November 3, 2010 in City

Supermajority in, some taxes out

By The Spokesman-Review
 

Washington voters removed some taxes and made it tougher for the Legislature to create new ones, but seemed to turn down plans to privatize some state services. Idaho voters passed a string of changes to the state’s bonding rules designed to help hospitals, airports and other public projects.

And Spokane voters turned thumbs down to Proposition 1, a plan to raise $5 million per year to help fight high school dropout rates.

In Washington, the most popular proposal of the night with voters was a constitutional change that allows criminal suspects facing life imprisonment to be held without bail before trial. Resolution 4220, sparked by a series of fatal shootings of law enforcement officers in Western Washington last fall, was passing with an approval rating of 85 percent.

Also high in voter support was I-1053, which reinstates a two-thirds supermajority the Legislature will need to raise taxes. The state had that rule for two years, but Democrats suspended it last spring as they struggled with declining revenues that weren’t keeping pace with programmed expenses. They cut some $780 million from the budget, but turned to taxes on some beers, soda, candy, bottled water and processed foods to raise another $500 million.

I-1053, which was sponsored by Tim Eyman and many Republican legislators, was carrying an approval rating of nearly 2-to-1 at night’s end.

In addition, many of those new taxes were being rejected Tuesday night with the passing of I-1107. That measure benefited from a $16 million campaign chest, funded mainly by the nation’s soda bottlers, although ads stressed the taxes on an array of food and beverages and confusion over what candy is taxed and what isn’t. Taxes will be removed on Dec. 2, and the Legislature will have to find ways to trim $55 million from what’s left of this biennial budget, and $217 million from the 2011-13 budget.

With such a strong anti-tax mood, it’s probably not surprising voters turned down – resoundingly – a state income tax on upper-income residents. The proposal would have lowered some state property and business taxes in exchange for an income tax on individuals making more than $200,000 a year and couples making more than $400,000. Opponents stressed that taxes can always be expanded, and safeguards in the initiative could always be removed by the Legislature after two years with a simple majority vote. Supporters tried to counter, but voters had seen that happen just months before.

Voters also appeared to be rejecting two plans to get the state out of the liquor business, which it has controlled at the retail and wholesale level since the end of Prohibition. They had a choice between I-1100 and I-1105, similar-sounding ballot measures with two very different sets of sponsors.

I-1100 was backed by Costco and other big retailers because it would allow them to set up their own distribution systems and negotiate directly with liquor producers. I-1105 was supported by wholesalers because it required private distributors to take the place of the state’s distribution system. State employees unions and law enforcement groups fought both plans, while supporters of I-1100 tried to make a case with voters to go with their plan but nix the other. In the end, voters seemed able to tell the difference between the two, but didn’t like either: I-1100 was trailing by about 50,000 votes at the end of the night; I-1105 was down by about 370,000 votes.

They also rejected a proposal from the Legislature to sell bonds to pay for energy rehabilitation projects at schools, state universities and government buildings. Democrats pushed it as a job creation measure, Republicans argued that it was too much money for too few jobs.

Idahoans on Tuesday appeared to be strongly supporting all four proposed amendments to the state’s Constitution. The four measures all required two-thirds approval from each house of the Legislature plus a majority vote of the people to pass.

H.J.R. 4, 5 and 7 would allow public hospitals, airports and municipal electric systems, respectively, to incur debt to acquire facilities, property and equipment without the approval of two-thirds of the voters.

With just over a third of Idaho precincts reporting, voters were approving the public hospital amendment 65 percent to 35 percent. They also were saying yes to the public airport amendment (55 to 45 percent) and the “power cities” amendment (60 to 40 percent).

All three amendments forbid repaying the debt using property taxes; instead they require any improvements be paid for with revenues from new or existing facilities. The public electric systems amendment will allow municipalities to enter into agreements to purchase, exchange, or transmit wholesale electricity to customers within its service area without voter approval, again, while requiring that any indebtedness be repaid through rates, not tax dollars.

A 2006 Idaho Supreme Court decision prohibited government entities from taking on multi-year debt for such projects without voter approval. David Frazier, the Boise man whose lawsuit resulted in that decision, said the amendments amount to nothing more than an effort to deny citizens the right to vote on public financing. He said elected officials don’t trust voters to make the right decision.

But supporters said giving public entities the ability to improve facilities and equipment without additional taxes helps attract investment, spurs the economy and improves service. The hospital amendment would permit public hospitals, many of which are in rural areas, to provide updated medical equipment and technology to better care for patients, supporters said. Kootenai Medical Center in Coeur d’Alene is the state’s largest public hospital.

Idahoans also strongly supported S.J.R. 101 which will allow tuition to be charged at the University of Idaho. That is now forbidden, so students pay “fees” instead. The difference is that tuition is what pays for classroom instruction and fees pay for everything else. The distinction has restricted the UI’s flexibility as it has patched together funding for programs while dealing with state budget cuts. Opponents have said the Constitution envisioned free education for students.

That ballot measure was passing 67 percent to 33 percent with just over a third of the state’s precincts reporting.

Staff reporter Tom Sowa contributed to this story.


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