Last summer the legislatures of Oregon and Washington took very different tacks while attempting to balance recession-wracked budgets. The Oregon legislature passed two major tax bills to raise about $727 million; the Washington legislature rejected tax increases in hopes of finding other ways to avoid a 2010 meltdown.
As I mentioned in a June 15 posting in this space, Democrats — who control both legislatures — took opposite paths, and both rolled the dice with the voters. With ballot results due on Tuesday (Jan. 26) in Oregon, legislators in Olympia will be watching results in hopes of picking up pointers.
Oregon's strategy appears to be winning. A poll released Tuesday by respected Portland pollster Tim Hibbitts shows both of the measures passing with votes to spare. Hibbitts is typically cautious, warning that tax votes are always volatile, but an income tax on high-earners has a 49-38 percent margin of approval and a corporate tax hike has an identical margin.
Hibbitt's margin of error is plus or minus 4.4 percent, meaning the results could be off by that much in either direction. Both results are well outside the margin of error. To add to the impact, 45 percent of the voters Hibbitts surveyed had already mailed their ballots when the survey was conducted Jan. 14-15.
As if to reinforce his caution, a follow-up Hibbitts poll released Friday showed the gap was narrowing, as final ballots are mailed. The Friday poll showed Measure 66 at 50 percent favoring a higher income tax and 44 percent in opposition — outside the margin of error. But Measure 67, an increased corporate tax, was favored in a 48-45 split, inside the margin of error, making it too close to call.
However, The Oregonian’s Jeff Mapes also reports a poll by Eugene pollster Rick Lindholm, showing the two measures are favored 50-39 percent and 51-40 percent, respectively. I don’t know Lindholm’s work, but I have always had confidence in Hibbitts, so at least the corporate tax may depend on turnout, particularly in Portland’s Democratic neighborhoods.
Oregon's Democratic leadership had hoped to avoid this month's election, but business interests conducted a referendum and placed the measures on the ballot. At least one early poll, in December, showed support for both measures leading, but well below 50 percent. It appears that undecided voters, at about 25 percent, swung heavily to the tax measures. That is unusual: Support for tax votes in Oregon normally declines as the election approaches, and most have been defeated.
Could Washington legislators have taken a similar path in 2009 and, more critically, will they opt to do so this year? That is the huge question for Olympia. In May 2009, Democrats adjourned with much breast-beating about how they had avoided Republican charges of "tax and spend" with a variety of one-time money and budget cuts. "All of us were miserable together when we made the very difficult choices for the people of the state of Washington," Gov. Gregoire said as she signed the budget.
Now it appears that the Oregon legislature can avoid a special session to deal with the defeat of its tax measures and spend the next several months praying for rain. In Olympia, a $2.6 billion gap in the state budget forces Democrats to consider at least some tax increases and grapple with Initiative 960's requirement for a two-thirds vote to pass a tax bill without sending it to the voters. Oregon has a 60 percent requirement, which the Democrats were able to reach in 2009. But voters had the final say in any event, via the referendum.
Looking at what appears to be happening in Oregon, what possible lessons could there be for Washington legislators? First, a caveat is necessary. Oregon is weirdly counter-cyclical in terms of its politics. When I first began covering Oregon politics, Barry Goldwater had just driven the Republican wagon into the ditch in his 1964 presidential campaign and Democrats were resurgent everywhere. Except in Oregon, where Republicans overturned Democratic control of the Legislature and began nearly a decade running the Oregon House.
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