A Surplus Of Proposals For Tax Cuts Lawmakers Racing To Offer Plans For Reductions In Election Year

Cross a $700 million budget surplus with an election year and what do voters get? Tax cut proposals. Lots of them.

State lawmakers are falling all over themselves to dish up tax cuts for businesses and property owners in the coming legislative session.

Several property tax cut plans are in the works, from lowering the tax rate across the board to restricting the rate of increase in property tax levies, said Sen. James West, R-Spokane.

Several property tax initiatives also are in circulation.

“We have to do something, or something may be done for us,” West said. “The problem is rapidly rising valuations. Spokane County government would get less if we did this, and they’ll tell you they’re broke.

“That’s because they always spend every penny they get. The thing to do is take the dough away from them before they get it. That’s the only way to control it.”

House Republicans also say they want to override Gov. Mike Lowry’s veto of tax rollbacks enacted by the Legislature last year.

One bill would have provided a permanent 5 percent reduction in the state share of the property tax, at a cost of about $92 million per biennium.

The other bill rolled back $176 million in business and occupation taxes by halving increases imposed on some service businesses in 1993.

Lowry canned the two tax cuts last June, saying the state couldn’t afford them.

Layoffs at Hanford, a slowdown at Boeing, and looming budget cuts from the federal government made tax cuts that big foolhardy, Lowry said.

The economy has chugged along ever since, generating a $677 million cash reserve, even bigger than what was on hand when Lowry vetoed the cuts.

But even if the House overrides both vetoes, the Democrat-controlled Senate isn’t expected to play along.

That’s when House Republicans switch to plan B, predicts Rep. Brian Thomas, R-Renton, chairman of the House Finance Committee.

“You take every bill that went through the House but was either vetoed by the governor or didn’t make it through the Senate and I think you’ll see it pedaled out again.”

That’s about $738 million in tax breaks, including elimination of all business-and-occupation and state sales tax increases adopted in 1993.

Even that’s not enough for some: “I’d like to see the state get out of the property tax business,” Thomas said.

The tax cuts are sure to make fine political footballs, with two of the state’s leading budget writers from opposing parties running for governor.

Over in the Senate, Democrats are searching for their footing, with the former majority leader, Marcus Gaspard of Tacoma, retired from office to take a six-figure state job on the Higher Education Coordinating Board.

His replacement, Sen. Sid Snyder, D-Long Beach, is more conservative.

Gaspard was a dependable champion for Lowry, who these days has scant support in the Democratic caucus. Lowry had only a one-vote majority to work with as it was.

Now 10 Democratic senators have thrown their support to Lowry’s Democratic rival for governor, Nita Rinehart, chair of the Senate Ways and Means Committee.

Rinehart opposed the House budget last session, including some of its tax cuts, saying they hacked holes in state support for education. Whether she’ll see things differently this year, especially now that she needs to differentiate herself from Lowry, isn’t clear.

Lowry may toss out a few tax cuts of his own, said Jordan Dey, spokesman for the governor, “If we can afford it.” Specifics are in the works, but even a property tax break may be on the table.

Whatever the governor does, “We need a responsible budget that looks to the future, and not shortterm political gain,” Dey said.

Thomas says he expects Lowry won’t be so hasty with the veto pen this time around. “I have a feeling Gov. Lowry is going to be a different governor this time. If not, he’s toast.”Just how big a tax cut is affordable is unclear.

The state budget office warns big cuts are coming from the federal government when Congress adopts its budget, particularly in social programs.

Estimates of the cuts in Washington state vary wildly from $2 billion to more than $4 billion over the next seven years.

But sitting on a big pile of dough in an election year is nuts, lawmakers agreed.

“We have three quarters of a billion dollars sitting in surplus. We have to give it back to the people,” said Rep. Larry Crouse, R-Spokane. “It’s an election year. People will look at all that money sitting there. And they are not stupid.”

, DataTimes