Legislature still far apart in budget negotiating process

When three Senate Democrats aligned with Republicans to advance a bipartisan supplemental 2011-2013 budget proposal last Friday in Olympia, it was intended to spur stagnant budget negotiations.

“Here we are a few days from the end of the regular session and nobody has moved the budget in the sense of the Senate, which then hasn’t allowed conversation,” said Sen. Joe Zarelli, R-Ridgefield, ranking minority member on the Senate Ways and Means Committee on Friday.

Senator Ed Murray, D-Seattle, had announced a Democratic budget proposal on Feb. 28 built around avoiding cuts to K-12 and higher education funding on the back of a $330 million apportionment delay on payments to school districts, which opponents called an accounting gimmick.

Zarelli said his budget was crafted with the intent of spending no more than the forecast amount of incoming revenue while leaving a reasonable amount of money in reserves and avoiding such “gimmicks.”

Armed with the 25-strong philosophical majority, the bipartisan group invoked a procedure known as the “Ninth Order” during Friday’s floor session that allowed them to call up their budget.

The budget passed 25-24 early Saturday morning after extensive debate. It was manifested in the form of a striking amendment to the Governor’s budget, ESB 5967, put forth by Zarelli. The amendment passed by the same margin.

“It is my belief that the Senate bipartisan budget is the superior proposed operating budget,” said Sen. Jim Kastama, D-Puyallup, who, along with Sens. Rodney Tom, D-Medina, and Tim Sheldon, D-Potlatch, joined Republicans on Friday to pass the measure.

“While it makes larger cuts this year than other proposals, over time it will provide more stability.” Kastama said. “Even though it will deliver less in services, it will not cripple our ability to responsibly address our core responsibilities.”

There is a philosophical difference between those who want to enact a budget that closes the nearly $1 billion shortfall in a way that they are sure will be sustainable moving forward and those who don’t mind creative accounting to protect social services and education funding.

“If we ever want to get ahead of our budget crises, our state needs wholesale government reform and a budget that reflects our commitment to sustainable governing,” said Tom.

Murray said the gap between the two sides right now is vast and there is residual anger from Friday’s maneuver.

“Why would we help them pass a budget that we believe, some of it, basically violates our values on education, on health care, on helping those most in need,” said Murray, the chair of the Ways and Means Committee. “We are Democrats. We are willing to cut programs, but we are not willing to simply declare war on the poor, and that’s what the human services part of that budget is.”

According to nonpartisan staff, the adopted Senate budget would cut $44 million from K-12 education, $30 million from higher education and $427 million from healthcare and other human services but leave $502 million in reserves.

Murray’s proposal would have addressed the budget shortfall while preserving education funding and cutting just $170 million from health care and other human services, though it would have left only $369 million in reserves and employed the deferred payment plan.

That proposal had been unable to make it out of the Ways and Means Committee and would not have had the votes necessary to pass the floor, said Zarelli.

The House supplemental budget, HB 2127, which passed 53-45 on Feb. 29, also utilizes the $330 million apportionment delay as well as a $75 million levy equalization shift, but cuts $7 million from K-12 education, $51 million from higher education and $227 million from health care and other human services.

As it stands now, the two budgets must be negotiated between the chambers, a process that is yet to really heat up, according to House Ways and Means Committee chair Rep. Ross Hunter, D-Medina, who led the budget process through his committee.

Sheldon said he thinks the apportionment delay is a non-starter in negotiations.

Murray suggested that a change to preferential tax rates is one option for a budget that would avoid many of the Senate budget’s cuts and get rid of the apportionment delay. However, it would require a two-thirds majority to pass.

“One of the things you could do to replace apportionment is maybe close a couple hundred million dollars in tax exemptions,” said Murray. “That’s compromise.”

“We’ll provide most of those votes, they’ll have to provide a few of those votes,” he said, reflecting on a need for bipartisan support to proceed.

Hunter said there’s still a long way to go before anything gets finalized.

“I’m a little bit in a wait-and-see mode,” he said. “We’re still doing a lot of analysis to try and think about what are the long-term implications of some of the things that [Zarelli] proposes.”

Zarelli, Murray and Hunter agree that getting the budget onto the governor’s desk prior to the Thursday, March 8 deadline is possible, though not a guarantee.