The irony of watching politicos who once opposed Initiative 747 now poised to the codify the 1 percent property tax cap in Olympia should be lost on no one.
The real question is what the one-day special session called by Gov. Christine Gregoire will really accomplish, besides rump-covering for incumbents facing re-election in 2008.
Thursday’s one-day session comes after the state Supreme Court, ruling on a technicality, struck down the property tax limitation passed by Washington voters in 2001. In so doing, the court handed anti-tax zealots and gubernatorial hopefuls the ultimate wedge issue a scant 12 months before the next election, practically daring Gregoire and incumbents to “defy the will of the people,” regardless of the merits of the cap itself.
While the 1 percent cap may have imposed a modest fiscal discipline on local taxing agencies, it’s also clear that no one is any happier with the state’s tax structure today than they were in 2001. And those who thought I-747 would cap hikes in their own tax bill at a 1 percent each year were sadly deluded.
On Bainbridge, property tax bills have increased significantly as voters approve more money for schools, fire protection and parks. Too, cagey local governments like our own city – knowing that demands for lower taxes are rarely accompanied by demands for fewer services – have blunted I-747’s impact by simply raising other fees and charges to make up the difference. A recent study by the state Department of Revenue estimates that Washingtonians have saved an estimated $1.6 billion in property taxes thanks to the initiative, but it would be interesting to know how much of those savings have been offset by tax and fee shifts.
Now, on the eve of the special session, our 23rd District delegates say they will support the governor and vote to reimpose the 1 percent tax cap. But after their vote, legislators should ask: Did we really accomplish anything? Is Washington’s tax structure any fairer today than yesterday?
We recall a few years ago, when a blue-ribbon panel led by William Gates, Sr., considered options for statewide tax reform. Among other revenue-neutral suggestions, the commission found that the State of Washington could slash its slice of the sales tax (from 6.5 percent to 3.5 percent) and abandon its share of the property tax entirely, imposing a flat 3.8 percent personal income tax in their stead.
State revenues would be the same, but it would be a noticeably progressive shift in a system that too long has put the cost of public services on the backs of wage-earners, retirees and “land rich, cash poor” citizens. Of course, the commission’s findings – a full, frank discussion of tax reform that the Legislature itself never musters the courage to address – went nowhere. Few in Olympia probably even remember it now.
What they do remember is that campaign season draws nigh. So take Thursday’s one-day special session for what it is. Your legislators won’t be voting to codify the 1 percent property tax cap because it’s good public policy, or because it’s tied to any objective index, or because they supported the cap when voters approved it by initiative in 2001. Or because they have any better ideas on how to make Washington’s painfully regressive tax system fairer.
They’re voting for the 1 percent cap to protect the governor’s job, and their own, in 2008. Nothing more.
