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.

What's New

Another title only ghost bill on the agenda today

March 10, 2010 in Blog

Stop me if you've heard this before, a legislative committee is holding a public hearing and is scheduled to take executive action on a title only bill at 12 p.m. today.

Based on the one sentence text of the bill it may be more appropriately named the: "Everything and the kitchen sink so we can go home act of 2010."

The final language ultimately adopted (once it eventually becomes available) could be the best thing since sliced bread, but we won't know until after the fact.

Details, or lack thereof rather, below:

Ghostbill

!

History of Bill

as of
Wednesday, March 10, 2010 7:50 AM

  Sponsors: Representative Linville
 
  2009 REGULAR SESSION
    Apr 16  First reading, referred to Ways & Means. (View Original Bill)

  2010 REGULAR SESSION
    Jan 11  By resolution, reintroduced and retained in present status.
    Mar 10  Scheduled for public hearing and executive session in the House Committee on Ways & Means at 12:00 PM. (Subject to change) (Committee Materials)
Go to history...
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Available Documents
Bill Documents Bill Digests Bill Reports
Original Bill
 
Bill Digest
 
 

Is a special session necessary?

March 9, 2010 in Blog

Running against a constitutional clock to adjourn in a few days some lawmakers are openly discussing the need for a special session to balance the budget and raise taxes on recession strained Washingtonians.

As noted by the Seattle Times:

"Past a longshot," was how Sen. Rodney Tom, D-Bellevue, summed up the odds Monday for an on-time finish.

The regular session is required under the state Constitution to end by midnight Thursday. A special session, which would have to be called by Gov. Chris Gregoire, would bring inevitable criticism about the extra $20,000-a-day cost to taxpayers for legislators' expenses.

But some Democratic leaders say a brief special session — say about a week — could be justified given the size of the state's budget woes.

"We&#!
39;re dealing with the largest fiscal problem the state Legislature has faced since the Great Depression," said Sen. Ed Murray, D-Seattle, one of the budget negotiators. "I think we need to go into a short special session to get it right."

After rejecting calls for a special session last fall when the state's finances further deteriorated, do lawmakers deserve overtime if they fail to do their job during the constitutional 60-days provided?

There is another solution as highlighted by House Speaker Pro Tempore Jeff Morris.

Morris told the Capitol Record:

"I think something that’s not been widely talked about is not adopting a budget at all !
is an option. We have a supplemental budget -– if we didn’!
t adopt one and if we got into a cash flow issue, the governor has the authority to start doing across-the-board cuts . . . if we can’t get people together with either an agreed to budget number or what taxes are need to buy state services back then that would be an option. That would probably be the most draconian but one that would be the most expedient."

According to 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 . . ."

Lawmakers chose not to solve the state's budget deficit last fall and are on the verge of failing to do so again during the 60-day 2010 Session. State law provides a remedy for the Governor to balance the budget if the Legislature is unable to do so.

If a special session is called, however, it should be done by the Legislature and not the Governor. According to Article 2, Section 12 of the state Constitution, only a special session called by the Legislature is limited to a specific topic. If called by the Governor, lawmakers are free to consider any bill or policy.

The last thing taxpayers need is a "Christmas tree" special session where votes are traded in exchange for new shiny ornaments of spending or policies.

UPDATED: Life Sciences and Research Targeted with 100% Tax Increase

March 9, 2010 in Blog

If you were up late last night (technically this morning I guess) you could have seen the House pass its tax package on a 52-45 vote. 

There is much to discuss about the 162 page bill that can be read here, but interesting enough amongst the menu of tax increases is a tax on the very life science industry the Governor has been pushing for several years. 

The language in the bill doubles the B&O tax 0.5 percent, from 0.484% percent to 0.984% percent (a 100% tax increase) for non-profit research and development, while for-profit R&D will see a 33% increase in their rate, from 1.5% to 2.0%:

"Scientific research and development services including but not limited to research and development in the physical, engineering, and life sciences (such as agriculture, bacteriological, !
fit research and development should be under the 0.484% catego!
ry, not the 1.5% category, which means the 0.5% increase represents a doubling of the tax rate, not thirty-three percent increase.  However, for-profit research and development is under the 1.5% service category and would see a 33% increase if this bill becomes law.

Legislature proposes $130 million of fee increases

March 8, 2010 in Blog

Long has there been arguments over what constitutes a "fee" increase versus a "tax" increase. It seems each year the legislature fights over the definition, even if the minds are made up about increasing whatever it is they end up calling it.

Senate Bill 6444, the supplemental operating budget, includes $130 million in fee increases over the next ten years. Many of these will hit the business community right in the pocketbook -- and so it doesn't really matter if it is a "fee" or "tax" increase; the point is that someone has to pay.

