On the same day the general election campaign for the presidency officially began, Sen. Barack Obama (D-IL) and Sen. John McCain (R-AZ) co-sponsored legislation to enhance the federal spending transparency website they previously teamed up to create in 2006.
This Act would expand information on USASpending.gov to include:
A copy of each Federal contract in both PDF and searchable text format.
Details about competitive bidding, the range of technically acceptable bids or proposals, and the profit incentives offered for each contract.
The complete amount of money awarded, including any options to expand or extend under a contract.
An indication if the Federal award is the result of an earmark.
Information about government lease agreements and assignments in the same manner that information is reported for contracts, grants, and other assistance.
An assessment of the quality of work performed on Federal awards.
Information about Federal audit disputes and resolutions, terminations of Federal awards, suspensions and debarments, and administrative agreements involving Federal award recipients.
Information about any civil, criminal, or administrative actions taken against Federal award recipients, including for violations related to the workplace, environmental protection, fraud, securities, and consumer protections.
Information about Federal tax compliance by Federal award recipients.
Information about parent company ownership that will be made accessible, along with other data on USASpending.GOV, through application programming interfaces.
Links to publicly available Government reports.
The Act would improve data quality on USASpending.gov through:
Improved searchability of data and use of unique award identifiers that prevent the release of sensitive personally identifiable information.
A simple method for the public to report errors and track the performance of agencies in confirming or correcting the records for which error reports have been filed.
Agency inspectors general review statistically representative samples of agency awards to verify accuracy and compliance with improved data standards.
General quality audit of website data every six months, including review and report of public error reporting system and recommendations for new quality standards and procedures.
On April 1, 2008, Governor Gregoire signed into law Washington's version of the 2006 federal reform, SB 6818. The new law is based on Washington Policy Center’s (WPC) recommendation for the state to adopt a searchable budget website. It passed the legislature unanimously.
Washington's new law already includes the requirement for performance information to be included on the searchable spending website. It's good to see this information may soon be available on the federal website.
On May 23, 2008, Thurston County Superior Court Judge Chris Wickham invalidated three rules the Department of General Administration (GA) adopted to implement the competitive contracting provisions of the 2002 Civil Service Reform. The Washington Federation of State Employees (WFSE) sued to have the rules thrown out. A copy of the ruling was made available by the Attorney General last night.
At issue are WAC 236-51-006, 236-51-010(11) and 236-51-225. The main issue of contention is on what it means to be a "displaced employee" due to an agency competitively contracting work.
I had an opportunity to talk with the Director of GA, Linda Bremer, after today's GMAP session to ask what the ruling means and what the next steps are. She said that at this time GA was reviewing its options and would make a decision in the next few weeks on whether to appeal or adopt new rules.
Even before the ruling, the use of competitive contracting by state agencies under the 2002 reform has been less than stellar. A performance audit conducted by the Joint Legislative Audit and Review Committee (JLARC) in January 2007 found:
“…few agencies have competitively contracted for services in the 16 months since receiving authorization to do so. Agency managers reported two main reasons for not competitively contracting. First, managers perceive the process itself to be complicated and confusing, providing a disincentive to pursue competitive contracting. Second, competitive contracting is a subject of collective bargaining, which creates additional challenges by requiring labor negotiations. Managers must bargain, at a minimum, the impacts of competitive contracting. Additionally, some agency collective bargaining agreements include provisions which proh!
ibit agencies from competitively contracting.”
Regardless of the ultimate outcome of the court ruling on the GA rules, Washington policymakers should simplify the bidding process to make it easier for agencies to use competition to improve services. Lawmakers should also shield contracting out from union and political influence by removing it from the collective bargaining process. Improving service to the public is too important to be a bargaining chip in government labor negotiations.
The State Auditor's Office released an audit of the Department of Social and Health Services (DSHS) today with 4 findings issued against the agency.
