Tag Archives: taxes

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.
Continue reading →

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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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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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Brown, Burlingame on veterans levy proposal

Following publication of a story July 5 on a proposed property tax levy to aid Kitsap’s veterans and non-veteran homeless, I heard from Abby Burlingame, who challenged Kitsap County’s actions related to its Veterans Assistance Fund over the past two years.

Burlingame, who ran against incumbent Commissioner Josh Brown in 2010, said, “During the campaign I raised concerns that the county was borrowing money from that fund to balance their budget. I would like to know if they paid it back. Was that question asked during your interview? If that question was not asked, I would like to know why not.”

I did not ask that question as I interviewed Brown for the recent article. But in response to Burlingame’s questions, I called Brown last week and a got a few answers to some questions she raised.

First, a little background. The county under state law collects and distributes money on behalf of indigent veterans. In the grand scheme of things, it’s not much, 1 and 1/8 cents per $1,000 of assessed value. But before 2006, the county didn’t have a systematic way of getting the money to veterans. That was done informally, through the local Veterans of Foreign Wars.

“By 2005, over $1 million had accrued in the fund because it had been spending less than what it had been taking in,” said Leif Bentsen, who works for the county part-time coordinating the Veterans Assistance Program.

The fund was then handled by the auditor’s office. In 2006 the board of county commissions assumed authority of the fund and turned the administration over to the department of personnel & human services. In December 2006, under the same state law, the Kitsap County Veterans Advisory Board was created.

“When my department took it over,” said Bentsen, “we realized that 1) having the money sitting in the bank wasn’t helping veterans; and 2) many vets-in-need were slipping through cracks under the previous system. Part of the problem was that the majority of veterans didn’t know that it even existed, including myself until I was given the responsibility of overseeing it and organizing the new board.”

By 2009, as the recession was raging full blast, the veteran’s fund still was underspent. It had a balance of $900,000 and the program that year had a projected budget of about half that amount. The county technically didn’t “borrow” money from the fund, but state law allows local governments to lower the amount collected when the balance in the fund exceeds the total amount that could be collected, in this case, $320,000 in 2009.

“It allows us to take that $320,000 and apply it to our general fund program, 70 percent of which is criminal justice,” Brown said at the time. “If we didn’t dip into these reserves this one time, we would need to cut another $320,000 from the general fund.”

That’s because the county is limited as to how much it can raise taxes in any given year to 1 percent over the previous year (not counting new construction). The net effect, as Burlingame points out, was $320,000 less for the veterans fund and $320,000 more for the general fund.

This February, Brown backed proposed legislation that would have separated the veterans fund levy from the general fund levy. The effect, said Brown and legislators who supported the bill, would be to eliminate competition between the two funds. With the veterans fund tax as a stand-alone, there would be no more of the push-me-pull-you syndrome. Money for veterans could be collected and the county could collect the equivalent $320,000, or whatever it would be in that year, for the general fund. And if you said that amounts to a tax increase, you are correct.

Burlingame wanted to know why, if the veterans fund was so flush that the county could tap it in 2009, there is now a proposal on the table to implement a separate levy specifically for homeless vets and other homeless people. Revenue from the levy would be split 50/50 between vets and non-vets. Advisory boards for each group would make recommendations about allocation of funds.

She also wanted to know, now that the veterans are apparently in such dire need, if the county intends to replenish the $320,000.

“The reason I mention this is not to have any kind of vindication on the issue, it is because our budget is in serious jeopardy,” Burlingame wrote to me in an email. “Our county commissioners continually make contradictory statements regarding the condition of our budget and The Sun allows them to gloss over the ramifications of those choices. While reporters may recognize these transfers of money when they happen, they never address how those previous decisions end up affecting people like the veterans in the future. They never attach responsibility to the politicians who made the decision and said everything would be fine.”

So here are the questions I asked Brown, with his responses.

– In 2009 the board eliminated collections to the Veterans Assistance Fund for one year. Do you feel any sense of responsibility for the fact that the county’s veterans assistance program expenses now exceed revenues?

“I guess I don’t look at it that way,” said Brown, who elaborated at length about the context in which that decision was made.

In the first place, said Brown, the Veterans Assistance Fund was being underutilized when he took office in 2007. Informal distribution through the VFW worked in previous years, but as new generations of soldiers returned home from service, they did not so much connect with that organization. The goal of county officials when Brown arrived was to get the funds out into circulation on behalf of vets. Brown didn’t claim credit for the effort, but he did support it. His own family has military ties, and he is a strong supporter of veterans, he said.

