Last week, Gov. Gregoire released her operating budget proposal to solve the state's revenue shortfall, consisting of two components. The first is a budget that makes up the shortfall by cutting a wide and significant range of public services. Here are just a few examples:
Cut more than $500 million from education programs. Proposals include shortening the K-12 school year by four days, which would result in a 2.2 percent reduction in salaries of school employees, and reducing the levy equalization payments that assist poor and rural districts in providing adequate education for K-12 students. State funding for colleges and universities would be cut by another 13 to 17 percent, and the state work study program would be suspended. The colleges will no doubt seek tuition increases to make up the cuts.
Cut more than $690 million from health and human service programs.
· Here are just a few of the many programs that would be eliminated in their entirety:
o Disability Lifeline and ADATSA (Alcohol and Drug Abuse Treatment and Support Act), which pays for medical and limited dental care for 20,000 adults who are temporarily unemployable due to a physical or mental incapacity or are in need of chemical dependency treatment;
o DSHS’ Family Reconciliation Services, which are voluntary services provided for preserving families in distress;
o Basic Health, which currently provides subsidized health insurance for 35,000 low-income people;
o The Medicaid subsidy for interpreter services at patient medical appointments;
o The State Food Assistance Program, which provides food assistance to legal immigrants who are not yet eligible for federal assistance because they’ve lived in the state for less than five years.
Many essential programs would face severe cuts, including the Working Connections Child Care program and Temporary Assistance to Needy Families (TANF).
Significant cuts to the Department of Corrections. These reductions would allow the early release of some offenders, shorten the length of offender supervision and reduce chemical dependency programs by 50 percent.
The Governor also provided a second proposal that includes a revenue package that would allow the legislature and the public to vote on whether or not to “buy back” a portion of the cuts through small tax increases.
The revenue proposal has three components:
· A ballot referendum for a temporary, half-cent sales tax increase for three years;
· A package of fees and revenue sources other than taxes requiring a simple majority vote of the Legislature; and
· A package of tax changes requiring a two-thirds vote of the Legislature.
The sales tax increase is projected to generate $494 million and buy back the governor’s proposed reductions mostly in K-12 and higher education. The majority vote package would generate $59 million. The package requiring a supermajority vote would generate $282 million and would be used mostly to buy back cuts in human services and health care. This latter package includes a variety of tax revenue proposals, such as closing tax loopholes and new oil and financial windfall taxes. Given the opposition of many Republicans, it’s questionable whether a supermajority vote can be achieved.
Further, even if all of the governor’s recommendations were carried out, the resulting new revenues would add up to only $835 million in new revenue, enough to “buy back” less than half of the $1.7 billion in budget reductions she proposed.
You can see the full details of Gov. Gregoire’s proposals here as well as an overview of the proposal by Senate Ways & Means Committee staff here.
The Governor’s proposal is just the beginning. Over the upcoming weeks, the legislature will consider her proposal and come up with our own. As I’ve mentioned repeatedly in this blog, I’m much more in favor of progressive tax increases such as an income tax and closing tax loopholes for wealthy individuals and for corporations rather than continuing to increase our regressive sales tax that already overburdens low- and middle-income folks.