The need for good schools for our children, safe communities for us all, and other programs that help our state thrive continues to grow. Yet Washington state government investment in these priorities remains depressed after years of deep cuts enacted during the Great Recession. Next week, as lawmakers gather in Olympia to convene the 2016 legislative session, legislators should take steps to further increase investments in our state so that we can create a thriving economy in which all Washingtonians have the opportunity to get ahead.
Governor Inslee’s proposed 2016 supplemental budget would modestly increase funding to cover unexpectedly high needs for health care, child care, mental health, and wildfire-fighting services. Even with this, state government spending in the current budget cycle would remain well below pre-recession levels when measured as a share of the economy (see graph below).
This session, legislators should fund Governor Inslee’s proposed improvements to mental health services and salary increases among first-year teachers. And they should take steps to better invest in our state to improve the well-being of all Washingtonians.
Stay tuned to schmudget for further recommendations on what kinds of steps lawmakers should take to strengthen Washington's economy during the 2016 session.
Trimming Tax Breaks to Invest in Teachers a Good Start; More Investments Needed to Strengthen Economy
Governor Jay Inslee's proposed supplemental budget makes essential new investments in schools and mental health services. This budget is a good starting point for policymakers ahead of the 2016 legislative session. If paired with additional investments in Washington's communities, families, and children, it would help create a stronger state economy.
His proposal would sensibly eliminate four wasteful tax breaks in order to increase first-year teachers’ salaries by $4,300 per year and provide a smaller, 1 percent increase for more experienced teachers. It would also draw down some budget reserves and redirect funds to offset the costs of fighting the wildfires that impacted our state this year. And the budget would preserve current funding for health care, child care, schools, and other important public investments.
The Governor is right to help schools in Washington state attract and retain high-quality educators by raising the salaries of teachers. It's a real issue: Washington school principals recently called the state teacher shortage a crisis. Inslee’s budget also puts an emphasis on the well-being of Washingtonians by seeking new funding to improve mental health services provided in state hospitals.
Funding for other important priorities, such as health care, public safety, and higher education, would not change significantly from the levels approved by lawmakers earlier this year in the comprehensive two-year state budget.
To boost teachers' pay, Governor Inslee proposes to generate just over $100 million per year by eliminating four wasteful tax breaks: sales tax exemptions for nonresident shoppers, bottled water, fuel used by oil refineries, and a real-estate tax exemption for banks and mortgage lenders on sales of foreclosed properties.
An important detail to understand as a backdrop for budget discussions is that although the recovering economy has enabled policymakers to increase funding for public priorities in recent years, many important needs remain unmet.
What's more, policymakers remain under intense pressure from the State Supreme Court to increase funding for schools in Washington by billions of dollars each year due to the McCleary decision mandate.
Securing these needed investments will require bold reforms to a state tax system under which the wealthiest households pay a lower rate of their income in state and local taxes than anyone else does. The Governor should continue to push – and the Legislature should act on – his previous proposals for a capital gains tax and fees on carbon pollution to help fund the mandated improvements to basic education.
Reforming Washington state’s tax system is also key to ensuring that funding for public priorities is stable and sustainable in the long run. Instead of pursuing additional sources of revenue, Governor Inslee proposes to tap reserves in order to pay for this summer’s wildfires and to maintain other key investments for the remainder of the budget cycle that ends in June 2017. Although the amount taken from reserves would be relatively small, drawing down reserves now is a risky move. If the money isn't replenished by the time the next economic downturn strikes, Washington will have a tough time meeting public needs.
Building a solid economic foundation for all Washingtonians requires significant reinvestments in education, public transportation, and other needs. And that can’t happen without significant reforms to the state's inequitable tax system.
No matter what indicator of child well-being you choose to focus on, it is almost without fail that children from low-income backgrounds are doing worse on it. When children do not have their basic needs met – even for a short period of time – it affects their brain development, the strength of their relationships, their ability to learn and perform in school, and their physical and mental health. So it goes without saying that the economic security of parents is inextricably tied to the well-being of their children. Indeed, family economic security is a precondition for a child to thrive. And Washington policymakers can help create the conditions for families to do better if they consider the needs of the whole family.
In Washington state, a surprising share of our children – almost one in three – are living in families that have a hard time meeting basic needs (living below 200 percent of the federal poverty line).
Rates of Washingtonians struggling to make ends meet range from a low of 11 percent in the 41st legislative district (Mercer Island, Bellevue, Newcastle, and Lake Sammamish) and 45th legislative district (Seattle) to a high of 47 percent in the 3rd legislative district (Spokane)).
The interactive map below demonstrates these rates of economic hardship across the state. (Hover over the map for more details and also see the fact sheet here.)
That’s way too many kids who may not have enough to eat, a consistent place to sleep, or the resources to afford a trip to the doctor. The growing research on brain science suggests that children who grow up with economic hardship are at greater risk of experiencing events that lead to levels of stress so toxic to them and their families that the impact will ripple throughout their lifetime. And if the individual impact of economic hardship on children doesn’t raise eyebrows, this statistic should: A conservative estimate of the economic costs of children who grow up in poverty is $11.7 billion per year in Washington state.
