Voters next month will again decide on a Tim Eyman initiative that aims to reinstate a two-thirds supermajority vote for the Legislature to raise taxes. But this year’s initiative is very different.
Three times in the past decade, Washington voters have backed Tim Eyman initiatives tethering the Legislature’s power to raise taxes with a two-thirds supermajority requirement.
The question is before voters again on the Nov. 3 ballot, in the form of Eyman’s latest, Initiative 1366.
This time, the debate has changed in some important ways.
The vote on I-1366 arrives amid a cloud of highly publicized ethics allegations against Eyman, who is accused by state election watchdogs of illegal profiteering off initiative campaigns.
But it’s not just that. After all, the former Mukilteo watch salesman has long been a divisive figure in state politics.
I-1366 also is more convoluted than its predecessors and could slice billions of dollars from the state budget — even as lawmakers wrestle with a court mandate to boost K-12 education funding.
Eyman’s latest brainchild would not simply reinstate the supermajority requirement for legislative tax increases. That’s because a 2013 state Supreme Court ruling struck down such restrictions as unconstitutional, invalidating 2012’s voter-approved Initiative 1185.
The decision leaves an amendment to the state Constitution as the only option to reinstate the tax limit. But citizen initiatives cannot amend the Constitution, so I-1366 seeks to pressure the Legislature into sending an amendment to the 2016 ballot.
The amendment would permanently reinstate the requirement that all tax increases pass by a two-thirds vote of both houses of the Legislature, unless they’re sent for a public vote.
If lawmakers refuse to submit that amendment to the 2016 ballot by April 15, then I-1366 would cut the state’s 6.5-cent sales tax by a penny. That would reduce state revenues by an estimated $8 billion over the next six years.
Opponents have called I-1366’s arm-twisting unconstitutional and unsuccessfully sued to keep it off the ballot.
“I’m hopeful the voters will recognize this would just be devastating,” said state Sen. David Frockt, D-Seattle, who was one of the lawsuit plaintiffs. “This would put us back into recession-era budgets where all we were talking about is recession-era cuts.”
Eyman said efforts by opponents to block a public vote is proof they fear the public will once again endorse the tax limits. He said voters are “rightly concerned” over politicians who want to raise a host of taxes.
“These guys just don’t seem able to restrain themselves in any way,” Eyman said, pointing to the Legislature’s approval this year of an 11.9-cent gas-tax increase to pay for a $16 billion statewide transportation package, as well as Democratic proposals for a capital-gains tax.
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Opponents call the two-thirds rule undemocratic because it allows a minority of legislators — as few as 17 state senators — to block even the smallest of tax increases.
The state is now under a $100,000-a-day fine and contempt order issued by the state Supreme Court, which said in its 2012 McCleary ruling that lawmakers have shirked their constitutional duty to adequately fund public schools.
If the I-1366 sales-tax cut is enacted, the state would face a deficit of billions of dollars just to maintain existing services — much less find the additional $3.5 billion needed in the next biennium to satisfy the McCleary ruling, the business-backed Washington Research Council noted in a recent report.
Such a deficit also could jeopardize parts of the state budget that are not constitutionally protected like K-12 schools are — including the 15 percent university tuition cut that was a major priority for state Senate Republicans this year. The tuition cuts cost the state about $159 million over two years, according to the state budget office.
The angst over funding hits — combined with doubts about Eyman — could explain why some business backers of previous tax-limiting initiatives are cool to I-1366.
The Association of Washington Business, for example, said it is staying neutral on the proposal, in contrast to its support and big donations to 2012’s I-1185.
Other past initiative funders, like the state’s grocery-store association, have said they halted donations to Eyman’s proposals over what they’ve felt is misuse of their donations in the past.
That hasn’t stopped Eyman from finding other business donors to get I-1366 on the ballot this year. The pro-I-1366 campaign has raised more than $1.6 million — mostly spent to pay signature-gathering firms to get the measure on the ballot.
Vancouver apartment developer Clyde Holland was by far the largest benefactor this year, contributing $540,000. Bellevue Square developer Kemper Freeman kicked in another $100,000.
And $160,000 came from the estate of Gerald Petersen, a Silverdale farmer who died in 2009 and left money to support Eyman-sponsored initiatives in his will. His heirs have since questioned whether Eyman spent the money properly.
A small-business association, the state chapter of the National Federation of Independent Business, has endorsed I-1366. Mark Peterson, NFIB state leadership council chair, called the initiative process “the only way to curb the spending.”
Peterson, who owns H&H Furniture in Yakima, said he doesn’t think government holds anyone accountable for mistakes, citing transportation boondoggles involving state ferries and bridge projects.
Peterson shrugged off the state Public Disclosure Commission investigation of Eyman, which found the initiative promoter has been getting secret payments from a paid-signature gathering firm.
“It may be shady, but I like the side of the fence he’s on,” Peterson said, saying “vested interests” want to change the subject from taxes and spending.
Opponents rally, wait
Meanwhile, in contrast to past big-spending efforts against Eyman initiatives, so far Democratic and union groups have shied away from mounting an expensive campaign against I-1366.
As of Friday, two campaign committees opposed to the measure had reported raising a total of about $53,000, mostly from unions.
Opponents are still considering whether to raise and spend more, said Adam Glickman, secretary-treasurer of Service Employees International Union 775, an officer for one of the “no” committees.
SEIU and allies have been pushing for years for a state income tax or capital-gains tax on the wealthiest taxpayers in the state — an idea that passage of I-1366 would threaten.
“I think it’s pretty clear this state needs more revenue,” Glickman said. Past Eyman anti-tax measures, he said, have “left us in a huge hole being able to fund education.”
Some critics of I-1366 are confident the debate this year could be moot. Like several past Eyman initiatives, this one could ultimately be thrown out by courts.
In September, King County Superior Court Judge Dean Lum rejected a lawsuit to pre-empt a public vote on I-1366.
But Lum wrote that I-1366 appeared to contain multiple constitutional defects and stood a “substantial possibility” of being invalidated even if it is approved by voters.
If that happens, Eyman isn’t sitting around. The state’s most prolific initiative sponsor, who filed more than 50 versions of initiatives with the Secretary of State’s office in 2015, has been busy drafting texts of possible new anti-tax initiatives for next year.
On Friday, he and co-sponsors Jack and Mike Fagan submitted their latest initiative, titled “Stop Skyrocketing Sales Taxes.”