Washington Policy Blog

Washington's Five Worst Environmental Moments of 2008

December 30, 2008 in Blog

It was a mixed year for environmental policy and we saw the good and the bad. If there is one theme, however, it is that 2008 was the year of eco-fads. Science and thoughtful policy were set aside frequently in the name of showing "leadership" on environmental issues. As we've noted before, "leadership" is the justification politicians cite when there is no other compelling reason to support a particular policy. What all of these share is not only that they are expensive or science-free, but that they will actually do harm to the environment by distracting from approaches that truly improve environmental stewardship.

So, here are the worst environmental moments of 2008. Feel free to add any moments you think deserve mention in the comments.

Honorable mention:

Here are the top five.

5. "We're talking about remaking the economy of the nation, the whole globe." - Becky Kelley of the Washington Environmental Council on the passage earlier this year of the state's legislation to reduce greenhouse gases. The foolishness of this statement, from the environmental community's lead on climate issues, is remarkable. The economy is extremely complex (as we are seeing now) and efforts to "remake" the economy have repeatedly failed. Even small efforts to change the economic calculus are fraught. Witness the impact of biofuel mandates on food prices. As long as environmental activists believe they can remake the economy, they will continue to fail to improve the environment and will damage prosperity and jobs.

4. Seattle's Car Free Days. This program, designed to make it difficult, or impossible, to drive your car in Seattle earned ridicule even from the enviro-conscious residents of Seattle. Fundamental to the environmental philosophy of the left is the belief that politicians need to force people to change their lifestyle. That approach often fails, as evidenced by the backlash to the program because people often have their own ideas. As WPC's Brandon Houskeeper noted in his analysis of the program, the City didn't even make an effort to see if the campaign actually reduced CO2 emissions. This was the ultimate in policymaking to show leadership.

3. Banning bonfires on Alki. The City of Seattle ended up deciding against this policy, but it is another example of commitment to the cause displacing science. We wrote about Seattle's effort to ban bonfires on the WPC blog earlier this year. Banning bonfires would have done little (or nothing) to reduce CO2 emissions. Trees absorb carbon from the atmosphere. Burning wood then releases that CO2 which is absorbed by other trees. This is why biomass is listed as a renewable energy source by the state's "green" energy law. It was an ill-considered proposal that lacked science or common sense.

2. Washington's Cap-and-Trade legislation and the Western Climate Initiative. The state's approach to reducing greenhouse gases has turned into a hodge-podge of approaches that will encourage political game playing, require wide-reaching efforts to force lifestyle changes, will cause dramatic economic costs and will ultimately fail to achieve meaningful reductions in CO2. Other than that, it is fine. The accounting system that underlies the Western Climate Initiative is extremely complex and the result of a political negotiation. Is it any wonder that the two biggest financial collapses of this decade, Enron and the housing bubble, involve accounting games? WCI creates an accounting web many times more complex. That complexity is an invitation to gaming the system as the Government Accounting Office's recent report on Europe's cap-and-trade makes clear. Fortunately, th!
at complexity is beginning to cause some to look for alternatives.

1. Seattle's decision not to salt roads during the December snowstorm. This list is fairly Seattle heavy, but they have earned it. This is another policy undertaken without good science or clear thinking. In justifying the sorry state of the roads during the storm, the City claimed that salting the roads was bad for the environment. The Seattle Times reported, however, that some believe the approach ultimately chosen by the city, sanding the roads, may be more damaging. While I was at the Department of Natural Resources, our top concern in forestry was to keep silt and sand out of the water, so it would not surprise me if the City's current strategy did more damage. Ultimately they chose to risk the safety of people and access to businesses during Christmas in favor of ill-conceived environmentalism. p>

It wasn't all bad this year. There are some good moments as well. We list the top five good moments tomorrow.

Who needs science when we're saving the planet?

December 29, 2008 in Blog

A British group, Sense About Science, has published their Celebrities and Science Review 2008 and one issue we've addressed in the past made the list.

