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Spokane, Washington  Est. May 19, 1883
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Spin Control

House Dem budget has no state sales tax increase

OLYMPIA -- House Democrats offered a budget plan that doesn't call for a state tax increase and doesn't make some of the cuts to public schools and state services that Gov. Chris Gregoire proposed in November.

The school year wouldn't be shorter. The money the state sends to school districts to help make up for the differences in property values between rich areas and poor areas, known as levy equalization, wouldn't be cut. Inmates wouldn't be released early from state prisons.

But House Democrats did propose pulling back some state money currently going to counties and cities, then giving local governments the authority to raise local taxes to cover the difference. They do delay payments to school districts, in what some Republicans call an accounting gimmick. They reduce state employment by more than 1,500 full-time workers. They would leave less money in the treasury at the end of the fiscal period than either Gregoire or the House Republicans. . .

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House Ways and Means Committee Chairman Ross Hunter called it a budget that will change in the coming days, with hearings and negotiations with the Senate, which will produce a budget proposal next week: "It's a first draft. We spend less than we take in in revenue."

While the proposal does not call for a state tax increase, that doesn't mean there won't be some discussion of a tax hike in the coming days, Hunter, D-Medina, said. But it does not cut key programs then ask voters to "buy back" some of them by approving a half-cent sales tax, as Gregoire proposed with her budget.

"If you put something on the ballot, it may not pass," he said.

But Spokane and other large counties would  have the authority to raise their sales tax by one-tenth of 1 percent, and split it with the cities inside their borders. Large cities would have the authority to raise their sales tax if their county didn't . Local governments could levy a local option restaurant tax of as much as one-half of 1 percent, and counties could levy a utility tax in unincorporated areas.

That money would help make up for cuts in state money sent to local governments for criminal justice, and for increased charges those governments would see for state services like crime laboratory services, police training and district or municipal court salaries. Hunter said the state increased payments to cities and counties after Initiative 695 ended the Motor Vehicle Excise Tax.

"We can't afford to do that any more," he said. "Something has to give."

The budget was quickly criticized by House Republicans, who released their own "alternative" budget last week. Rep. Gary Alexander, R-Olympia, said Democrats were hanging on to "lower priority" programs like the Basic Health plan and the Disability Lifeline. Giving the cities and counties authorities to raise taxes is an "end-run" around the requirement for a two-thirds vote of the Legislature to raise taxes statewide, he added.

In announcing the budget, Hunter said county and city officials are close enough to their constituents to make a decision on raising taxes without voter approval. But if they want to put them on the ballot, they have that  option.

The state teachers' union and the League of Education Voters praised the proposal for spending more on schools than Gregoire proposed. It's also more in line with a recent state Supreme Court ruling on the state's responsibility to spend more on "basic education," they said.

House Democrats had an advantage Gregoire didn't have last fall when crafting her budget, Hunter said. An economic forecast and a projection of the need for state services improved the budget outlook by nearly $440 million.

Senate Democrats, who are in charge of writing that chamber's budget proposal, and Gregoire, called the latest spending plan "a good start" at developing a final budget, which both houses must pass by March 8 to avoid a special session.

Jim Camden
Jim Camden joined The Spokesman-Review in 1981 and retired in 2021. He is currently the political and state government correspondent covering Washington state.

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