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Dear Friends,
In my last e-newsletter in September (https://houserepublicans.wa.gov/news/shea-e-newsletter-11-09-27/), I told you the governor had called a 30-day special session to begin Nov. 28 to address a budget shortfall that is now expected to reach nearly $2 billion. We’re now finishing the first week of that special session in Olympia and to date, there has been nothing brought to the House floor to address the budget problem.
Governor wants a half-billion dollar tax increase, yet her agencies remain bloated
Just a few days before Thanksgiving, the governor called a press conference to announce her plan to slash education, long-term care, development disability services and public safety unless voters approve a half-billion dollar state sales tax increase in March. I certainly don’t appreciate that the governor is holding these priority programs hostage in order to take a half-billion dollars from the pockets of people across the state who are struggling in this difficult economy – and many don’t have jobs and can’t afford higher taxes.
The governor is pleading poverty and says she can’t reduce government any further in the budget. Although her words are getting a lot of attention in the press and among protesters, they don’t match reality.
Here are some facts to consider:
In the remaining 19 months of the state’s fiscal calendar, state government is expected to take in nearly $2 billion more than the previous budget cycle.
While the governor is seeking to reduce education funding by another $411 million that she would “buy back” through her proposed sales tax increase, she has yet to reduce the budgets of several of her own agencies. For example, the total operating budgets of each of these departments have INCREASED by the following amounts over the previous budget cycle:
- Agriculture – UP 8.2 percent;
- Natural Resources – UP 7.6 percent;
- Ecology – UP 10 percent;
- Parks and Recreation – UP 12.2 percent; and
- Fish and Wildlife – UP 14.8 percent.
I would call your attention to the chart on the right. Except for a slight dip during the 2009-11 budget cycle, the Department of Ecology’s total operating budget has continued to rise. It’s now $13.7 million above its highest previous point.
So then why is the governor asking for tax increases when these agency budgets are up?
I believe we need to get back to the core values and services of government, and those should be reflected in the budget. Our first priorities for funding in the budget should be education, public safety and protection of the state’s most vulnerable citizens.
Unfortunately, the governor seems to have it backwards. She’s increasing funding for parks, fish and environmental programs while proposing deep cuts to these other important government services.
Check out the next chart on the right. The difference between private sector compensation versus public payroll costs has grown substantially over the past decade. This demonstrates to me that state government still has plenty of room for reform. Unlike families and employers in these tough times, state government has not adjusted to economic realities.
The voters of Washington have spoken clearly on tax increases. They have said they want it to be harder to raise taxes and they didn’t like the taxes that were raised. In September 2008, the governor said, “Now is not the time to be raising taxes, or talking, even, about raising taxes.” So I’d like to know, why is now – when we are in a fragile recovery and nearly 320,000 people are unemployed – the time to raise taxes?
Workers’ compensation reform prevents rate hikes
During the regular session earlier this year, I helped to negotiate the most substantial reforms to our state’s workers’ compensation system since the program’s inception. (Read my news release from May 23: “Shea idea on structured settlements breaks logjam on workers’ compensation reform”)
The Legislature accepted my proposal to allow for negotiated “structured settlements,” meaning an injured worker could agree to resolve a claim and the cash would be paid out over a period of time.
The reform I proposed is expected to save businesses more than $500 million through 2012. That’s $500 million that can be pumped back into our state’s economy to create jobs. My plan is also expected to save the state $1 billion over the next four years.
In September, the Department of Labor and Industries (L&I) proposed to increase workers’ compensation rates by an average of 2.5 percent for 2012. On Wednesday, the director of L&I, along with the governor, announced they would forgo the rate increase because the economy is still very fragile and businesses cannot afford to pay more. The reforms I pushed through the Legislature are also partially why there will be no rate increase. That’s extremely good news for businesses across the state who had paid out an average 12 percent increase
last year.
By unleashing the power of the private sector to create jobs and establishing spending priorities of government, we can balance the state budget and preserve vital services without raising taxes on families when they can least afford it.
(Click here to read the Associated Press story: “Washington’s businesses see savings from recent reform”)
I’m here to serve you
Please call my office any time you have a question, comment or concern about state government. I maintain a district office in Spokane and when the regular session of the Legislature begins Jan. 9, I will be opening our office in the newly-remodeled John L. O’Brien Building in Olympia. Representative government works best when you are involved. So please contact me with your comments and ideas.
Thank you for the honor of allowing me to serve you!
Sincerely,
Matt Shea