Budget record, but no tax cut

The majority party in the House passed their supplemental operating budget proposal. It represents the largest spending plan in state history. Their supplemental budget is almost 10 times more expensive than any previous supplemental budget.

As a reminder, our state operates on a two-year (biennial) budget that is adopted in odd-numbered years. During even-numbered years, the Legislature passes a supplemental budget to cover unforeseen expenditures or emergencies. With the supplemental budget that House Democrats passed today, state spending continues to increase at an unsustainable rate – much faster than the incomes of the citizens who will pay for it.

From the 2011-13 budget to the 2021-23 budget, state spending will have increased by over $34 million – more than double! This is unsustainable and gambles that record tax collections will continue indefinitely.

Despite this large increase in spending, their budget contained no meaningful tax relief. I strongly advocated for property tax relief as much of the increase in state revenues is coming from escalating property taxes.

Here are some other numbers to consider:

• Despite the pandemic, tax collections have skyrocketed. Revenue growth is 13.3% in 2021 and 8.7% in 2022.

• Since the 2021-23 budget was enacted last March, revenue has increased by $9.25 billion over the four years.

• After paying for the cost of currently authorized programs, there is a four-year surplus of about $15 billion!

• This budget spends $65 billion in state funds, an increase of $6.2 billion (10.5%) over current 2021-23 spending.

• This budget leaves a small four-year ending fund balance of $221 million plus $1.25 billion in the rainy-day fund, enough for the state to operate for about 10 days (compared to the 50-state median of 29 days.)

We offered an amendment on the House floor to decrease the state sales tax. This would have an immediate and lasting impact, especially with inflation at a 40-year high and as the cost of goods and services increase.

We also offered amendments to increase funding for law enforcement (violent crime and property crimes continue to escalate) and to put money back into our state’s rainy day fund for the inevitable downturn in our economy. We offered an amendment to redirect their $2 billion transfer for the state transportation budget from the Multimodal Account (transit) to the Motor Vehicle Account (highways).

While I was pleased that House Democrats accepted our amendment to bring more broadband access to rural areas, nearly all of the rest of our amendments failed. In the end, because this budget had no meaningful tax relief for struggling families, spends money at an unsustainable rate (faster than the incomes of those required to pay for it), and because it leaves too little in our reserves – I voted no.

I would hope that budget negotiators in the House and Senate can find a way to give some of the state’s $15 billion surplus back to taxpayers. At a time of record-high tax collections, record inflation, and record property taxes, it’s difficult to justify the state’s hoarding of this excess revenue.

In contrast, we offered a budget framework called the SAFE Washington plan that makes appropriations prioritizing safety, affordability, families, and the economy.

What do you think? With a four-year budget surplus of $15 billion, should the state give some back to taxpayers? And if so, should it be a 1% decrease in the state sales tax, or a portion of the state’s property tax collections? Or something else?

Your comments and opinions are greatly appreciated as I strive to represent and serve you in the Legislature.

— Rep. Joe Schmick, R-Colfax, represents the 9th Legislative District, including Whitman County.