We need to rethink child poverty in Washington state. The individual, societal, and economic costs are too great, and would surely be trumped by the benefits to reduce it. The question is – how?
Nationally, two-generation approaches to reducing poverty – those that focus on economic success of families, as opposed to a focus on children or adults alone or in silos – are gaining momentum and showing promising results. In Colorado, Utah, Connecticut, Massachusetts, and Oklahoma – to name just a few states where two-generation policies and programs are being put to the test – lawmakers, agencies, and service providers are taking innovative and holistic approaches to advancing family economic security. They are doing this by coordinating across five key domains – high-quality early childhood education; post-secondary education and career pathways; asset-building; health & well-being; and social capital (see graphic).
Early investment in two-generation programs like CareerAdvance, Jeremiah Program, and Keys to Degrees are paying off. With basic needs of the family met, these programs are leading to living-wage careers for parents, better education outcomes for kids, and a low rate of return to social benefit programs.
Washington state is well-positioned to adopt a two-generation approach to reducing child and family poverty. The expansion of a high-quality early learning system for children under the Early Start Act, as well as promising career pathways for low-income parents under the Workforce Innovation & Opportunity Act, are ripe for integration of two-generation programs that advance the well-being and security of families. We also have nationally recognized programs and models already in place to build off, like IBEST, Opportunity Center for Employment and Education, and Head Start/ECEAP.
The evidence is as compelling as it is concrete – the benefits of reducing child poverty far outweigh the costs of the investments to make it happen. We encourage lawmakers to rethink Washington state’s approach to reducing child poverty in the upcoming legislative session.
Our Research and Policy Director, Lori Pfingst, recently gave a two-part presentation to the House Early Learning and Human Services Committee highlighting this two-generation approach for achieving family economic security in our state. Listen to the audio of her presentation here.
If our state doesn’t generate additional new sources of revenue, it will not be able to maintain existing investments in schools, public health, and other essential programs over the long term. This is according to the November revenue forecast. What’s more, the four-year budget outlook shows that our state will be facing a nearly $500 million budget shortfall by 2019.
The revenue forecast did show some welcome news in the form of increased revenue, primarily from home sales and marijuana revenue – an additional $101 million for the remainder of the 2015-2017 biennium, and $25 million more in 2017-2019. However, state resources continue to fall far below what’s actually needed to fund high-quality K-12 education, as required by the Supreme Court’s McCleary ruling. That’s not even taking into consideration the continued funding needed for other important state investments.
To top it off, the forecast doesn’t factor in the potential havoc that Initiative I-1366 would wreak on state spending if the Supreme Court upholds the initiative’s constitutionality. The recently passed Tim Eyman ballot initiative seeks to force the Legislature to adopt a two-thirds majority to raise taxes; if it doesn't, the state sales tax will be cut by a full percentage point. At a time when our state needs continued investments in education, firefighting resources, affordable housing, and more, such a sharp drop in the sales tax rate would eliminate $1.5 billion in tax resources that support these investments in the current budget cycle. That amount would rise to nearly $3 billion in lost resources in future budget cycles, according to the state Office of Financial Management.
The recent forecast and the threat of I-1366 loom large for the people and economy of Washington state. With state resources barely bouncing back to pre-recession levels, our ability to make progress on essential investments continues to be hindered by an upside-down revenue system that disproportionally relies on people with the lowest incomes to pay into.
The children, families, and communities of Washington state deserve a revenue system that provides a foundation of equal opportunity so everyone can thrive. The only way to get there is to fix our broken revenue system with common sense reform – like through a capital gains tax, the closure of wasteful tax breaks, and a tax structure that isn’t rigged in favor of the wealthy.
While it’s certainly a small step forward to have some additional revenue in our state budget, it’s not nearly enough for Washington state to reach its full potential. More investments are required to ensure we can be a place where everyone has the opportunity to get ahead and to live in safe, healthy, thriving communities.
Have you been trying to decide whether to attend our Budget Matters 2015 Policy Summit? Well, let us tell you all the reasons you should!
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Still not sure? What if we tell you that scholarships and discounted group rates are available? Buy your tickets now! You won't regret it.
And find out more about the summit -- including who our fantastic panelists are -- here.
The Budget & Policy Center welcomed economic justice advocate Misha Werschkul as its new leader in September. Misha, a long-time collaborator with our organization, has made a career out of building coalitions in support of progressive statewide campaigns in Washington. We talked with her about what she brings to the Center, what's in store under her leadership, and much more.
What makes you most excited about working here?
The team! I have been fortunate to partner with the talented Budget & Policy Center staff on a range of campaigns for nearly a decade. I am so impressed by their strategic insight and their passion for the work they do. They produce meaningful, credible research and they are responsible for making major contributions to advance innovative policies. I’m truly honored to now be part of this team that has such an impact on Washington’s families and communities.
