Democrats hold a clear majority in the Washington state Senate, but they have yet to coalesce around a plan for solving the state's budget crisis, Sen. Rodney Tom said Thursday during AWB's weekly Lobby Lunch meeting.
It's apparent by now that tax increases will figure prominently in the final solution, but details about which taxes -- broad ones such as the sales or targeted ones like sin taxes and tax incentives -- are far from clear, said Tom, D-Medina, vice chair of the operating budget for the Senate Ways & Means Committee.
"I have no idea what direction we're going to go," Tom said.
His preference would be to target sin taxes and tax incentives that may not be giving the benefit that was expected.
That's the opposite view of Rep. Kelli Linville, chairwoman of the House Ways & Means Committee.
Linville, D-Bellingham,told AWB that she favors a small, across-the-board sales tax increase that would go away when the economy improved as opposed to numerous smaller tax hikes aimed at specific targets such as the oil industry.
It's not possible to "nickel and dime our way" until the economy improves, Linville said.
She defended the idea of a sales tax increase from those who charge that it's regressive by noting that groceries and utilities are already exempt. Also, low-income people who have been hit hard by the recession are likely not doing much discretionary spending anyway, she said.
Whatever the solution, its first draft could debut as early as next week. Lawmakers in the state Senate are aiming to produce their budget by Feb. 17, and the House is shooting for Feb. 22, Tom and Linville said.
The two lawmakers agreed about the need to "reduce the footprint" of state government.
Linville said the budget crisis "makes it more likely that we'll make some progress in this area," and Tom said there has been a "fundamental shift in the growth pattern of the economy."
"I do think the public expects us to do something different," he said.
They both support privatizing the state's liquor stores, though Linville said it's unlikely that a full privatization bill will pass this year.
She said she'd be happy with a bill that takes a step in that direction by implementing a pilot program to look at what it would require to move toward all contract liquor stores.
Linville said she was "very disappointed" by this year's increases in workers' compensation and unemployment insurance rates, two of the biggest issues affecting the business community.
She raised the possibility of asking the state Auditor's Office for a performance audit of the workers' compensation system so officials can target changes in the future.
Tom left the door open just a bit for liquor store privatization and other big changes, however, saying many of the ideas that lawmakers are rejecting now could receive serious consideration in the next few weeks when they realize there are not many options.
"In the end, they're going to end up saying, 'That's our only ticket out of town,'" Tom predicted.
