Jmercier

Hold on to your wallets

January 30, 2008 in Blog

The state's supplemental budget debate just got a lot more interesting. Previous budget forecasts estimated a $621 million deficit by the end of the next biennium. According to a new report by the Senate Ways and Means Committee, the projected deficit has worsened. Richard Davis at the Association of Washington Business broke the news today:

"As we posted earlier, OFM has discontinued production of the familiar six-year budget outlook. Sen. Joe Zarelli subsequently asked the Senate Ways and Means Committee to make the forecast. The committee's projections are here and its methodology here.

By the end of the next biennium, in 2011, the outlook shows the General Fund running in the red by $937 million. Looking out to the end of the 2011-2013 biennium, the General Fund shortfall is $2.5 billion. The outlook also looks at the emergency reserve account and budget stabilization account, both of which would be drained (assuming the requirements to tap the budget stabilization account could be met)."

It is likely this bad news will only get worse on February 14 when the state's new revenue forecast is released. This situation illustrates the importance of limiting increases in the budget to ongoing revenue instead of using one-time money to balance the budget.

Earlier this session a bill was introduced (HB 2932) to require six-year budget outlooks be available following the adoption of a budget and quarterly revenue forecast. From the bill:

"No later than thirty days after enactment of each omnibus operating budget act, and no later than seven days after adoption of each quarterly revenue forecast under chapter 82.33 RCW, the state council on fiscal management shall present a three-biennium outlook on the state's operating budget."

In light of today's news it will be interesting to see if this proposal moves forward to help provide this type of information multiple times a year to help guide spending decisions.

Look before you leap

January 28, 2008 in Blog

One of the more interesting debates happening in Olympia right now is how to pay for the paid family leave entitlement put into law last year. Count me as one of the naive individuals who thought the legislature was supposed to figure out the details of a program before adopting it.

Apparently last year's faith based punt on the family leave entitlement hasn't put a damper on some lawmakers' desire to adopt new programs without figuring out the details first. Consider the following statement from Senate Majority Leader Lisa Brown concerning the proposal to adopt a sales tax rebate for the state's low income.

According to The Olympian: “Senate Majority Leader Lisa Brown, D-Spokane, said it might be necessary to create the program this year but determine the amount of assistance next year when the state's budget outlook is clearer.”

The Yakima Herald is encouraging lawmakers to take a deep breath and not move forward with this type of faith based budgeting:

"The Seattle Times reported Friday that Democratic leaders in Olympia are pushing Senate Bill 6809, which starting next year would provide a sales-tax break for low-income families of as much as $470.

About 350,000 households in the state would be eligible for the proposed rebate, which calls for the state to provide a 10 percent match to people who qualify for the federal Earned Income Tax Credit . . . Projected hit on the state treasury: About $120 million every two years.

But that's not all. Even if it's approved, Washington residents would not be able to apply for the credit until next year because the state Department of Revenue hasn't even had time to determine just how much it would cost to administer the plan. It's expected to take several months for the state to set up a system to handle the paperwork involved.

The unknown costs of such an ongoing program are reason enough to shelve it.

Have state lawmakers already forgotten that an expected $1.4 billion surplus at the end of the current budget cycle is expected to turn into a deficit of as much as $600 million by the end of the 2009-2011 budget period . . . We said before the session began that this is not a good time for state lawmakers to embark on costly new programs -- including this election-year grandstanding.

If majority-party Democrats insist on railroading this ill-advised legislation through this session, then we would call upon Gregoire to heed her own advice about "save the surplus" and veto it to show that she meant what she said."

Meanwhile, The Seattle PI warns today that "Reality will bite state budget."

"Gov. Chris Gregoire and leading Democrats in the House and Senate have reached one early agreement in this year's budget negotiations: It's time for a reality check.

Anticipating a bleak revenue forecast, they've agreed to start looking for places to trim the $33 billion budget they passed last year. They say they want to have their priorities in order in case the slowing economy forces them to find efficiencies or even cut programs altogether.

"We're not taking for granted that everything that was budgeted last year is going to go forward this year," said Senate Majority Leader Lisa Brown, D-Spokane.

Neither she nor any other Democratic leaders provided specific examples of what might have to be cut.

Gone are the halcyon days of a skyrocketing real estate market and a ballooning economy that had led to back-to-back-to-back upward adjustments in the state's revenue forecasts.

