Gregoire signals new willingness to talk taxes
As the state's projected deficit grows, the governor's new chief of staff says he "would be surprised" if the shortfall can be closed without new revenue.
State of Washington
One-point-seven billion dollars. That’s the size of the hole that’s been ripped in Washington state’s freshly balanced budget, says Jay Manning, Gov. Chris Gregoire’s newly appointed chief of staff.
Manning used that much larger deficit figure (as of a few weeks ago the number Olympia insiders were using was $1.2 billion) during an interview with me late last week on "TVW’s “Inside Olympia.”
“As far as I know that’s the hole … so it’s going to be a big number,” Manning warned. “That is going to be the consuming issue for the governor, for me, for our administration, and the Legislature as we go into this short session.”
The Legislature reconvenes in January for a 60-day, election-year session. Before that, in November, the governor and lawmakers will get updated revenue and caseload forecasts.
The revenue forecast projects the amount of tax dollars that will flow into state coffers over the next two years. The caseload forecast anticipates how much demand for state services — everything from public education to prison population to welfare rolls — will increase.
A Murphy’s Law of government is that demand for services goes up when the economy and revenues falter. In other words, after the November forecasts the shortfall could be even bigger.
In December, the governor will roll out her proposed “supplemental” budget. Think of the supplemental as the update to the state’s two-year (or biennial) budget which runs from July of this year to July 2011.
Earlier this year, majority Democrats in the Legislature patched a projected $9 billion hole through July 2011 with a combination of cuts, one-time budget gimmicks, and a big-time bailout from the feds.
There are already signs that Democrats don’t have the stomach to squeeze another nearly $2 billion out of state spending. In fact, in my interview with Manning he brought up the question of new taxes before I got a chance to ask him.
It is going to be extraordinarily difficult to figure out where these additional cuts come from. The governor last year pushed through a no-new-revenue budget and did that out of concern for what would new taxes do to families, to small businesses here in Washington. This time we’re facing that question again. What will we do in terms of revenue? Can we cut our way out of this? That discussion is going on as we speak internally and with various people and stakeholders on the outside.
Manning echoes what the governor herself said a few weeks ago, that her door is open to those who want to make the case for targeted tax increases (this could include closing tax loopholes). That’s a significant change from Gregoire’s emphatic no-new-taxes pledge during her reelection campaign last fall, and her position during the 2009 legislative session.
But Manning’s comments provide the strongest signal yet that Gregoire is seriously open to — if not already contemplating — a revenue piece to rebalance the budget. “I guess I would be surprised if this $1.7 billion hole in the budget was closed exclusively with cuts,” Manning concluded during the TVW interview.
Meanwhile minority Republicans remain firmly planted in a taxes-over-my-dead-body frame of mind and show no signs of budging. Why would they? Democrats don’t need them to pass a budget.
Even so, one Republican lawmaker is calling for a special session in December to start addressing the shortfall. Sen. Joe Zarelli, the ranking Republican on the Senate budget committee, argues the earlier lawmakers start cutting the better. But as long as the call for a special session is coming from the minority party, it’s not going to happen.
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Comments:
Posted Tue, Oct 27, 10:09 a.m. Inappropriate
Isn't there a push from the state insurance commissioner's office to have a special session in December to deal with flood insurance, too?
Posted Tue, Oct 27, 11:18 a.m. Inappropriate
The governor doesn't know how to cut the budget because she refuses to accept certain recommendations. Otherwise, it would be fairly easy. And of course, the Legislature has the same bias against common sense solutions.
Implement tort reform, eliminate joint and several liability, and implement "loser pays".
Eliminate state biofuel mandates. That would immediately save residents, business, and government money.
Let parents (and their kids) decide where their kids go to school. Give $8000 school vouchers. Let parents decide whether to go to a charter school, private school, public online school, or traditional brick and mortar school, or a blended school. Stop funding the Olympia education bureaucracy.
Decriminalize pot and get offenders out of jail and prison, and instead into treatment.
Endorse ANWR drilling, and watch 12,000 WA state jobs get created. Watch thousands more get jobs in Alaska. Watch WA's 300+ oil services companies increase sales and watch an increase in sales tax revenue.
Quit providing L&I; and other resources to illegal aliens.
Just a few...
Posted Tue, Oct 27, 11:21 a.m. Inappropriate
How big did Gregoire increase her staff from when she was elected. Start cutting there.
When you vote in 2010 for legislative and state senate candidates, consider how well they've managed the budget over the past several years. We were warned years ago to expect a recession. They mostly ignored the warnings. Why would voters want to keep repeating the same mistakes?
Posted Tue, Oct 27, 11:24 a.m. Inappropriate
Oh, and for every student a parent starts homeschooling, that's over $10,000 savings for taxpayers. And homeschoolers, on average, score much higher than traditionally taught students.
The state should be ENCOURAGING homeschooling. That's $1 million for every 100 students parents start homeschooling.
Posted Tue, Oct 27, 12:26 p.m. Inappropriate
And if we render our own wax from bee hives we can make candles for light to read by, saving on the power grid infristructure spending.
Stop supplimenting counties that choose to not raise school levies, with tax money from districts that dochoose to pass levies. Not too many Republicans embraced that "savings" last session, extending a hand out when it serves you.
Posted Tue, Oct 27, 12:36 p.m. Inappropriate
I imagine it's hard to extend a hand on anything when you are physically excluded from the budget process and negotiations that were held behind closed doors and attended exclusively by Democrats. It's your deficit,live with it.
Posted Tue, Oct 27, 2:24 p.m. Inappropriate
Oh, I mean, wanted a hand-out. There, much better.
Watching Republicans crying for a redistrution of wealth was interesting. They could have cut the budget by tens of millions of dollars but chose to run unending debate as a stall tactic on the final night of the session. Taxes are bad, except when they are not.
Posted Tue, Oct 27, 3:23 p.m. Inappropriate
As I recall they wanted some limits as to what could be spent along with scoring of the impacts of the greenhouse gas bill and others. The response from the majority?....what me worry?
Posted Sat, Nov 14, 6:10 p.m. Inappropriate
I'm a little late into this conversation but Gregoire is the WORST Governor we have ever had. She did this last time she was self elected too. Same story. Has anyone even mentioned that out of 50 States we are the 8th highest in regards to taxes? What a joke. Maybe the liberals will wake up and see she is not what Washington needs. Hey..lets let Boeing go and stand behind a notion that she couldn't have done anything and then wonder why our unemployment is so high. Maybe if everyone in office took a cut in pay like the rest of us have to keep our jobs it could help in this economy.Oh..I forgot..were talking about Democrats here..
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