Center for Government Reform
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Launched in 2007, the Center for Government Reform’s mission is to partner with stakeholders and citizens to work toward a government focused on its core functions while improving its transparency, accountability, performance, and effectiveness for taxpayers. The Center's objectives include using the power and principles of the free market to change and improve the culture of government, focus government spending and programs on its core functions, adopt structural budget reforms, ensure taxpayers dollars are spent efficiently and effectively, adopt government transparency reforms and ensure government remains open and accountable to the citizens it serves. |
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Government Reform Publications | Government Reform Blog
2010 Legislative Briefing
Jason Mercier discusses reforms needed to address the state's budget deficit at WPC's 2010 Legislative Briefing.
Lawmakers Cannot Count on Sin Taxes for Budget Relief
January 26, 2010
In an effort to increase revenue, some lawmakers are proposing an increase in so-called “sin” taxes in hopes of killing two birds with one stone. They want to discourage people from engaging in certain behaviors, like smoking, drinking, even overeating, by making it more expensive to purchase products related to these behaviors. At the same time, they want to alleviate state budgetary pressures with the additional money they hope to collect from higher sin taxes ...
Tax increases will cost more Washingtonians their jobs
January 11, 2010
Today Washington Policy Center (WPC) is running a full-page ad in The Olympian warning lawmakers about the impact of tax increases. The ad uses information from Washington Research Council’s new study, “The Economic Impact of Hiking Taxes to Close the Budget Gap.” “As legislators wrestle with the state budget shortfall, it’s important that they recognize the effects of tax hikes on job preservation and creation,” says Dr. Kriss Sjoblom, VP for Research and Economist with the Washington Research Council. According to the study, increasing the state Business and Occupation tax (B&O) by $1 billion would eliminate up to 15,072 jobs. A $2.6 billion B&O tax increase would cost 38,968 Washingtonian’s their jobs ...
KING 5 TV Up Front January 10 episode 2010 Legislative Preview
Jason Mercier is interviewed about the state’s budget deficit and tax increases, beginning at approximately the 12 minute mark.
Budget solutions will require tough decisions and real reforms
Seattle Times
Some leaders in Olympia are telling Washingtonians to shoulder a higher tax burden or the most vulnerable people in our state will suffer. This threat is built on the assumption that everything we're paying for today should be continued indefinitely, and vital government services must be delivered exactly the same way today as they were in the last century. Focusing on new taxes as the solution, however, demonstrates an unwillingness to re-evaluate which programs are in fact core functions of government and which are low-priority spending that we've grown accustomed to but can no longer afford. Complicating the debate is a failure to address the full budget problem. Though the current $2.6 billion deficit is capturing the headlines, the state is facing at a minimum a three-year budget problem ...
How Competitive Contracting Can Help Balance the Budget without Raising Taxes
Washington lawmakers again face a multi-billion dollar budget deficit, meaning they will either increase the amount of money they collect from citizens each year, or re-evaluate the way they deliver core services to the public. Increasing taxes during a recession would add economic hardship, while changing the way services are delivered offers part of the solution to closing the deficit without raising taxes. One tool available for improving service delivery is Washington’s competitive contracting law, passed as part of civil service reform and signed by Governor Gary Locke in 2002. In practice, however, state managers rarely exercise their statutory contracting out authority, meaning an important provision of the 2002 civil service law remains largely unused ...
The Columbian: It's the taxpayers' money that the governor ponders as budget woes worsen
(12/11/09)
The Seattle Times: Washington state's finances require long-term solutions
(12/11/09)
Governor's budget proposal results in $2.8 billion deficit for 2011-13
Governor Gregoire today released her proposal to close a projected $2.6 billion deficit in the current budget. While she is to be commended for starting the conversation on the type of changes needed to reset state spending, she failed to identify the changes necessary for a truly balanced and sustainable budget. The Governor acknowledged that the state is facing at a minimum a three-year problem. In fact, assuming her budget is adopted, a $2.8 billion deficit is projected for the 2011-13 biennium. Here is the 4 year budget outlook provided by the Office of Financial Management ...
WPC recommendations to Open Government Task Force
The Open Government Task Force created by State Auditor Brian Sonntag and Attorney General Rob McKenna met October 5th to discuss alternative ways to enforce the state's open government laws. Currently the only option available to citizens is to file a lawsuit if they disagree with an agency's opinion on whether a record should be disclosed. Opening the meeting State Auditor Brian Sonntag noted there has to be a better way for citizens to access government records without having to resort to lawsuits. Attorney General Rob McKenna agreed highlighting the fact that every other area of law has an administrative mechanism for addressing concerns...
