Tag Archives: B&O tax

Inslee misses deadline for releasing real budget – and why that budget is the real story

By ericcampbell | Published on December 21, 2018

The orcas won’t want to hear this, but the $54 billion budget Governor Inslee brought out last week is not the proposal he was required to submit to the Legislature.

Under a state law dating to at least 1959, the governor is to provide a budget document based on “the estimated revenues and caseloads as approved by the economic and revenue forecast council and caseload forecast council or upon the estimated revenues and caseloads of the office of financial management for those funds, accounts, sources, and programs for which the forecast councils do not prepare an official forecast.”

In short, Inslee is to submit a no-new-taxes budget. It’s known informally as the “Book 1” budget. The law allows the governor to also submit a proposal that reflects “revenue sources derived from proposed changes in existing statutes” – as in new or higher taxes. This purely optional “Book 2” budget is what Inslee unveiled December 13.

Under a 1973 law, also part of the state code on budgeting, the Book 1 budget is due no later than December 20. I am told it was finally posted online today (apparently buried somewhere on the fiscal.wa.gov website). Is anyone in the governor’s office aware that failing to meet the deadline is a misdemeanor?

Inslee also took an under-the-radar approach to releasing his Book 1 budget in 2017. At the time, a member of the Capitol press corps explained to me in so many words that a Book 1 budget wouldn’t be relevant anyway, because Inslee wasn’t pushing it publicly. The perception was that Inslee’s real priorities – the stuff worth reporting – were in that year’s Book 2.

News flash: Inslee’s real priorities are in the Book 1 budget. It shows what goes in the budget box and what doesn’t when revenue is limited. That’s much more than a formality. It’s also very different from a Book 2, which is like making a shopping list, then compiling a list of new taxes to cover it.

The Book 1 budget tells the orcas whether they still get $1.1 billion even if Inslee can’t include revenue from a state income tax. Or, without revenue from raising the B&O tax, where Inslee cuts to protect funding for the new collective-bargaining agreements. If a budget is a “statement about what we value,” as Inslee once said, then comparing his Book 2 and Book 1 will reveal something about his values. To me, that’s newsworthy.

As a fiscal conservative who sees no need to raise taxes for 2019-21, because a whopping $50 billion is forecast to be on hand, I’m interested in seeing Inslee’s no-new-taxes budget. It might have some actual value to legislative budget writers, unlike a Book 2 wish list that hinges on tax votes that may not happen.

Did someone think keeping Inslee’s Book 1 budget under wraps until the Friday before Christmas, despite the legal deadline, would minimize the attention it will get? That’s even more reason for the news media (and taxpayers) to take interest.