Some highlights ($$ total over 10 years):

  • Acupuncture license fee -- $1.2 million
  • Adult family home license fee -- $44.2 million
  • Animal massage practitioner license fee -- $230,000
  • Boarding home license fee -- $9.6 million
  • Dental license fee -- $8.3 million
  • Farmworker housing fee -- $1 million
  • Mental health counselor license fee -- $2.2 million
  • Nursing license fee -- $26 million
  • Nursing Assistant license fee -- $10.2 million
  • Nursing Home license fee -- $11.4 million
  • Optometry license fee -- $655,000
  • Respiratory Therapist license fee -- $2.2 million
  • Child care provider license fee -- $5.4 million

Not all fees are bad. Sometimes the fees go towards programs or expenses that incur costs from a specific activity -- one that a general tax should not pay for. But, as in the tax discussion, the increase in fees should be weighed carefully against the benefits of levying the fee because it just raises the cost of doing business.

Idaho Governor to taxpayers: We'll love you if your state won't

March 8, 2010 in Blog

Tax policy is one of the ways states compete with each other for businesses. It looks like Idaho Governor Butch Otter is taking this to heart.

Today Otter released a "love letter" to businesses in Washington and Oregon. Here is Otter's letter in full:

            It’s true that a rising tide lifts all boats. But how those boats are handled makes a big difference when the tide is out and the waters get rough.

            State governments across the country are dealing with the continuing national recession in different ways. In Idaho, our focus is on stability. Predictable tax and regulatory policies are what our employers need in order to maintain their operations through t!
his rough patch, and it’s what employers elsewhere are looking for when they consider expanding or relocating.

            Other states, however, have chosen some interesting and in my view counterproductive approaches. Last month, for example, Oregon voters approved their legislature’s decision to raise taxes on the wealthy and on many businesses by $727 million. The immediate result was that my phone started ringing – and so did phones over at our Department of Commerce. It seems that word has spread about our Project 60 initiative, and that we are open for business, including theirs!

            The businesses that have called are emotional about this subject, and they have every right to be. Rising costs – especially during a recession – could put some employers out of business, or at least prompt layoffs. Mo!
re than 2,000 Oregonians joined a Facebook group to protest th!
e tax increase and commiserate about the repercussions. No less an Oregon business icon than Nike’s Phil Knight calls it “Oregon’s Assisted Suicide Law II.”

            Legislators in the state of Washington are talking about even bigger tax increases to tackle a budget deficit that figures to be as big as Idaho’s entire State budget. Businesses in both states are like those in Idaho; they are facing the most challenging times in decades, and even incremental cost increases can mean the difference between surviving and closing up.

            The problem in Oregon is that folks were convinced that state government was what needed to be shored up rather than the jobs- and revenue-producing private sector for which state government is supposed to work. As a result, they’re chasing some of their cash cows to the b!
order. And I welcome those businesses with open arms.

            We now are reaching out to hundreds of Oregon businesses, and will do the same with those in Washington if the legislature there follows Oregon’s lead. We aren’t offering many bells and whistles, but what we can offer is a business-friendly State government, a highly qualified and motivated work force, and communities where people understand that while government cannot be the solution to their problems it can and must be a champion for their own solutions.

            Businesses small and large are the backbone of Idaho’s economy. They employ our citizens, who in turn can provide for their families. Businesses and individuals also pay reasonable taxes that enable State and local governments to provide such essential services as public schools and publ!
ic safety. And make no mistake: Any business that doesn’t pass along !
its operating costs to consumers – including their tax bills – doesn’t stay in business for long.

            Of course, Oregon businesses can choose to accept their higher tax burden, and many will. After all, I understand that the quality of life over there is pretty good. But they have nothing on Idaho in that regard.

            For those Oregon businesses facing a decision about whether to lay off employees or close their doors entirely, I have a proposal: Move to Idaho. The Tax Foundation rates our corporate tax burden at 17th in the nation, compared to Oregon’s ranking of 31st.   Our individual tax burden is lower, too. Those kinds of numbers can make a real difference to a bottom line.

            For Oregonians reading!
this: Find the best Idaho community for your business by visiting us online at www.gemstateprospector.com. Or call our Department of Commerce toll free at 1-800-842-5858 for details about available land, buildings and incentives.

            I’ll continue to share information wherever I can about Project 60 and our business-smart state. Find out what so many folks already know – Idaho is a great place to live, to work, and to create career-path jobs and opportunities.

Most transparent Legislature ever?

March 8, 2010 in Blog

Senate Majority Leader Lisa Brown was asked by reporters last Friday if the public has been given enough opportunity to participate in the discussion on the various tax proposals now being adopted.

According to the Capitol Record Brown responded:

“We’re far from done yet,” she said, when asked whether the public was given enough chance to weigh in on some of the proposals.

“I think our processes are much more transparent than when I entered the Legislature,” she said. “I don’t think members are being somehow secluded from outside influence.”

If this is what legislative transparency l!
ooks like I'd hate to see an opaque process.

Safe to say some don't share Brown's assessment of the Legislature being transparent: