Democrats’ budget avoids tax increase

Legislature: Draft delays $405 million in school funding into next cycle

BRAD SHANNON; Staff writerFebruary 22, 2012 

House Democrats unveiled a budget proposal Tuesday that closes a $1.1 billion budget gap and may doom the sales-tax increase once intended for the spring ballot.

As outlined by Democratic Rep. Ross Hunter, the plan spends $30.66 billion, leaves the state’s schools intact and limits cuts to the safety net. It also avoids a 24-day unpaid furlough for state workers that House Republicans want.

“It’s a first draft,” said Hunter, who is chairman of the House Ways and Means Committee. “We don’t do any significant damage to our K-12 funding. … We fully fund basic ed.’’

Hunter said the proposal is workable, balances the books and spends less than the state takes in through June 2013. It does this by lopping $81.6 million of state support for local governments, delaying a chunk of K-12 public school funding into the next budget cycle, and assuming 1,554 fewer employees on the state payroll.

But Republican Reps. Gary Alexander of Thurston County and Bruce Dammeier of Puyallup both criticized it for using a gimmick – the delay of $405 million in school funding to July 2013, the first month of the state’s next budget cycle – and for failing to eliminate whole programs. Their budget, released Friday, got rid of 51 programs.

On the other side, advocates for schools and for health care programs serving the poor and elderly said the plan avoids draconian cuts Democratic Gov. Chris Gregoire and House Republicans both had sought. Among the spared programs: Basic Health Plan for the working poor and the Disability Lifeline that gives health help and housing vouchers to the temporarily disabled.

HOUSE FLOOR VOTE AS SOON AS FRIDAY

The new budget proposal – formally known as House Bill 2127 – went to a public hearing late Tuesday afternoon. It could receive a vote as soon as this afternoon in the House Ways and Means Committee and get a floor vote in the House as soon as Friday.

The Senate is expected to unveil its more bipartisan spending plan next week –possibly Tuesday – as lawmakers begin the sprint to a March 8 finish.

Both the House Republicans and Democrats are proposing some new revenues. But neither assumes the half-cent sales tax Gregoire had proposed to “buy back” cuts to K-12 schools and the social safety net.

Hunter said talk of revenues will wait for next week.

Rep. Laurie Jinkins, a Tacoma Democrat who has advocated for a capital gains tax, said a spring ballot proposal is looking unlikely. She said the state could have another $2 billion shortfall next year under Hunter’s plan, and many Democrats are starting to look at major tax reforms to fix that problem longer term.

Like the House Republican plan outlined Friday, the budget assumes $18 million from ending a mortgage-interest tax break that benefits large out-of-state banks. That bipartisan support means there is a good chance of getting the two-thirds vote needed to end the tax break.

The Democrats’ budget also assumes $13.1 million would be raised by levying cigarette taxes on roll-your-own cigarette products.

LOCAL IMPACTS

The plan cuts into the Department of Corrections’ budget, reducing community supervision of released offenders and chemical dependency treatment while adding money for prison radios.

Of special interest to South Sound, the House plan:

 • Does not call for moving the Special Commitment Center from McNeil Island. But it would make changes in how the sexually violent predators housed at the center are prosecuted and defended. The biggest change is a shift in the defense responsibilities from counties to the Office of Public Defense, a state agency that would contract with private defense lawyers and set up procedures for reimbursements of expert witnesses.

 • Closes two wards of Western State Hospital in Lakewood, but does not close the Rainier School for the developmentally disabled, which Gregoire proposed.

 • Reduces the state contribution to $800 per month per worker for public employee insurance benefits, down from $850. Gregoire proposed $825 and the House GOP proposed $800. But the reduction is not expected to automatically require higher employee contributions.

 • Cuts the state work force by 1,554 full-time equivalent slots, continuing a 31/2-year trend. About 900 of those cuts are layoffs resulting from voters passing Initiative 1183 last November, ending state-run liquor sales and distribution.

INTEREST GROUPS MAY BE RELIEVED

The Washington Education Association and League of Education Voters are offering measured support for the Democrats’ level of funding for schools despite cuts in bonus payments to nationally certified teachers.

But both education groups put out statements that drew attention to Democrats’ fresh cuts for higher education. The budget cuts $65 million from higher education institutions and $10 million more from state need grants – after a series of recent tuition hikes and hundreds of millions of dollars in cuts since 2009.

Hunter’s plan does add money for some science and technology degree programs, leaving a net $51 million cut for institutions, according to his highlights paper.

The Eldercare Alliance’s lobbyist Jerry Reilly said he was pleased the plan avoids further cuts in eligibility for home care services such as bathing, cleaning and cooking for the elderly, as well as new cuts for home care agencies. But Reilly, who had praised the Republican budget for its funding of elder services, said Democrats cut 20 percent in adult day health programs that help seniors stay in their homes by providing regular medical check-ups.

Democratic Rep. Jeannie Darneille of Tacoma said budgets over the past four years “have had significant negative impacts on low-income families in our state,” including the dropping of welfare benefits meant to help children in poor families. She said the new budget doesn’t reverse course.

“We know that part of the boon that we’ve had in reduction in caseload has actually been reflected by families not receiving services in our state,” Darneille said.

Brad Shannon: 360-753-1688 bshannon@theolympian.com www.theolympian.com/politicsblog

Staff writer Jordan Schrader contributed to this report.

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