And gone is the free and easy feeling about spending, the unflinching commitment to "targeted investments" that Democrats have enjoyed for the past three years.

The upcoming revenue forecast comes out on Valentine's Day, but given the circumstances no one is expecting a very rosy message from the state's top economist, ChangMook Sohn."

Spokesman Review: Demystify state budget

January 27, 2008 in Blog

The Spokesman Review's Sunday editorial highlights WPC's proposal for a free searchable website of state spending and performance information. From the article:

"It's not that state spending isn't already public information, but digging it out in meaningful detail is enough to tax the skills and patience of most of us. In bill form, for example, the state budget is hundreds of pages long, and finding anything specific means poring over documents compiled and maintained by agencies and the Legislature.

A searchable Web site would bring all that information together, preferably in standardized format, and put it online where an interested resident could get speedy answers to plain-language questions.

No need to understand the intricacies of the legislative process. No need to speak the insiders' jargon.

The Washington Policy Center, a conservative, Seattle-based think tank and an outspoken advocate of the idea, notes that the Legislature will be spending some $71 billion over the current biennium.

Breaking that down into chunks that mean something to the average resident is possible, but only if lawmakers take advantage of available technology."

Previously the Everett Herald, Columbian and Tri-City Herald have called for Olympia to take action on this reform.

Lawmakers appear to be listening. Bipartisan bills have been introduced in the Senate (SB 6387 & SB 6818) and House (HB 2342) to implement this reform.

Lose it, pay for it

January 21, 2008 in Blog

A bill introduced today (SB 6621) would hold state employees accountable for lost or damaged state equipment left in their care. This proposal appears to address a problem highlighted by the State Auditor. An audit of the Department of Labor and Industries in 2006 found:

"During our audit, the Department discovered that 105 items with a total cost of more than $180,000 were lost or missing. The Department stated that a search could not locate the items. The items subsequently were removed from the inventory. These assets included 24 digital cameras, eight laptop computers and five camcorders."

If adopted, SB 6621 would clarify the culpability of those who lose state equipment:

"Sec. 6. Cont!
rolling agencies shall establish the degree of responsibility and liability of their state employees, as well as appropriate punitive measures for gross negligence or misuse of controlled property by their employees. State employees shall be advised of any liability they may incur due to their custody of controlled property and the procedures to follow when an item is reported as lost, stolen, damaged, or destroyed. Employee liability shall not exceed one-half of an employee's monthly salary.

Sec. 7. A state employee who intentionally, willfully, or with gross negligence damages controlled property shall be financially liable for the cost of repair or replacement of damaged controlled property unless his or her supervisor determines that there are mitigating circumstances that justify a waiver of liability. Such justification shall be documented and sent to the state auditor's office for publication on the state auditor's web site. Controlled property that cannot!
be repaired economically or is not marketable should be destr!
oyed and the property control number kept on file by the controlling agency."

Tri-City Herald: Adopt budget transparency website

January 18, 2008 in Blog

Add the Tri-City Herald to the growing lists of newspapers supporting WPC's proposal for a free searchable website of state spending and performance information. From today's paper (in-part):

"It sounds too good to be true, but the Taxpayer Transparency Act would actually do what its name implies and make it easier to see how your money is spent . . .

The Taxpayer Transparency Act would create an online database that the public could tap into for details about agencies and companies receiving state funds.

Enter the name of any company, and up pops the amount of state money it's getting, what the money is supposed to buy and links to all state audits of past performance.

The conservative American Legislative Exchange Council is promoting the idea to state legislatures. The bill's sponsor, Sen. Val Stevens, R-Arlington, is on the council's board of directors . . .

It's encouraging to note that State Auditor Brian Sonntag and Attorney General Rob McKenna are both supporting the bill. They belong to opposite parties, but each is a strong advocate for transparency in Olympia.

The Democratic-controlled Legislature was smart enough to approve the rainy-day fund last session, despite the concept's conservative origins.

Here's another chance for lawmakers to rise above partisanship and pass a measure that benefits everyone."

The Olympian today ran my article on this proposal.

Speaking of improving access to budget information, check out this proposal introduced today by Rep. Anderson (HB 2932). The bill would require six-year budget outlooks be available following the adoption of a budget and quarterly revenue forecast. From the bill:

"No later than thirty days after enactment of each omnibus operating budget act, and no later than seven days after adoption of each quarterly revenue forecast under chapter 82.33 RCW, the state council on fiscal management shall present a three-biennium outlook on the state's operating budget."

