Washington Governor’s Parting Budget Emphasizes Taxes

Dec 18, 2012

OLYMPIA, Wash. – Taxes are a key part of Washington Governor Chris Gregoire’s final budget before leaving office . The outgoing Democrat released her proposed two-year spending plan Tuesday as required by law. Gregoire says she wrote her budget with incoming Governor Jay Inslee in mind. But he hasn’t exactly embraced it.

Washingon Gov. Chris Gregoire
Credit Credit Austin Jenkins

On the campaign trail, Democrat Inslee said no to new taxes. But signaled he was open to closing some tax loopholes and funding a new transportation package. Departing Governor Chris Gregoire says she kept that in mind as she handpicked a series of taxes to impose and extend as part of her hand off budget proposal to Inslee.

Chris Gregoire: “As I understood it, never said he wouldn’t do taxes for transportation. In fact he talked about a transportation plan. He never said he wouldn’t continue current taxes.”

So Gregoire’s parting budget includes a new wholesale tax on gas and diesel. It would fully fund school bus transportation in Washington over six years. The outgoing governor would also repeal a fuel use tax exemption that benefits oil refiners. And extend for another three-and-a-half years two temporary taxes including a surcharge on beer. All told, Gregoire aims to raise $1 billion more for education in the next two year budget cycle in order to comply with a recent Supreme Court ruling. She says it can’t be done without taxes.

Chris Gregoire: “I don’t see anyway anybody has to invest $1 billion in the K-12 system, time is up, there’s no more recess. The bill is here. We have to do it.”

In a statement, Governor-elect Inslee thanked Gregoire for her “thoughtful effort” and said he will “lay out his own budget priorities that reflect his vision for state government.” But Republican State Senator Andy Hill all but ruled out taxes. The future senate budget chair says Washington voters have spoken loud and clear.

Andy Hill: “We’re not sending more money to Olympia which we consider a black hole and we’re not getting anything in return for it. They don’t see the results. There’s a lot of focus on the input, not much on the output.”

Hill adds that his assumption is Governor-elect Inslee will veto any new taxes. Inslee’s staff would not answer specific tax questions. Governor Gregoire’s final budget would also reinstate taxes on candy, gum and soda pop to fund a pay raise for unionized homecare workers. This despite the fact that two years ago, Washington voters overturned newly imposed taxes on those very same convenience store items.