No Washington agency safe from budget knife

OLYMPIA – For the casual observer, it may help to regard the Legislature as theater. Some days it’s a comedy, some days it’s a tragedy, but there’s always a big cast of characters.

When the curtain went down on the 2009 production, everyone hoped they’d written an end to a historic budget drama titled “The Worst Economic Crisis Since the Great Depression.” Turns out, however, that was just Act I. After about eight months of intermission, Act II starts Monday. Here’s the plot:

Legislators must fill a gap of at least $2.6 billion in the two-year budget it adopted last spring, because the economy continued to get worse. No one is really sure how much worse, because every few months the state gets a new economic forecast and the revenue-expenditure gap always gets bigger.

Much of last year’s script included talk of draconian measures, but most were staved off by federal aid, which arrived as a savior toward the end of the session.

This year, federal aid is far less certain, an end to the economic woes is unpredictable and talk of draconian cuts is part of Gov. Chris Gregoire’s prologue to Act II: a budget that closes the gap with reductions in all state agencies and elimination of such programs as Basic Health, General Assistance for Unemployable Adults and most financial aid for students. Even the author realizes it’s a work of fiction.

“I can’t live with that budget,” Gregoire said recently. But the state has to have a balanced budget, she said, and without tax increases of some kind, that’s the way to stay out of the red.

Sometime this week Gregoire will propose a new budget, or at least part of one. Some details on possible tax increases may have to wait until the federal government signals what it will do about additional recovery money.

The Legislature will also come up with separate spending plans in each chamber, and likely from each party. Last week Republicans were calling for budget cuts, no new taxes and a temporary reprieve from some government regulations to boost jobs.

“Jobs, jobs, jobs, and a sustainable budget,” said Senate Minority Leader Mike Hewett, of Walla Walla.

With large majorities in both houses, the Democratic proposals are the ones with the most chance to pass. They’re most likely to propose some tax increases – extending the sales tax to bottled water or bakery goods are among those being floated right now – but only after explaining the “moral necessity” to keep from cutting money for schools, children or the disabled.

What Democrats are most likely to try to suspend or rearrange first, however, is Initiative 960, a law voters passed in 2007 that requires a two-thirds majority in both houses for any tax increase.

“We will have to modify or repeal 960,” Senate Majority Leader Lisa Brown, of Spokane, said last week. Even revoking unworkable tax incentives, also known as tax loopholes, now requires a two-thirds majority, even though the tax breaks can be enacted with a simple majority, Brown said.

Although 51.2 percent of voters approved the measure, that doesn’t mean it can’t be changed, she added. Initiatives are just like laws the Legislature passes, she said, and almost every law gets modified at some point.

“Gregoire and the Democrats should at least try to abide by I-960’s policies before they suspend them,” sponsor Tim Eyman said last week.

The longtime initiative crafter and a group of his compatriots plan to be in Olympia Monday morning when the curtain comes up, filing a new initiative to restore the supermajority, even before it’s repealed. Some committee chairs have told their members not to even bother proposing legislation that would cost the state extra money, although Brown has said a complete ban on new spending isn’t realistic. The levees along the Green River are in bad shape, and the state may need to shore them up; Western Washington has been rocked by the shooting deaths of six law enforcement officers in two months, and some new laws may be proposed in response. Criminal justice issues always come with a price tag, she said.

Although the main plot will revolve around the budget, there may be some subplots for other issues, large and small. The Legislature may vote on a constitutional amendment to give judges more authority to deny bail to criminal suspects they deem a danger to society. It may agree to expand the capacity of distilleries in the state. It may make some adjustments to the Basic Health program policies after Congress settles on health care reform for the nation. It is likely to keep North Spokane Corridor and Riverpoint campus construction on track, because money for building and transportation projects comes from sources other than the general fund.

But the budget will be center stage in almost every scene. If the economy doesn’t improve, it will back next year, with some new characters after the elections, for Act III.