Editorial: Change is on the horizon, not just in the cushions
If Washington state’s revenue projections get any bleaker, Gov. Chris Gregoire may have to start fishing loose change out of the gubernatorial sofas. Every nickel, even a symbolic one, will be needed to fill a gaping $385 million hole in the remaining seven months of the 2009-’11 biennial budget.
That, to be clear, is the budget that’s in force now. The 2011-’13 budget that the incoming Legislature will have to construct, starting next month, has its own, separate multibillion-dollar challenges.
The immediate difficulties arise from a combination of factors, not the least of which is the economy’s stubborn sluggishness. Add to that the excessive size and reach of a state government that grew recklessly fat during pre-recessionary times. The Legislature tried last spring to compensate for declining revenues by increasing taxes but that didn’t go well. Voters beat the package down in November’s general election. Don’t look for tax rate hikes to be part of the solution now.
But there aren’t many options left.
Gregoire already ordered a round of across-the-board spending cuts, a strategy most agree is flawed but unavoidable.
She also invoked her statutory authority to send state employees back to the table to reopen collective bargaining agreements that are now in place but can no longer be afforded, given the relentless plunge in revenue collections.
This week the governor announced plans to go after businesses that aren’t paying the taxes they owe. The state Department of Revenue, under new Secretary Suzan DelBene, will hire six auditors and seven tax examiners to track down businesses that are delinquent. If state lawmakers give their OK to a short-term amnesty program Gregoire has proposed — and they should — the Department of Revenue hopes the incentive of avoiding fines and interest will pry loose some $44 million in back taxes.
That would be a small dent in the nearly $1 billion that is needed right away, but it would help. It also would send an important symbolic message that responsible businesses that do pay their taxes won’t have to keep subsidizing the scofflaws.
By the same token, if the state is serious about being a reliable steward of the taxpayers’ limited means, it will be as energetic in ferreting out fraud and abuse in social service programs. Sincere advocates of the needy should be among the strongest supporters of any strategy to make sure finite resources go only to the people who truly need them.
Between the commitment to crack down on tax evasion and a broader initiative to simplify the state’s complicated tax structure, Gregoire and former Microsoft executive DelBene have a chance to create a fairer and more sensible climate for small businesses.
That’s a longer-term goal, however. For now, don’t rule out that sofa.