Category Archives: Taxation

Request to block initiative 1366 goes before King County judge on Friday

Voter initiatives have been found to be unconstitutional in the past, but voters usually get to weigh in before the courts intervene. Several plaintiffs, including King County Elections Director Sherrill Huff, filed suit to block Initiative 1366 from appearing on the general election ballot.

The Tim Eyman-led measure would direct the Legislature to send a constitutional amendment to the ballot. If the Legislature refused, the state’s sales tax take would be reduced from 6.5 percent to 5.5 percent, which in the near term would mean a loss of $2.8 billion per biennium, according to John Stang’s Crosscut piece.

The constitutional amendment Eyman wants would require a two-thirds majority in the House and Senate to approve any tax increase. Voters have approved the two-thirds requirement before, but most recently the court struck down one initiative that created a constitutional amendment, saying those have to start in the Legislature.

Washington Secretary of State Kim Wyman, issued a response today urging the court to let the ballot measure go on the November ballot. She took no stand on the initiative itself, but said voters should weigh in.

“The subject matter of I-1366 is not outside the scope of the people’s initiative power, and the courts have made it a practice to avoid pre-election review except in ‘limited and rare circumstances’ that do not apply here,” Wyman said in a statement.

The lawsuit argues that the initiative’s intent, despite its path to get there, is to amend the constitution. The argument against allowing it on the ballot relates to the cost to taxpayers by having it on the ballot across the state and the usurpation of power normally left to the Legislature to begin a constitutional process.

“In the absence of an injunction, Ms. Huff, Ms. Hall and the taxpayer Plaintiffs will suffer irreparable harm from incurring the expense of an invalid and needless election as well as the harm caused to all taxpayers by unlawful government action,” the plaintiff’s complaint argues. “Additionally, in the absence of an injunction, the Legislator Plaintiffs will suffer irreparable harm to their constitutional rights under Article XXIII as representatives of the sole body that can lawfully initiate the constitutional amendment process.”

The case will go before King County Superior Court Judge Dean Lum at 10 a.m. Friday.

Huff was formerly the Kitsap County Auditor for eight years between 1979 and 1986 and Bremerton’s deputy mayor.

Eyman was in Bremerton in May 2014 talking about the initiative. Here’s the audio.

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We just might get a budget, ending sequestration

Derek Kilmer, Democratic congressman from these parts, was in the office last week talking about a lot of issues. Of particular import was his estimation that the House and Senate in Washington, DC will work out a budget that ends sequestration. It won’t be an overly ambitious one that settles things for years, but it would avoid another government shutdown and perhaps would not in and of itself become a campaign issue in 2014.

According to this Politico story, Patty Murray, Democratic senator from this state, has been negotiating with Congressman Paul Ryan of Wisconsin to get a deal Republicans and Democrats can live with, even if there are parts both sides will hate.

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Five bills get sent to ballot

Under Initiative 960, legislation that raises any taxes is sent to voters for an advisory vote. Advisory votes carry no obligation on them, so the votes won’t overturn those tax increases.

The State Attorney General identified five legislative bills that triggered the advisory votes to be put on this year’s ballot in November. The AG’s press release follows:

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Beer tax video from both sides of the debate.

In preparing Friday’s story on local brewers’ reaction to a proposed beer tax I created a video. Technical difficulties (i.e. operator error) prevented me from getting the video up sooner. I still think it’s worthwhile, especially posted alongside Gov. Jay Inslee’s comments on the issue. So first, here’s Inslee discussing the tax during his March 28 press conference on the budget. That’s followed by the views of Valholl Brewing’s Jeff Holcomb, part owner and head brewer at the Poulsbo business.

The third video is more Inslee specifically addressing the tax.
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The national debt is my debt

“It’s our country. It’s our debt. We are all responsible. We can’t just sit around waiting for government to fix this.” — Scott Soucy | Middletown, Del.

Eli Saslow at the Washington Post has a story about a guy, Scott Soucy, with a proposal to pay down the national debt. He believes each of us, including businesses, can take care of the national debt on our own. The simple explanation is you donate $1 every paycheck and businesses donate $1 for every transaction over $10. Personally, I think the paycheck proposal is easier to swallow than the business one.

There is a group looking to have a place on your tax form you can designate to donate to the debt. Before I found the site, I looked at the 1040 form and there is not a space specifically designated for that. You can give $3 to the presidential campaign fund, but not for the debt. You can send the IRS a separate check with your return if you like, but how many people are actually mailing hard copy tax forms anymore?