The findings are:
DSHS does not have adequate controls to ensure all payments made through its Social Services Payment System are supported and approved. This resulted in "$88,230.42 in inappropriate payments to 115 clients and providers. The Department had identified 28 of these through its review process and our audit identified the remaining 87. The Department has begun recovery proceedings for 110 of the overpayments identified. The overpayments were a combination of state and federal dollars." - Repeat Finding
DSHS does not adequately monitor contracts with Crisis Residential Centers to ensure compliance with state law and contract requirements. DSHS "is not in compliance with state law or its own contract. By paying a provider who has allowed clients to stay beyond five days, the Department is not receiving the services – open available space for at-risk youth – agreed on in the contract. These facilities are designed to be short-term residences for emergency situations."
DSHS Children’s Administration, did not perform adequate monitoring for background checks of foster care providers. DSHS "licensed and paid foster care providers without evidence showing a required criminal background check was completed and cleared. The lack of background checks for all required individuals increases the chance of people with disqualifying criminal backgrounds having access to children served by the Department." - Repeat Finding
Public funds were misappropriated at the Department of Social and Health Service’s Division of Child Support. "On March 27, 2007, a client notified the Division that a payment, that had been made, was not posted to their child-support account. The client contacted their bank and found the payment was deposited into a personal bank account, not the Department account. The Department recognized the name on the personal bank account as a temporary employee and terminated the individual on March 27, 2007. The Department immediately filed a police report with the Olympia Police Department, which referred it to the Washington State Patrol. The Patrol conducted an investigation and interviewed the former employee on June 6, 2007. During the interview, the individual stated she misappropriated the payment. After further investigation, the Patrol concluded the former employee had misappropriated at least $25,571.58 in public funds between December 1, 2!
006 and March 27, 2007. As a result of this loss, the Division has made improvements in its internal controls regarding processing of child-support payments."
It's never good to receive an audit finding but it looks like DSHS is making progress with just a handful of problems identified. That said, there should never be a repeat audit finding. Hopefully the Governor and Legislature will make sure DSHS doesn't repeat this year's violations in next year's audit.
With a worsening federal budget outlook leading the Congressional Budget Office to project the possibility of massive income tax increases, Congress asked the Government Accountability Office (GAO) to study how best to design user fees to fund federal programs. According to a GAO report issued yesterday:
"The federal government will need to make the most of its resources to meet the emerging challenges of the 21st century. As new priorities emerge, policymakers have demonstrated interest in user fees as a means of financing new and existing services. User fees can be designed to reduce the burden on taxpayers to finance the portions of activities that provide benefits to identifiable users above and beyond what is normally provided to the public. By charging the costs of those programs or activities to beneficiaries, user fees can !
also promote economic efficiency and equity. However, to achieve these goals, user fees must be well designed.
GAO was asked to study how user fee design characteristics may influence the effectiveness of user fees. Specifically, GAO examined how the four key design and implementation characteristics of user fees—how fees are set, collected, used, and reviewed—may affect the economic efficiency, equity, revenue adequacy, and administrative burden of cost-based fees. GAO reviewed economic and policy literature on federal and nonfederal user fees, including prior GAO work, and used relevant case examples to illustrate different types of design elements and the impacts they may have . . .
Total federal user fees are in the hundreds of billions of dollars annually and growing. According to Office of Management and Budget (OMB) data, total fee collections increased 69 percent from $138 billion in fiscal year 1999 to $233 billion in fiscal year 2007. Even after adjusting for inflation, fee collections grew 39 percent. During this time period, total user fee collections varied from 6.4 to 7.6 percent of total federal spending (gross outlays).
User fees can be designed to reduce the burden on taxpayers to finance the portions of activities that provide benefits to identifiable users above and beyond what is normally provided to the public. By charging the costs of programs or activities to identifiable beneficiaries, user fees can promote economic efficiency and equity just as prices for private goods and services can do in a free and competitive private market. However, to achieve these goals, user fees must be well designed."
To view the GAO findings and recommendations on federal user fees, click here.
Marking the five year anniversary of the 2003 Bush tax cuts, the White House put out a "fact sheet" today warning "The Largest Tax Increase In History Is Looming." From the White House:
"By the end of last year, Americans would have paid an additional $1.3 trillion in taxes had it not been for the President's tax relief. If the President's tax relief is allowed to expire at the end of 2010, Americans will pay about $280 billion more in taxes each year . . .