Performance audits matter

January 17, 2008 in Blog

The State Auditor is moving full steam ahead with the performance audit authority granted by the voter approved I-900. It looks like, in the case of the recent Port of Seattle performance audit, lawmakers may be responding. Consider the following bills introduced this session:

The Olympian in an editorial yesterday encouraged lawmakers to take the results of performance audits seriously:

"Eyman's initiative wisely predicted that government officials would drag their feet when it comes to following audit recommendations. To prevent that, Initiative 900 requires that at least one public hearing be held within 30 days of the release of the audit. I-900 requires lawmakers to take the audit findings into account when assembling the state budget. And lawmakers must issue a report to the people on progress toward the recommendations. That report must justify the Legislature's reason for not following individual recommendations and state why corrective actions were not taken . . .

If lawmakers want to ignore performance audits, override the recommendations, stall and obfuscate, they do so at their own peril and can expect to get hit with one initiative after another. If legislators won't lead government reforms, the public will."

The Auditor's efforts are also getting attention nationally. The Washington D.C. based Heritage Foundation will be holding an event next month on congestion relief with the focus: "The Seattle Congestion Performance Audit: Can it be Replicated for Other States and the Federal Government?"

Kudos to the State Auditor!

Updated (2:35 p.m.)

Linda Long (director of the state's performance audit program) just finished testifying before the House Appropriations Subcommittee on General Government & Audit Review on the impact of performance audits. Her testimony included the following information:

  • Performance audits issued to date - 9
  • Audits in progress - 8
  • Total audit recommendations - 434
  • Potential cost savings identified (over five-year period) - $3.2 billion

How much does that bill cost?

January 15, 2008 in Blog

Have you ever wondered how much a specific legislative proposal will cost taxpayers? Technically a "fiscal note" is supposed to be available when lawmakers consider legislation to help shine a light on the impact a bill may have on taxpayers. Unfortunately, fiscal notes aren't always available before a bill is passed out of committee.

A bill introduced today, however, would require that any bill with a fiscal impact have a completed fiscal note available before lawmakers could take action. The following is from HB 2682 (addressing fiscal notes):

NEW SECTION. Sec. 4. A new section is added to chapter 43.88A RCW to read as follows: (1) Before either house of the legislature may vote on final passage on a bill that if enacted into law would increase state government expenditures or would increase or decrease state government revenues, a fiscal note prepared pursuant to RCW 43.88A.020 must be available on the most recent version of the bill that applies to the bill as it is to be voted upon. In no case shall the fiscal note be made available more than seventy-two hours after the bill is placed on final passage. (2) The requirement in subsection (1) of this section may be suspended by the applicabl!
e house of the legislature with a vote of sixty percent of the members elected to that house.

Speaking of fiscal notes, the information on tax and fee increases required by I-960 is now available on the Office of Financial Management's website. To sign up for these details click here.

Emergency clause reform

January 15, 2008 in Blog

Today's Everett Herald decries the legislature's abuse of the emergency clause. The paper is urging lawmakers to adopt a constitutional amendment restricting their use of emergency clauses to circumvent the people's right of referendum:

"Nothing fuels voters' cynicism more than being misled by government officials. If state lawmakers want to build trust with voters, they should start by coming clean on their abuse of the emergency clause, a tactic they've used often in the recent past to preempt voters' right to second-guess them on controversial legislation.

Washington's Constitution grants the people considerable power through the initiative and referendum processes. The latter gives citizens an opportunity to veto unwanted laws passed by the Legislature by filing a referendum within 90 days after the session in question ends. If enough signatures are gathered, voters get to decide whether to keep the law as passed or reject it.

The Constitution makes one exception: The right to referendum can be bypassed if a bill is "necessary for the immediate preservation of the public peace, health or safety, support of the state government and its existing public institutions."

Trouble is, lawmakers have taken that definition beyond any test of reasonableness, tacking emergency clauses onto 740 bills in the past 11 years. That's 17 percent of all bills enacted. With that many emergencies, it's remarkable we've survived."

Last month the Spokesman Review also weighed in on this issue:

"Citizens' ability to write or reverse state law is renowned in Washington and other Western states whose constitutions were adopted under the populist influence of the late 19th century. The initiative and referendum have been used by the left as well as the right to remind elected legislators who ultimately is the boss.

