Sunday, January 30, 2011

Note to the Seattle Times on state budget cutting: We're in this together, some more than others

I have deleted rude comments from the Seattle Times editorial so you can is is easier to see the story and the argument.

The short of it is that Adams (18,376), Asotin (22,290), Ferry (8,117), Stevens (46,616), Lincoln (10,393), Garfield (2,410), Yakima (241,446) and Wahkiakum (4,172) counties have populations that take in far more state tax money to run than they produce (wa.ofm 2010 estimate).

There are plenty of smaller counties than Yakima, and Washington State counties are not formed by some defined process, not by land mass or population, and not by how many people need representation ((Crosscut/Mossback). Lack of population is a different issue where those counties might want to consider consolidating into other counties to save money on administrative costs. The measure Washington State Representative Glenn Anderson (R - Fall City) is sponsoring is to address the gross imbalance of taxes a county paid to taxes it received. Anderson is one of three sponsors of legislation (HJR 4214) that address heavily subsidized counties.

WHEREAS, Taxpayers in certain counties of the state persistently contribute more in state taxes than the state expends in those counties; and
WHEREAS, Other counties of the state persistently absorb more state moneys than taxpayers in those counties contribute in state taxes; and
WHEREAS, Taxpayers in counties that contribute more in state taxes than the state expends in their counties reap a disproportionately small benefit from their tax contribution, and therefore bear an unjust and unreasonable tax burden; and
WHEREAS, The fiscal well-being of the state demands that each Washington county contribute to the economic welfare of the state; and
WHEREAS, Principles of fundamental tax-burden fairness call for dissolution and reorganization of counties that persistently absorb more state funds than their taxpayers contribute to state tax revenues;
THAT, At the next general election to be held in this state the secretary of state shall submit to the qualified voters of the state for their approval and ratification, or rejection, an amendment to Article XI, section 3 of the Constitution of the state of Washington to read as follows:

(read the rest of the bill, and follow HJR 4214 here)

Attention Seattle Times: Some of us have noticed that the counties that persistently vote down tax increases locally and state-wide persistently take in more taxes than they actually generate.

The larger point is that these counties both complaining about taxation while essentially being welfare counties. See the "Ratio of Expenditures to Revenue" column here, and notice at the top the 6 counties get back less than they put in, and at the bottom are counties that in some cases get more than two times as much tax money in return.

State Rep. Glenn Anderson proposes a constitutional amendment to allow the state to dissolve and reorganize counties that receive twice as much in state services as they generate in tax revenues. Oooh. Bad idea.

SOMETHING strange is happening in Olympia, where two state lawmakers from King County are overly excited that urbanized and suburbanized counties contribute more tax dollars to state coffers than rural areas.

This fact is neither new nor news, but that has not stopped state Rep. Glenn Anderson, R-Fall City, from introducing a constitutional amendment to allow the state "to dissolve and reorganize" counties that receive twice as much in state services as they generate in tax revenues. He refers to Adams, Asotin, Ferry, Stevens, Lincoln, Garfield, Yakima and Wahkiakum counties. Oh, please.

It is obvious that urban-suburban areas will pay more on a percentage basis than rural areas. So what?

. . .

Anderson's point is that rural counties bristle at King and other wealthier counties for dominating the state budget and agenda. But these wealthier counties net export dollars to places where lawmakers complain.

Beyond that, Anderson says rural counties need a long-term plan to sustain themselves either by merging with another county or finding new ways to create jobs and become more self-sufficient.

The best way for Washington to dig out of its current budget crisis is to do it together as one state solving problems collectively.

. . .

. . . six counties contribute 75 percent of the state's total tax revenue and many others receive more in services than they pay.

If this is all about having a conversation about the imbalance, discuss at will. But the constitutional idea is going nowhere. That involves the state sloughing problem areas off to counties, which are in no better shape than the state.

Lawmakers must engage in solid budget cutting endeavors that do the least harm to all of Washington.