If you want to help pay off the debt, Pay.gov has a page, Gifts to Reduce the Public Debt, where you can donate online.

Obviously, if you’re convinced government has more of a spending problem than an income problem, you might not be motivated to do something like this. However, the fact that it’s voluntary might have some appeal even to fiscal hawks.

There are legion stories about government spending money it doesn’t have, the most glaring example being our entering a war we that didn’t cost us a single extra tax nickel now. It was the first time we ever did that. We got into debt for other wars, but we at least paid for some of each with additional taxes.

Complaining about that, though, has yet to do anything to solve the debt trouble we are in. At least Soucy is seeing the problem as his own. I think there is probably much to fault in his specific plan, but he is not waiting around for someone else to come up with a better idea. He’s taking on the challenge now and encouraging others to do the same. If 220 million other people felt that same level of accountability we might actually solve the problem.

It may come down to 220 million people like me realizing that however little blame I am willing to accept for the overall problem, I benefit from federal spending any time I cross the Manette Bridge.

According to CNN people donated nearly $8 million to pay down the debt in fiscal 2012, more than double the donations from earlier years. It’s a groundswell, but it’s far from 220 million. No wonder, then, there is little movement in solving the fiscal cliff issue. American leaders are taking their cues from us. Almost everyone involved is waiting for someone else to budge.

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The revenue public officials love to hate

Every year about this time, give or take, city and county officials oversee distribution of lodging tax revenue collected in their respective jurisdictions. And in every city hall or county chambers there is a greater or lesser degree of wailing and gnashing of teeth, as public officials haggle over amounts that typically make up a but fraction of their budgets.

The law allows for collection of a tax of up to 2 percent from hotels, motels and B&Bs to be poured back into the community to bring more “heads in beds.” Under state law, citizen committees recommend how the money should be distributed to applicants. Lodging tax advisory committees are made up equally of those who pay the tax and those who receive the tax.

While the process sounds logical and equitable, recommendations of the committees and subsequent discussion by city councils or boards of commissioners can all too easily come off as a popularity contest or power struggle.

In Port Orchard, for example, the council’s recent discussion of its LTAC recommendations grew heated at a meeting Sept. 18 when Councilman Jerry Childs, who chairs the council’s economic development and tourism committee, presented a significantly different set of proposed numbers from those of the lodging tax committee.

Port Orchard’s estimated lodging tax revenue for 2013 is $87,000. The council on Sept. 11 had already voted (but not unanimously) to set aside $10,000 as a reserve for yet-to-be-identified needs. Voting against the reserve were Fred Chang, the councilman who chairs the lodging tax committee in a non-voting capacity, Rob Putaansuu, who said he didn’t like the idea of a reserve for an unspecified expenditure, and Carolyn Powers, who at the meeting the following week spouted off about the tourism committee’s “wholesale” revision of the LTAC’s proposal.

We should note that among the 17 applications for the city’s lodging tax money, four were made by the city itself. The tourism committee wants to put directional signs in strategic city locations. The city’s Festival of Chimes and Lights grows bigger every year and draws people from around the region. The city contributes to holiday and Sunday foot ferry service, and there’s a need for police overtime to staff festivals.

Applicants’ requests for funding totaled $151,786, compared to $77,000 available. The lodging tax committee’s total for city-sponsored applications was $17,000. The economic development and tourism’s total was $24,400. Child’s said his committee’s recommendations were more in line with “historic” distributions. He cited the LTAC’s $16,460 allocation to the Port Orchard Bay Street Association as one that jumped out at him and fellow committee members, Cindy Lucarelli and Jim Colebank. The economic development committee recommends $6,750. And yes, Lucarelli is involved with Cedar Cove Days, another LTAC applicant.

Other applicants are community groups like Fathoms ‘O Fun, the Saints Car Club and the Sidney Museum and Arts Association. Committee members who are part of an applicant group excuse themselves during discussion of their group’s request.

“To me it warrants oversight. It warrants more than just a kick down the road,” said Childs.

Powers blasted the economic development committee for putting its two cents’ worth in before the council even had a chance to digest the LTAC proposal. She also dug in her heels over what she described as a radical departure from the LTAC figures.

