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Published on Thursday, April 4, 2013

Senate releases proposed operating budget

Please contact your Senators (via email or phone) in the next 24 hours and ask them to oppose further cuts to liquor revenue and to protect the Public Works Trust Fund.

Wednesday afternoon the state Senate released its much-awaited operating budget. It includes significant sweeps to state shared liquor revenues and the diversion of funds for local capital programs. While the budget does not seek to reduce all shared revenue, as originally feared, we still have significant concerns about its impact on cities.

Of most widespread concern is the proposed further reduction to local liquor revenue. The $50 million in liquor taxes that cities and counties are scheduled to receive over the next two years are reduced by 50%. See how much your city loses in liquor revenue under this proposal here.

The Senate proposal also sweeps $15 million from the Public Works Assistance Account into the state General Fund. In addition, another budget related bill, SB 5895, permanently redirects to education 67% of the Real Estate Excise Tax (REET), 100% of the Public Utility Tax, and 100% of the Solid Waste Tax revenues that were formerly directed to the Public Works Assistance Account. This leaves only $21.4 million in REET revenues, plus loan repayments and other existing resources, to fund 2014 construction loans. Over six years, this will lead to the loss of $368 million in direct revenue.

AWC President and Sammamish City Councilmember, Don Gerend, testified to these concerns at the bill’s hearing Wednesday afternoon and asked for these reductions to be reconsidered. He reminded Senators that liquor revenue supports public safety programs and has been maintained for more than 80 years because the impacts of liquor consumption are felt first and foremost in our cities. He also explained that the reduction to the public works trust fund cripples the ability of the state’s centerpiece infrastructure program to invest in core needs. If time had permitted, he also would have noted that the fund has supported more than $4.5 billion in infrastructure, created over 46,000 jobs, and never had a loan default since its creation 26 years ago. 

The Senate will likely vote on this proposal tomorrow. If it passes, it then goes to the House for consideration.

AWC has created an outline of local impacts of this budget proposal. The full Senate budget proposal can be found here.

Watch video of President Gerend’s testimony.

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