Editorials | Note to state budget cutters: We're in this together | Seattle Times Newspaper

The Seattle Times Editorial Board fails to offer a meaningful argument against the legislation, just that it would be "bad". The reality the Seattle Times is refusing to face is that the voters did vote down tax increases and so we are seeing a natural reaction of self preservation. In this state those that "have" also happen to have the population to ensure the counties that "have not" get exactly what they claim they want, less government.

Government in this little exercise is expressed in dollars.

Expect government to be transferred to the local level where possible, that is, taxes collected and kept at a local level. This local government will naturally invite people to question why tax money in some cases is held at the local level while in other cases it is redistributed in grossly uneven quantities to other counties.
Expect it, because that is where we are.

Last Tuesday, Goldy at The Stranger wrote a pretty good story on this, Since Red Counties Enjoy a Disproportionate Share of the State Budget, They Should Expect a Disproportionate Share of the Cuts
(see his groovy map below)

Sunday, January 23, 2011

Don’t let Peter Callaghan's sports talk fool you – arts funding fuel tax extension

Peter Callaghan, of the Tacoma News Tribune, has a story on King County's effort to wrestle away the hotel and car rental taxes from the control of the state. Where Callaghan might have the story not quite right is the who is driving the legislation.

Yes, Safeco Field wants a funding source for major capital repair. The current taxes do end with the paying off of the bonds used in the initial build of the facility. Washington State Senator Joe Zarelli said nearly two years ago when the Senate Ways & Means Committee took testimony on Senate Bill 6116 that this is a public facility with a substantial public investment that we do not want to find ourselves in a "Sonics" situation a few years from now.

Simply, they want to keep the admissions and parking taxes at the facility to fund major capital repairs. Any bill that includes King County hotel and car rental taxes getting extended pretty much must have this component. This required component does not mean that the Safeco and Qwest Fields (same boat, different sport) need is driving force. Both facilities are Public Facilities Districts, they have different partnerships with the private companies that use those facilities, but those PFD's could come back to the state or get transferred to the county and put the request to tax the users on the ballot. That is a much tougher route to go, no question about it, but it is not the death of those institutions.

What is in a life or death struggle is the funding for 4Culture in King County. I just do not see how they could lose 75% of their operating funds in 2012 and then come back later to the state or King County and ask for a tax increase across the board on hotels and have a glimmer of hope to have that pass.
4Culture needs a bill this session, and that bill will not get very far without the stadium tax extension.

King County Executive Dow Constantine will ask that a bill be introduced to allow the county to keep some taxes collected only within the county. Proceeds would be used for tourism-related facilities and projects.

“The proposal will honor the original intent behind these taxes,” said Constantine’s external affairs director Sung Yang.

Two of the taxes are now directed toward Safeco – the half-cent sales tax on restaurant and bar tabs and a 2 percent tax on car rentals. Yang said the proposal would be to maintain the car rental tax permanently but extend the food and drink tax only until 2015. (State Restaurant Association head Anthony Anton said the group would not oppose a temporary extension.)

Don’t let art talk fool you – sports teams fuel tax extension | Peter Callaghan - The News Tribune

I did not expect this story written that way now. What I am expecting is for a similar story to be written on February 2nd when the Arts and Heritage folks descend upon Olympia for Arts and Heritage Day
The arts folks will lament that they need the sports stadium folks, and Yakima (they use the Kingdome tax law), to get their bill passed.


Road Trip to Olympia - Join us for Arts & Heritage Day

Clear your calendar on February 2nd. 
It's Arts and Heritage Day in Olympia and we need all advocates to attend! The Washington State Arts Alliance and the Washington Museum Association are joining forces to coordinate this year's event. 

Arts and Heritage Day provides an opportunity for you to meet your legislators, in person, so you can advocate4culture and tell them what is most important to you. 

If you can attend, please visit this page and contact your team captain (organized by where you live). Your savvy captain will get you signed up and will tell you when meetings are scheduled with your legislators. There will be other advocates attending these meetings with you - so you won't feel alone. If you haven't been before, you'll see that there are many advocates that will guide you along the way. Arts and Heritage Day is a great way to see that you do have a voice in Washington State. Come join us! 