“If we tweak one or two, I guess I could live with that, but I can’t live with a wholesale change of everything the LTAC committee has recommended. That just doesn’t seem right to me,” Powers said. “We have all these groups that are working their tush off, as they say, and actually do all these great things for the city, and I just can’t see us (the city) taking such a big chunk of it.”

City Attorney Greg Jacoby noted that the council’s relative interest in the LTAC process waxes and wanes. This council is particularly hands-on, he said. And, Jacoby added, council members are well within their rights under the law to be as hands-on as they see fit.

“What if each one of us brought in a whole list like this?” Powers asked.

“You could!” Jacoby replied.

“Then why even have the LTAC committee in the first place?” Powers said.

“There’s a lot of people who wish the law was written differently. That’s a good point,” Jacoby said.

Lodging Tax committee member Don Ryan, speaking after the Sept. 18 meeting, said he and his fellow LTAC members had invested considerable time in four meetings over a two-month period to study the numbers and make thoughtful recommendations. Like Powers, he took exception to the economic development committee’s rewrite proposal. Ryan, it should be noted, is president of the Port Orchard Bay Street Association.

Also at the center of the council’s debate is how much the council should lean on LTAC funds for items like police overtime that aren’t directly related to marketing the city and its attractions. A law allowing for the use of LTAC funds for operations (in addition to marketing) in festivals and special events is set to sunset in June 2013. Chang supports the sunset. Childs, Lucarelli, Powers and Putaansuu support a more flexible use of LTAC funds, so no sunset.

The council will take up lodging taxes again at its Oct. 16 work study meeting.

If you’re in the hotel-motel business, or are part of a community organization involved in promoting tourism, would you make changes to the LTAC law? What if anything can be done to make the distribution process less likely to breed resentment?

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State shows economy on the red side of ‘flat’

Mike Baker’s Associated Press story today on the state’s economic forecast emphasizes the most salient point, something that could be lost in the press releases.

“Washington state government can expect to bring in $16.1 million less than projected in the current budget cycle because of a lackluster economic recovery, forecasters said Wednesday” is what Baker wrote in the AP story Wednesday.

That might be confusing to some who read the state’s Office of Financial Management press release that carries the headline “Washington quarterly revenue projection for 2011–13 increases $156 million.”

Both are correct, but context is important. State revenues are up $172 million for the two-year budget because of “policy changes and fund shifts,” wrote Brad Shannon at the Olympian. Subtract $16 million from revenues lost by the overall economy and you get that $156 million increase.

In relative terms the $16 million is more or less flat, according to House Ways and Means Chairman Ross Hunter, a Medina Democrat. Compared to the forecast a year ago when revenues were projected to be down $780 million from earlier predictions, that’s true. The celebrations over the most recent numbers, however, are tepid at best and fraught with warnings about events that could make the numbers a lot worse.

OFM’s press release follows, as does the governor’s official statement and those from Republican budget leadership. If Democratic leadership from the Legislature issues any statements I’ll add them.
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Seaquist doubts viability of vets and human service bill

Rep. Larry Seaquist, D-Gig Harbor, is doubtful about the prospects of HB 1786, which he reintroduced during the state Legislature’s second special session toward the end of 2011.

The bill, if approved, would allow for “additional property tax levy flexibility in order to preserve and enhance the veterans and human services safety net.” Specifically it would allow counties like Kitsap to detach property tax collection for its Veterans Assistance Fund, used for indigent vets, from its general fund property tax collection. The net effect would be a tax increase.

Seaquist and other sponsors of the bill say the nominal tax increase would help counties provide for the needs of vets, which have been increasing, according to local veterans advocates. As the law now stands, the board could increase the collection rate (currently at 1 and 1/8 cents per $1,000 of assessed value) without a vote of the people, but the increased collection amount for the benefit of veterans would have to be subtracted from the general fund collection amount. Separating the two funds would remove the effect of any change to the veteran’s fund rate on the general fund.

The bill is unchanged from its earlier form, which never made it out of committee earlier in in 2011.

Seaquist doesn’t hold out much hope of the bill passing this time either. “To be candid,” he said, “I do not think the bill is likely to be moving in its present form at all.”

A special veterans and human services property tax levy (unrelated to HB 1786) was shot down by Kitsap County voters in November.