“It’s been just a phenomenal success,” Brown said. “And today, we are helping many more vets than we did in the past.

That’s one of the reasons the fund balance is down. County and local social service workers became better at identifying and connecting with veterans in need.

“In a way we’re a bit of victims of our own success,” Brown said.

The second point of context was the state of the economy during late 2009, when the county and other public agencies were facing unprecedented funding shortfalls. Brown described revenues at the time as “a falling knife.”

“Sale tax revenues were dropping precipitously. We were dealing with a major financial crisis, not just as a nation but locally,” Brown said.

The board weighed the fact that the veterans fund had nearly $1 million, for a budget of around $400,000, as compared to what had been whittled down to a $4 million reserve in the in the general fund balance. To put that in context, county general fund revenues in 2007, when Brown took office, were about $86 million, he said. They’re now down to $78 million, and the reserve fund has been built up to $7 million. In 2009, the board of commissioners was worried about exhausting its reserve fund. So they chose to use the veterans fund to help balance the budget.

“This was not a decision the commissioners made lightly,” Brown said.

– Now that the economy has more or less stabilized (if not recovered) why wouldn’t the board consider reimbursing the veterans fund, as Burlingame has suggested, for the amount it was unable to collect in 2009, about $320,000?

Brown says that would be a stopgap measure. At the current rate of consumption, $320,000 would last about 8 months.

“I concede there’d be 8 more months of funds,” Brown said, but he denies the action taken in 2009 caused the problems the fund is having today.

Were the board to consider making the transfer, Brown said, it would force a choice between shoring up the veterans fund and cutting essential services, like law enforcement. In the long run, it would not solve the issue of sustainable funding for vets, Brown said.

The vets levy, however, has been successful in King County and Brown thinks it could help address the sustainability problem here. Although not openly endorsing the proposal, Brown said, he’s open to discussing its merits, despite the fact it involves the dreaded “T” word.

– The bill separating the veterans fund from the general fund would have prevented the board from making the budget shift in 2009. Earlier this year, you seemed to favor what you described as elimination of competition between the funds, and yet the law as it is helped you balance the budget in 2009. Can you comment on this apparent conflict?

Brown reiterated his goal, and the goal of county veterans advocates, is to provide sustainable funding for veterans. The bill, which didn’t make it out of committee, would have helped do so by protecting the fund from fluctuations in the general fund.

The bill would have allowed for a small — Brown emphasizes — tax increase, because the money now going to veterans would have been taken out of the general fund maximum in any given year, essential creating more taxing capacity. The impact to individual taxpayers would have been minimal, Brown said. For the owner of a $250,000 home, the 1 and 1/8 cents per $1,000 vets fund levy amounts to about $2.80 per year.

Had the law passed, said Brown, he would have pushed — and still may — for a “council-matic” increase in the vets levy. Brown suggested a penny per $1,000 increase, or an additional $2.50 per year on the same $250,000 home. That would generate about $300,000, which would have a substantial impact on the fund, Brown said, adding it’s the least we can do for our vets.

State of the Vets Fund

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Fire District Merger: Heads up Bremerton taxpayers

Here we go again. Every time a city fire department merges into a fire district, the question comes up whether city residents taxes will go up (beyond the annual 1 percent increase in total tax collection allowed by law). The answer is a definite maybe.

The proposed merger is far from a done deal, but the committee that’s been tweaking the plan to make it happen will present it for public comment in early June. Depending on the response from Bremerton and South Kitsap residents (and unions representing both districts) the committee Bremerton City Council and South Kitsap Fire District Commissioners could decide to put the merger on the November ballot (story up on website later tonight).

If voters approve the merger, nothing about how South Kitsap residents are assessed for fire protection will change. The rate will change as a result of the allowed 1 percent annual increase in total assessment allowed by law. But that would happen with or without the merger.

But if the merger goes forward, Bremerton property owners would be charged a new fire levy tax, based on South Kitsap’s rate, and the amount of city property tax would be reduced accordingly.

Many factors play into the maximum property tax levy rate a city can receive. Other rules affect maximum rates for other types of taxing districts, including fire districts. The interplay of maximum levy rates can result in a city gaining the capacity to increase taxes beyond the 1 percent without a vote of the people. Bremerton is not currently at its maximum rate, so technically that possibility already exits.