If the President's tax relief is allowed to expire, every income taxpayer will see an increase. Taxes will increase for 116 million income taxpayers who will see their taxes go up by an average of $1,800. It will force many families to accept a nearly 200 percent tax increase. In addition:
48 million married couples will face a $3,007 increase on average. Part of the increase is due to the fact that many married couples will once again be forced to pay more taxes as a married couple than if each were treated as a single.
12 million single women with dependents will face a tax increase averaging $1,091.
18 million seniors will face a $2,181 average tax increase.
27 million small business owners will face a $4,066 tax increase on average.
These pending tax increases will be devastating for average American families. A typical family will pay $500 more per child in taxes, and 43 million families with children will face an average tax increase of $2,323. American families are facing higher costs in the grocery line and at the gas pump. Americans deserve to keep more of their income. If Congress allows the President's tax relief to expire:
A single parent with two children earning $30,000 would see an increase of over $1,600 in taxes.
A family of four earning $40,000 would see an increase of over $2,300 in taxes.
A family of four earning $50,000 would see an increase of over $2,100 in taxes – an increase 191 percent
A family of four earning $60,000 would see a tax increase of approximately $1,901 in taxes – an increase of 70 percent.
A family of four earning $80,000 would see a tax increase of about $2,000 in taxes."
So will Congress allow the 2003 tax cuts to expire? What about the spending side of the equation? Until Congress makes up its mind taxpayers will be left wondering what fate awaits them.
The cost of government is going up this year. During the 2008 Legislative Session, lawmakers proposed over $200 billion in fee and tax increases. Of that, they imposed $768 million in increases over a ten-year period.
State senators proposed 46 bills (including companion bills) that would increase state taxes or fees. The initial versions of these proposals sought to raise $215.4 billion in revenue over a ten-year period. Of these proposals, the legislature adopted five, raising $13 million in fees or taxes.
State representatives proposed 36 bills (including companion bills) that initially sought to raise $98.8 billion in fees or taxes over a ten-year period. The legislature ultimately adopted nine of these bills, raising $755 million in fees or taxes. In total the legislature enacted 14 bills raising fees and taxes by $768 million over a ten-year period.
For a list of the tax and fee increases proposed and enacted in 2008, click here.
The Department of Revenue has released a report summarizing all the 2008 legislation impacting tax collections. From DOR's website:
"The Department of Revenue has posted online a summary of tax-related legislation enacted during the 2008 and late 2007 legislative sessions. It also has published an annual update of tax exemptions with expiration dates and reporting requirements.
The Department generates the tax summaries annually to help make businesses aware of changes to the state tax system. See the 2008 summary, which covers 38 bills that will reduce state revenues by $2.2 million in Fiscal Year 2009, and see the summary of the two property tax measures enacted during the 2007 special session.
The Washington Research Council released a policy brief yesterday highlighting Washington's tax burden ranking. According to the Research Council:
Washington’s $3,948 per capita in state and local taxes for FY 2005–06 ranked 18th highest among the 50 states. New York had the highest per capita tax burden, $6,413; Alabama had the lowest, $2,782. The nation-wide average was $4,001. Washington’s per capita ranking has not changed much over the last three years. For FY 2004–05 Washington ranked 21st; for FY 2003–04 it ranked 18th.
For FY 2005–06 Washington’s $111.99 in state and local taxes per $1,000 in personal income ranked 28th highest among the states. Wyoming collected the most state and local tax revenue per $1,000 of personal income; South Dakota collected the least, $91.03. T!
he nation-wide average was $116.22.
We've been sounding the alarm (along with others) about the serious spending problems facing the nation and the lack of attention our elected officials are paying to this growing fiscal disaster. Now come projections out of the Congressional Budget Office (CBO) on what further delay means to taxpayers and the economy. The following is from a CBO letter dated yesterday to Rep. Paul Ryan (R-WI):
"Under current law, rising costs for health care and the aging of the population will cause federal spending on Medicare, Medicaid, and Social Security to rise substantially as a share of the economy. If tax revenues as a share of gross domestic product (GDP) remain at current levels, that additional spending will eventually cause future budget deficits to become unsustainable. To prevent those deficits from growing to levels that could impose substantial costs o!
n the economy, the choices are limited: Revenues must rise as a share of GDP, projected spending must fall, or both."
