Rep. Mike Sells April 16/2012 e-memo

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Budget and Jobs Now Act approved; Legislature adjourned sine die

A balanced, responsible, and sustainable operating budget and the capital budget/Jobs Now Act passed the full legislature early Wednesday morning, and now sit on the Governor’s desk.

The final operating budget contains no further cuts to K-12 education or higher education, and protects important safety net services like the Basic Health Plan, Disability Lifeline, and family planning grants.

The Jobs Now Act will generate over 22,000 jobs statewide and fund construction investments that are essential for the long-term prosperity of our communities.

How did we meet the 2012 budget shortfall?

We faced a nearly $2 billion revenue hole from what the forecasts told us we would receive when we began working on the supplemental budget last November.  How did we deal with it?

In December 2011 we addressed $480 million of the problem.

Then, in early February, we got a couple shots of better economic news.

  • In the current biennium, revenues are expected to grow by about $87 million.
  • Tighter eligibility requirements, the demand for state services dropped by around $340 million.

That left us with a shortfall of around $1.2 billion to fill in the final negotiated budget. We did that with a combination of things:

  • $340.3 million in maintenance level changes
  • $295.4 million in policy changes
  • $238 million from the Local Sales Tax Working Capital Reserve
  • $177.3 million in additional revenues
  • $120 million in reversions
  • $28.4 million in fund transfers

There are still those who want to insist that the state operating budget hasn’t actually been cut at all over these past four years – that the “cuts” have really only been a decrease in the increase that would have otherwise been made.  To some degree, that might be considered true.  Take, for example, the funding of Initiatives 728 and 732.  Those are voter-approved obligations to increase spending for education, and for several years we have not funded them.  Those are counted as “cuts” since they are expenditures we ordinarily would have made.

But that doesn’t account for anywhere near the whole budget situation.  State spending is actually lower than it was a few years ago, both in real dollars and in per-capita spending.  In fact, today the per-person spending in Washington, adjusted for inflation, is back down to 1985 levels.

Here is a chart that shows how individual budget items evolved through the process, starting with the Governor’s proposal from last December, then the budgets that passed the House and Senate last month, and finally the budget that is on the Governor’s desk today.

Class Size Initiative Eliminated

In the special session, the legislature voted to eliminate the class size initiative with the promise of funding education with recommendations from a task force to report in the future. As I stated to my colleagues during the session, I don’t have a lot of faith in another commission to solve a long standing problem, especially without the initiative in place to remind us how much our citizen’s care about class sizes in our schools. The McCleary decision on school funding will supposedly help with the pressure on K-12 funding, but we had the Doran decision in 1976 which demanded similar action on funding. To be fair, we have had a number of times where the initiative has been set aside for lack of revenue. Now, we have eliminated it entirely on a promise that legislatures have not been able to keep for at least the last 40 years.  Add in some new administrative demands on teacher evaluation that is, I believe, underfunded. Throw in legislation demanding more confusing administrative paper work on school employee health care programs that was driven by a political desire to get last minute budget votes. What you have is a dancing around of our constitutional duty to fund basic education while increasing costs to a system already under stress. We need to get back to basics in education funding before throwing any more at the system.

 

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