Budget snap judgments

April 5, 2011

Notwithstanding the ill-advised decision to hold a public hearing only three hours after releasing the 472 page 2011-13 budget, Rep. Hunter deserves credit for producing a serious budget proposal.

Though I am still slogging through line-by-line, none of the "felony gimmicks" the Treasurer or Governor warned against are present though there are a few "misdemeanors" that are cause for concern.

Absent from the budget are any proposals to rely on:

  • a 25th month (though there is the use of an extra day for K-12 payments);
  • borrowing (except for fund transfers); or
  • the assumption of voter approval for tax increases.

Responding to the proposal, Governor Gregoire said:

“My staff will need more time to review the details, especially surrounding the $300 million assumption for privatizing the state’s liquor distribution center. Chairman Hunter has proposed a reasonable, thoughtful outline to begin the discussion in the Legislature. I am especially pleased to see an ending fund balance that is appropriate for the needs of these uncertain economic times."

The ending fund balance, and the balance sheet as a whole, is cause for optimism. As pointed out by Rep. Alexander, however, there is still too much reliance on one-time revenue and program suspension versus elimination:

“The can continues to be kicked down the road. Programs the state can no longer afford remain on life support, and the footprint of government continues to be larger than our taxpayers and economy can support. While I agree with many of the budget components we see before us today – and have worked with House Democrats on many of these issues – I and my colleagues in the House Republican caucus cannot support a spending proposal that is unsustainable and continues the use of various budgeting gimmicks to balance the bottom line.

I’ve seen go-home budgets before and this isn’t one of them. I’ve got a go-home budget that reduces spending by about a billion dollars more than the Democrat proposal. Because almost half of that amount comes out of the general fund, we don’t need to rely on some of the budget gimmicks that my counterparts do. We don’t push expenditures out into the next biennium and call them ‘savings’ today; we don’t rely on one-time money from securitizing the state’s liquor distribution center; and we don’t use the same money in both the capital and operating budget as the Democrats do with a portion of the Real Estate Excise Tax.”

Hopefully Alexander's plan will be available early today so lawmakers and the public will have an opportunity to consider the two proposals before the Ways and Means Committee is scheduled to take executive action on the budget at 3:30 tomorrow.

Though the sustainability of the budget is still in question, budget writers are to be commended for producing a thoughtful proposal and coming within throwing distance of aligning spending with the revenue forecast and not resorting to "felony gimmicks."

Not bad for the first legislative salvo in the budget debate.

Next we'll see if House Republicans or the Senate's proposal can improve on the balance sheet's health and the long-term sustainability of the budget.