If you need a ride to Olympia, or just need some encouragement to attend, send us an email and we'll help get you there.  


I suggest that Peter Callighan join them and write that story, too.

Buried in the back page of the About 4Culture web site is their compelling story.
Funding for 4Culture will end in 2012 unless citizens, Representatives and Senators work to change state legislation this year.


4Culture invests $4.5M every year in artists & arts/heritage organizations and activities in King County. This is the single largest source of contributed revenue available in our community on a regular basis for artists, arts organizations, heritage organizations and heritage/preservation projects.

In 2009 alone, 4Culture provided financial support to:

168 individual artists & small arts groups
211 arts organizations
37 heritage organizations
87 cultural facilities
24 landmarks (preservation $$)
40 individual specialists for heritage projects and education curricula
17 heritage collections projects

Additionally, lodging tax funds supported 4Culture programs that gave
18+ KC school districts support for integrated arts curriculum training to principal-led teacher teams
400+ performing and visual artists presentation opportunities through 4Culture Site Specific
30+ visual artists exhibition opportunities in Gallery4Culture and the electronic gallery e4c
100+ performing artists promotional support through the 4Culture Touring Arts Roster
100+ heritage sites promotional support through Destination Heritage tourism brochures

4Culture is also home to King County’s award-winning Public Art Program.

These activities and more make our region an attractive tourist destination. They enhance our quality of life, define our sense of place and serve as a powerful economic driver for our local communities. The small investment of lodging tax for culture ripples throughout the local community, making art and history programs accessible; keeping neighborhoods active, safe and walkable; and employing thousands of residents throughout our region.


In 1990, the state legislature passed a law allowing a portion of KC lodging taxes to be used for arts and culture. 4Culture has stewarded these funds for 20 years. When the law was originally crafted, it had an expiration date of 2012 – and required that a portion of the tax be set aside for an endowment that would sustain the programs of 4Culture after 2012. Unfortunately, due to changing economic trends, there is not enough in the endowment account to maintain the level of support currently provided by 4Culture. If 4Culture began to operate solely off the endowment, the funding available for the cultural field would be cut by 75%.

Therefore, if new legislation is not passed to augment the endowment and designate future uses of lodging taxes for culture after 2012, 4Culture will need to start winding down programs and services. This cut of resources will obviously be devastating to many small non-profit organizations, artists and community-run programs in every corner of King County, and to the people employed in this sector.

The page ends with the likely description of the bill.

The arts and heritage funding we are working for is just a small percentage of the available visitor taxes. Traditionally, lodging taxes have also paid for the construction of stadiums, and support of the convention center. The legislature’s obligation is to disperse these taxes among a variety of causes that can steward tourism, while potentially addressing some of our regional economic and social services issues. Other issues that may be in a bill with 4Culture include: low-income housing, heath and human services programs, regional centers publically owned facilities, and support for cultural districts (like the International District). Our opportunity is to position arts and culture at the center of these various goals. Culture is part of the solution to regional problems.

What that reads like is last legislative sesson's HB 2912. That bill was sandbagged and killed by Washington State Senator Rodney Tom's dozen floor amendments.
Let's see if Tom can control himself this year.

What may help the bill this time around is that the University of Washington will not be grasping at those funds for Husky Stadium. The university will remodel that facility on their own through donations and leveraging future revenues that will increase as a result of the major remodel.

Saturday, January 22, 2011

Seattle Times: KeyArena's name to change; bank drops sponsorship

The value and timing of the renaming depends on the location of a new arena.
Seattle Center's arena could retain a tiny bit more name value if a new arena is built in Bellevue as opposed to some place in Seattle, but not much.

I am sure it will still have some value. The question is how diminished that value is with its novelty as the only indoor facility of its size in the Seattle media market removed?
Does it then get a local second tier name?
Does it get a local name that is an international company but valued at the second tier price?