According to Kitsap County Assessor Jim Avery, it is also true that a fire district merger could increase that taxing capacity, resulting in a “bonus” capacity. Even if the council chose not to impose the tax increase, they could “bank” the capacity, which could be used in the future.

In fact, said Avery, it is likely this scenario would play out, as it did when the city of Port Orchard merged its fire department with South Kitsap Fire and Rescue, and when the city of Poulsbo merged with North Kitsap Fire and Rescue … and when Port Orchard’s library was folded into Kitsap Regional Library’s district.

In the last case, the current city council agreed not to use its bonus capacity, so that the net result to taxpayers was an equivalent payment. Bremerton City Councilman Jim McDonald, not speaking for the whole council, said he would support a similar approach should the fire merger give the council additional taxing power.

Council president Will Maupin said the council has not received enough information on the tax implications for him to be able to say what their response would be. The council does support the concept of the merger, Maupin said.

The take-away from all of this for Bremerton taxpayers is that it’s likely the merger would affect the city’s levy rate in such a way that would gain bonus taxing capacity. But, they already have the ability to raise taxes beyond the 1 percent annual increase. They haven’t done so in recent years. Like most governments, I’m guessing, they’re responding to the prevailing anti-tax sentiment. Would future councils take advantage of that capacity? Like seemingly everything having to do with predicting tax rates, the answer is a definite maybe.

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Bonus Taxing Capacity, Deja Vu

I just wanted to call out a part of my story this week on a proposed merger between South Kitsap Fire and Rescue and the Bremerton Fire Department.

According to Kitsap County Assessor Jim Avery, there is the possibility, repeat possibility, that the merger could produce something called bonus taxing capacity for the city of Bremerton. Many variables go into calculating the city’s maximum allowable tax rate, and remember that, if the merger is approved on the November, 2011 ballot, the tax implications pertain to 2012. So anyone trying to make predictions as to whether this would happen or not would have to make some educated guesses about the variables.

What the implications would be for individual Bremerton property owners is likewise hard to pin down. But Avery did confirm that the merger could play out in the same manner as when the cities of Poulsbo and Port Orchard were annexed into NKFR and SKFR respectively. The same potential exists as a result of Port Orchard’s annexation into Kitsap County Regional Library District. The PO council, however, has said they do not plan to access the additional taxing capacity, so it gets “banked” until and unless a future council chose to use it.

Avery said he and his staff would take a closer look at the numbers, but with the holiday, I don’t expect a quick answer.

Bremerton City Council President Nick Wofford said he would not comment on the hypothetical possibility of the city being able to use or bank bonus taxing capacity because there are currently too many unknowns.

Hypothetical as this issue — and the merger itself — are, I mention bonus taxing capapacity not to stir up Chicken Little, running around squawking “tax hike, tax, hike!” But the possibility of such does deserve mention and more analysis.

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“Sustainable” Revenue Among County Commissioners’ 2011 Priorities

I attended the Kitsap County Board of Commissioners retreat today at the county campus. (Bunnies are back in the parking lot, I see. Thought they’d been eaten by raccoons.)

The big news coming out of the meeting was that the board is considering a tax measure for 2011. Two years ago, when the crumbling economy was getting too hard to ignore, Josh Brown, who is up for re-election this year, said the idea of raising taxes was not on the table. The message he and the rest of the board got was that any tax increase would be intolerable.

Brown, as I recall our discussion, did not preclude a tax hike proposal at some point in the future. Some day, he said, citizens may need to choose between maintaining an adequate level of services — including public safety — and avoiding a tax increase. What’s changed since then and now, said Brown and fellow commissioner Steve Bauer, is that the county has run out of ways to absorb revenue lost as a result of the recession and the cumulative effects of the 1 percent limit on property tax increases.

The discussion is still in its very early stages, and commissioners will be checking in with the public on the proposed tax measure, as well as other county issues.

Today’s meeting heralds budget season at the county. There will still be some give and take between the board and department heads as they hammer out the 2011 budget, but here are the commissioners’ other priorities (in no particular order).

Under the heading of “Land as a Resource”,” North Kitsap Legacy Partnership: The county must dedicate resources to the several departments involved in planning for a private-public development and land conservation project in North Kitsap.