Let's assume that tax increases are the preferred solution for the powers that be to resolve this self-inflicted spending problem. How large of a tax increase are we talking about?
"With no economic feedbacks taken into account and under an assumption that raising marginal tax rates was the only mechanism used to balance the budget, tax rates would have to more than double. The tax rate for the lowest tax bracket would have to be increased from 10 percent to 25 percent; the tax rate on incomes in the current 25 percent bracket would have to be increased to 63 percent; and the tax rate of the highest bracket would have to be raised from 35 percent to 88percent. The top corporate income tax rate would also increase from 35 percent to 88 percent. Such ta!
x rates would significantly reduce economic activity and would!
create serious problems with tax avoidance and tax evasion. Revenues would probably fall significantly short of the amount needed to finance the growth of spending; therefore, tax rates at such levels would probably not be economically feasible . . .
The United States faces serious long-run budgetary challenges. If action is not taken to curb the projected growth of budget deficits in coming decades, the economy will eventually suffer serious damage. The issue facing policymakers is not whether to address rising deficits, but when and how to address them. At some point, policymakers will have to increase taxes, reduce spending, or both. Much of the pressure on the budget stems from the fast growth of federal costs on health care. So constraining that growth seems a key component of reducing deficits over the next several decades. A variety of evidence suggests that opportunities exist to constrain health care costs both in the public programs and in the health care system overall without adverse health consequences, although capturing those opportunities involves many challenges."
So what do the current presidential candidates plan to do about this? As noted by former U.S. Comptroller!
General David M. Walker, they aren't saying. Voters should demand an answer before it is too late.
The State Auditor today officially released a performance audit on government compliance with the Public Records Act. So what does public records compliance have to do with government spending and efficiency? Consider some of the recent taxpayer payouts for government violations of the law:
"In recent years, court cases in which state agencies and local governments have been assessed fines and penalties have been specifically related to the entities’ improperly withholding public records and/or delaying release of the records. We did not identify litigation that was based on entities’ practices other than improper denials or excessive delays. In addition to penalties, attorneys’ fees, and costs awarded by the court, the entity also bears it own legal costs of the litigation. Accordingly, minor court awards can be expensive if the legal costs associated with the !
litigation are considered as well. Examples of recent lawsuits include:
• The Department of Corrections settled a lawsuit for $65,000 in late 2007. A Tacoma man made public records requests at 10 government agencies for information about employee health insurance coverage. The Department said it could not electronically redact the requested records and offered to provide paper copies at a cost of $8,900. A Thurston County judge ruled in this case that the Public Records Act does not require agencies to provide records in an electronic format. However, the agency ultimately provided the records electronically to the requestor.
• The Department of Corrections settled another public records lawsuit earlier in 2007 for $541,000. Prison Legal News, a watchdog newspaper, requested records in 2000 and disagreed with DOC regarding the documents withheld and the time it took to provide the records requested. The Thurston Co!
unty Superior Court order supported the position of the Depart!
ment and, on appeal, that decision was supported by the Washington Court of Appeals. After a favorable decision from the two lower courts, the Supreme Court reversed their decisions and ordered the documents to be released. DOC was ordered to pay statutory penalties, attorney fees and costs incurred over the 7 years it took for the case to pass through the appellate process. The case involved issues over exemptions in the Public Records Act.
• In 2006, the City of Spokane settled a case for $299,000 involving its refusal to release public records regarding financing of a parking garage. At the time, it was thought to be the largest public records-related settlement in the history of the 1972 Public Records Act.
• A state Court of Appeals judge in 2007 fined the King County Executive $123,000 for failing to comply with the state’s Public Disclosure Act. A Seattle businessman took a case to court in 2000 after the !
Executive’s office failed to respond to a 1997 public records request for documents regarding the public financing of Qwest Field. A King County Superior Court judge originally fined the Executive $5 per day for each day it failed to produce the requested records. The Act allows up to $100 per day. The case was still being resolved at the time of the audit.
