The Tim Eyman sponsored Lower Property Taxes Initiative 1033, which will be voted on by Washingtonians this November, aims to limit increases in state and local government’s property tax revenue to a measure of inflation known as the Implicit Price Deflator. In recent years, the IPD has been a negative figure. Critics of I-1033 claim that it will make it impossible for these governments to provide the services that residents demand. Supporters say that it will ensure governments are more disciplined with their spending.
Here, The Reporter presents two differing viewpoints of what I-1033 might do for Washington. Found below is the viewpoint of Tim Eyeman, I-1033’s author.
In support of Initiative 1033
Initiative 1033 would limit growth of certain state, county, and city revenue to annual inflation and population growth, not including voter-approved revenue increases.
Revenue collected above the limit would reduce property tax levies.
Let me start by thanking the 315,444 citizens who voluntarily signed I-1033’s petitions, as well as the thousands of volunteers who made that possible.
Here’s what we’re debating with I-1033: how fast should the government grow and who should decide?
I-1033 takes the position that the public sector should grow at the same rate as the private sector (unless voters OK faster growth) and it should be the citizens, and not the politicians, who decide.
I-1033 brings back successful policies and principles passed by the voters previously.
In 1993, during tough economic times, voters approved I-601, which put reasonable limits on government’s fiscal policies.
I-601 established a sustainable rate for government to grow, saying it could grow at the inflation rate plus population growth.
It included a safety valve that said if government thought I-601’s automatic increase wasn’t a big enough increase, they could go to the voters and ask for an even bigger increase.
Despite a multi-million-dollar-special-interest-group-funded opposition campaign, the voters passed I-601.
I-601 worked very well for many years until the Legislature started putting loopholes in it. It started with the Republicans in 1998, and accelerated with the Democrats in 2000, 2001, 2002, 2005 and 2007. Those loopholes removed I-601’s reasonable fiscal discipline and policies. The result? Two major deficits — $3.2 billion in 2003 and $9 billion in 2009.
Those loopholes allowed them to take their budgets on a fiscal roller coaster, overextending themselves in good times — creating unsustainable budgets — and then slashing during bad times.
I-1033 gets us off that fiscal roller coaster by reestablishing I-601’s same reasonable allowance for growth allowing higher increases with voter approval.
I-601 worked, it can work again with the passage of I-1033.
So what happens to excess tax revenues that government collects above I-1033’s limit? After a fixed percentage of tax revenue is transferred into the constitutionally-protected rainy day fund, the remainder of excess tax revenues gets refunded back to taxpayers via lower property taxes.
Opponents of I-1033 pushed really hard for higher taxes and a state income tax during this year’s legislative session.
Even Governor Gregoire and the Democrats rejected doing that, which just shows that I-1033’s opponents are on the absolute extreme fringe regarding tax policy.
Opponents are against any limit on government’s growth and against any restriction on government’s power to take as much as they want from the taxpayers.
I-1033 establishes a reasonable, automatic increase in government revenues every year and allows bigger increases if they ask taxpayers’ permission. I-1033 provides fiscal discipline with flexibility: any revenue from any source deposited into general funds is limited except voter-approved revenues, rainy day funds, and federal funds for the state and except voter-approved revenues for counties & cities. Opponents want no limits whatsoever.
Putting a reasonable limit on the growth of government, like I-601 previously did, gives politicians the excuse to say ‘no’ to the special interest groups and the courage to finally start prioritizing and reforming government. And if the automatic increase allowed by I-1033 isn’t enough, government can use I-1033’s safety valve and go to the voters and ask for a bigger increase.
Property taxes keep going higher and higher and government keeps getting bigger and bigger. The people are losing control. I-1033 allows the state, counties, and cities to grow, but at a rate that citizens can control and taxpayers can afford. I-1033 gets government off the “fiscal roller coaster,” allowing it to grow at a sustainable rate that doesn’t outpace taxpayers’ ability to afford it. I-1033 is needed now more than ever.
I-1033 is our last, best chance to gain control of our government and provide the first real reduction in property tax bills in our state’s history. We’re very proud of our supporters and very hopeful that voters will support controlling the growth of government and lowering property taxes by approving I-1033 in November.
Tim Eyman is co-sponsor of I-1033 and heads up Voters Want More Choices, a grassroots taxpayer-protection organization.