The market is big enough that a new modern arena could make money without completely destroying the value of Seattle Center's arena, just expect it to be what it already is, second tier, when the novelty of being the only major arena goes away.

Seattle Center officials are shopping the naming rights to KeyArena, the city's high-profile entertainment venue, after KeyBank let its contract expire Dec. 31.

Bill Boucher, KeyBank's regional marketing director, said the bank valued the presence it got from the sponsorship but decided not to renew the contract.

"Like every company, we continuously review our portfolio of sponsorships and strive to improve their impact and return on investment," Boucher said in a statement.

Cleveland-based KeyCorp, the bank's parent company, paid the city $300,000 annually for the past three years even though it could have walked away after the Sonics left for Oklahoma City in 2008. Before the team's departure, KeyCorp had paid the city $1.3 million a year since 1995.

In a statement Friday, Seattle Center Director Robert Nellams said he was confident the city would find a new partner.
. . .
Boucher said the bank isn't shying away from Seattle. Over the past 18 months, KeyBank has established new sponsorships with the Seattle Mariners, Tacoma Rainiers and Broadway Across America at the Paramount Theatre, Boucher said.

Business & Technology | KeyArena's name to change; bank drops sponsorship | Seattle Times Newspaper

How did that work out?
As evidenced by the market, not so well.

Sunday, January 16, 2011

Seattle Times | Frustrated Gregoire says 'status quo does not work'

Last week, Governor Christine Gregiore opened the Washington State Legislative Session for 2011 with her state of the State address. The speech included challenges to the legislature to be prepared to make fundamental changes to state government.

The governor has been giving interviews and proposals to prepare people for change as the state struggles with a $4.6 billion dollar hole in its 2011 - 2013 biennium, as well as almost a billion dollars in the current budget that ends June 30th.

When times were much better the state poured money into a variety of programs, as well as tax breaks to grow certain industries.
Gregoire says she doesn't have any choice given the budget gap and the reality that no more bailouts will be coming from Congress.

Surprisingly, though, Gregoire also seems unsure that the money she poured into education improved student achievement as much as she'd hoped.

"I came in here determined to make the system work better. To invest more money. I put a lot more money into K-12. But then you sit there and say, 'Why have I not been able to get the result I set out to achieve?' " she said.

Local News | Frustrated Gregoire says "status quo does not work" | Seattle Times Newspaper

Let's be clear about this, K-12 education support is a mandate in the Washington State Constitution (see here, ARTICLE IX EDUCATION). Gregiore's question has more to do with the system the state pumped money into than the amount of money. To be sure, if they state's educational system was in a position to produce a population of superior students but all it needed was money, then we would have seen a surge in standard test scores over the past few years. We didn't.
That is a fine example, and it is not the only one. Tax breaks are also investments in systems that made claims of being ready to produce exciting economic benefits and jobs, all we needed to do was either give a tax break, or increase taxes on somebody else, then we would see a surge in our economy over the past few years that were above standard. The unemployment rate in Washington State is remarkably similar to the rest of the nation.

Everything the state does in the public sector should be closely examined to ensure that our investments are beneficial.
Everything the state does for the private sector should be closely examined to ensure that our investments are beneficial.

As a result of these examinations and changes we will see county and city governments have to pick up some things that the state drops. The question is if the state will pass the means to stay in the business of health, safety, education, economic infrastructure investment.

The state has until April to figure it out.
Good luck.

Saturday, January 15, 2011

Seattle Times, Ryan Blethen's Opinion | The trolls and bullies must not stifle community engagement

The Seattle Times' Ryan Blethen has taken the tragedy of the shooting in Arizona and the resulting public discussion on the nature of public discourse to publish a self-serving opinion piece on how people say mean things on Seattle Times' comment boards.

No, I'm not kidding.

If we as a nation learned anything from the shootings in Tucson it is that stirring, meaningful speech is still possible. Yet it can be hard to hear above the roaring sewer that often passes for public dialogue
. . .
I questioned whether I should write this column. Are the commentors who hide behind fake names worth my time addressing? The answer is: occasionally.