Both Barack Obama and John McCain indicated that they believe the vaccine preservative Thimerosal was linked to rising autism rates. The President-elect noted during the campaign that:

"We've seen just a skyrocketing autism rate," said President-elect Obama. "Some people are suspicious that it's connected to the vaccines. This person included. The science right now is inconclusive, but we have to research it," he said.

The problem is that numerous studies have disproven the link. Earlier this year a study noted that even though the preservative was banned in California several years back, autism rates continue to climb. The problem is that this eco-fad needlessly increases the cost of vaccines and distracts from efforts to find the real cause of autism. Researching proven dead ends is costly and dangerous.

The study lists numerous other scientific errors made by celebrities and politicians. This is an ongoing problem in environmental policy. The City of Seattle's decision not to salt the streets to clear the snow is another example. As long as we are making policy decisions based on fads, not science, we shouldn't be surprised when the result is bad for prosperity and the environment.

Seattle's decision to use sand on snow and ice proves to be a slippery slope for the environment and commuters!

December 23, 2008 in Blog

An article in today's Seattle Times, by Susan Kelleher, highlights the different strategies being used by major jurisdictions across our region for dealing with the compact snow and ice that have plagued our streets for more than a week.

Unlike most other cities and transportation authorities, like the Washington State Department of Transportation, the City of Seattle has elected to not use salt to clear local roadways.  Instead Seattle officials have elected to only use sand, which is placed on top of the snow and ice.

So why has the City of Seattle elected to forgo salt in favor of sand?

According to Alex Wiggins, the chief of staff for the City's Department of Transportation , the City has, "decided not to utilize salt because it's not a healthy addition to Puget Sound."

Despite Seattle's environmental concerns for the Puget Sound other local jurisdictions have been using alternatives such as salt to help keep up with the conditions.  As noted in today's Timesarticle, Kelleher points out that other jurisdictions are wary of sand due to the same environmental concern expressed by Seattle officials for their local water quality.

Ann Williams, spokeswoman for Denver's Department of Public Works said:

"We never use sand...sand causes dust, and there's also water-quality issues where it goes into streets and into our rivers"

In fact, earlier this year the Puget Sound Partnership released their road map to protecting and restoring the Puget Sound.  A center piece of the Partnership's plan is a study done by the State Department of Ecology which noted that more than fifty-two million pounds, or approximately twenty-six thousand tons, of sediment, metals and other materials are washed into the Sound annually.  In comparison the City of Seattle has pored more than six thousand tons, or about one-fifth of the total annual tonnage reported by Ecology, on to City streets within the past week.

So is sand really better for the environment?

Diane Spector, a water resource planner with Wenck Associates told the Times that:

"The occasional application of salt is probably not going to have a lasting effect...it's highly dependent on where it's used, how often and how much is applied."

Finally this little nugget according to Wiggins at the Seattle Department of Transportation:

"If we were using salt, you'd see patches of bare road because salt is very effective."

So despite the acknowledgment that salt is effective and would bring immediate relief to the taxpayers and businesses in the area, the City of Seattle will continue to use sand because they believe it is better for the environment, although others clearly disagree.

Local mayors' appetite for pork

December 18, 2008 in Blog

Earlier, I wrote about how cities across the country have compiled a list of infrastructure projects that should be funded by the federal government.

Now, according to the National Taxpayers Union, and this article from CNN, some of the mayors' requests could be considered "pork," including a polar bear exhibit, a water park ride and an aquatic center.

This got me thinking about what our local mayors requested. Sure enough, here are some of the questionable spending requests:

  • Stadium improvements at Auburn Memorial Stadium: $1,600,000
  • Rerouting a creek in Bremerton: $6,000,000
  • Habitat for Humanity housing in Everett: $300,000
  • Major home repairs in Lakewood: $150,000
  • Qwest Field improvements: $7,000,000
  • Nutrition Program space rehabilitation in Seattle: $316,000

In January, WPC released the Washington State Piglet Book, which highlighted the problem with pork spending at the state level.

