistant went, too, for a 50 percent hike. Pierce County hired a chief financial officer from the state for a $20,000 raise. Tacoma hired a chief financial officer away for a 20 percent raise and more vacation. Seattle hired three state tax auditors for raises between 20 percent and 25 percent. A senior information technology worker left the state for a 15 percent raise with the Port of Tacoma. Gregoire is beyond seeking sympathy. She surely realizes that many residents of the state continue to view the bureaucracy as a part of the problem. But she doesn’t think residents realize that state workers have suffered more than other governments’ employees."

Why would this be happening? Maybe in part because Washington state government relies heavily on sales and business & occupation taxes that have been sliced by the bad economy, while local governments have been supported more by property taxes, which haven't taken nearly so large a hit.

Point being this: The state legislature, which will arriving in a month, will have authority to make some adjustments. Will Gregoire ask for them? And have the local governments enough clout to fend them off if she does?

Governor Chris Gregoire's proposal for the legislative special session next month includes loads more cuts and no revenue increases - tax or other increases. She's not going there, on her own at least.

But she also included language in her statement that if the Legislature wanted to include revenue increases, she wouldn't necessarily stand in the way.

There's what looks like a complex set of dance steps on the Washington revenue front. Depending on how it plays out, Republicans might wind up with some bitter medicine which they mixed all by themselves.

Although Democrats control both House and Senate, they lack the two-thirds vote that a Tim Eyman initiative requires for a tax increase - and the Republicans definitely ain't going there. But there is another option: Run a ballot issue asking the voters to increase taxes.

This seems problematic at first. But voters approved a challenged gas tax not many years ago. The point could be made that the state has in fact cut billions from spending, and the further point of what consequences would be if another $2 billion in cuts (Gregoire's initial proposal) are made. Let them make the policy choice ... and it wouldn't be a surprise, really, if they went for taxes under the circumstances.

That's not a foregone conclusion, of course. But considering Washington's overall temperament, and the recent change in discussions (assuming it didn't shift again) toward social needs, an approval would not be a great shock.

And it may happen. There's this quote out today, for example, from Senator Ed Murray, D-Seattle: "We have to write a budget that actually balances, with draconian cuts in it. My hope is to ask the voters to get some of those cuts back."

If voters did approve such a tax, that would severely blunt the Republican message during a key election cycle. As a political dynamic, it's not hard to imagine Democrats glomming on to it.

Washington Governor Chris Gregoire's office described the list of nearly $2 billion in state budget cuts - a response to revenue shortfalls - as "a starting point to the conversation," ahead of the special legislative session starting a month from now (November 28). It could be highly useful, as a starting point - and if blanks are filled in.

The proposals, dozens of slices ranging in size from six figures to nine, carry all sorts of possible implications. One of those is simply the expenditures averted, and those are listed carefully, item by item. The implications and future costs of those cuts, though, seem to be skimmed over. And therein lies the usefulness of some real discussion. Some cuts could probably be made without much blowback, and a few are accounting shifts (noting for example that putting out wildfires cost less this year than expected). But others - most - are likely to result in real damage to the state and people in it, and there ought to be some accounting of that, and what it means for the future.

Gregoire remarked, “I expect additional feedback from communities and various stakeholder groups that I will certainly consider before I present a more complete budget next month. This list will likely change before then. But not much – our options are limited. We’ve already cut $10 billion from state government over the last three years, which leaves very few options moving forward. I said the work of slashing our budget by another $2 billion would be dreadful, and that’s what it is. Washingtonians are going to get a lot less of what they need.”

The implications of getting "what they need" are a lot different from getting "what they want." Let's take a few examples from the scores of cuts.

▪ "Eliminate state funds for domestic violence programs - $9.4 million. Terminates state funds for domestic violence shelters that serve about 16,700 individuals annually. Retains funding for non-shelter services." You can pay now or pay later on combatting domestic violence - there's no other option. And when you pay later, it'll be a lot more. Not to mention the human suffering between here and there.

▪ "Reduce chemical dependency services - $14.5 million. Reduces out-patient and detoxification chemical dependency services for 11,000 low-income clients." Same comment, maybe more emphatically: Higher costs, more crime, more complex and difficult solutions for problems as they fester and worsen.

