Building an Economy that Works for Everyone

Kick the Can Budgeting

Brendan Williams

Guest column by Brendan Williams, former Washington State legislator

A progressive can fairly argue that one-time budget gimmicks are as insidious as an all-cuts budget in keeping the focus away from the budget sustainability that can only come from real tax reform.

From that perspective, the result of the 2011 2nd Special Session can be seen as another masterpiece of evasion. While the former legislator in me is tempted by the argument that “cuts are more regressive than [fill in the blank],” there comes a point where gimmickry is not moving the ball forward. Instead, it is simply magnifying the size of some future budget apocalypse. Eventually all the rabbits are emptied out of the magic hat, and when you shake it a final time only a dusty “Past Due” note falls out.

Consider the sleight of hand in budget adjustments revealed before the House Ways & Means Committee this week. One imagined David Copperfield as the architect.

Just to give a few examples, the abracadabra included measures as small as saving $759,000 by shuffling the cards of the knotweed program fund (an invasive freshwater weed, if you’re curious), grabbing funds available from 30.6 FTE slots that were open for three months at the Health Care Authority, and saving $2 million from the attorney general’s consumer protection activities by using Anti-Trust Revolving Account money instead of the state’s general fund.

So bedazzled by this magic show were the members of Ways & Means that only one voted no. Indeed, even he turned around and voted yes on the floor – leaving only 6 no votes at a time when partisan budget differences have all but disappeared.

Because actual cuts did not constitute the majority of the savings achieved (with a few exceptions, one being sex offenders will apparently eat 5% less), none of this is sustainable in the long term. One imagined a floor speech on this breaking into a top hat-waving song, like Billy Flynn in “Chicago”: “Give ’em the old double whammy, Daze and dizzy ’em; Back since the days of old Methuselah, Everyone loves the big bambooz-a-lah.”

Looking ahead we see more of the same. The governor’s proposed budget pulls out the old tried-and-true “extra day” trick of extending a fiscal obligation – K-12 apportionment payments – from the last day of the current biennium to the next biennium: July 1, 2013. That’s a $340 million imbalance to the biennial budget. A related act of legerdemain is delaying state payments to school districts for bus replacement by 10 months to pick up $49 million.

I do not point this out to suggest I would rather – in the alternative – cut K-12 education by $389 million now for my 9-year-old and other kids Nor am I unsympathetic to the terrible challenge the governor faced, or that my legislative friends face now. A certain level of unlovely triage is inevitable. Yet we cannot ignore the fact that these moves defer the revenue decisions we must make for a really balanced budget in this era of greater consumer austerity and the absence of housing hyper-inflation – both trends having facilitated the nation’s worst revenue problem.

One-time money grabs effectively amount to a hidden tax upon our future, unless the revenue picture dramatically improves in ways that appear unforeseeable now. They’re part of a pattern of avoidance on the Legislature’s part that dates back to the tobacco settlement securitization of 2002, the Rossi-Locke budget of 2003, the breaking of the Plan 3 pension promise to state workers and teachers in 2007, the use of the bonded capital budget to support the operating budget beginning in 2009, and myriad other moves in the past three years.

Using K-12 funding as a state-of-denial, kick-the-can piggybank is especially poignant because the gigantic bill for the deferred promise of K-12 education reform comes due in 2018. As I asked when this policy was enacted in 2009, “If this Legislature does not have the courage to pay for its convictions, how can we expect a future Legislature to?” We now have our answer.

Eventually we’re going to run out of knotweed funds and extra days. What then? It’s time to get serious about tax reform.

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