Seaquist, who chairs the House Higher Education Committee, says the Legislature needs to work on strategies that will have the greatest impact on the state’s economy. If, repeat, if going to voters to request a tax increase were among the strategies, Seaquist said, the proposed tax increase had better have demonstrable returns. One idea Seaquist thinks may have merit is a tax increase that would go directly toward higher education. He estimates 60,000 technology jobs in the state are going unfilled for lack of qualified workers.

“I believe if we can put the money in exactly the right place, we could make a major contribution to employment because we’re accelerating our ability to produce high tech graduates,” Seaquist said.

Anything the state asks of voters must be simple, coherent and sensible, with clear widespread benefits, Seaquist said. If more people could obtain living-wage jobs, the increased quality of life in our state would in theory raise everyone’s boat.

Before the state goes to voters, however, it must show that it has “squeezed spending” as much as possible, and that there is innovation at the local level, Seaquist said.

In the meantime, Seaquist approves of the idea for creating a veteran’s court in Kitsap County. Funded by a yet-to-be-discussed (let alone approved) increase in the county’s sales tax, the special court would, like drug court, get at the cause of criminal behavior resulting from mental health and substance abuse among veterans.

Seaquist said veterans’ advocates at the state level are looking at various solutions to veterans’ needs, including homelessness. There has been some talk of converting a wing of Western State Hospital to housing for homeless vets, still in preliminary stages.

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Live Blog: Bremerton Council, Port of Bremerton, Vets Levy

We plan to live blog the League of Women Voters forum this evening. Two races and one issue are part of the two-hour event:

  • Bremerton City Council District 2: Cecil McConnell and Leslie Daugs
  • Port of Bremerton Commissioner District 3: Axel Strakeljahn and Shawn Cucciardi
  • Veterans & Human Services Levy

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Should taxes go up on the ‘super rich?’

We have a new poll question for you. Warren Buffett, a super-rich man himself, said people in his class should be taxed more. He points out that he pays a lower tax rate than people making, say, $200,000 a year. That claim is determined to be true by PolitiFact. If you really want to did into tax code issues, you should also read the PolitiFact’s treatment of John Cornyn’s statement that 51 percent of Americans paid no federal income taxes in 2009. That was also determined to be true. Cornyn is a Republican senator from Texas.

The PolitiFact pieces are great, because though each statement is true, there is context to each worth considering.

This is America. Please vote.

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Veterans and Human Services Levy Resolution – Read it Here

Comments on today’s story about the county’s Veterans and Human Services Levy, approved for the Nov. 8 ballot by the Kitsap County Board of Commissioners, indicate there is considerable lingering disgruntlement about the board’s decision in 2009 to defer collection of the the veterans assistance fund levy in 2010, a move made to help balance the county’s general fund budget.

Please note that the fund that would be created if voters approve the special Veterans and Human Services Levy is separate from the county’s Veterans Assistance Fund, but because they both are aimed at helping veterans, people have connected the dots.

Commissioners Josh Brown and Charlotte Garrido, who were on the board at the time, seemed at last night’s meeting well aware of the sense of mistrust and long memories of those who disagreed with that decision, the net result of which was $320,000 that did not go into the fund.

Garrido and Brown commented more than once to that effect.

“Levy proceeds can only be used for the stated goals of this program. Levy funds cannot be used to supplant the county’s general fund.” – Charlotte Garrido

“We want to make it very clear that if this levy is approved, these monies go in a lock box. The monies cant be diverted.” – Josh Brown

I’ve attached a copy of the Veterans and Human Services Levy Resolution to the story (and put a link to it here). The document goes into considerable detail about how the money will be tracked and allocated. Revisions were made in response to public comments, said Leif Bentsen, who coordinates the county’s Veterans Assistance Program. Whether provisions of the resolution adequately provide for efficiency, transparency and effective use of the $1.4 million per year is open to debate between now and Nov. 8.

Several readers also commented that they would prefer a sales tax over a property tax. Commissioner Rob Gelder got back to me today and reaffirmed what he said at the meeting. While state law allows for the county to collect sales taxes for a host of purposes, a human services levy is not among them. The closest the law comes to that is a provision for mental health funding, Gelder said.

Chris Henry, reporter

Here’s the entire document for those who can access it.

Homeless Levy

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State issues report on county assessors’ workloads/appeals

The Washington State Department of Revenue has issued its annual comparison of county assessor statistics.

Property tax assessments were the subject of a recent debate between Port Orchard mayoral candidates Tim Matthes and incumbent Lary Coppola.

