This year, the Washington legislature approved increases, or adjustments, in several state taxes. Three measures on the statewide ballot in November are asking whether you approve of those changes. Those are Advisory Votes 16, 17 and 18.
According to the Secretary of State’s website, advisory votes were authorized by voters in 2007 when they approved Initiative 960. The votes are non-binding and won’t change anything, but they give people the chance to express their opinions on tax increases.
Advisory Vote 18 is the largest of the measures, moneywise. It asks voters whether they approve of a rise in state property taxes to help fund a major increase in spending for public schools. It’s expected to raise about $13 billion during the next 10 years.
Supporters of the legislation, including the governor, hope this will satisfy the state supreme court. It ruled in 2012, in what has become known as the McCleary decision, that the state has failed to adequately fund basic education.
The advisory vote was approved by roughly two-to-one margins in both the state House and Senate on the last day of the fiscal year. Sen. Michael Baumgartner (R-Spokane) voted yes.
“So here we are with a bill that funds McCleary and moves us past this issue with a complicated, but fundamental equalization of property tax across the state, which has the net result of increasing it for some folks in wealthy areas and decreasing taxes for folks largely in areas where I care about,” Baumgartner said.
According to a district-by-district chart created by the state, the average increase in 2018 for owners of single-family homes in Spokane-area school districts will be somewhere in the $100-200-a-year range. The increases are expected to be smaller in many rural districts in eastern Washington. And then in 2019, patrons in many districts will see their state property taxes go down.
In Bellevue, the average increase next year will be much higher, about $600.
“While it has the intent, or the benefit, I guess, of making school district funding equitable, it’s an inequitable funding source, in that it hits certain districts much harder,” said Sen. Patty Kuderer (D-Bellevue). “And one of those districts, Mr. President, is mine.”
Kuderer said many of the lower wage residents in her city risk losing their homes because they won’t be able to pay the higher tax. She also criticized the secrecy and rush-rush associated with the rollout of the plan in the last days of the session.
Sen. Andy Billig (D-Spokane) was also part of the group that negotiated the new education budget. He voted for the property tax increase but had mixed feelings about it.
“I think the policy, I think the spending decisions, I think they’re really good,” Billig said. “The funding source, I’m really disappointed about, that it was in this bill. The property tax, I think there were fairer, smarter ways to fund this.”
Now voters have a chance to express their opinion through Advisory Vote 18.
Advisory Vote 17 is also a big ticket item. It’s expected to raise about $565 million for the state during the next 10 years. It involves several changes in taxes. Among them, it includes an expansion of the state business and occupation tax so that more businesses pay it. It means consumers who buy things online or via mail order will soon pay sales tax, whereas now, in many cases, they don’t. It also changes state law so that you will soon pay sales tax on bottled water.
The bill that included all of these was presented to the Senate and House for a vote on the last day of the special session.
Rep. Kristine Lytton (D-Anacortes) praised the provision that institutes an Internet sales tax.
“I have a furniture store in Mt. Vernon and the owner has talked repeatedly over the years of how he has customers come in, they look at furniture, he spends a great deal of time with them. And they politely thank him and they say, ‘actually I’m going to buy this online because I don’t have to pay the sales tax.’ And that’s created a really unfair playing field,” Lytton said.
Rep. Ed Orcutt (R-Kalama) said he understands the fairness argument that Lytton makes, but he expects the Internet tax will be challenged in court, leaving the state budget vulnerable if a court rules the tax isn’t legal.
Orcutt also aimed at the bottled water tax. He remembered that the legislature voted to tax it several years ago, only to have voters approve an initiative that repealed that.
“I get concerned when the voters tell us, ‘No, do not tax this. We think it is bad policy for you to tax this.’ And then a few years later, we just come right back and tax it,” Orcutt said. “I think the voters are going to be pretty upset with us for doing that.”
The House approved the tax changes by a 51-to-42 margin. The Senate vote was about two-to-one.
And finally, Advisory Vote 16. It’s much smaller and more targeted. Among other things, it expands fees for some commercial fishermen and makes changes in the way that industry is regulated. It’s expected to raise less than a million dollars during the next 10 years, with the money targeted for the state wildlife account.
You can read more about the advisory votes in the state voters’ guide that you may have received in the mail or online at the Secretary of State’s website.