Saturday, November 14, 2009

Joe Zarelli, "Washington lawmakers should meet soon to deal with state budget imbalance"

Special Session, or not to have a Special Session, that is this week's question. The economy has reached a bottom and the reality of the demand on public services, and reduced revenues, are realized.

Two weeks ago Washington State Senator Joe Zarelli pressed for a Special Session, writing in the Opinion pages of the Seattle Times:
The math is straightforward: Each dollar saved in January is equivalent to a cut of $1.50 in July. Put another way, $67 million in reductions effective in January will erase a $1.2 billion gap in 18 months, when the 2009-11 biennium ends; if lawmakers wait until July, the cuts must be 50 percent deeper, or $100 million per month.

If serving our most vulnerable citizens is truly important, acting early — preserving $33 million worth of services every single month — makes sense.
There's time for legislative leaders and budget writers to prepare a spending-reduction package to take effect Jan. 1. New state caseload and revenue forecasts are due Nov. 13 and 19, respectively, and assuming they don't significantly shrink the budget gap, Gov. Chris Gregoire or the Legislature itself can call a special session for early December. Legislators will be in Olympia already for committee meetings. It would cost no more to convene quickly, bring the cost-saving package forward and adopt it.
. . .
Trouble is, soon there will be nothing to force lawmakers to reduce spending, because this year's budget punt ran enough time off the clock to send I-960 off the field.

Under our constitution, it takes a two-thirds legislative vote to amend initiative-based laws enacted less than two years earlier. Initiative 960 took effect in December 2007, so when the Legislature convenes Jan. 11, the majority party can do what it could not in 2008 or 2009: toss I-960 and raise taxes all on its own. No vote by the people, no bipartisan support or "public conversation" required, just one late-night legislative roll call and those tax-hike protections vanish.

History says bet on it. In 2002 and 2005, the majority suspended limits on government taxation and spending created by the people, most recently to allow $500 million in tax increases.

Sen. Joseph Zarelli of Ridgefield is Republican leader on the Senate Ways and Means Committee and a member of the state Economic and Revenue Forecast Council.
From the Seattle Times, Op-Ed, Joe Zarelli, "Washington lawmakers should meet soon to deal with state budget imbalance"

His points are true, he may be right, but he is in the minority party. His influence is opinion based, he does not have the power to call a Special Session, the majority party does.
Posted in the yesterday was this report:
OLYMPIA, Wash. -- Higher costs for government services have driven the state's projected budget shortfall to about $2 billion, Gov. Chris Gregoire's budget office said Friday.

And that's not all: The deficit is likely to grow even larger next week, when state economists issue a new forecast of expected tax income for the current budget period, which runs through mid-2011.
. . .
House Ways and Means Chairwoman Kelli Linville, D-Bellingham, said the Legislature will have to be open to all options, including the elimination of some state services. The Legislature largely avoided those kind of cuts last session, instead opting for across-the-board reductions and one-time budget fixes.

"Now we're down to: Do we do the service, or do we not do it?" Linville said.

The Statehouse's minority Republicans still see room for savings through a major restructuring of how the state delivers services. The GOP also says the Legislature should make those moneysaving moves quickly, rather than spending money for months on programs that will eventually have to be cut.

"Timing is everything," said Senate GOP budget chief Joe Zarelli, R-Ridgefield.

Linville agreed with Zarelli's push for quick action, and said her colleagues in the House have spent the summer compiling lists of moneysaving ideas.

She and Zarelli also agreed that the majority may look first at closing some tax loopholes, rather than straight-ahead increases of the state's sales, business, or property taxes. By CURT WOODWARD, ASSOCIATED PRESS WRITER, Washington budget short about $2B through mid-2011

The next bit of news should show up on November 19th, when the revenue forecast comes out.

It is still unlikely that a Special Session happens, but not impossible. What should be clear is that the legislature is at work, and should be ready to go on cutting some things, and working to find ways for local governments some options.
Allowing King County, and Seattle, to extend existing hotel taxes would allow both governments to shift non-core costs off core revenue streams.
Let's hope.

Have a great day,
Mike Baker

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Anonymous said...

The Gov responds ---

Anonymous said...

Well I think I've reached the final stage of grief--acceptance. After tearing my guts out watching this team leave and summarily seeing our politcal and business leaders accomplish nothing over the last years I'm moving on. I've been, and will continue to be an admirer of your clear concise writing and the future of Seattle Center and the NBA, but like Danny Westneat has said--"Were in the minority here". I've come to the conclusion that Seattle's future in regard to moving forward with the Center lies with Seattle U, the Storm, and the Rat City Rollergirls and I say good luck with that, I hope the city and Nick Licata can squeeze every penny out of those forms of entertainment. I may check out a Seattle U game in the future but as far as my participation in the diversity and revenue contribution to lower Queen Anne I'm pretty much done there. Time to move on. I don't plan on becoming a Sounders FC fan, but I'll find something else to do. I guess those bastards were right. Take care and good luck.

Anonymous said...

Mike - I e-mailed Kohl Welles just to see if there was anything in the works. She gave me her typical "still working on it but it's not looking good" response. You hearing anything?

Mr Baker said...

No, nothing yet. I have sent out a few emails.

Dow needs to step up for the county here. They have no good options.

Anonymous said...

Any responses to your e-mails, Mr. B?

Mr Baker said...

No, not really expecting one.

Anonymous said...

Saw your entry on the SOS site. I take it you haven't heard anything new? Seems like there is now zero hope of something by year end.

Mr Baker said...

I do not see a special session happening.
Clay will be off the hook. He would have been off the hook either way.
In January I expect the county to be pressuring the state for help, there is a chance something could happen there. I think Steve Ballmer is still in, the question is where an arena happens. I think you see others move on if the legislature does nothing in the 100 day session.

Anonymous said...

I predict that the leglislature will "regretfully" raise taxes with full endorsement from SEIU, WEA and the IAW big shock I know. How do you think this relates to allowing King County to use its taxing authority? And on another note. Billy Hunter is playing his case in the media regarding the CBA and he's scared...very scared.

Mr Baker said...

The real news in that SI story is that it was wriien by Frank Hughes.
He has a job.

Anonymous said...

Yeah how about that? Good for Frank. I think a lock-out is inevitable though. Which once it's resolved might work in our favor....Provided we have a venue that is.

Mr Baker said...

Billy Hunter can't say what his position is because he doesn' have one.
The league has to be asking for much more than the 50-50. The owners a living with all of the downside.

What are the players going to do, strike?
Where is that line in the sand?
The league needs to find it, and go there.