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Spokane, Washington  Est. May 19, 1883
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Eye On Olympia

Taxes tossed? Snohomish County judge rules against state money-shifting…

A Snohomish County judge ruled Friday that the state improperly shifted around $250 million to various state accounts in order to raise the state spending limit, according to a spokesman for one of the plaintiffs.

Last summer, a group of conservative, farm and business groups (the state Farm Bureau, the Evergreen Freedom Foundation, National Federation of Independent Business, Building Industry Association of Washington, state Realtors' association and the state Grange) filed suit over the state budget, saying the state broke the law when it enacted hundreds of millions of dollars in new taxes.

On Friday afternoon, according to EFF spokesman Jason Mercier, the superior court judge ruled that the state had improperly shifted the money to evade the limit. Mercier said the judge ordered that several tax increases that were part of that the budget (cigarettes, alcohol and extended warranties) not take effect unless voters ratify them with a statewide vote.

Judge James Allendoerfer based his decision partly on e-mails by legislators and their staff in which they reportedly discussed ways to get around the spending limit.

State officials were scrambling Friday afternoon to figure out what the ruling means. But it's considered unlikely that the taxes will disappear overnight. The state could make a motion to reconsider, or could simply ask that the judge's ruling be stayed pending appeal to the state Supreme Court.

Gov. Chris Gregoire had no immmediate comment.

"Since there’s nothing in writing, at this point it’s really somewhat speculative," said spokeswoman Holly Armstrong. "It's yet to be seen what will be done."

She said the ruling would not affect Washington's estate tax, but could affect last year's House Bill 2314, which includes those other tax increases.

Short takes and breaking news from the Washington Legislature and the state capital.