Originally published September 22, 2011 at 11:40 AM | Page modified September 23, 2011 at 4:47 PM
$2 billion problem: Gregoire calls special session
The state Legislature will go into a 30-day special session starting Nov. 28 to tackle what's expected to be at least a $2 billion shortfall in the state budget.
Seattle Times Olympia bureau
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OLYMPIA — Democratic leaders say it's premature to talk about tax increases as they prepare for a special budget-cutting session in November, but they've already checked with the secretary of state to see when a referendum could go on the ballot.
Gov. Chris Gregoire said Thursday she would call the Legislature back for a 30-day session starting Nov. 28 to deal with a projected budget shortfall of at least $2 billion.
The Secretary of State's Office said it's gotten inquiries about possible election dates from the Governor's Office, as well as House Democrats, Senate Democrats and Senate Republicans. The soonest something could be put on the ballot would be Feb. 14, but that would require the Legislature to pass a measure by Dec. 2 — five days after the start of the special session, said Dave Ammons, a spokesman for the Secretary of State's Office.
No one is talking about the Legislature approving a tax increase on its own. Tim Eyman's Initiative 1053, approved by voters last year, requires a two-thirds vote in the House and Senate — a near impossibility — or voter approval to raise taxes.
Senate Minority Leader Mike Hewitt, R-Walla Walla, said his staff called the secretary of state about dates just to figure out what the Democrats might be up to. "I think this thing is all canned, quite frankly," Hewitt said. "I think the Democrats have orchestrated this, and they are going to have a revenue package."
Democrats disagreed. "Members are making inquiries. But there's no plan. No one has said lets tax X and put it on the ballot," said Senate Ways and Means Chairman Ed Murray, D-Seattle.
Sen. Joe Zarelli, the ranking Republican on the Senate Ways and Means Committee, is taking a wait-and-see attitude. "It remains to be seen whether you can even get 25 votes to send something to the ballot out of the Senate," he said.
Even if Democrats wanted to put a tax proposal on the ballot, they still would have to write a budget that would assume voters would not approve new revenue, he said.
Zarelli said he agreed with Gregoire's decision to wait until late November for the special session. Budget writers need time to work through the numbers and bring other lawmakers up to speed before the Legislature starts work, he said. The Legislature's regular session starts in January.
The governor said that if she brought legislators back now, most of them would be sitting around while a handful of budget writers try to hammer out a deal. It's better, she said, to get that work out of the way first.
Plus, another forecast of state tax collections is due on Nov. 17. Odds are that it will show the state has an even bigger hole in the budget than it's facing now.
Gregoire already has asked state agencies to prepare for cuts as high as 10 percent and said she'll propose even deeper reductions before lawmakers meet.
"There will be more cuts that will affect our vulnerable citizens. There will be more cuts in our corrections system. There will be more cuts in our public schools, colleges and universities. It is simply unavoidable," she said.
Exactly what will be cut is unclear.
Gregoire contends that nearly two-thirds of the budget is essentially off-limits to cuts because of federal mandates and state constitutional restrictions. The biggest components are basic education, Medicaid, pensions and state debt.
That means the $2 billion in cuts must come from the remaining $8.7 billion of the budget that is unprotected by the constitution or federal law, the governor said. "That is, bottom line, a 23 percent cut," she said.
State-subsidized insurance for the working poor and aid to property-poor school districts — two programs that Democrats vigorously fought to protect last session — fall into the unprotected category. Those two programs account for about $500 million in spending.
Higher education and worker pay and benefits also are on the table, she said.
Gregoire said what the Legislature cannot do is nibble around the edges.
"We're going to have to admit there are things we simply as a state can no longer do," she said.
Zarelli disagreed that any part of the budget is off-limits. For example, he said, the state could choose to stop certain services even if it meant losing federal matching dollars.
"A lot of times we simply do things because there is a 50 percent federal share. We still have state money in there. If that's not a high priority lets look at it from the perspective of what could you do with that money," he said.
The call for a special session comes about three months after Gregoire signed a two-year, $32 billion spending plan with seemingly healthy reserves.
Since then the economy has teetered on the brink of another recession instead of recovering as had been projected. A revenue forecast earlier this month estimated the state would collect $1.4 billion less in tax revenue than expected between now and the end of June 2013.
The new projection, combined with a down forecast in June, wipes out the state's reserves and leaves a big hole in the budget. Gregoire said she views it as close to a $2 billion gap, given the need to leave money in reserve.
Andrew Garber: 360-236-8266




Well governor,I think you are the one who grew the public sector by 33% on your watch... (September 22, 2011, by wsrc)
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