Like it or not, what they say is part of the dialogue of The Seattle Times Opinion section.

My favorites are the regulars who comment on every column I write. Charlievictor has become so predictable after 531 comments, I don't even have to read what he writes. Without fail he always begins:

"Once again, the ethically challenged, self-dealing helium filled gas bag otherwise known as corporate welfare king Ryan Blethen ... ." Blah, blah, blah ... . On editorials he uses the same language and substitutes my name with "The Seattle Times editorial board."

The Charlievictors are harmless and not effective. The most they do is call me an idiot and claim the only reason I have a job is because my family owns the newspaper. Never heard that one before.

Some days I feel like we provide a service. A place to vent and hopefully prepare angry commentors to face the world a bit deflated.
Opinion | The trolls and bullies must not stifle community engagement | Seattle Times Newspaper

Dear Ryan Bkethen,
Maybe the Seattle Times could use their journalistic skills and separate how people are communicating with what people are communicating. They might realize that there is a consistent and repeating message by people that see the world all around come apart, not just the "nice to have" things but real people with real problems of homelessness and a lack of food. These people, apparently, have not benefitted from the billions of dollars of tax loopholes, and the business community that always championing the cause of somebody else giving something to make things better.

It appears that many people see big business, including the Seattle Times owners, as hypocrites. With one hand you champion your "new normal", with the other your hand is out for my tax money (that is what a tax break is, Ryan, my tax money).
Maybe the Seattle Times, and all of the businesses that champion for less government should actually participate in less government by willingly taking your hand out of my wallet. Let's go ahead an let the freedom of the marketplace determine winners and losers, and not have the state government pick winners and losers by giving you, the Seattle Times, a tax break.
Lead by example, Seattle Times.
This appears to be a starting point from which the "fifth generation Seattle Times owner", Ryan , launches into a critique of modern public discourse on the Seattle Times comment section. People are mean on the internet. That is true. It is also true that the anonymity that frees people to be mean also frees them to be nicer to complete strangers they have never met in the flesh. Ryan, it cuts both ways, your business just happens to be in the industry that profits from delivering bad news, tending to make people (wait for it) unhappy. When you compound that "delivering bad news for a profit" business model with editorials that routinely demand media freedom and less government, while taking corporate welfare, you are bound to be speaking from a logical disadvantage.
It's the hyprocracy, stupid.

Saturday, January 8, 2011

Seattle Times Opinion: State should change how it does business, not simply cut programs

Don Brunell, the president of the Association of Washington Business, points out everywhere the State of Washington can institute systemic savings, everywhere except in his own backyard.

Asking everyone to sacrifice, change the way the state works, and not be open and honest about the role the business community has in our tax mess is at best disingenuous.

For its part, the Seattle Times gives free media space to a lobbyist, a lobby they depend on for their own special tax break that ends in 2015.

The Association of Washington Business is the biggest pig at the trough.

Spending cuts are necessary given Washington's budget crisis, but more systemic change is needed. Guest columnist Don Brunell of the Association of Washington Business suggests five such systemic changes to how the state does business.

Unfortunately, lawmakers resist such changes until the last possible minute. And when a financial crisis finally hits, it makes the necessary cuts seem even more painful. But there are systemic changes the governor and state legislators can make to get spending under control.

• First, we must reduce or eliminate existing programs and lawmakers should not add any new ones. In Gov. Gregoire's first term, the state budget increased 31 percent with higher salaries, richer benefits, 6,100 new state workers, new programs and even a new state agency. In today's economy, taxpayers simply cannot afford it.

• Second, legislators should also resist raiding dedicated accounts set up by specific taxes to fund specific programs, such as hazardous-waste cleanup. Robbing Peter to pay Paul by moving money around and deferring payments doesn't solve our long-term problems.

