Gov. Jay Inslee believes $1.26 billion is needed for legally mandated education improvements in 2013-2015 — and he proposes $1.26 billion worth of closing tax exemptions and keeping expiring taxes to do that job.
That approach will be dead on arrival in the Washington Senate, retorted Senate Republican Caucus Leader Mark Schoesler, R-Ritzville.
Inslee unveiled his budget priorities and proposed revenue-raising measures Thursday. But he stopped short of announcing a full-fledged budget with detailed expenses for the 2013-15 biennium.
He identified 11 tax exemptions for closing, which would raise $565 million for the upcoming budget. And he wants to keep an otherwise-sunsetting beer tax and business and occupation service charge, which would tally another $661 million.
"I choose, and believe we should all choose, education over tax breaks. .... I know it won't be easy. ... We'll see the evolution in people's thoughts as the numbers sink in," Inslee said.
A beer drinker himself, Inslee compared paying extra for beer with boosting education. "We've enjoyed this (taxed) brown liquid without destroying the economy. ... Everybody who enjoys a beer ought to enjoy early education more," he said.
Meanwhile, Schoesler said, "I didn't see one [tax-exemption closure] I could support today. ... It's not a choice between kids and tax breaks, but between tax hikes and bureaucrats."
The battle lines are drawing up like this.
The current 2011-2013 state operating budget has $31.29 billion in revenue, $31.13 billion in expenses, and an expected $426 million left over when the biennium ends June 30.
Meanwhile, last week's state revenue forecast predicted $32.86 billion in operating budget income under the status quo. Inslee seeks $34.66 billion in revenue — a $1.8 billion increase. Two-thirds of that increase would come from Inslee's tax-related measures, and the rest would come from transfers to the operating budget from other funds. Inslee campaigned on a promise of no new taxes. But he does not view closing tax exemptions and keeping expiring taxes as tax hikes.
Inslee wants to spend $34.43 billion in 2013-2015. That includes $17.4 billion to keep the education system at its current status, plus the additional $1.26 billion to tackle the Washington Supreme Court's requirements to install full-day kindergartens statewide and to shrink the teacher-student ratios in schools by 2018, plus other measures. Inslee's staff calculated that $531 million would be left by June 30, 2015.
The Senate's 23-Republican-two-Democrat Majority Coalition Caucus is aiming to release its proposed budget next week, but cannot guarantee that. "When we do it, we want to do it right," Schoesler said.
Schoesler declined to say what the expected total figure would be nor how much the majority coalition believes will be needed to meet the Supreme Court's education fix-it requirements. Right now, the House Republicans say $817 million is needed in 2013-2015 to meet that mandate. Inslee now has a $1.26 billion target. House budget guru Ross Hunter, D-Medina, has talked about a $1.4 billion figure. Rosemary McAuliffe, D-Bothell and ranking Senate Democrat on education matters, has mentioned $1.7 billion. Schoesler said the majority coalition's Supreme-Court-fix-it figure would "be in the range" of the House Republicans' and Inslee's numbers.
The Democratic-controlled House is supposed to unveil its proposed budget a few days after the Senate majority coalition announces its plan.
A major unknown is the Supreme Court, which will be looking over the Legislature's shoulder and can make its own determination whether that branch is following the justices' ruling.
A complicating factor is that Inslee and the Republicans appear to be using different ways to build their budgets.
Inslee built his quasi-budget proposal by taking 2011-2013 dollars figures — and then adding the dollar figures for increased population, university enrollments, medical costs and caseloads to create his baseline. From that, he then ponders whether to add or subtract money and programs.
Meanwhile, Republicans appear to take the 2011-2013 figures as their baseline, not factoring in growths in population, university enrollment, medical costs and caseloads. They appear to be using the original 2011-2013 dollar figures as the launching point to determine whether to add or subtract money and programs.
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