In addition to the financial expense of being involved in a legal dispute involving public records, failing to respond properly to public records requests can erode the public’s overall trust and regard for the entity and government in general."
To view the full audit and recommendations for improvements, click here.
Adam Wilson of The Olympian wrote an interesting article this weekend about a state computer project that some legislators thought they eliminated this year. According to the article:
"The state Health Care Authority plans to spend an additional $9 million on a computer project that the Legislature tried to cancel this year.
State officials say the move will preserve work done so far and buy another chance at continuing the project. But a key lawmaker said it contradicts what the Legislature intended.
After $5 million had been spent on early development of the computer project, lawmakers approved spending $25 million more on the BAIAS system in 2007. The computer would replace the 30-year-old system that handles public employee health insurance.
The state spent $2 million last year on the project, but Democratic lawmakers, looking to save money, pulled $14 million from the project in March.
The cut effectively ended the effort to develop the system after $7 million in taxpayer money had been spent because there wasn't enough money left to finish it. But $9 million from the original budget was still available. The agency plans to spend that money on the system in the next year . . . A lawmaker on the board, Rep. Ross Hunter, D-Bellevue, warned against the proposal. He said he opposed canceling the project, but had no doubt that is what the Legislature wanted to do.
State spending is expected to outstrip revenue by $2.4 billion in the next two-year budget. Hunter said it's unlikely more funding will be given to the project next year, making spending more now questionable . . . As for concerns about reversing the decision of the Legislature, run by the Democratic majority, Swecker said it was fair play.
'My theory is if they were trying to terminate the project, they should have cut all the money,' he said."
So is the Health Care Authority an agency run amok blatantly disregarding the law and the intent of lawmakers?
Well, not exactly. Perhaps in their haste to rush through the $306 million 2008 supplemental budget increase, lawmakers left the original language in the budget concerning the project even though they reduced the funds:
"Sec. 214(7) $784,000 of the health services account--state appropriation for fiscal year 2008, $1,676,000 of the health service account—state appropriation for fiscal year 2009, $540,000 of the general fund--federal appropriation, and (($22,480,000)) $8,200,000 of the state health care authority administrative account--state appropriation are provided for the development of a new benefits administration and insurance accounting system"
We're all for reducing unnecessary spending and saving money, but lawmakers need to be more diligent in how they write the budget so they !
can clearly convey their intent. Perhaps if they had adopted a 72-hour budget review reform, this oversight would have been caught.
Peter Callaghan of the Tacoma News Tribune has a great column today on the increasing strategy of businesses trying to carve out exemptions from the crushing burden of taxes they face. While I find no fault with these employers for trying to make doing business in Washington more palatable, the answer is not discriminatory tax relief, but instead universal tax relief for all employers and individuals in Washington.
From Peter's column:
"If cities like Tacoma and states like Washington are willing to offer tax breaks and other public funding to keep big employers, DaVita would be silly – even financially irresponsible – not to grab them.
DaVita didn’t create the atmosphere that allows companies to set up bidding wars. That was begun years ago, ironically by a business that has been deemed by federal courts to be a nonbusiness, exempt from antitrust laws. That would be Major League Baseball, which wrote the textbook on getting ladles of tax dollars.
All sports franchises had to do was threaten to move a beloved team elsewhere (and persuade the people who run those elsewheres to play along). In nearly every case, it worked.
But while pro sports leagues created the technique, The Boeing Co. brought it into the private sector and perfected it, at least around here.
First, the aerospace company won $60 million in tax breaks from Chicago and the State of Illinois to move a few hundred corporate office folks.
It then launched a second round of civic bidding with its competition to site the assembly plant for the 787. Washington won – or perhaps bought – that race. The Legislature gave up $3.2 billion in future tax collections to keep the plant in the state. The state also paid for road improvements, a $30 million dock that turned out to be unnecessary, and a training center.
That worked out so well for Boeing that it has begun to set the stage for a third contest – this one to host the plant for the jetliner that will eventually replace the mid-sized 737.
