Lifting the cap on property taxes could lead to a larger taxpayer revolt.
PROPERTY taxes don’t increase as fast as they used to.
Most people think that’s a good thing. But a lot of powerful governments, lobbyists, and special interest groups see that as a problem. So they’re in Olympia right now trying to convince the Legislature to make it easier for state and local governments to jack up property taxes without a vote of the people.
Some background: In the 1990s, each government could increase property taxes up to 6 percent a year. State government raised property taxes 6 percent annually, so did counties, cities, ports, and fire and library districts. All those 6-percent increases multiplied year after year, and property taxes skyrocketed.
And taxpayers suffered.
So, we sponsored Initiative 747 in 2001, which limited each government’s regular property-tax levy to 1 percent a year — the only way to increase it more was by asking voters’ permission. And even though we were radically outspent by a well-organized opposition, voters in 37 of 39 counties approved the initiative with a whopping 58-percent yes vote. It was a huge victory for taxpayers.
Six years later, in a goofy 5-4 ruling, the state Supreme Court said voters were “misled” into voting for the initiative and struck it down.
Gov. Chris Gregoire called a special session and one month later the Legislature reinstated the 1 percent limit. A look back shows that 91 percent of state House members and 81 percent of state senators voted yes. And our Democrat governor signed it into law.
I highlight this history because there’s a full-court press in Olympia to overturn this important protection. Last May, the powerful Washington State Association of Counties decided that it was its top legislative priority to get the Legislature to allow state and local governments to increase property taxes as much as they want without a vote of the people.
The Legislature shouldn’t take that right away from voters.
First off, all the arguments now being made against the 1-percent cap were made during the 2001 campaign, and voters rejected those arguments and approved the initiative by a massive margin.
And those same arguments were made again during the 2007 special session and the Democrat-controlled House, Senate and governor’s office rejected them and reinstated the protection by an even wider margin.
There’s been an overwhelming vote of the people and even a broader legislative vote to make the 1-percent cap the law.
It’s important to know that governments get property taxes from multiple sources. Every year, they get property-tax revenue, as well as tax dollars from new construction, improvements, annexations, real-estate excise taxes, property-valuation increases and voter-approved levies. When added together, property taxes to government consistently rise faster than inflation.
But even that isn’t the whole story.
Governments get revenue not just from property taxes, but from many other taxes and fees as well. The fact is governments are taking plenty of money away from the taxpayers. And if they want more, all they have to do is ask the voters’ permission.
Some want to go back to the “good old days” when state and local governments could jack up property taxes as much as they wanted without voter approval. That would be horrible for taxpayers. But it’d be even worse for governments. Why? The 1-percent cap is a gift compared to what the taxpayers really want — across-the-board property-tax reductions.
Property taxes continue to be a huge burden for struggling working families. Take away the 1 percent, and property taxes would skyrocket. And if that happens, governments would inevitably face a rebellious electorate eager to support an initiative similar to California’s Proposition 13 that cuts and caps property taxes. Governments should consider themselves lucky that the 1-percent cap is in place.
The 1-percent limit has protected taxpayers for 13 years. It continues to have broad public support. Olympia shouldn’t take it away.