Governor's budget proposal

December 18, 2008 in Blog

There will be a lot written and said about the Governor's budget in the coming days. We will hear a lot about drastic cuts and how the state will cease to function because of the Governor’s proposed changes. One point that may get lost in the debate but shouldn't is the fact that despite very real reductions in some programs, overall state spending will still be higher biennium over biennium if the Governor's budget is adopted.

That's right - the overall budget will still grow over previous cycles.

General Fund State Spending Growth
(Dollars in Millions)

Budget

Expenditures

$
Increase

%
Increase

1999-01

$21,046.7

$1,887.8

9.9%

2001-03

$22,548.8

$1,502.1

7.1%

2003-05

$23,671.7

$1,122.9

5.0%

2005-07

$27,766.1

$4,094.4

17.3%

2007-09*

$29,412.0

$1,645.9

5.9%

2009-11*

$30,579.0

$1,167.0

4.0%


*As proposed by Governor 12/18/08

How is this possible? Despite the economic situation state revenues are still projected to grow biennium over biennium though at a slower rate than initially thought but it is growth nonetheless. This is in contrast to the 2001-03 budget cycle when revenues actually decreased from the 1999-01 levels.

General Fund State Revenue Growth
(Dollars in Millions)

Budget

Revenue

$ Increase

% Increase

1999-01

$21,262.1

$1,642.0

8.4%

2001-03

$21,140.7

<$121.4>

<0.6%>

2003-05

$23,388.5

$2,247.8

10.6%

2005-07

$27,772.0

$4,383.5

18.7%

2007-09

$28,626.6

$854.6

3%

2009-11

$30,070.4

$1,443.8

5%

We'll have more to say about the Governor's budget after we've had time to read it line-by-line. Assuming the Governor effectively prioritized and selected those programs demonstrating the best results, she should fight hard for her proposal and not let the Legislature use it as a floor for budget discussions. She should also fight legislative efforts to raise taxes.

The Governor is absolutely correct when she said today: "No way to tax your way out of this problem. We have to live within our means."

NY's budget woes

December 18, 2008 in Blog

Just ahead of the Governor's release of her proposed budget later this morning comes news out of New York that might provide ideas on what not to do. Granted, Governor Gregoire's budget has been written for some time but as legislators wrangle over the details in the coming session they have the opportunity to avoid expanding the reach of government.

The state of New York is facing a $15.4 billion budget shortfall and Governor David Paterson is proposing billions in new state taxes to help make up the gap. His office released its 2009-2010 Executive Budget yesterday and with it came 137 new or increased taxes and fees. Some of them are making national headlines:

  • Extend sales tax to cable and satellite television and radio
  • Repeal the sales tax cap on motor fuel
  • Increase the tax on flavored malt beverages
  • Tax coupons: Impose sales tax on the amount paid by the customer plus the amount of the coupon rather than on the net discounted price
  • Impose state and local sales tax on purchases of prewritten software, digital audio, audio-visual and text files, digital photography, games  and others. [this is being called the iTunes Tax]
  • Increase motor vehicle registration fees by 25 percent
  • Reissue license plates in the next 2 years and increase the associated fees by 67%
  • Increase the bi-annual physician registration fee by 67%
  • Impose a tax-preparer tax, all persons compensated for the preparation of 10 tax returns or more must now pay $100

Again, as is the case in Washington, the New York legislature will iron out the details so not all of these are set in stone. But now that these new or increased taxes and fees are already in the proposed budget, the burden will fall on policymakers to prove that the new taxes should not be passed, rather than justifying that the taxes should be enacted.

During this last election, Governor Gregoire promised to not raise taxes to solve Washington's budget deficit. Perhaps New York and it's new or expanded 154 taxes could be used as a cautionary tale: "Taxes Gone Wild!"

The full list can be seen on the New York State's website.

 

2009 Washington Business Climate

December 17, 2008 in Blog

Russ Roberts, an economist at George Mason University has an excellent economics podcast at www.econtalk.org. This week he focuses on the Great Depression and includes a quote from P.G. Wodehouse's book Jeeves in the Morning. Wodehouse provides this psychological profile of businessmen from the 30s that will soon be appropriate again in 2009:

Over in America, it appears life for the business man is one long series of large cups of coffee, punctuated with shocks from the New Deal. He drinks a quart of coffee, and gets a nasty surprise from the New Deal. To pull himself together, he drinks another quart of coffee, and along comes another nasty surprise from the New Deal. He staggers off, calling feebly for more coffee…

Coffee and nasty surprises from government tinkering...the business climate for Washington in 2009.

Obama should bring government transparency into the 21st century

December 17, 2008 in Blog

The Examiner (Washington, D.C.) published our op-ed today on the need for President-elect Obama to make fundamental reforms to improve government transparency and accountability. I teamed up with Patrice McDermott, Director of OpenTheGovernment.org, to write the op-ed.

It is based on the national 21st Century Right to Know Coalition's recommendations to Obama published last month.

Here is an excerpt from the op-ed:

Even if secrecy was not on the rise, President-elect Obama would still face significant challenges in making government more transparent. At t!
he root of the problem is that government is still grounded in a 20th century (some might even say 19th century) approach to openness. Yet today’s interactive technologies make it possible to make quantum leaps forward in improving transparency.

Transparency is a powerful tool to demonstrate to the public that the government is spending our money wisely, that politicians are not in the pocket of lobbyists and specials interest groups, that government is operating in an accountable manner, and that decisions are made to ensure the safety and protection of all Americans. Effective transparency means that the public has access to accurate information in a timely manner. With today’s technology, it also means such information should be available in searchable formats, making it easier for commercial or government search engines to sift through mountains of material . . .

Obama has many transparency models he can pull from. For example, immediately upon!
taking office in January 2007, Florida Governor Charlie Crist!
issued an executive order on government ethics that created a new Office of Open Government; ordered training on public records, open meetings, and records retention; required comprehensive reviews of agencies’ performance in providing the public access; and directed agencies to use plain language to make information more understandable. The Crist order is a perfect example of laying out a policy vision for government transparency in a manner that conveys the importance of the issue.

Even though Washington State is ahead of the curve when it comes to open government, there are many recommendations from the 21st Century Right to Know Coalition's report in Chapters D & E that are
applicable for the state.

These recommendations were discussed at a meeting in Baltimore back in September.  Here is a copy of the full report: 21st Century Right to Know Recommendations

Viaduct planning is upside down

December 16, 2008 in Blog

Comparing the performance data of the original eight scenarios reveals some very interesting data.

Viaduct planners expect about a 50% increase in transit trips in Seattle over the next seven years. But according to the American Public Transportation Association's (APTA) annual ridership reports, transit trips for all of King County have only risen by 13% over the last seven years.

How do they expect such a disproportionate increase in transit ridership?

As I suggested in an earlier post, Viaduct planners are underestimating road!
demand
by assuming a large number of people will either stop driving into Seattle or shift to another mode, like public transit.

Perhaps more troubling is the negative impact on traffic congestion. The performance analysis measures travel times on certain corridors during peak commute times for each scenario. Even with their assumption that vehicle trips will decrease, the travel times along the Viaduct corridor will increase under every scenario.

Travel times along I-5 are slightly better depending on the option selected. The surface scenarios worsen travel times on I-5 while the road scenarios generate shorter times.

The performance analysis also measures each option's impact on three freight corridors. Not surprisingly, every option shows a significant increase in travel times. Some by as much as 50%. This is probably why the following headline appears in today's Seattle Times: >Port urges more study of viaduct tunnel hybrid.

I would think that when policymakers replace a piece of infrastructure, they would want travel times to be less than they were before it was replaced. But even with their overestimation of transit ridership and underestimation of road demand, traffic congestion will worsen. 

The WSDOT has now moved beyond these original eight options by combining the "best" pieces into two hybrid finalists. Unfortunately, the WSDOT has not completed the same level of performance analysis as they did with the original eight. Once they do, I will make the same comparisons. The governor has said, however, that she will continue to consider all the options on the table.

Political Presents Under the Tree

December 16, 2008 in Blog

The Seattle Times reported recently that Governor Gregoire favors allocating free carbon credits to companies in Washington as part of the cap-and-trade system she advocates. Companies would be allowed to emit the same amount of CO2 as they have in the past. If they are able to reduce their emissions, they can sell the allowances they were given from the government. The allocations would decline year to year, but the initial allocation would be based on historical emissions - plus politics.

This system was used in Europe and led to some companies being given large excesses of carbon credits which they then sold on the market. In short, government gave something of value (carbon credits) to companies who then profited from them. Worse, a recent report by the Government Accounting Office found that politicians handed out presents, choosing winners and losers when it came to handing out allocations, leaving some industries short and others long.

Most power generation facilities were short whereas industrial facilities, including iron and steel; manufacturing ceramics; and pulp, paper, and board manufacturing were long. Member states allocated the shortage to the power sector because they believed this sector could reduce emissions at a lower cost than covered entities in other sectors. In addition, there were concerns that compliance with the ETS (emissions trading system) would create costs for covered entities that compete with facilities outside the EU that are not subject to carbon limits. Therefore, member states generally allocated the surplus to the globally competitive industrial sectors and the shortage to the power sector, which does not generally compete with entities outside the EU.

In other words, politicians changed the allocations arbitrarily to favor some sectors over others for political reasons. This is a major problem with cap-and-trade. Free allocations allow politicians to hand out favors to those they like and punish others. Some of these accounting games have already occurred.

It is one reason why the EU is not likely to meet the Kyoto targets. Governments over allocated credits in an effort to limit the impact on the economy, making it difficult to reach the targets.

The alternative to free allocation is auctioning. There are some advantages to this system, but the version of auctioning favored by the environmental community would be worse than free allocations and would amount to a multi-billion dollar tax increase in the middle of a recession.

A complex system like cap-and-trade invites accounting tricks and political favoritism. That's why many who once favored cap-and-trade are looking to other alternatives to reduce the risk from CO2. Unfortunately, Washington seems mired and married to a bad system.

Spending Our Way to Green Jobs and Cheap Energy

December 15, 2008 in Blog

Today's Seattle Times features a story from Les Blumenthal about a plan to create 50,000 "green" jobs by spending billions for a new green energy infrastructure. He writes:

As the current economic downturn deepens, there is talk of another major public-works project for the Northwest, one that would deliver green wind power to the Interstate 5 corridor, which connects Seattle and Portland, and by some estimates would help create 50,000 jobs.

Later, there is a cost of $1.8 billion mentioned for some, but not all, of the work. This article is a textbook example of the sloppiness of claims about "green" jobs.

First, the 50,000 jobs isn't the result of the spending but the total potential number of jobs in the wind energy sector overall. The spending advocated by Rep. Inslee and Sen. Cantwell would "help" create those jobs. They appear to be taking credit for all the jobs when this program would be only a small portion of the costs. How many new jobs are dependent on this program? They don't say, perhaps because the link is so tenuous that any claim would be unverifiable. So they offer a large number in the hopes that people will fixate on it but they qualify it to the point where it is meaningless (i.e. it "could" "help" create the jobs).

Second, the jobs come with a cost because the cost of the program will be paid by ratepayers. BPA is required to pay the costs of the new infrastructure back to the Treasury, meaning it will have to increase rates. The article doesn't estimate how much it would cost ratepayers, it only  mentions the potential increase in jobs. Thus, even if we are paying ten to do the job of one, they figure, at least we are creating jobs. When costs are considered, however, people might have a different idea.

Third, this is treated as a jobs program a la the New Deal. The assumption is that government spending can be used to create jobs effectively. There are many problems with this concept. If government spending creates jobs without cost, why not have the government control 100% of the economy? Spending, government or private, is only as good as the return on that investment (we could hire everyone into the military which would create lots of jobs but it is a bad investment). Spending on bad investments is bad for jobs and prosperity. Spending well helps growth and government is notoriously bad at choosing wise investments. Harvard economist Greg Mankiw notes that two recent studies (one by the Chair of Obama's Council of Economic Advisors Christina Romer) indicate that spending by government is about one-third as effective at creating economic growth as i!
nvestments made by business. Thus, taking money from the private sector to spend in the public sector isn't a good strategy in the medium- to long-term. And even when it provides short-term stimulus, it has a disproportionate future cost.

Finally, advocates of alternative energy often argue that such energy sources won't significantly increase the cost of energy. This article, however, shows that they try to have it both ways. They argue that alternative energy doesn't cost more but that the billions in spending to support green energy is good because it creates jobs. We have argued in the past that incorporating the costs of the risk from CO2 into carbon-based energy is appropriate, but we need to be honest about the various costs of energy and the trade offs. Pretending there are no trade offs is precisely why politicians consistently make poor environmental and economic decisions.

There are certainly reasons to modernize the grid and reasons to diversify our energy portfolio. But we shouldn't pretend that there are no costs associated with spending to achieve a political goal, whether that is meeting an artificial alternative energy target or taxing some sectors of the economy to create jobs in other sectors.

Your budget recommendations

December 15, 2008 in Blog

The Governor asked and you answered.

I've spent the last few hours reviewing the volumes of budget recommendations provided to the Governor in response to her request for suggestions. So what have you been saying? Here is a sampling:

  • Don’t ask for federal bailout money.
  • Cut salaries versus layoffs.
  • Get the state out of the liquor business.
  • Increase state employee health care cost sharing.
  • Promote more telecommuting and more teleconferencing.
  • Merge state agencies with similar responsibilities (L&I/ESD).
  • Eliminate prevailing wage.
  • Consolidate state offices to save on rent.
  • Simplify and streamline all processes, such as contracting. Make things easier to accomplish, not more difficult.
  • Eliminate all state travel except field and work with the public.
  • Re-negotiate the union contract and eliminate pay raises for all employees – managers, elected officials, everyone for the next 4 years.

Here are additional recommendations and WPC's suggestions.

Many thanks to the Governor's office for responding so quickly to my records request and providing this information.

Google Has its Cake...

December 15, 2008 in Blog

Images An article in today's Wall Street Journal is causing quite the stir in the tech policy community. Google, long a proponent of Network Neutrality (an issue WPC commented on in November), was essentially caught with its pants down as it was supposedly negotiating with a major cable and tele!
phone company to create a fast-track for its own content.

Net neutrality, the idea that no network provider (think AT&T) could prioritize the data that streams through its broadband cable lines, was championed by Google et. al. in the tech community for the last several years. Essentially, the content and search providers were worried that the network providers would freeze, or de-prioritize, the content providers' data. Outside of the infamous Comcast case from earlier in the year, there has been little-to-no evidence that network providers have been surreptitiously slowing down data. They have, however, taken steps to cap usage (Comcast implements a surcharge for usage over 250GB per month). Read more about Net Neutrality.

Anyway, the real story out of the Jour!
nal
today shows that Google is seemingly being two-faced !
over this issue. For years they have lobbied for Net Neutrality, but now it looks like they are backing off this idea in favor of a system that could actually favor them because of their dominate position in the market (plenty of cash on hand).

How charming it is then, to see a company espouse a strong regulatory structure when it suits them, but then pulls a 180 and supports a market solution knowing full well they can have the upper hand?

Viaduct performance analysis underestimates road demand

December 15, 2008 in Blog

First of all, despite the years of trouble with replacing the Viaduct, I am pleasantly pleased with the state's current process of comparing the list of possible scenarios. Typically, spending in transportation is tied to political agendas and which constituency has the most influence. Surprisingly, this new method is right in line with WPC's call for tying transportation spending to performance measures and weighing how each option achieves them.

But reviewing some of the underlying modeling used to define the performance of each scenario shows the measures are based on unrealistic assumptions.

Take for example the following table (page 6) presented to the Stakeholder Advisory Committee, which shows the mode share of each scenario as i!
t compares to today's mode share.

Mike_Chart

The modeling shows an 8% to 11% drop in Single Occupant Vehicle (SOV) use, and a corresponding increase in non-motorized (walking and biking) and public transit use. In other words, Viaduct planners are assuming that about 10% of those who currently drive into the city will switch to transit, biking or walking over the next seven years.

Most everyone who uses the Viaduct is driving into Seattle from some other place. None of those people will switch to biking or walking because its too far away. So the mode-switch to non-motorized forms
of transportation simply will not happen. Sure, more people will walk and bike with the new
improvements but they will not be the same people who currently drive on the viaduct.

As far as those people switching from SOV's to transit...transit options already exist today.
So adding more transit will not convince current SOV users to make the switch. Just look at historical mode share patterns to see t!
hat building more transit does not translate into a greater share of people using it.

Sure, some might. But Viaduct planners are assuming a 10% switch in seven years! That simply will not happen. If they are not using transit today, the likelihood they will switch in the next seven years is extremely low.

The assumption that about 10% of motorists will no longer drive into the city over the next seven years is unrealistic and underestimates road demand in Seattle. As a result, the surface options probably appear more favorable than they normally would.

Deficit not that bad . . .

December 15, 2008 in Blog

. . . so says Speaker of the House Frank Chopp. According to the Tri-City Herald:

House Speaker Frank Chopp said Washington's projected deficit may not be as bad as it looks.

Chopp,
a Seattle Democrat, was in the Tri-Cities on Friday for a forum with
the Columbia Basin Badger Club, a local group that grills politicians
and newsmakers on political issues without taking sides.

Several
club members from the audience of about 75 asked Chopp about the state
budget, which officials estimated in November would face a $5.1 billion
shortfall in the upcoming biennium.

But Chopp said
the doom-and-gloom prophecies include estimates for $1 billion in
spending on new programs, which seems unlikely given the current
revenue picture.

"In fact, we won't do that now," he said.

Some programs -- like the idea of offering all-day kindergarten -- will have to wait until the economy turns around, he said.

Chopp
identified several ways he expects the Legislature will look at
slashing spending so it doesn't have to borrow money to balance the
budget.

Among those were cutting programs added to the budget in
recent years that aren't working, like a job search program through the
Employment Security Department that has only a 5 percent success rate.

"We're going to wipe that out," Chopp said.

Kudos to the Speaker for putting the budget discussion into context. It is also important to remember that state revenues are projected to be $855 million higher in the current budget than the last and $1.4 billion higher for the next budget.

General Fund State Revenue Growth
(Dollars in Millions)

Budget

Revenue

$ Increase

% Increase

1991-93

$14,862.2

-

-

1993-95

$16,564.6

$1,702.4

11.5%

1995-97

$17,637.7

$1,073.1

6.5%

1997-99

$19,620.1

$1,982.4

11.2%

1999-01

$21,262.1

$1,642.0

8.4%

2001-03

$21,140.7

<$121.4>

<0.6%>

2003-05

$23,388.5

$2,247.8

10.6%

2005-07

$27,772.0

$4,383.5

18.7%

2007-09

$28,626.6

$854.6

3%

2009-11

$30,070.4

$1,443.8

5%


Source: Washington State Economic and Revenue Forecast Council

It will be very interesting to see what the Governor proposes this Thursday when she releases her budget. Last week WPC sent the Governor our suggestions for budget reform. Here is an excerpt from our letter:

Washington Policy Center would like to offer its assistance in light of the state’s budget outlook. We appreciate your commitment to balance the 2007-09 and 2009-11 budgets without raising new taxes and fees. We share your belief that this is a unique opportunity to rethink what the government does and how it delivers vital services to the public.

Our organization stands ready to help in any way that you find useful to bring about the fundamental budget ref!
orms in which you have expressed interest . . .

To offer constructive suggestions, we have enclosed our “Do not buy list,” which we adapted from your 2009-11 Priorities of Government report, as well as a list of eight reforms that we believe will help put the state on the path toward a sustainable performance-based budget.

To read the full letter click here.