Russell Investments must have learned from the Boeing example. Not just that there is money to be had but that seeking it can lead to bad feelings among taxpayers. Boeing looked greedy by asking, so Russell escaped that by not really asking. It continues to act as though it doesn’t even realize that cities and developers are drooling for a chance to host the company.
Altogether, Tacoma, the state and the feds have developed a package worth $140 million. But Russell has declined to comment throughout the competition, so no one knows if it will be enough.
Now comes DaVita. Russell employs 1,100 people downtown with promises of hundreds more if it stays. DaVita employs 850 and also predicts expansion. Russell jobs pay more, while DaVita is a solid employer of workers in its billing, accounting, information technology and government reporting sections.
DaVita has the city’s interest. But who’s next?"
It’s past time for elected officials to address the business climate (tax relief) on a universal basis and stop using the tax code to reward those employers deemed worthy of relief by the government. No more exemptions and subsidies, instead one flat universally low tax rate. Same goes for individual taxes. No more sin taxes or special exemptions (except for maybe food and medicine). If government wants to raise taxes, they raise taxes on everyone and if the tax rate is too high (which it is) they lower taxes for everyone. No more tax code winners and losers determined by the power and force of government influenced by he with the strongest lobbyist.
On April 15, 2008, former Comptroller General of the U.S., David M. Walker, provided the keynote address at our Government Reform Conference. The title of his presentation was "Learning from the Past and Creating our Future." Here are excerpts from Walker's speech:
". . . I am here to tell you, our Republic is at risk. Washington is out of touch and out of control. I’ve had the good fortune of going to 26 states and 40 cities as part of the 'Fiscal Wake-Up Tour' during the last two years. I’ve been to a number of other states, and many more cities in my capacity of the role as Comptroller General of the United States, and now in my capacity as President and Chief Executive Officer of the Peter G. Peterson Foundation . . .
Frankly, I’m not just concerned about the sustainability challenges we face. I’m concerned about how far this nation has strayed from the solid foundations that our Founding Fathers provided for us in 1789. And let me mention just a few examples.
First, the size of government. The Founding Fathers believed in limited government. In 1789 the federal government was 2% of the economy. Today it’s 20% and is scheduled to get a lot bigger.
Second, the composition of government. At the beginning of our republic, the federal government focused on things that realistically only the federal government could do. Responsibilities like national defense, foreign policy, treasury, postal service, Congress and the Executive Office of the President of the United States. Today, the 38% of the budget that is deemed to be 'discretionary spending' contains every major express and enumerated responsibility envisioned by the Founding Fathers for the federal government. Every single one. What happened to the provision written by the founders: that any role or function not expressly reserved for the Federal government belongs to the states and ultimately to the people? We have lost our way . . .
Let me touch briefly on a few sustainability challenges then wrap up and go to Q&A. Firstly, our federal fiscal challenge. It’s not our current deficits, and it’s not our current debt levels that are the problem. Yes, the deficits are larger than they should be. Yes, our debt levels can hardly be justified given the principles our founders established, and frankly, America’s history, up until the 1970s. When we incurred significant debt because of wars, whether it was the Revolutionary War, whether it was the Civil War, whether it was World War I, or World War II, our nation had a tradition of paying down that debt as quickly as possible so we did not encumber future generations with burdens that they should not be expected to bear. But since the 1970s, that tradition has gone by the wayside, and it’s time that we think about bringing it back over time.
We have large deficits and debt levels, but the real problems are off-balance-sheet obligations. As per the latest federal financial statements, we have over $44 trillion (there are 12 zeros to the right of that 44) in off-balance-sheet obligations, primarily in the form of unfunded Medicare and Social Security obligations. Adding this number to our nation’s current net liabilities means that our total federal fiscal hole was about $53 trillion as of September 30, 2007. That unfunded hole is getting bigger by $2-3 trillion a year by doing nothing. If you balance the budget tomorrow, which we’re a long way from doing, that hole would still grow by $2 trillion-plus a year. $2 trillion-plus a year!