What role do you think the Budget & Policy Center plays in shaping the policy debates in this state?
The Budget & Policy Center is the organization in Washington that is pushing for policymakers and influencers to keep the focus on the long term. Throughout my time in Washington state’s policy arena, I have become ever more aware of the need for long-term reforms in our state – especially around the revenue policies that shape our state economy. The Center’s ability to focus on a big picture while building alliances is so unique. And it’s a much-needed voice in the public policy debates.
How do you hope to build on this long-term focus and vision?
My primary goal with the Budget & Policy Center is to build on our already considerable strengths. To help make our voice even stronger and increase our impact. Our team’s research and policy expertise – in areas including helping hardworking families get ahead, promoting public engagement in budget and policy matters, and making sure the state raises the revenue it needs equitably – combined with their strategic communications, advocacy, and outreach efforts are helping set our state on a path toward shared prosperity.
What are your most pressing priorities?
I will be devoting much of my time in my first six months toward deepening relationships with and getting to know the many people who help make this organization so strong – its staff, board, supporters, community partners, policymakers, and the like. I will be asking lots of questions to better understand the needs and priorities of this organization’s many partners and allies.
I am also excited about our fourth annual Budget Matters event on December 9. This half-day summit will feature keynote speaker Patrisse Cullors from #BlackLivesMatter and spotlight the need to make sure there’s a racial justice focus in policymaking. It’s so clear we are long overdue in changing the policies that have played a role in allowing racial inequities to persist in everything from income to incarceration rates. Advancing racial equity has been a strategic priority for the Center for some time. This summit is a reflection of our commitment to providing a forum for a wide range of communities to contribute to the ongoing dialogue about disparities in our public policies – and to discuss the steps we must take to start making things right.
And of course, I intend to support the priorities that the Center’s staff are currently working on. Right now that includes playing a key role in challenging Tim Eyman’s Initiative 1366, continuing to lead in efforts to lift Washingtonians out of poverty, and making plans to use the 2016 legislative session to show how important it is for government to invest in schools, safe communities, and other building blocks of economic growth.
What made you interested in pursuing public policy as a career?
I grew up in a politically aware family and was raised from an early age to see the connection between public policy decisions and quality of life for my family. That I was able to breathe clean air, attend public school, and hike and boat on the beautiful Rogue River in Oregon was all a result of public policy decisions. My parents taught me that grassroots advocacy and good political leaders played a key role in helping provide pathways to opportunities for my generation and future generations. So when it came time for me to choose a college major, it was a no-brainer to study political science and economics. I have been fortunate to devote my career to advancing economic policies that make people’s lives better and our communities stronger.
What do you like to do in your free time?
I love living in the Puget Sound, where my husband, Josh, and I can easily get out to the mountains for hiking or camping in the summer and skiing in the winter. When the sun is shining closer to home, you might find me walking around the Columbia City neighborhood, running around Seward Park, paddleboarding on Lake Washington, and growing vegetables in my neighborhood p-patch. These days, we are also spending a lot of our free time preparing the house for our first child, who we’re excited to welcome in early February.
What is something people would be surprised to know about you?
I grew up in a town with fewer than 100 residents in southwest Oregon called Agness and attended school in a one-room schoolhouse. My life looks a lot different these days, but I do try to keep to my rural roots by raising chickens and doing that gardening as much as possible!
Any final thoughts?
I hope to see and meet lots of new Budget & Policy Center friends on December 9 at our Budget Matters Summit!
Contact Misha at mishaw(at)budgetandpolicy.dot.org, 206.262.0973, ext. 222.
Our new infographic on Initiative 1366 provides a snapshot of how Tim Eyman’s ballot initiative would hurt Washingtonians. I-1366 is the serial initiative promoter’s most recent attempt to strong-arm our elected officials into handing even more political power over to corporate lobbyists and political extremists in Washington state.
If approved by voters on the November ballot, I-1366 would force lawmakers – under threat of deep cuts to funding for health care, public safety, higher education, and other important investments – to pass a constitutional amendment requiring a two-thirds “supermajority” vote of the Legislature in order to enact any tax increase.
A supermajority vote requirement would grant veto power over all state tax and budget decisions to as few as 17 Washington state senators (of 147 total legislators). This would make it virtually impossible to close wasteful corporate tax breaks, fully fund court-mandated improvements to schools, and reform our state’s deeply inequitable tax system.
See for yourself why I-1366 is not a good choice for our state and its people by clicking on the image below.
And read our previous analyses of how I-1366 would undercut democracy and harm future generations of Washingtonians:
- Eyman Initiative Aims to Create Endless Gridlock
- Efforts Underway to Block Eyman Blackmail Initiative
- I-1366 Lawsuit Headed to Washington State Supreme Court
- Battle Over I-1366 Shifts To November Ballot