Olympian joins the Seattle Post-Intelligencer in endorsing WPC's recommendation for searchable tax website
An October 2, 2008 editorial from the Olympian endorses WPC's recommendation for the state to create a searchable tax website where Washington residents can easily search to see all the taxes they are subject to and their total tax burden. The Seattle Post-Intelligencer endorsed the idea on August 18, 2008.
Learn more about WPC's recommendation for a tax transparency website here
Below are the recent updates from WPC’s new blog Olympia Policy Watch, a blog focusing on government reform and fiscal news coming out of the state capitol in Olympia. To receive these updates as they are posted, sign up for the blog’s RSS feed here.
Washington State Open Government Conference (co-sponsored by WPC)
Saturday, January 16, 2010 - 8:30 AM – 2:00 PM
University of Washington – Seattle Campus
Learn your rights to open government and get practical tips on exercising them at the federal, state, and local levels. Hear the latest on court battles, issues expected at the 2010 state legislative session, and the Obama administration’s open government initiatives. Network with other community leaders, and meet the most knowledgeable experts in the field, all at the Washington State Open Government Conference, in spectacular surroundings on the University of Washington campus.
The January 16 conference begins with a keynote speech by Hon. Rob McKenna, Attorney General for the State of Washington, a leader in the effort to heed and strengthen open government laws. The luncheon speaker is Heather Brooke, an award-winning journalist and author, and graduate of the University of Washington, whose pioneering use of open records laws exposed widespread misuse of public funds by members of the British Parliament and will soon be featured in a BBC TV satirical drama, "Bringing Down the House" . . . READ MORE
Tuesday, January 5, 2010
Workers' Comp audit released
The State Auditor is required by law to conduct annual audits of the financial statements and actuarial assessments of the Workers' Compensation Fund. The latest audit shows that the Workers' Comp funds may be heading towards insolvency within as little as two years. The workers' compensation system is made up of three components: the Medical Aid Fund, which pays for medical care for claimant; the Accident Fund, which pays non-medical claim costs such as wage replacement benefits, most vocational rehab, and disability and survivor benefits; and the Pension Reserve Fund, which pays benefits to all permanently disable pensioners. Both employers and employees pay L&I premiums. It is no surprise that the contingency reserves for the Workers' Comp trust fund dipped substantially during the time in question (July 1, 2008 through June 30, 2009) given what happened with the stock market and the economy in general, as the audit points out . . . READ MORE
No session would be complete without the obligatory income tax proposal. Senators Rosa Franklin (D-29) and Joe McDermott (D-34) have introduced SB 6250 and SJR 8219 to fulfill this annual session prerequisite. Here is the intent section for SB 6250: "It is the intent of the legislature in adopting this title to provide the necessary revenues for the support of vital state services on a more stable and equitable basis." It will be interesting to hear how this income tax proposal will be able to fulfill this intent and succeed where other income taxes have failed. I'm sure other income tax states such as California will be eager to learn how to make income tax revenue recession proof.
Can budget savings be found in changes to sick leave cash out?
