September 22, 2011 in News, City

Gregoire calls special session for Nov. 28

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OLYMPIA — The Legislature will spend the month between Thanksgiving and Christmas trying to cut as much as $2 billion out of the state’s budget.

Gov. Chris Gregoire said today she will call legislators into a special session, which by law can last as long as 30 days, starting Nov. 28.

Before they get to Olympia, Gregoire said she will present them with a plan to cut programs and keep the state from ending the 2011-13 fiscal cycle in the red. That plan will be a starting point, but legislators will have to hold hearings and adopt legislation, so it’s not a problem that can be handled in a single day, like the special session last December.

The timing is tied to the next state revenue forecast, due on Nov. 17, which the state’s chief economist, Arun Raha, has told state officials is much more likely to be down, rather than up.

Last week in his official September forecast, Raha said the state was likely to have $1.4 billion less than legislators thought when they drew up the 2011-13 general fund budget. Just cutting that $1.4 billion out of the budget would leave the state’s general fund with no reserves, Gregoire said; she’ll ask legislators to come up with $2 billion.

“Everything is on the table,” Gregoire said at a morning press conference. Asked if she’d propose any tax increases, the governor said that is “premature.”

“I’m not talking revenue now,” she said.

Although some liberal groups have called for the state to raise taxes by closing some exemptions for businesses, Gregoire said most such proposals don’t raise enough money and would lose the jobs those exemptions were enacted to stimulate.

“Somebody will have to show me $2 billion I can get passed in the Legislature,” she said. “Frankly, someone will have to show me $2 million.”

Two comments on this story so far. Add yours!

• 

  WashPIRG on September 22 at 1:01 p.m.

  We often hear that the budget can be balanced by eliminating ambiguous ‘waste, fraud and abuse.’ But what isn’t ambiguous are special-interest tax exemptions, including these big ticket examples (http://oureconomicfuture.org/pdf/TaxGiveaways.pdf) of where our precious dollars are being siphoned away through our tax code every year:

  • Tax breaks for Wall Street banks: $100 million
  • Sales tax break for consumer services: $100 million
  • Sales tax break for out-of-state shoppers: $44 million
  • Sales tax break for fertilizer: $40 million
  • Sales tax break for elective cosmetic surgery: $8 million
  • Special tax break for private jets: $5 million

  This list isn’t exhaustive - it just the ‘big stuff’ on top of the dozens of other loopholes that seep anywhere from a few thousand to tens-of-thousands of dollars apiece each year.

  Taken individually, each of these is just a drop in the bucket compared to a $1.4 billion revenue shortfall; collectively, the amount to revenue that could prevent further cuts to programs that are crucial to millions of Washingtonians – and that’s just the immediate impact. Over time, that revenue could actually restore funding to employ teachers, firefighters, cops, and healthcare providers for our state’s most needy citizens.

  Closing tax loopholes is not a panacea; but then, neither was slashing spending. The truth is, there’s no single silver-bullet solution to a problem this complex.

  With a special session set for November, leaders in Olympia will be meeting ahead of time to begin discussions of what the full Legislature will do when they gather; prudent planning can go a long way to effective action.

  Their first order of business should be establishing an ‘everything’s on the table’ approach - including the elimination of unfair tax breaks that benefit special interests over the public interest.

  Steve Breaux
  Washington Public Interest Research Group

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  Mike1950 on September 22 at 3:35 p.m.

  Sales tax breaks for elective cosmetic surgery - $8 million!!! Who the hell comes up with these crazy ideas in the first place? I say they put all the tax breaks on the table and start slashing. Let’s get things back to an even playing field.