Topics that have surfaced during the debate include:
a. the accuracy and fairness of Kitsap County Assessor’s property valuations.
b. the possibility of a class action lawsuit on behalf of commercial property owners whose assessed values increased sharply.
c. the possibility of changing appeal laws/procedures to reduce the burden of proof on the property owner.

If either b. or c. goes anywhere, I’ll be following up on it. As for a., if I’m interpreting the DOR analysis correctly, it appears Kitsap County’s success rate/satisfied customer rate — judging from the percentage of appeals per properties assessed — is better the state average.

Now for the qualifying statement. Mike Gowrylow, DOR spokesman, specifically states in his press release, “Washington’s thirty-nine county assessors operate within unique local geographical, political, and economic environments that often influence the attributes of a county’s assessment system and the level of services they provide. Consequently, making direct comparisons between individual counties may result in distorted or misleading conclusions unless additional information is considered or more in-depth analysis is conducted.”

And yet, the report “is intended to provide property tax administrators and decision-makers with a uniform set of comparative statistics to assist in the analysis and evaluation of assessment operations and the adequacy of assessment resources.”

Also note: the numbers counties reported for their budgets, FTE levels, and appeals were as of a specific point in time (March 2011) and may have changed since then. The report also tallies assessed values, number of parcels, new construction, number of appeals and other relevant figures.

Kitsap County in 2010 had a total of 112,218 parcels and a total assessed value of nearly $28.2 billion ($28,158,972,045) representing 3.48 percent of the all-county total AV. Commercial properties (46 in manufacturing, 4,416 in commercial use) make up 4 percent of the total number of properties.

Kitsap’s average value per parcel is $246,986. The straight up state average for counties like Kitsap that do annual assessments is $177,056. The statewide weighted mean, in which data are given weighted values for a more statistically accurate description, is $256,918.

The DOR analysis looked at workloads based on staffing and number of parcels assessed. The Kitsap Assessor’s office lost 2.9 percent of its staffing between 2009 and 2010; the drop was 7.2 percent between 2010 and 2011. Statewide staffing decreases varied widely, with a number of counties showing no change between 2010 and 2011. Lincoln County’s staffing decreased by 20 percent. At the other end of the spectrum, San Juan County increased its staffing by 16.5 percent.

Looking at number of inspections per appraiser, Kitsap was about in the middle of the pack with 1,255. Douglas County had the heaviest load with 3,663. Garfield County had the lightest, with 302.

Check out page 36 of the document for a report of the number of appeals each county had in 2009 and 2010. Kitsap had 615 in 2009, with 64 appeals going to the Washington State Board of Tax Appeals. Kitsap in 2010 had 573, with 1 going to the BTA.

Statewide appeal totals were 35,162 county-level appeals in 2009, 3,480 BTA appeals in 2009, 24,299 county-level appeals in 2010 and 1,002 BTA appeals in 2010.

Looking at the percentage of appeals compared to the total of non-exempt parcels, Kitsap’s appeal rate was .55 percent for 2009 and .51 percent in 2010 among counties that assess annually (13 counties assess cyclically, less frequently than each year). The 2009 state average is .80 percent and the state weighted mean is 1.33 percent. Looking at the 2010 appeal rate, we’ve got .61 percent average statewide and a statewide weighted mean of .84 percent.

So Kitsap did better than average in 2009 and 2010, and quite a bit better than the statewide weighted mean in those years. I’m guessing that’s cold comfort to those who saw large jumps in assessment in those years.

Kitsap County does a detailed assessment, with a visual inspection of the property, every six years. Complaints typically result when the detailed inspection results in a jump in property value, as properties that have, according to the assessor’s office, been undervalued are brought into line with current comparable assessments.

The law states the assessor must value properties at “True and fair value,” which “means market value and is the amount of money a buyer of property willing but not obligated to buy would pay a seller of property willing but not obligated to sell, taking into consideration all uses to which the property is adapted and might in reason be applied.” The law goes on, “In determining true and fair value, the assessor may use the sales (market data) approach, the cost approach, or the income approach, or a combination of the three approaches to value.”

So, I’ll leave you with a question or two or three, “How (if at all) would you change the law on assessments, and why?”

“How, if at all, would you change the law on appeals, which currently requires the property owner to show ‘clear, cogent and convincing evidence’ the assessor is wrong?”

