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Largest spending increase in
state history and sharp rise in projected budget shortfall go
hand-in-hand
Rep. Gary
Alexander,
Republican leader on the House Appropriations Committee, made this
statement about the Office of Financial Management’s projection of a
$718 million shortfall for the 2007-09 biennium: (http://www.ofm.wa.gov/fiscal/outlook/apr2006.pdf):
“The 27 percent rise in
the projected 2007-09 budget shortfall, from the $564 million OFM
projected following the 2005 session to $718 million now, is a
disappointment but not a surprise. It’s part of the fallout we expected
from the largest spending increase in state history approved last month
by majority Democrats and the governor.
“By spending nearly all of
the taxpayer revenue available this year the Democrats have turned a
$1.6 billion surplus into a $718 million deficit in one budget cycle.
This belies all of their presession talk about fiscal restraint. And if
the Democrats respond to OFM’s revised projection by claiming they saved
money for next year, don’t buy it. The idea that you can save money that
is also counted as spending – part of the 17 percent increase in state
spending Democrats approved – seems a lot like voodoo accounting to me.
“If the Democrats are upfront with taxpayers they will acknowledge the
OFM outlook probably understates the size of the budget problem for
2007-09. That’s because the maintenance level-plus model OFM is using
assumes no other new spending in the next biennium: not on education
enhancements, not on human services enhancements, no new spending –
period. But after what we’ve seen the past two sessions, does anyone
really believe the Democrats can hold the line on new spending if they
continue to have a lock on the legislative process and the keys to the
treasury?
“And what if Judge Allendoerfer in Snohomish County, who is presiding
over the spending limit lawsuit brought by the Washington Farm Bureau
and others, ends up invalidating the omnibus tax bill the Democrats
passed in 2005 to help cover their overspending? That would make the
projected budget hole bigger still and maybe bring it very close to the
billion-dollar deficit the Legislature faced two short years ago.
“I believe the Democrats are pinning too much on the hope that state
revenues will continue to increase at the rate we saw during the
session, in spite of the spike in fuel prices and tangible evidence that
the construction and real estate activity is slowing. But if that
strategy backfires they can always go back to their revenue-raising
strategy from 2005: huge tax increases.
“It’s really too bad the Republican proposals for truth in budgeting, a
constitutionally protected spending limit and a constitutionally
protected rainy-day fund were rejected this year. The best hope for
taxpayers now is a new Legislature that takes a more conservative
approach when it comes to spending the people’s money.”
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For more information, contact:
Brendon Wold, Public
Information Officer: (360) 786-7698
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