Fact-checking Olympia’s Initiative 1 proposal to fund tuition through an income tax
Supporters and opponents of an unprecedented income tax initiative in Olympia are working hard to spread their message to voters ahead of the Nov. 8 general election.
But are both campaigns sticking to the facts?
Initiative 1 calls for creating a college tuition fund for resident high school students that would be funded by a 1.5 percent tax on all household income within the city that exceeds $200,000 a year. The program promises to pay at least one year of tuition at a public community college for Olympia high school graduates, or apply that money toward tuition at four-year public university.
The pro-initiative Opportunity for Olympia campaign — fueled by the Economic Opportunity Institute of Seattle — had raised more than $224,407 as of Friday to support Initiative 1, according to the state Public Disclosure Commission. The opposition group Olympians for Responsible Tax Reform – headed by Olympia Mayor Cheryl Selby —had raised about $5,691 as of Friday.
The following statements come from fliers that the campaigns have mailed to Olympia voters about Initiative 1. Below each claim is a clarification of the facts by The Olympian.
▪ Claim by Opportunity for Olympia: “Six years after high school, 64 percent of Washington’s students have still not obtained any higher education degree or job training certificate.”
Clarification: This statement accurately cites the Education Research and Data Center, which studied the six-year “education pipeline” for Washington high school graduates from 2005-06. According to the study, about 77 percent of the high school graduates had enrolled in postsecondary education at some point in the six years, but only about 27 percent had received a bachelor’s degree or higher, and about 9 percent had received an associate’s degree or job training certificate.
▪ Claim by Opportunity for Olympia: “Since 1980, tuition for community college has gone up by 366 percent.”
Clarification: The Olympian could not verify this exact figure, but a range of sources show that college tuition has gradually become more expensive in Washington. Since 2001, the average community college tuition in the state has increased from $1,743 a year to $3,852, which represents an increase of about 120 percent. Since 2006, tuition for University of Washington and Washington State University has increased from about $5,880 a year to about $10,000 a year. Smaller schools such as Central Washington University, Western Washington University and The Evergreen State College have seen tuition increase from about $4,400 a year to about $6,500 a year, according to the Washington Student Achievement Council. In 2005, the House Subcommittee on Education Finance Structures reported that community college tuition was $509 in 1985, which would mean tuition has increased 656 percent since then.
▪ Claim from Olympians For Responsible Tax Reform: “If passed, the city would be obligated to defend its legality in the courts at considerable expense” and “the initiative would create a costly tax collection bureaucracy to comply with a new law.”
Clarification: After unsuccessfully trying to come up with an alternative proposal, the city of Olympia has spent about $100,000 to try to keep Initiative 1 off the ballot, according to Selby. Because income taxes are prohibited by the state constitution, she said the initiative could cost taxpayers $300,000 to $400,000 to defend in court. Conservative think tank Freedom Foundation is just one group that has vowed to sue the city if voters approve the tax.
If the initiative is approved, Selby said the city would need to devote three full-time employees to administer the scholarship program and collect the tax. The initiative mandates that 5 percent of the tax proceeds go to administration, but city officials have concerns that it won’t generate enough revenue through voluntary tax declaration to pay for the administrative costs.
▪ Claim by Opportunity for Olympia: “Nearly 25 percent of Olympia’s high school graduates don’t continue on to any kind of higher education.”
Clarification: This is accurate, according to the state’s Education Research and Data Center, which reports that about 75 percent of Olympia’s high school graduates enrolled in postsecondary education in 2013.
▪ Claim from Olympians For Responsible Tax Reform: “It’s not about going to college; it’s about going to court.”
Clarification: The ballot language explains the initiative’s intentions for establishing a college fund with a tax. However, supporters and opponents both expect a court challenge if voters approve the initiative because an income tax is prohibited by state law. Supporters of the initiative have cited the need to reform access to higher education as well as reform the state’s regressive tax system. Pierce County Superior Court Judge Jack Nevin ruled Aug. 24 that the initiative extends beyond the city’s powers and clashes with state law, but a state appellate court commissioner later allowed the initiative to appear on the ballot without addressing its legal validity.
▪ Claims by Opportunity for Olympia: Initiative 1 will raise “more than $2 million per year for Olympia’s college grant program from just the top 3 percent” and “Initiative 1 would pay for itself through a small (1.5 percent) tax that only applies to the wealthiest 3 percent of Olympia households.”
Clarification: The proposed tax would apply to an estimated 750 households. However, collection of the tax is unclear because the initiative lacks an enforcement provision. As such, the city says it would have to depend on a voluntary declaration of tax income because the Internal Revenue Service cannot share confidential tax information.
▪ Claim from Olympians For Responsible Tax Reform: “Initiative 1 is the brainchild of a Seattle-based think tank. 97 percent of the funding to pass this measure comes from King County contributors — to tax Olympia residents!” and “Initiative 1’s intent is to get Olympia taxpayers to foot the bill for another court ruling on whether income taxes are constitutional.”
Clarification: The Economic Opportunity Institute of Seattle is a nonprofit progressive public policy think tank. Many of Initiative 1’s top donors are regular contributors to the institute. The proportion of King County contributors, according to the Public Disclosure Commission website, is about 91 percent. In a statement to The Olympian, institute executive director John Burbank said “our progressive donors can see that skyrocketing college and job training costs directly impact our ability to attract and keep good jobs in Olympia.”
Top donors for the Opportunity for Olympia campaign include Seattle stockbroker Floyd Jones ($50,000); Seattle philanthropist Ann Wyckoff ($25,000); Seattle and Whidbey Island philanthropist Nancy Nordhoff ($27,500); Seattle author and Paccar heiress Judy Pigott ($20,000); and T. Cody Swift of the Riverstyx Foundation ($20,000).
Top donors for Olympians for Responsible Tax Reform include Koelsch Construction ($1,500), Olympia Mayor Cheryl Selby ($694), Thurston County Realtors Association ($500) and Mike Brewer of American Pump and Electric ($500).
More facts about Initiative 1 and college aid
The Opportunity for Olympia campaign hired Portland-based Patinkin Research Strategies to conduct a telephone poll in mid-September, asking 300 voters in Olympia whether they support Initiative 1. The poll showed that 62 percent of respondents said they support the measure, about 32 percent opposed it, and about 6 percent were undecided.
The Olympia School District already partners with South Puget Sound Community College on a program called Running Start, which allows high school juniors and seniors to earn college credit while paying no tuition. Students qualify for the program by passing a College Placement Test.
Last year’s Running Start enrollment was 1,102 at SPSCC, said Kelly Green, director of public relations at SPSCC. Of that total, 349 students came from Olympia — including 164 students from Olympia High School and 161 students from Capital High School.
Running Start students can earn as many as 45 college credits that can transfer to a larger educational institution. SPSCC reports that students save an average of $3,056 in tuition through the program, and that participants complete about 85 percent of courses.
The state Education Research and Data center reports that almost 1 in 3 students in Washington received a need-based federal subsidy called a Pell Grant that does not require repayment. Nearly half of all undergraduate students receive some sort of grant, according to the center.
Washington also provides State Need Grants and College Bound Scholarships based on family income. However, a report by the Washington State Institute for Public Policy shows that about 32,400 students who were eligible for a grant in 2012 did not receive it because of a lack of funding.
Last year, Gov. Jay Inslee signed legislation authorizing tuition cuts of up to 20 percent at the state’s universities and colleges.
This story was originally published October 29, 2016 at 9:00 AM with the headline "Fact-checking Olympia’s Initiative 1 proposal to fund tuition through an income tax."