“What, if anything, do you think could a class action lawsuit on behalf of property owners who feel they’ve been unfairly assessed could accomplish?”

Thanks for your thoughts. Chris Henry, reporter

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Audio: Norm Dicks on Afghanistan, Iraq, Libya, Stimulus, Anthony Weiner

I recorded the conversation with U.S. Rep. Norm Dicks, D-Belfair, for the Sunday story on his position on U.S. efforts in Afghanistan. He is among Democrats and a few Republicans calling for a quicker withdrawal of U.S. troops.

I also asked him about Libya, Iraq and whether Anthony Weiner should resign. I cut about a minute and a half from the recording, but it’s still a bit more than 19 minutes long.

Norm Dicks on Afghanistan

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Tax day truth in the USA

The Washington Post has a tax day feature outlining how much the very rich (I’m talking rich enough to misplace a house.) and the lower 45 percent (The number being that large makes “I paid nothing in income taxes last year” less impressive at parties.) pay in taxes.

“In all, the tax code is filled with $1.1 trillion in credits, deductions and exemptions, an average of about $8,000 per taxpayer, according to an analysis by the independent national taxpayer advocate within the IRS.”

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News Flash: Budget cuts will hurt

A New York Times story from today about Republicans disagreeing with each other (something they didn’t do until they were the majority in the House) also includes tidbits that point out that budget cuts will be painful for someone. Surprised? I didn’t think so. At least we all know that in our heads. See if any of these proposals touch you anywhere else.

One Republican idea is for a program that helps local cities hire more cops. Bremerton has used that program and in doing so committed to fund the positions past the three-year grant period. We’re trying to figure out if this would mean the federal government would be making that commitment moot by taking back the commitment to the second and third years.

Republicans would also make cuts to the EPA, legal aid, energy efficiency programs and would kill AmeriCorps and any federal money for the Corporation for Public Broadcasting.

Obama’s proposal would cut in half money spent to help low-income Americans pay energy costs.

Do any of these ideas hurt you personally? Had the tax increases Democrats wanted (restoration of all the previous tax rates just for the top 2 percent wage earners in the country.) made it through in December, would that have hurt you? What would hurt you and America more?

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A newstip that piqued our interest — and our appetites

Some of the candy we purchased in researching this post

About a month ago, a reader called in to deliver a news tip that piqued our interest – and our appetites.

He claimed that a day after the state-mandated sales tax on candy, soda and bottled water was repealed by voters, major grocery store chains upped their prices by the same margin as the tax.

Consumers would fork over the same amount for their M&Ms both before and after the tax was repealed, he said.

In other words, retailers would pocket an extra 9 cents for each package of Reese’s Pieces they sold while the state would simply go without. That was the caller’s hunch.

Had we just stumbled onto Candygate 2010?

We decided to test his theory by looking into whether retailers would charge more for the snacks and water immediately after that sales tax went away.

On Wednesday night, we made trips to Safeway, QFC, Walgreens and a convenience store on Kitsap Way.

At each stop, we picked up a candy, gum and water. We took note of how much the stores charged for soda.

We returned a day later — when stores were told to stop collecting the sales tax —  to buy those same items and compare the receipts.

The caller’s theory didn’t hold up. At three of the four stores, we spent less on our purchases the second day.

But the convenience store charged us $3.90 both times for a package of Wrigley’s 5 Gum, a Three Musketeers candy bar and a 20-ounce bottle of Aquafina. A 23-cent sales tax was tacked on to both purchases.

Despite what we encountered there, state Department of Revenue spokesman Mike Gowrylow wrote in an e-mail that the Dec. 2 transition “has gone smoothly as far as we know” for most retailers.

He said that consumers should demand a refund if stores charge them for a sales tax on candy, gum or water.

If that doesn’t work, they can seek a refund from the DOR, he said.

The bigger problem for the agency is retailers who stopped collecting the tax before Dec. 2. “But we really can’t do anything about that,” he said.

Unfortunately for us, there was no corporate grocery store conspiracy to unravel — but at least we got to eat a bunch of candy.

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2007 Campaign Promise on Taxes Has Port Orchard Councilman in “Bind”

What passes in most governments as a matter of housekeeping became the topic of prolonged discussion Tuesday, as the Port Orchard City Council voted 5 to 2 to take the annual 1 percent property tax increase to which it is entitled by law. The vote put Councilman Jim Colebank, who ran in 2007 on a platform of “no new taxes without a vote of the people,” in a tight spot.