With Washington facing a short term $2.6 billion budget deficit, all savings opportunities should be on the table. One possibility is to change the practice of allowing state employees to carry forward and cash out unused sick leave. According to the state's budget transparency website, Washington paid out $65.3 million in unused sick leave during the 2007-09 biennium. The state has already paid out $13 million since the 2009-11 budget started in July . . . READ MORE
Washington's annual financial report released
The Office of Financial Management has released the state's 2009 Comprehensive Annual Financial Report (CAFR). Some of the details of note: "Governmental activities resulted in a decrease in the state of Washington’s net assets of $2.2 billion. A number of factors contributed to the decrease: Tax revenues decreased $893 million in Fiscal Year 2009 as compared to Fiscal Year 2008. While certain tax sources showed moderate increases, sales and use taxes reported a decrease of $1.0 billion . . . READ MORE
States face at least $405 billion unfunded liability for retiree health benefits
While states attempt to deal with their short term budget problems, elected officials must not lose sight of the long term obligations being placed on taxpayers. Highlighting this fact is this report from the U.S. Government Accountability Office (GAO) on state and local government retirement health benefits (OPEB - Other Post Employment Benefits): "We found that the total reported unfunded liabilities for OPEB (which are primarily retiree health benefits) for state and select local governments exceed $530 billion. The $530 billion includes about $405 billion for states and about $129 billion for the 39 local governments we reviewed . . . READ MORE
Faced with closing a projected $2.6 billion budget deficit, lawmakers have been told that 70% of their budget options are off limits meaning reductions need to occur in only 30% of spending. Here is how Governor Gregoire describes this dilemma: "Parts of our state’s budget, including basic education, debt service and pensions, are considered ‘protected’ because of constitutional mandates require these cost be paid. Other parts are considered protected, too, due to requirements imposed by the federal government when the state accepted funds under the American Recovery and Reinvestment Act, primarily in Medicaid and higher education." A recent federal audit conducted by the Government Accountability Office (GAO), however, noted that states may seek a waiver from the "stimulus strings" for Education State Fiscal Stabilization Funds. According to GAO . . . READ MORE
State Auditor releases update on performance audit recommendations
State Auditor Brian Sonntag this morning issued a report highlighting the status of performance audit recommendations made to date. According to the report: "From February 2007 through June 30, 2009, performance audits identified nearly $3.6 billion in cost savings, unnecessary expenditures and economic benefits. Some recommendations have a financial impact, such as past costs that were questionable or avoidable, those with future cost savings and recommendations with future revenue opportunities. The figure below is focused on recommendations with future revenue opportunities or future cost savings that can be realized when the recommendations are implemented. We made 214 recommendations with future cost savings or revenue opportunities; 67 percent of those recommendations have been fully or partially implemented or are in progress, as shown below . . . READ MORE
State Auditor: "Opportunities for Washington"
The State Auditor's Office this morning released a report titled "Opportunities for Washington." In a letter to citizens State Auditor Brian Sonntag wrote (in-part):"I am pleased to present to you 'Opportunities for Washington,' our performance review of state government operations. For such a time as this, state government has an opportunity and a need to significantly change how it does business. As Governor Gregoire and the Legislature deal with the state's difficult financial challenges, this review reflects our first such effort to help. It contains ideas and recommendations to save money, to streamline government programs and functions and to provide better service to citizens. The review also identifies areas in which we can direct performance audits in the near future. Those audits are intended to identify actionable efficiencies . . . READ MORE
Newspapers comment on Governor’s budget proposal
Reactions to Governor Gregoire's proposed supplemental budget have been decidedly mixed. Beneficiaries of the programs identified for elimination have warned taxes should be raised instead of making the cuts. The majority of the state's newspaper editorial boards, however, warn that tax increases should be the last resort and state spending must be reformed first. Here are the editorials to date . . . READ MORE
Unemployment Insurance taxes to increase 54% in 2010
The Employment Security Department (ESD) today announced that Unemployment Insurance taxes for the state's employers are going up in 2010. In a release from ESD, Commissioner Karen Lee outlined the plan that will see the average total tax rate increase from 1.55 percent in 2009 to an estimated 2.38 percent in 2010 -- a 54% increase . . . READ MORE
How competitive contracting can help balance the budget
Washington lawmakers again face a multi-billion dollar budget deficit, meaning they will either increase the amount of money they collect from citizens each year, or re-evaluate the way they deliver core services to the public. Increasing taxes during a recession would add economic hardship, while changing the way services are delivered offers part of the solution to closing the deficit without raising taxes. One tool available for improving service delivery is Washington’s competitive contracting law, passed as part of civil service reform and signed by Governor Gary Locke in 2002. In practice, however, state managers rarely exercise their statutory contracting out authority, meaning an important provision of the 2002 civil service law remains largely unused . . . READ MORE
Governor's budget proposal results in $2.8 billion deficit for 2011-13
