County asking for sales tax increase
September 22, 2010
By Dan Catchpole
New: Sept. 22, 4:18 p.m.
Hey buddy, can you spare a dime? Well, actually, can you spare two cents on every $10 purchase?
King County officials say that is what is required to avoid drastic cuts in criminal justice and public safety services. Voters will decide in the Nov. 2 election whether to increase the county sales tax by two-tenths of a cent to minimize layoffs of sheriff’s deputies, prosecutors, public defenders and court employees.
After several months of debate, the Metropolitan King County Council voted 5-4 to put the proposal on the general election ballot.
The proposal would raise the sales tax in most of King County from 9.5 percent to 9.7 percent. The county has one of the highest sales tax rates in the country, according to economists.
If passed, it is estimated to raise $59 million in 2011 and $80 million in 2012, the first full year it would be in effect.
Half of the tax increase would be used to keep employees who would otherwise be laid off. That portion would expire after three years, unless extended by voters. The county would receive 60 percent of that money, and cities would receive 40 percent.
The other half would pay for a new Youth Services Center courthouse in Seattle and would be collected for 20 years.
Supporters see the tax as a way to help criminal justice programs stave off the massive budget cuts planned for all county departments.
Others oppose the increase saying that the tax burden is already too high and the county should cut other areas to better fund public safety programs.
“The economy’s hurting so bad that people don’t have money to pay any extra in taxes,” said County Councilwoman Kathy Lambert, who represents Sammamish.
Deep cuts
King County faces a $63.5 million budget shortfall in 2011 and potentially a more than $80 million gap the next year, according to the county’s economic forecast.
To close the gap, King County Executive Dow Constantine has proposed an across-the-board, 12-percent budget cut to all tax-supported county agencies.
“It threatens the whole administration of the criminal justice system,” Superior Court Presiding Judge Bruce Hilyer said.
He joined District Court Presiding Judge Barbara Linde, Prosecutor Dan Satterberg and Sheriff Sue Rahr in backing the tax increase.
In courthouses, budget cuts will mean fewer prosecutors and public defenders, fewer court employees, more time before cases go to trial, longer waits for court records and to enter the courthouses and fewer cases being tried.
On the streets in unincorporated areas, budget cuts will mean things like longer response times, fewer investigations and less backup for sheriff’s deputies.
The King County Sheriff’s Office has already started preparing to lay off nearly 30 officers, demote 12 and transfer 50 detectives and supervisors back to patrol if the tax proposal doesn’t pass, according to Rahr. The department is also preparing to consolidate facilities.
The Youth Services Center courthouse must be replaced. It is crowded, unsafe, and stiflingly hot in the summer and chillingly cold in the winter, Hilyer said.
“No one drinks the water — it’s all brown,” he added.
Sales tax is already a burden
The sales tax measure will only require a simple majority to pass, but Lambert, who represents Sammamish on the County Council, said she is doubtful it will manage that based on conversations with her constituents.
“It was a pretty overwhelming ‘no,’ bordering on ‘hell no,’” she said of their reaction.
Lambert joined fellow Republicans Jane Hague, Reagan Dunn and Pete von Reichbauer in voting no on putting the proposal on the general election ballot. (While voters made the council nonpartisan in 2008, members continue to vote along partisan lines on many issues.)
The additional sales tax likely won’t have a direct impact on people’s purchasing power, but it could have a negative psychological effect on spending, according to Lew Mandell, an economics professor at University of Washington.
The increase simply adds a little more onto a tax burden that already hits low- to moderate-income households hardest. They typically spend a larger portion of their income on taxable goods and services than do richer people.
“At close to 10 percent, the sales tax is one of the highest in the country. The disparity is already there — this just adds to it,” Mandell said.
Republicans on the County Council wanted to offset the increased sales tax by rolling back property taxes, but couldn’t get enough support for their plan.
They are also upset that the tax measure would move $15 million from road services in unincorporated areas to the sheriff’s office. Already, $4 million of the rural roads program’s $80 million budget supports traffic enforcement by sheriff’s deputies.
The council has protected criminal justice from budget cuts as much as possible, Lambert said.
The sheriff’s office and courts had about 1 percent budget cuts last year.
“At this point, it’s their turn to be looked at and ask where can you cut?” she said.
But the courts have offset would-be budget cuts by increasing fees, Hilyer said.
In effect, the courts have seen money from the county’s general fund decrease by about 12 percent over the past two years, he said.
Labor costs add to budget problems
Both sides agree that rising labor costs are aggravating the situation.
The executive’s office has been in talks with 59 unions representing county employees, asking them to defer guaranteed cost-of-living increases next year. So far, three unions have agreed.
But the budget shortfalls are coming before labor policy reform can be implemented, Hilyer said.
The county’s hands are also tied by the state’s 1 percent cap on how much it can raise property taxes.
“We can’t keep pace with inflation because of that, but our expenses keep going up beyond the rate of inflation,” said Councilwoman Julia Patterson, who voted for the tax proposal.
Bad labor policies and bad budget prioritizing are behind the budget crisis, according to Paul Guppy, vice president of the Washington Policy Center, a free-market think tank.
The county is putting money toward lower-priority programs and salary increases rather than first fully funding criminal justice, Guppy said.
After several years of deep cuts, only essential programs remain, according to elected officials.
“I don’t think that, legally, we can do away with the elections office or the executive branch or the assessor’s office,” Patterson said.
What happens here?
Sammamish City Councilman Tom Odell said he worries that if the sales tax measure fails, cuts to county staff could affect public safety services the city relies on, such as police and prosecutors, though if it were passed the tax could end up as a windfall for the city.
The exact effect on Sammamish depends on how the budget process plays out this fall, said Frank Abe, spokesman for the King County Executive’s Office.
Though Sammamish Police are technically King County Sheriff’s deputies, the cuts would not directly affect staffing levels here because the city has a contract for those employees. Specialized services like the bomb squad or SWAT team would also not be affected.
The county handles most major crimes committed in Sammamish, while the city is responsible for prosecuting traffic citations and most misdemeanors, including property crime that results in a loss of less than $10,000. Mike Sauerwein, administrative services director for the city, and Lynn Moberly, the city’s contracted prosecutor, said they had not heard anything about additional prosecution work being left to the cities.
Sauerwein said that the office could theoretically increase the threshold for prosecuting property crimes higher than $10,000, passing off more crimes to cities.
If it passes, the tax would mean approximately $785,000 for the city, since 40 percent of proceeds are distributed to county cities on a per-capita basis. State law requires that one-third of that total be spent on public safety. Sauerwein said it would be up to the City Council to determine how to spend that money.
Sales tax breakdown
On a $1 purchase in King County, 9.5 cents are charged in sales tax. (An additional half-cent is collected in restaurants and bars for Safeco Field construction.) Here’s where it goes:
State general fund: 6.5 cents
County and cities basic fund: 1 cent
King County Metro Transit: nine-tenths of a cent
Criminal justice (county and cities): one-tenth of a cent
County services for mental health and drug dependency: one-tenth of a cent
Sound Transit*: nine-tenths of a cent
Total: 9.5 cents
Proposed increase to support criminal justice: two-tenths of a cent
Proposed total: 9.7 cent
* Collected only in areas served by Sound Transit.
Source: State Department of Revenue
Reach reporter Dan Catchpole at 392-6434, ext. 246, or editor@snovalleystar.com.
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