Tax, fee plans may induce sticker shock

OLYMPIA – As Olympia struggles to agree on a major tax plan to send to voters in November, they’re also talking about a lot of small things that will never appear on any ballot – but that are still likely to cost you.

Among them:

•Letting cities impose a 6 percent tax on water and sewer districts.

•Allowing state college tuition increases of nearly 30 percent over the next two years.

•Letting local school districts collect tens of millions of dollars more in property taxes.

•Raising some court fees by $50 to $200.

•Tripling the $50 “document fee” that auto dealers can charge buyers.

•Letting counties tack a new 6 percent tax onto power, garbage, cable-TV and other utility bills for residents who live outside cities.

•Charging a new, voluntary $5-a-car annual fee for state parks.

•Boosting the costs of hunting and fishing licenses, as well as raising licensing fees for thousands of health care workers.

Sen. Mark Schoesler, R-Ritzville, predicted sticker shock as the increases add up.

“Wait until you see the multiplier effect of all these taxes and fees on the average citizen,” he said.

Most of the proposals come from majority Democrats, who are grappling with a $9 billion budget shortfall over the next two years. Republicans have argued for more cost-cutting, but Democrats say that some increases are crucial to easing devastating cuts.

Schools, for example, are facing nearly $1 billion in cuts, compared to what it would cost to maintain current services. In the face of thousands of teacher layoffs, Gov. Chris Gregoire recently proposed letting dozens of school districts collect $62 million in taxes that voters have approved, but that a state tax limit prevents schools from collecting. Gregoire wants to temporarily lift that limit.

The move “will provide critical relief to many of these districts to keep their programs intact,” she said.

In many cases, lawmakers are trying to help cash-strapped local governments – such as cities and counties – by changing laws to let them increase their taxes.

“But the effect for the homeowner or business is the same,” said Paul Guppy, of the conservative Washington Policy Center.

Guppy said that it can be hard for voters unhappy with tax increases to figure out who to blame. The local governments point to state lawmakers, saying they allowed the changes. And lawmakers point back at the locals, which actually get the money.

At the state level, House lawmakers will hold a hearing today on their leading tax plan. It would boost the state sales tax by about a third of a cent for the next three years. If voters agree to that in a statewide vote in November, the state would collect hundreds of millions of dollars to help pay for health care programs across Washington.

Budget writers argue that they have few good options this year.

The alternative to the big tuition increase, they argue, is to force students to pay for an extra year of college just to get the classes needed to graduate. The new county utility taxes would pay for law enforcement and work on public buildings. And without the millions of dollars expected from the $5-a-car park fee, proponents say, Washington will be forced to close dozens of popular state parks.

Earlier this week, Rep. Kathy Haigh recalled promising college students that lawmakers wouldn’t have to increase tuition more than 7 percent.

With state revenues worsening, that was a promise she couldn’t keep. On Monday, she introduced a bill to do away with the 7 percent limit.

“It’s a very difficult time for all of us,” she said.