Governor Gregoire today released her proposal to close a projected $2.6 billion deficit in the current budget. While she is to be commended for starting the conversation on the type of changes needed to reset state spending, she failed to identify the changes necessary for a truly balanced and sustainable budget. The Governor acknowledged that the state is facing at a minimum a three-year problem. In fact, assuming her budget is adopted, a $2.8 billion deficit is projected for the 2011-13 biennium. Here is the 4 year budget outlook provided by the Office of Financial Management . . . READ MORE
Bill introduced to end state liquor monopoly
Senators Tim Sheldon (D-35) and Curtis King (R-14) have introduced a bill to end the state's archaic liquor monopoly. From SB 6204 - Privatizing the sale of liquor: "(1) The legislature intends for privatization of retail and distribution of liquor to result in a system that is more efficient than public sector retail and distribution. The legislature finds that the present system of state control includes a markup amount at distribution that generates revenue for the state and local governments, and that this markup will be eliminated when liquor sales and distribution are privatized. The legislature further intends that the privatization of liquor sales and distribution not result in revenue losses to state or local governments as compared to projected revenues assumed under state control, not including any separate licenses or franchises . . . READ MORE
Governor Gregoire will release her proposed fix to the state's $2.6 billion budget deficit tomorrow at 9 a.m. As required by law, it should be balanced within existing revenue though the Governor has clearly stated she plans to release a tax increase proposal prior to session. The Everett Herald has posted a list prepared by the Department of Revenue of potential tax increases (click here for list). While everyone will be focusing on the short term $2.6 billion problem for the current budget, solutions debated this coming session must address the long term structural problem and what to do about replacing the billions in one-time fixes being used (such as the federal stimulus funds). If only the current deficit is addressed, elected officials will have this debate to look forward to again in 2011 . . . READ MORE
Reform state's competitive contracting law to realize budget savings
With the current budget crisis, lawmakers and the governor should take full advantage of every opportunity to promote the efficient delivery of routine state services, so tax money can be freed up to fund high-priority core functions of government. State elected leaders should fix weaknesses in the competitive contracting law, and direct agency managers to use competition to reduce the cost of operating state programs. Specifically, state leaders should simplify the operation of the 2002 competitive contracting law and, like other states, create a Government Competition Council to assist managers in identifying public services that could be improved through competitive contracting . . . READ MORE
The Center for Government Reform
Launched in 2007, The Center for Government Reform mission is to partner with stakeholders and citizens to work toward a government focused on its core functions while improving its transparency, accountability, performance, and effectiveness for taxpayers. The Center's objectives include using the power and principles of the free market to change and improve the culture of government, focus government spending and programs on its core functions, adopting structural budget reforms, ensuring taxpayers dollars are spent efficiently and effectively, adopting government transparency reforms and ensuring government remains open and accountable to the citizens it serves.
Director Jason Mercier
Jason Mercier is the Director of the Center for Government Reform. He serves on the Executive Committee of the American Legislative Exchange Council's Tax and Fiscal Policy Task Force and is a contributing editor of the Heartland Institute's Budget & Tax News. Jason is also a columnist for Seattle PostGlobe.org and serves as Treasurer on the board of the Washington Coalition for Open Government and was an advisor to the 2002 Washington State Tax Structure Committee. He received a B.A. in Political Science from Washington State University.
Contact Information
For questions or for more information from the Center for Government Reform please e-mail jmercier@washingtonpolicy.org.
Past events:
On April 15, tax day, state and national policy experts gathered in Seattle for WPC's Government Reform conference. Two interactive panels discussed budget and tax policy reform issues, as well as budget accountability, performance, and the role of government. |
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The conference was very well attended including individuals from at least 26 states. It drew a wide variety of attendees including state legislators, agency and legislative staff, business owners, citizens and media. Former U.S. Comptroller David Walker (pictured right) delivered the lunch keynote address to a packed room. He highlighted the looming fiscal crisis caused by government overspending and entitlement programs and record-low levels of savings amongst citizens. |
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Panel 1: Budget and tax reform - TVW
- Donna Arduin - Former budget director for Florida Governor Jeb Bush and California Governor Arnold Schwarzenegger - Topic: Rich states, poor states
>Video
- Chris Atkins - Senior Fiscal Policy Adviser, Indiana Governor Mitch Daniels - Topic: Property tax reform
>Video
- Jonathan Williams - Director of the Tax & Fiscal Policy Task Force for the American Legislative Exchange Council (ALEC) - Topic: Budget and tax transparency
>Video
Panel 2: Budget accountability/performance and the role of government
- Hon. Brian Sonntag - Washington State Auditor - Topic: Performance audits
>Video
- Larisa Benson - Director of Washington State Government Management Accountability and Performance (GMAP) - Topic: Performance management
>Video
- Sheila Weinberg - Founder & CEO of Institute for Truth in Accounting - Topic: Requiring accurate budget information
>Video
Keynote Lunch Address - TVW
Additional media coverage of the conference is available here.
