SAYING YES TO tax increases isn’t easy.
Monday morning, a Presidents Day “tea party” attracted an estimated 3,000 people to the steps of the state Capitol building in Olympia to declare they’re taxed enough already.
Monday afternoon, as estimated 6,000 — many of them from state-employee unions and college campuses — gathered in the same place to demand more revenue to pay for state services.
Inside the building, majority Democrats worked feverishly to suspend Initiative 960, which requires a two-thirds vote of the Legislature to raise tax rates or increase fees.
While waiting eagerly to sign the I-960 suspension, Gov. Chris Gregoire assembled a package of tax hikes projected to add $605 million to the state revenue stream.
Gregoire proposed increasing taxes on cigarettes; reclassifying bottled water, soda pop, gum and candy to treat them as non-food items subject to sales taxes; and nearly tripling the pollution tax on petroleum products and other pollutants.
Previous cigarette tax increases have demonstrated the mathematical uncertainty of Gregoire’s revenue projections.
It’s easy to calculate, if customers bought 19.2 million cans of pop last year, collecting 5 cents a can would raise $96 million.
However, adding that extra nickel per can — $1.20 per case — will impact the number of cans sold, for a net collection less than projected.
Discouraging consumption of soda pop may well have public health benefits, but if the tax is used to justify $96 million of spending, there’ll be another hole in the state budget.
Likewise, taxing candy, gum and bottled water could inspire shoppers to shift to purchasing cookies, beef jerky and juice.
That scenario might generate little in the way of health benefits, and something less than the projected $163 million in new state revenue.
Similarly, the state recently reported a drop in gas tax revenue because people have switched to more fuel-efficient vehicles and are driving less.
Oil refiners and others who pay the pollution tax warn that if the state dings them for what Gregoire predicts will be another $148 million, that cost will be passed on to consumers.
Higher costs to fuel vehicles will heavily impact truckers who move virtually all commodities, inflating prices and potentially further depressing the already struggling economy.
That struggling economy is, of course, the inspiration or excuse behind efforts to channel more money into state coffers.
Tax revenue is down, putting many services at risk.
The budget crunch is so severe that even I signed letters to Sen. Jim Hargrove, D-Hoquiam, Rep. Lynn Kessler, D-Hoquiam, and Rep. Kevin Van De Wege, D-Sequim, supporting their efforts to maintain funding for cost-effective social service solutions.
Hargrove, Kessler and Van De Wege, who represent Clallam and Jefferson counties and part of Grays Harbor County, all voted to suspend I-960.
The letters, written in my capacity as coordinator of the Shelter Providers Network of Clallam County, were less fervent than my boss, Kathy Wahto, hoped.
Wahto, executive director of Serenity House of Clallam County, was in Washington, D.C., serving on a work group on federal initiatives to end homelessness.
Before leaving, she expressed hope that the Network would send a strong message to our legislators supporting increasing revenue to preserve funding for programs serving people who are homeless.
After hearing a report about last Friday’s Housing Advocacy Day in Olympia, Jody Moss, executive director of the United Way of Clallam County, said Kessler and Van De Wege both “stressed the need to generate revenue for the programs we want to keep in place or enact.”
But when I asked the Network about sending a letter supporting revenue increases (aka tax hikes), Moss was the first to say she couldn’t sign on without her board’s consent.
Others echoed that concern, and Barb Townsend of the St. Vincent de Paul Society said she had additional reservations about tax increases.
The Network agreed only to “express support for increasing state revenue specifically to preserve housing programs and related critical support services for people who are homeless or at risk of becoming homeless.”
Meanwhile, other advocacy groups are demanding money for everything from recreational trails to public art — perhaps with less antipathy for tax hikes.
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Martha Ireland was a Clallam County commissioner from 1996 through 1999 and is the secretary of the Republican Women of Clallam County. She and her husband, Dale, live on a Carlsborg-area farm.
Her column appears Fridays.
E-mail her at irelands@olypen.com.