Now, what is $53 trillion? It’s $455,000 per American household. What’s median household income in America? Less than $50,000 a year! Therefore, based on our present policies and programs, the typical American household has an implicit mortgage of over nine times their current annual income, but no house to back that mortgage. That’s the big sub-prime crisis . . ."
Presidential candidates John McCain (R) and Hillary Clinton (D) are proposing a federal gas-tax holiday to alleviate the pain Americans are feeling at the pump. Barack Obama (D), however, is correctly rejecting this unsound voter pandering but is instead unwisely proposing a "windfall profits" tax on companies that invest in oil production.
The Tax Foundation has a good write up on the folly of these proposals here.
As for the current debate on temporarily suspending the federal gas-tax, a better course of action would be to eliminate the federal gas-tax and return that taxing authority to the states to use. Rather than send our gas-tax dollars to Washington D.C. only to have to beg to maybe have them returned back to the state with numerous strings attached, we could keep all those gas-tax dollars here and use them on our priorities instead of having them earmarked for a bridge to nowhere or for an interchange no one asked for.
There is already a proposal in Congress to do this.
This means that if we increased our state gas tax by say 15 cents, the federal gas-tax we pay would be reduced by 15 cents so the overall tax burden would not increase but those gas-tax dollars would stay in the state for our transportation priorities – no federal strings attached.
The goals of the STATE Act are:
Free state transportation dollars from federal micromanagement, earmarking, and budgetary pressures;
enable decisions regarding which infrastructure projects will be built, how they will be financed, and how they will be regulated to be made by persons best able to make those decisions;
eliminate the current system in which a federal gasoline tax is sent to Washington and through a cumbersome Department of Transportation bureaucracy;
prohibit the federal government from forcing unwanted mandates on states by threatening to withhold transportation money; and
achieve measurable congestion mitigation and infrastructure preservation and safety in a cost effective way subject to available resources.
It would be interesting to see what the presidential candidates think of the STATE Act and whether or not they support the goal of returning transportation taxing and decision making authority to the states.
The New York Timesreports today that New York taxpayers could save $1 billion a year through consolidation of government services and requiring government employees to make more contributions to their health insurance plans.
The recommendations come from a special commission formed last year to help identify ways to address New York's growing budget deficit of more than $5 billion and to help ease the state's high property tax burden.
According to the Times:
With the worsening state financial picture as a backdrop, the commission, headed by Stan Lundine, a former lieutenant governor, made many recommendations to eliminate layers of government and bring more consistency and efficiency to those that remain, in part by eliminating duplications like garbage pickup and tax collection. The report also suggested working toward a single, state-run jail system.
The commission identified thousands of local government entities distinct from county, city, town and village governments, including a profusion of “special districts” created to provide water, library and other services to the state’s sprawling suburbs. Those entities are studded with appointive jobs and many can levy taxes, helping give New York “arguably the most complex property tax system in the nation,” according to the commission’s final report.
The report’s recommendations were endorsed by Governor Paterson, a Democrat, who said that some of the local boards had become “patronage mills.” He called the changes an essential step toward bringing down New York’s high property taxes and coping with an economic downturn.
Succinctly summing up the tax and budget situation, commission member Howard Weitzman said:
“Taxes are high because governments spend money. And therefore, the less government we have, the less money we’ll be spending.”
While NY is looking at government consolidation to address its budget deficit, no details have been made public on how Washington elected officials plan to address our self-inflicted $2.5 billion forecasted deficit. In fact, rather than reduce spending in th!
e face of the projected deficit, state officials increased spending this year.
This spending increase coupled with the Senate Majority Leader's lawsuit to help make it easier to raise taxes indicates Washington state officials plan to close the deficit with tax increases, not spending reductions.
Jason Mercier is Director of the Center for Government Reform at Washington Policy Center. He is a contributing editor of the Heartland Institute’s Budget & Tax News, serves on the board of the Washington Coalition for Open Government, and was an advisor to the 2002 Washington State Tax Structure Committee. In June 2010, former Governor Gregoire appointed Jason as WPC’s representative on her Fiscal Responsibility and Reform Panel. Jason holds a Bachelor’s degree in Political Science from Washington State University.