Time is wasting and, in Washington state, it’s wasting money. A special session of Washington’s Legislature must be convened to address the state’s enormous budget crisis.
Gov. Jay Inslee’s stubborn refusal to call a special session, as he holds out for more federal relief, will cause more harm than good.
The state is projecting an $8.8 billion revenue shortfall over the next three years. Its general fund is spending down its cash. Even if Congress provides more help, it’s likely to fall far short of the gap. Some new taxes might be necessary, but the Legislature and governor cannot ask people hit hard themselves by the pandemic to pay more unless they do fundamental belt-tightening.
Delaying hard decisions only makes them harder. Even deeper cuts will be required if the state doesn’t trim spending this year.
A persuasive argument for prompt action is made by the nonpartisan Washington Research Council.
Had the Legislature convened in June, it could have addressed the shortfall by cutting spending between 2.9% and 9.4%. If it waits until 2021, cuts will have to be as high as 28.2%, the council estimates.
That makes sense: Reducing spending levels by a dollar this year avoids having to cut two dollars from the biennial budget legislators will start writing in January.
Waiting has real-world impacts. Residents who care about particular programs — such as higher education and early learning — should demand Inslee and the Legislature act soon to prevent deeper cuts.
Recall that three of the Legislature’s four caucuses favored a special session in June. House Democrats and Republicans and Senate Republicans were ready to go, knowing it’s better to cut less today than more tomorrow. But Senate Democratic leadership balked, and Inslee declined.
That decision was influenced by Inslee and Democrats wanting to protect the second of two raises over two years bargained by state employees, which took effect in July. As Washington residents grapple with their own job losses and income effects, halting the raise was an obvious first cut, since it would save nearly $800 million over three years with no decrease in service.
Since June, the state’s budget situation worsened substantially.
Inslee made some trims, including cutting raises for nonunion workers and requiring furloughs, that will save $55 million over the next year. Another $91 million would be saved if state agencies not under his authority take similar steps. He also froze hiring and vetoed $235 million out of nearly $1 billion in new spending approved by the Legislature. But those moves were too small to cover much of the enormous shortfall.
New urgency is added by the state’s cash situation. If there’s a general-fund deficit projected, state law requires an automatic, across the board spending cut.
After providing legislative staff on July 30 with a spreadsheet showing a deficit, Inslee’s budget office backpedaled. On Aug. 11, it said that was a preliminary, incomplete projection, only looking at a general-fund subsection. Counting other revenues, the overall fund is still in the black, it claims.
Regardless, the situation demands action, even if the governor is reluctant.
One, legislators need to clarify the deficit budgeting law. They should specify how it will be enforced, if the state’s executive isn’t willing.
Two, legislators must convene a special session.
Nobody wants automatic, indiscriminate spending cuts. But the potential of that nuclear option bolsters the argument for convening to trim spending judiciously.
Inslee’s budget chief, Office of Financial Management Director David Schumacher, said the administration is making a policy choice to avoid further cuts now, during the pandemic. He acknowledges that has a price.
“If it requires slightly bigger solutions out over the next couple of biennia, I think that’s a good trade,” Schumacher said.
This board isn’t the only group that disagrees.
Three of the Legislature’s four lead budget writers told this board they favor a special session to start reducing spending.
The fourth, House Appropriations Chair Timm Ormsby, said he’s not opposed but is deferring to Inslee and wants to see what federal relief arrives.
“We’re all waiting to see what the federal government does, every single one of us,” the Spokane Democrat said.
State Sen. John Braun and Rep. Drew Stokesbary, Republicans from Lewis County and Auburn, favor making targeted cuts and policy changes that reduce spending going forward.
Senate Ways and Means Chair Christine Rolfes, a Bainbridge Democrat, said a special session is needed, perhaps in November.
“There’s a benefit to everybody coming together to say ‘here are five things we need to do,’ ” Rolfes said.
Mass unemployment continues. Households and businesses are tightening belts to get through the downturn. State and local governments face a potentially long and difficult recovery.
State leaders must show a good-faith effort to buckle down and address the budget crisis. Failing to do so this year will also undermine any call for new taxes, which Democrats are seeking next year.
Inslee and legislators must show they are prudent and willing to make difficult choices before asking taxpayers — many of whom are struggling — to pay more.
Besides, the lack of decisiveness in Washington, D.C., is always a weak excuse for inaction in Washington state.