The Washington Legislature hasn't taken the reminder lying down, though. Its members routinely protect measures they approve from the referendum process by including an emergency clause.

This pattern should trouble citizens, regardless of personal ideology. It neutralizes a constitutional protection that exists to keep elected representatives accountable to voters, even after the election . . .

As the Legislature prepares to convene in January, the Washington Policy Center is planning to push a constitutional amendment that would require a 60 percent vote in the Legislature on any bill with an emergency clause. That wouldn't be an arduous test if conditions truly match the language of the emergency clause: "necessary for the immediate preservation of the public peace, health or safety, support of the state government and its existing public institutions."

Click here to learn more about the abuse of the emergency clause and the proposed reform to restore our right of referendum.

Property tax rally

January 14, 2008 in Blog

Around 50 determined citizens braved the cold and rain today to rally for property tax relief on the steps of the capitol (there's nothing like taxes to put a chill in the air). The tax protestors were joined by sympathetic legislators and tax advocates urging the just convened 2008 Legislative Session to focus on property tax reform.

Deemed the "Property Tax Tea Party," the rally was organized by Property Owners for Predictable Tax Now, co-founded by Shelley Taylor and Jill Willaue.

The Olympian has a write up of the event here.

If lawmakers really want to address the concerns expressed at today's rally they should enact permanent tax cuts, not simply reduce the impact of future tax increases or shift the costs from one taxpayer to another.

Ways lawmakers can truly reduce the property tax burden include:

  • Permanently cut the state property tax levy; or
  • Phase out the state property tax levy over five to ten years.

Stay tuned for more details on these proposals for real property tax relief.

Everett Herald on board for budget website reform

January 11, 2008 in Blog

The Everett Herald has joined with the Columbian in editorializing in favor of WPC's proposal for a free searchable website of state spending and performance information. From today's paper (in-part):

"Much of the state's budget information exists online today, but it's a burden for most citizens to find it or make sense of it. It needs to be organized in a way that's accessible and useful.

A user-friendly, searchable budget Web site would enable citizens watchdogs to see how -- and how effectively -- tax money is being spent. It would put accurate information at the fingertips of anyone interested in learning how government is going about its responsibilities. Successes could be built upon, shortcomings more quickly addressed.

There's nothing to keep lawmakers from adopting the proposal this year. Similar sites already exist in Texas and Missouri. A federal version, approved by Congress unanimously, went live last month (usaspending.org). One Washington agency, the Department of General Administration, already has a searchable Web site showing its public contracts. Microsoft stands ready to design it, and costs figure to be low. Democratic state Auditor Brian Sonntag and Republican Attorney General Rob McKenna, two leading voices for open government, have both expressed support.

How the state spends taxpayers' money is a mysterious and convoluted process to most folks. Lawmakers shouldn't be fearful of shining light on it, even if some warts are exposed. The more open government is, the more effective it's likely to become."

Even with a short legislative session about to begin this reform is very much in reach. Stay tuned.

Port of Seattle JLARC performance audit hearing

January 9, 2008 in Blog

Yesterday the Port of Seattle (POS) held a public hearing on the State Auditor’s damning audit of its construction practices. Today the Joint Legislative Audit and Review Committee (JLARC) held a public hearing on the audit as required by I-900. The contract auditor for the performance audit, Cotton and Company LLP, took issue with the response of the Port Commissioners at yesterday’s hearing in Seattle (emphasis added):

“We attended the Port’s public hearing on the audit results yesterday. The Commission’s reactions to the audit recommendations have been encouraging. At the public hearing yesterday, the Commission enacted several steps that will, if carried out as asserted, implement several of the audit’s most important recommendations. We have several concerns, however, about Port management and staff’s commitmen!
t to implementing the audit’s recommendations . . .

The Port’s more recent assertion that the Port agrees with findings and recommendations needs to be viewed with skepticism . . .

A recent action by POS indicates that it has not taken the findings and recommendations as seriously as it would have you and the public believe . . .”

The U.S. Justice Department has started an investigation of POS as a result of the audit.