• Third, state lawmakers should also find more innovative ways to provide public services. For example, the state should contract out services to the private sector when it is more efficient and cost-effective to do so, ensuring proper oversight and quality controls. To make that happen, lawmakers will have to change state law to remove contracting out from the collective-bargaining statute.

• Fourth, Olympia needs to change collective-bargaining agreements with public employees. Government workers must sacrifice to the same degree as private-sector employees. So far, that hasn't happened. Originally, the governor proposed increasing the health insurance co-pay for premiums from 12 percent to 26 but ultimately announced it would be 15 percent. Most private-sector workers pay 25 percent or more.

• Fifth, shorten permitting time, eliminate duplicative regulations and reduce costs for private-sector employers. Eliminating those unnecessary costs will free employers to create jobs, which will restore economic vitality and provide more state tax revenues.

None of this will be easy, but if lawmakers take this opportunity to make real changes in the way the state does business, we will all be better off in the long run.

[Don Brunell is the president of the Association of Washington Business, Washington state's largest and oldest statewide business association.]

Opinion | State should change how it does business, not simply cut programs | Seattle Times Newspaper

Don Brunell is right, but doesn't go far enough, and completely misses a spending program that is wasteful and anticompetitive; payments to one company over another through tax incentives must end. The free market will produce the best industries and companies in this state. Paying companies through the state tax system is costing all Washington tax payers tens of millions of dollars every year.

So, in Don Brunell's priority list at the top there should be a line zero:
• Zero special tax inducements/breaks/payments (the B&O tax is the B&O tax), and the immediate repeal of all tax inducements where the state is not contractually obligated, and where the state can not show a direct return on our investment of our tax money.

That's my tax money, too, Don Brunell.
Put up or shut up, Don Brunell.

I know we could save a little money on the state side by not having to have a team of experts figuring out which tax dodge business owes or avoids, which tax rate, for which service.

Here is an idea, if YOU are doing business in Washington State then how about paying your share of taxes?

Here is 1.1 billion dollars of freeloaders:
Consultants and miscellaneous business services worth $25.2 million
Legal services worth $199.8 million
Engineering & architectural services worth $84.4 million
Accounting and auditing services worth $84.2 million
Detective and security services worth $66 million
Computer and data processing services worth $66.2 million
Management services worth $131.7 million
Trade-ins of used products worth $176.3 million
Credit agencies worth $76.9 million
Security brokers worth $77.8 million
Insurance companies worth $5 million
Insurance agents worth $101.6 million
Real estate brokers & agents worth $5.3 million
Holding companies worth $7.6 million
Precious metals and bullion worth $6.4 million
Other financial services worth $41.6 million

Total: $1.1 billion.

Are we "One Washington", or not?

Monday, January 3, 2011

WSDOT - Big changes coming to First Avenue S. in Seattle as crews work to rebuild Alaskan Way Viaduct ramps

In a few months Seattle might vote to stop what is starting today.
That, right there, is Seattle politics; vote in the future to stop something in the past because somebody doesn't like the decision made last year.

It's like a fuse, burning up from the southern mile.

SEATTLE – In less than a week construction crews working to replace the southern mile of the State Route 99 Alaskan Way Viaduct will reduce First Avenue S. to just one lane in each direction between S. Royal Brougham Way and S. King Street around-the-clock through April 1.

The long-term closures are necessary to give crews working for the Washington State Department of Transportation the space they need to safely demolish and relocate the First Avenue S. on-ramp to the viaduct.

The ramp demolition is a sign of things to come for the south end of the viaduct. Crews working for WSDOT and contractor Skanska USA Civil will demolish the rest of the seismically vulnerable viaduct between S. Holgate and S. King streets in 2012.

Monday, Jan. 3 – Crews will close both directions of First Avenue S. between S. King Street and S. Royal Brougham Way and the SR 99 on- and off-ramps at First Avenue S. between 7 p.m. and 5 a.m. to restripe the roadway and set up the work zone.

WSDOT - 2010 - Big changes coming to First Avenue S. in Seattle as crews work to rebuild Alaskan Way Viaduct ramps