To put the vote in perspective, the increase will cost the owner of a $240,000 home about $5 a year.

The city’s 2011 levy, with the 1 percent increase plus revenue from recent annexations and new construction, is $2,626,207. The 1 percent increase over last year’s levy represents $23,044 of that amount.

Last year, the council, after much debate, refrained from taking the 1 percent increase. They elected to make do with 2009 revenue levels out of consideration for residents struggling with the economy. The budget was balanced through cuts and use of reserve funds.

Recent history seemed to play into this year’s levy setting discussion, as the council again spent considerable time dissecting the effects of taking or not taking the 1 percent.

The pre-vote discussion kicked off with Councilman Fred Chang asking what the additional $23,044 would be used for. Chang questioned whether the increase was truly needed and said he’d be voting against the ordinance.

The city has deferred many projects and drawn down its reserve accounts to maintain a balanced budget, said Treasurer Allan Martin. Although the ordinance does not designate the 1 percent increase to any specific purpose, one of the expenses it might be used for is to replace one of the Port Orchard Police Department’s aging patrol cars, Martin said. (The city hopes to replace three patrol cars in the upcoming year.) Martin added that not taking the increase over a period of years would surely lead to layoffs, which the city has avoided so far.

One of the city’s known expenses for 2011 is a 2 percent cost of living increase for staff members. The increase is overdue and well deserved, said Mayor Lary Coppola, who noted Port Orchard operates with a staff of 68, much smaller than most cities its size. “Everyone works their butt off,” Coppola said. “If you had any clue what they do, you’d be shaking your head and, saying, God they need some help.”

Carolyn Powers added that one of the reason Port Orchard is in better shape financially that other local governments is the efficiency of its staff. “We’ve been very proud to say we’ve been holding our own. A big majority is because our staff has been doing a lot more more work and not getting more money,” she said.

Several council members commented on the prolonged effects of deferring projects and putting off replacement of aging equipment. Since inflation typically runs higher than 1 percent, the city’s cost to do business has been rising faster than its increase in revenue. Councilman Jerry Childs likened it to a slow leak in the budget. Although the 1 percent increase would not address all the city’s needs, it would help slow the leak, he said.

Childs too ran on a platform of no new taxes. But, he said, he also made a commitment to “protect and improve” city residents’ quality of life. Failing to properly maintain the city’s infrastructure and facilities would be irresponsible, he said. Child’s comments were echoed by other council members, including Powers, Rob Putaansuu and John Clauson, who speculated, “Most people would be willing to give $5 (the annual increase on a home of $240,000). I don’t think it’s exorbitant by any means.”

Colebank acknowledged the amount individual homeowners will pay as a result of the increase may not seem like much, but he is sensitive to seniors on fixed incomes and other citizens who might still be feeling the effects of the recession. Colebank said his campaign promise presented a “dilemma.” “It puts me in a real bind, because I really care about the people who are having a hard time. I can see this is going to pass anyway, so I might vote ‘no.'”

“I don’t think there is anyone at this table who wants to raise taxes, but we do have an obligation to provide the best service we can” said Powers. “I appreciate what you’re saying, Jim, but sometimes that’s a danger we’re taking when we say were never going to raise taxes.”

The Port Orchard City Council will hold a work study meeting on 2011 budget expenditures at 7 p.m. Tuesday at city hall, 216 Prospect St.

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Income Tax Initiative Could Get Serious Play

Austin Jenkins from the Northwest News Network is reporting that a proposed initiative filed in March to implement a state income tax may have the backing it needs to get a serious signature-gathering effort going.

All depends on the supporters’ ability to get financial backing. According to Jenkins a decision about whether to pursue it aggressively could be made as soon as Wednesday.

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Tax Protesters Going to Olympia

Residents plan to descend on Olympia Thursday, the day your tax filing is due, to tell politicians they are “Taxed Enough Already.”

An e-mail from the county’s Republican Party suggests Bremerton’s Keli Carender (Liberty Belle) will be there, along with radio talkers Dori Monson, Kirby Wilbur and David Boze.

There will be chartered bus rides available for $15. The buses leave from Poulsbo, Silverdale and Port Orchard and getting a ride requires a reservation.

More complete information follows.

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