Press coverage of yesterday’s hearing here:

Columbian supports budget website reform

January 9, 2008 in Blog

Vancouver's lead newspaper, The Columbian, has an editorial today in support of WPC's proposal for a free, online searchable website of state spending and performance information. The Columbian writes:

"When Republican State Attorney General Rob McKenna and Democratic State Auditor Brian Sonntag agree on an idea, Washingtonians would do well to pay attention. Both leaders feverishly pursue policies over politics. Both men have powerful reputations as independent problem solvers. McKenna and Sonntag support a proposed budget database that would allow taxpayers to research state spending on the Internet. It's a superb idea, and Washingtonians should feel slightly embarrassed that Congress beat our state to the punch . . .

On Monday, state Sen. Val Stevens, R-Arlington, announced she will introduce the Taxpayer Transparency Act in the Legislature's 2008 session, which begins Monday. We hope lawmakers expedite passage of the bill . . .

A similar bill was introduced last year but was not granted a public hearing. We hope that, with Congress setting an example, swift action can be taken this year. Jason Mercier of the Washington Policy Center this week described the proposal as "a win-win for everyone, except possibly for those who fear something embarrassing about public spending might be revealed." Clark County legislators, take note. Constituents will be watching how you vote on this one."

The editorial makes reference to information from a press release WPC issued earlier this week concerning the support of Sonntag and McKenna for this reform. 

Here is a link to Sen. Stevens' press release announcing her proposal.

Last week the Tacoma News Tribune also commented on this reform.

State Auditor, Attorney General support WPC budget website proposal

January 7, 2008 in Blog

Two of the state’s strongest advocates for transparent and accountable government have voiced their support for a Washington Policy Center (WPC) proposal to create a free searchable website of all state spending and performance information. On December 5, 2007, WPC released a study entitled Creating a Free, Searchable Website of State Spending.

State Auditor Brian Sonntag (D) and Attorney General Rob McKenna (R) offered the following comments about this proposed reform:

“Citizens deserve to have as much information available as they desire. When government’s doors are open, people have the access they need to see where their dollars are being spent,” said Sonntag.

“Budget transparency is a laudable goal,” McKenna said. “Citizens need to be informed about the cost of government and where their tax dollars are being spent. I support the Washington Policy Center in its work to bring more transparency and access to our state’s taxpayers.”

Click here for more details.

Public nondisclosure act

January 2, 2008 in Blog

While the rest of us were enjoying our Christmas gifts, the state Supreme Court was putting a big bow on its present to governmental agencies in a 5-4 ruling granting a huge exemption from public accountability.

One of the four dissenting Justices, Charles Johnson, had this to say about what the Court did, "The majority essentially creates a public nondisclosure act, turning the act inside out so that documents are withheld from the public unless the public can demonstrate that no remotely connected litigation exists, past, present, or future."

Here's how the Walla Walla Union-Bulletin described the ruling:

"The Washington state Supreme Court last week provided public agencies with a shield against the state's Public Records Act that is broad enough that only the most honest — or most inept — public agency will ever have to worry about releasing potentially embarrassing records again.

All an agency will have to do is to have all documents pass through the hands of its attorney and then claim them as covered by attorney-client privilege and attorney work product. It can seal the deal by hiding behind the court's expanded interpretation of the "controversy" exemption in the Public Records Law.

Then it can tighten its grip even more by forcing anyone who requests a record to defend his request in court.

It's too bad that before issuing the 5-4 decision the justices didn't do a little more research on the history and intent of the law. The idea was that everything the government did — either in record form or during a meeting — belongs to the public. A very small and narrow list of exceptions was included. If it didn't fit this tightly written list of exemptions, it was open to the public.

Since those historic days, special interests have tagged on numerous other ways in which what should belong to the public can be withheld.

The court is correct when it says agencies need an attorney-client privilege so they can communicate freely. But it was never meant to be a way to disenfranchise the public . . . Justices Barbara Madsen and Mary Fairhurst tried to shift the blame and say it is up to the Legislature, not the courts, to deal with this.

Nice try. On many issues this would be a valid point, but the justices are there because they are supposed to have good judgment and are able to make reasoned decisions. This ruling fails that standard.

But Madsen and Fairhurst are right about one thing: We don't have to accept this. The governor and the Legislature have been examining the proliferation of roadblocks to the public's ability to keep tabs on the government. Add this to the list of things that must be fixed."

More details about the case at og-blog.

Taxpayers need searchable Web site to track state spending

December 23, 2007 in Blog

The Tacoma News Tribune ran my column today discussing our proposal for a free searchable website of state spending and performance information. Details here: