Open Government

WPC's Center for Government Reform's mission is to partner with stakeholders and citizens to work toward a government focused on its core functions while improving its transparency, accountability, performance, and effectiveness for taxpayers.

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Roll Call

March 13, 2010 in In the News
Wenatchee World
Source: 
Wenatchee World
Date: 
Saturday, March 13, 2010

Will Treasurer be forced to use short term borrowing to pay bills?

March 12, 2010 in Blog

Governor Gregoire has officially called a special session to start next Monday. One of the bills to be considered will be the state's supplemental budget. Based on language currently in the House version of the budget, the state Treasurer may be forced to use short term borrowing to pay the state's bills, even if a "balanced" budget is adopted.

Consider Section 904 of the House budget:

"For purposes of RCW 43.88.110(7), any cash deficit in existence at the close of fiscal year 2010 shall be liquidated over the remainder of the 2009-2011 fiscal biennium."

The inclusion of this section seems to imply that House budget writers acknowledge the possibility that their budget could result in a cash deficit in the current fiscal year.

This would trigger the requirements of ="http://apps.leg.wa.gov/RCW/default.aspx?cite=43.88.110" target="_blank">RCW 43.88.110 (7):

"If at any time during the fiscal period the governor projects a
cash deficit in a particular fund or account as defined by RCW 43.88.050,
the governor shall make across-the-board reductions in allotments for
that particular fund or account so as to prevent a cash deficit, unless
the legislature has directed the liquidation of the cash deficit over
one or more fiscal periods . . ."

By ordering the liquidation of a cash deficit over the rest of the biennium, the Legislature would avoid the requirement that the Governor issues across the board reductions. It may not, however, help the Treasurer pay the state's daily bills if a cash flow problem occurs.

Last December the Treasurer warned he may have to resort to short term borrowing to pay the state's bills if cash liquidity wasn't improved.

I've contacted the Treasurer's office to see what would happen if a cash deficit does materialize as warned by Section 904 of the House budget. 

I'll post the reply once I receive it.

Labor benefits from proposed budget language

March 12, 2010 in Blog

Budgets are complicated and long piece of legislation, which is why hardly anyone actually reads them. But the devil is in the details, as they say, and two things in particular stand out in the House's version of the Senate's proposed supplemental operating budget. These two concerns would benefit labor at the expense of businesses and taxpayers.

First up, as pointed out by AWB's Jocelyn McCabe and Kris Tefft over at OlympiaBusinessWatch.com, a slimmed-down version of the employer gag rule was inserted into the budget. The language looks innocent enough, but there is reason to be concerned. The language in SB6444 (sections 205 & 206) says,

"No employer, provider, or entity receiving state funds to provide long-tem care services or services to the developmentally disabled may use these funds to assist, promote, or deter union organization."

Seems innocuous. The problem is the language is illegal due to a recent U.S. Supreme Court case where the Court invalidated a similar California statute that prohibited private employers that accepted state program funds from doing largely the same thing. Even if the language was not invalid due to the Court case, it would set a dangerous precedent from prohibiting employers from exercising their First Amendment rights simply because they accepted state program funds.

Secondly, the Evergreen State College's Labor Center is being relocated from the Evergreen State College to South Seattle Community College and at least $164,000 of state funds are being set aside to pay for its operations. The problem? An internal audit found the Labor Center guilty of 10 violations including violations of state ethic laws and the audit questioned whether or not the mission of the Labor Center is illegal. WPC's Jason Mercier researched this subject a year ago and reported the audit stated that:

A review of the Center’s mission statement and by-laws found that the revised documents currently used by the Center have not been reviewed and approved by Senior Management, the College’s legal counsel, or the Board of Trustees.  This created a lack of clarity of the activities and work allowed for the Center and boundaries for staff.  The Center’s mission creates close and strong ties with labor unions and in several instances, the members of the Center’s advisory board request and report on work to be done or which has been performed for labor unions. !
; A lack of a clear and approved mission and ambiguity related!
to the College’s relationship with these organizations provides the appearance of possible ethics issues.  Other possible ethics violations included:

  • The website provided readers with two petitions:  one asking U.S. Congress and the President to declare the birthday of Cesar Chavez a national holiday and another asking reader to stop patronizing Burger King.  RCW 42.52.180 specifically prohibits use of State resources for political purposes.
  •  In one instance, the website announces collections for an outside organization during a Center sponsored activity.  An announcement for a Farm worker’s Justice includes a wish list for Bellingham Cooperative and states donations for the cooperative will be collected as part of the event.  Collection during a campus event and announcement of this item on the Center’s website is a violation of the State Ethics Law prohibiting use of resources for an outside organization (RCW 42.52.160)
  • Both Center newsletters available on the College’s websites and minutes of the advisory board include numerous references to efforts to oppose federal agencies, a rally held as part of a Center managed workshop, political work of the union in several industries, and the Center’s partnerships with special interest groups, all of which provide the appearance of potential violations of RCW 42.52.180 prohibiting use of State resources for political purposes.
  • A review of the minutes for the advisory board meetings found several discussions about support of special interest groups.  In the October 29, 2006, minutes, a member suggests participation with an organization called “U.S. Labor Against the War”.  The committee agreed to advise the center to join the group and directed the Center’s Assistant Director to make a membership payment to the group in possible violation of the Ethics in Public Service Act. 

It remains to be seen if these provisions will survive the special session and upcoming budget re-writes. The first problem is one of legality, so that should take care of itself. The second problem is one of ethics, so who knows if the Labor Center will clean up its act or if the funding for it will be yanked. 

How your lawmaker voted: sine die edition

March 12, 2010 in In the News
The News Tribune (Tacoma)
Source: 
The News Tribune (Tacoma)
Date: 
Friday, March 12, 2010

Proposed state small business tax credit may have caveat

March 12, 2010 in In the News
Bellingham Business Journal
Source: 
Bellingham Business Journal
Date: 
Friday, March 12, 2010

Update: City B&O Tax and Spokane

March 11, 2010 in Blog

pan style="BACKGROUND-COLOR: #fcfae1; FONT-FAMILY: Helvetica; FONT-SIZE: 14px">mischaracterization of what he was trying to say. Cooley says his comments were simply a metaphor to highlight the economic value of Riverfront Park.

 

The City of Spokane’s Chief Financial Officer Gavin Cooley, in no-uncertain terms indicated he wants the city of Spokane to consider increasing taxes and mentioned once-again imposing a city-wide Business and Occupation tax.

 

While discussing options for how to pay for the purchase of the Downtown Spokane-Riverfront Park YMCA building, Cooley said the city needn’t accept an offer from Spokane County to buy the facility. Council members are trying to figure out how to pay off the $4.4 million debt they incurred when they bought the property and building.

 

Cooley said the city should look at increasing hotel taxes, selling parks or boosting property taxes. He then went on to remind the council about a B&O tax that once existed in the city to help pay for Expo ’74 improvements.

 

Never mind that both Spokane and Spokane County face enormous deficits, and that officials are already asking for higher property taxes for a new Spokane County jail. In addition, the B&O tax would only push more small business people to the brink and outside city limits. If Spokane wants to attract new businesses and new jobs, and keep the ones it already has, adopting higher taxes, and especially a new city B&O tax during a recession is not the way to do it.

New Jersey Governor targets size of state government

March 11, 2010 in Blog

With a special session all but assured for what the Seattle Times calls increased spending, it is interesting to hear what New Jersey's new Governor is doing to solve their budget deficit.

According to this article (N.J. Gov. Christie to create commission to privatize 2,000 state jobs):

Governor Christie Thursday will create a commission to privatize as many as 2,000 state jobs beginning next January, officials said Wednesday night.

As he grapples with an $11 billion deficit in the budget he will present on Tuesday, Christie is also considering invoking the Disaster Control Act to suspend Civil Ser!
vice rules to make it easier for him to lay off higher paid workers, according to two administration officials.

The Republican governor Thursday plans to sign an executive order creating the task force to cut the size and cost of the state payroll. Three officials familiar with his plans last night said the commission will identify which jobs or agencies would be operated by the private sector and how that would be accomplished . . .

Suspending civil service would allow Christie to order layoffs of higher paid unionized state employees with many years of service, rather than the usual practice of layoffs that affect lower paid new employees first, the officials said. Currently, workers with more seniority can "bump" less experienced workers from their jobs.

Christie’s office declined to comment Wednesday night beyond a brief statement about his schedule, saying he will create "a task force to study and make recommendations !
on the potential efficiencies to be gained from privatizing ce!
rtain functions of state government."

In other national news, while discussion of an income tax still can be heard on the floor of the Senate, lawmakers in Missouri are debating repealing its income tax and replacing with a broad-based sales tax.

According to Kansas City.com:

The Missouri Senate opened debate [last] Thursday on a bill to replace the state’s income tax with a higher and broader sales tax.

The bill would phase out the state income tax over a five-year period, beginning in 2013. In its place, the state sales tax would be expanded to include services and raised to as much as 7 percent . . .

Proponents maintain that the tax change would ignite business growth in the state and empower citizens by tying their tax burden to consumption rather than!
income.

“If we did this right,” said Sen. Luann Ridgeway, a Smithville Republican, “it could become the most important — and probably the most dramatic — chance for economic activity and job growth the state of Missouri has ever seen.”

Roll call

March 11, 2010 in In the News
SnoValley Star
Source: 
SnoValley Star
Date: 
Thursday, March 11, 2010

Senators: No per diem for special session

March 10, 2010 in Blog

Several Senators introduced a bill today to prohibit lawmakers from receiving per diem if called into a special session.

According to SB 6883 - Restricting the payment of legislators' expenses:

"During any special session of the legislature convened within thirty days following a regular session of the legislature under Article II, section 12 of the state Constitution, no member of the legislature shall receive any allowances for per diem expenses under Title 44 RCW."

As we previously discussed, if a special session is called it should be done by the Legislature and not the Governor to ensure that it is limited to only the budget.