February 11, 2009
Budget Crisis? Where?

Democrats in Olympia are setting themselves up for a swoon by overtly delaying necessary budget cuts to the current fiscal cycle - let alone dealing with the looming $6+ billion budget shortfall for the next biennium:

Why is it taking so long to accomplish a single task, given how quickly they say they are working?

Republicans aren't to blame. With large majorities in each chamber, Democratic leaders don't need to corral any GOP votes to pass budget bills this session.

One reason is this is not easy stuff...

[snip]

Another explanation is that some Democrats in both chambers still seem unconvinced the problem is as serious as forecasted. [emphasis added]

They talk of how Washington is not as bad off as California. Nobody is, but does anyone really want to reach the point of writing IOUs for government services?

Finally, Democratic leaders are waiting to see what Uncle Obama sends our way.

They are overly hopeful the sum will be large enough to negate much of the deficit before cuts are made.

It really sounds like it will take a kick in the teeth from the next state revenue forecast on February 19th to wake up some members of the Legislature to the challenge at hand. And even then it will take some real leadership to combat the inevitable "well, we'll just have to raise taxes" answer.

The Democratic majority's delay in the Legislature has become an irritant to Governor Gregoire, because people with sense realize the potential train wreck at hand. From Sen. Joe Zarelli's "Budget Tidbits" [pdf]:

Given declining revenues since that forecast, the deficit is now likely to exceed $1 billion. That is, $1 billion worth of adjustments to the current budget will have to be made between now and June 30th -- just to break even. [emphasis in original]

The Legislature has been in session one month and has yet to act on that serious and immediate problem. That does not speak highly of their capacity to cope with the even large fiscal problem, creating a two-year budget, which is the purpose of this legislative session.

UPDATE: link fixed.

Posted by Eric Earling at February 11, 2009 09:12 AM | Email This
Comments
1. "They talk of how Washington is not as bad off as California. Nobody is, but does anyone really want to reach the point of writing IOUs for government services?"

Relative to population, we are very much in the running for being as bad off as California (6 Billion vs 38 Billion). Worse yet, this state tends to mirror much of the attitude of California in terms of government entitlements, only we're a couple years behind. Instead of learning from California's model of inefficiency, we ramble down the same road to idiocy that they've paved for us and then are flabbergasted when it turns out to be a dead end street.

Posted by: Rick D. on February 11, 2009 09:35 AM
2. The protest against the porkulus is on for President's Day!

Date: Monday, February 16th, 2009
Time: 12:00 p.m. to 3:00 p.m.
Where: Westlake Park in downtown Seattle, 401 Pine St., in the open area by the big arch.

The idea is to use what we've learned about dissent over the last eight years. We need loud protests with lots noise and visuals. So, what should you bring?

Bring AS MANY PEOPLE AS YOU CAN! Bring your families, your friends, neighbors, bring everyone!

Bring SIGNS!! Get those craft making juices flowing and make signs and banners and pictures and paintings. Just imagine that you are a left-wing college student with nothing else to do and that should help you get started!

Bring something to sit on and appropriate clothing.

Most importantly, JUST BRING IT!!!

Posted by: Libertybelle on February 11, 2009 09:39 AM
3. SIDEBAR 2 Eric: You're missing the ''h'' in the ''http'' in your link to the HeraldNet piece.

Ditto what Rick D. said @ #1 above.
The (D)s in Oly now have a tiger of their own making by the tail:
Much as I expect they wish they could, even those Legislators who are most out there in deep-space orbit with the moonbats are not going to be able to paper over the reality of our multi-billion dollar shortfall thru the next biennium. And they will not be able to close that gap without causing serious pain, anguish, and anger among several of their (at least until now) most ardent supporters on the left (SEIU, WEA, WFSE, et. al.). The longer they procrastinate, the worse it will get.

My sympathy for the majority in the WA Leg and the Gov is so far down in the noise it doesn't register:
They brought it on themselves (unfortunately we the people are likely to suffer the consequences of their prior reckless and profilgate spending).

Posted by: Methow Ken on February 11, 2009 10:06 AM
4. I don't remember the last time the 2-yr budget was done by the end of February. It's just the usual practice. We've always thought that they would have the budget done by April and if they get it done by the middle of March they were working pretty fast. Of course off-year budget adjustments don't take as long.

They had to move up both the revenue forecast and caseload forecast many weeks to get those in February so that they would have time to consider them in budgeting.

Then again if you want them to build a budget based on previously projected numbers instead of the newest ones, that's fine. The legislative rules are and have always been (even when Republicans were running it) such that non budgetary bills have earlier cutoffs for committee readings and the like, while the budget decisions waited until the reports come in.

Posted by: Doug on February 11, 2009 10:10 AM
5. Why do you think this state is compared to Cal? It is the same idiots that screwed that state up so bad in the 70's so they all moved up here to screw this state up. Remember when Oregon put up a sign that said "Come visit but don't move here"? Well lo and behold they came and stayed and what do we have? 3 screwed up states.

Posted by: bud on February 11, 2009 10:50 AM
6. Doug -

The timeline you're talking about is for passing a budget for the next biennium, which begins in July. The problems outlined above are for addressing large holes in the current budget, which has roughly five months remaining before it expires. They have to get past the triage phase before they get to the operating room for major surgery.

Posted by: Eric Earling on February 11, 2009 11:16 AM
7. One reason is this is not easy stuff...

Right, which is why we wanted Dino as our governor, because he has proven he can accomplish such a daunting task.

The Democrats dishonestly convinced the public there was no serious problem. The Republicans should have done a better job in the campaign, but at the end of the day, we tried. And we'll keep trying. Some of us worked so hard this year not just because we wanted Our Guys to win, but because we knew what was coming and who would fix it, versus who wouldn't.

Granted, Gregoire has so far at least given lip service to the idea of cutting and not increasing taxes. We'll see if she sticks with it. The Democrats in the legislature seem to be assuming she'll sign off on whatever they decide, and I think they're right.

Posted by: pudge on February 11, 2009 11:32 AM
8. Here's another $63,000,000...
---
"Washington monthly tax revenue less than expected"

http://seattlepi.nwsource.com/local/399625_revenue12.html?source=rss

OLYMPIA -- The state Revenue Forecast Council says tax collections in the past month in Washington were $63 million short of the amount expected.

That adds to the budget gap state lawmakers will have to close.

The council will issue an interim report on Feb. 19 with the outlook for the four months remaining in the current budget and for the next two-year spending period.

In Tuesday's monthly report the council says taxes from retail firms were down 13 percent, furniture 30 percent, vehicle dealers 27 percent, gas stations and convenience stores 20 percent, clothing 19 percent and building materials 18 percent.

Tax payments from car dealers have been declining for 13 straight months.
---
I have Monday off and may come down to protest.

Posted by: Dantzler on February 11, 2009 12:14 PM
9. I don't think sales on vehicles being down hurts the state. The racket is that the state collects B&O when the vehicle arrives irregardless if or what it sells for. At least that is what I was told by a Ford dealer. a couple of years ago.

Posted by: swatter on February 11, 2009 12:37 PM
10. The last time we were in a fix this was in 2003 when Dino Rossi and Gary Locke put together a group of cuts to the 2001/03 biennium. As I recall it was passed by early April.

But that was when only about $200 million was necessary. Yesterday's collections report now has the $600 million at $800 million with 5 months to go (& the shortfalls are averaging $65 million per month).

Posted by: Gary in Olympia on February 11, 2009 12:43 PM
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