▪ "Change eligibility for Children’s Health Insurance Program $145.0 million. Terminates funding for 134,000 categorically needy children, as defined by the Medicaid program, above 150 percent of the federal poverty level, which is $33,525 for a family of four. Families will have the option to purchase full health care coverage at 100 percent of the premium." More people getting sicker ... is additional comment really needed? This is one of the places where still-higher health care costs come from.

▪ "Eliminate Disability Lifeline medical program - $110.0 million. Ends medical services to 21,000 clients enrolled in the Disability Lifeline and ADATSA (Alcoholism and Drug Abuse Treatment Support Act) programs." And what happens to the alcohol and drug abusers then? Not hard to imagine.

▪ "Reduce shellfish harvest and management - $536,000. Reduces clam and oyster seed planting on public beaches by 30 percent, resulting in a 20 percent reduction in recreational harvest within two to three years. Eliminates two Puget Sound crab and shrimp managers, which will delay openings for winter crab fisheries and lowered catch limits." An example of how state expenditure cuts stand to directly affect private businesses - although in fact, a great many of these cuts would have business-problematic effects.

There have been some counter views. One from Remy Trupin of the Washington State Budget and Policy Center: "We cannot create jobs and get our economy back on track through deep cuts to education, health care, and social services. This one-sided, lopsided approach will do significant damage to the very things that make our state a good place to live, work, and do business."

As noted, Gregoire made mention of no revenue options, as a way of stanching some of these cuts. It's unclear whether more than a handful of legislators will.

Hot times in Tacoma over big boxes: The city council is considering a moratorium on approving construction of new stores over 65,000 square feet in size. Continuing a moratorium, that is - the original six-month ban started on August 30, when the city council declared an emergency.

The council held a hearing on the moratorium on Tuesday night, and the circumstances were such (especially in this environment of encouraging any and all new businesses) that anti-moratorium arguments should have been at a peak. If they were, the big boxers should be concerned: Testimony was overwhelmingly in favor of continuing the ban, and quite a few speakers wanted to make it permanent.

(A quote from one resident: “If we are to build a resilient community that will not just survive but thrive … we need to think outside the big box and think inside the circle of community.”)

A Walmart application was the specific trigger for the action, but it would apply to any retailer seeking to build upwards of 65,000 square feet.

One of the opponents of the moratorium, as you might expect, is the Tacoma Chamber of Commerce, which bases its position in part "on there being an emergency because our regulations fail to address some issue. I've yet to hear any specific issue raised that is not addressable through existing regulations. Traffic, public services, parking - all there. Now, just because a tool is there does not mean it's going to be used. But failing to use it does not mean it is not there."

That sounds true enough, but it's a bit of a legalistic approach: Evidently quite a few people seemed to think there was, as a practical matter, an emergency. Or at least the need for a slowdown, and consideration of whether new big boxes really add to the economy, or just move money around, and into ever-fewer hands.

Some talk about Washington Republicans that there's no need for a 2012 legislative session. And you can almost imagine some Democrats pausing a moment and thinking, hmm ...

From an email release out Monday:

Washington State House Republicans are urging lawmakers to come prepared to go to work quickly when they convene for a special session on November 28. Rep. Richard DeBolt, R-Chehalis, today said the only two pressing issues the Legislature needs to address this year is adopting a sustainable supplemental budget and reforms that will get Washington working again. And while these are big challenges, DeBolt said if the Legislature can tackle those two objectives during the 30-day special session, it could adjourn for the year and forego the 2012 60-day regular session. He noted the Legislature would save taxpayers more than $2 million by skipping the regular session.
“The last thing Washington citizens need is for 98 lawmakers to come back to Olympia in January for a 60-day regular session and consider bills that end up costing taxpayers money we simply don’t have,” said DeBolt. “If we come to town and get our work done in December, there is no compelling reason to come back a few weeks later.”
The Legislature is scheduled to convene on Nov. 28 to correct a nearly $2 billion state budget shortfall and when it does House Republicans will be advocating for a package of bills aimed at getting Washingtonians working again.

There may be some temptation along these lines for Governor Chris Gregoire. You can imagine her thinking: Wouldn't it be such a nice several months if they weren't here ...