Water as a Resource: The county wants to make conservation of water an ongoing priority. Kitsap County, unlike other areas of the state, relies solely on rainfall to replenish its aquifers. Even in our rain drenched area of the state, maintaining access to adequate clean water will require a concerted and well-coordinated effort, county officials say.

Financial and Service Sustainability (several related items here):
a. Performance measures: The commissioners want to institute performance measures to ensure that the county is getting the most bang for its buck. Bauer has been a strong proponent of this approach. Department heads have been measuring activities, but there’s been no monitoring, said county administrator Nancy Buonanno-Grennan. “They don’ generally measure meaningful things,” she said. “There’s not a lot of rigor to them.”
b. Compensation reform: The county will analyze its salaries to make sure its compensation is reasonably in line with private sector salaries.
c. Public Discourse on Services: The county will ask the public to weigh in on what services it wants and expects in unincorporated areas (this is related to annexation issues and the ballot measure issue below).
d. Annexation policies: The city will develop these in coordination with cities to make the process of annexation, with its trade-off of revenue and responsibilities more predictable.
e. Interaction with cities on annexation: The county will meet individually with leaders of Kitsap cities on their respective plans for annexing urban growth areas. They’ll be looking for a two-year plan of action to make the process more predictable for everyone.
f. Public outreach to urban growth areas: The county will try to inform citizens about changes they would see with annexation.

Under the heading of Resource Conservation/Economic Development/Green Jobs: South Kitsap Commissioner Chalotte Garrido is pushing for a regional effort to secure energy grants. (Garrido mentioned this initiative, already under way at the county level, as a possible model for performance measurements, since the county already has some experience in this area with grants that require measurable outcomes.)

Also under Resource Conservation, the county needs to have a sustainable business plan for its parks department, Garrido said, and it need to standardize its policies and procedures that affect all of the counties parks, even though they are quite different from one another. Garrido also wants to see some action on plans for South Kitsap parks including South Kitsap Regional Park and Howe Farm. Of SK Regional Park, Garrido said, “There should be things happening in that park with the funding that has been designated to it.” Bauer raised to possibility that the county some day may need to let go of parks altogether, which would require the formation of a municipal parks district.

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Speaking of New Library Taxes

It seems the Kitsap Regional Library Board faces a steep climb if it does indeed ask voters to approve a library levy id lift in November.

Comments on a story I wrote for today’s Kitsap Sun sounded a lot like this one from jetvilleres:
“With the internet available just about everywhere these days, who needs a library anyway. And for all you parents with kids, books are cheap at the Goodwill and Value Village.”

Comments like that outnumbered comments like this from Robin_in_Manette:
“We have an excellent library system. Good luck with the levy!”

The board will make a decision on whether to run the levy in the next few months. In the meantime, they’re keeping their eyes on the economy, voters’ moods, other possible measures that could run at the same time and “political” factors, including the possibility that Port Orchard’s library could join the KRL system.

Finance committee chairman Rob Putaansuu, says annexing into the library district would give Port Orchard residents a say in any library levy lid lift. Putaansuu and other council members have said it would not amount to a tax increase, and that’s true … in one respect. Port Orchard property owners would not see an increase in their library tax, but, according to Kitsap County Assessor Jim Avery, the city could raise its levy rate as a direct result of the library annexation.

To give credit where credit is due, I got the heads up about this from a piece by South Kitsap columnist Bob Meadows, who gave a detailed explanation. I’ll try to give the Cliff Notes version.

Port Orchard residents have access to the same books, CDs and other materials available to KRL patrons. They can check out and return those materials at any KRL branch. And they pay the same library property tax rate as KRL patrons, but they pay it in the form of a Port Orchard library tax as opposed to the regional library district tax. The city forwards revenue from its library tax to KRL, essentially acting as a pass through agency.

As Meadows points out, Port Orchard’s annexation into the library district would create a gap or void between its highest allowable tax rate and the amount it actually collects, presenting the council with the opportunity to raise taxes. Avery calls it bonus taxing capacity. Significantly, the council would not be required to act on the option immediately, but they could “bank” the increase for future use.

I’ll let Avery explain the details:

“This is the same thing we saw play out when the fire district annexed all of Port Orchard (and Poulsbo) several years ago.

The City of Port Orchard and other regular taxing districts are limited by two things when it comes to how much they can levy in property taxes each year. They cannot levy above a statutory maximum levy rate (dollars per thousand of assessed value). And as long as they do not exceed that rate they can levy 1% above their “highest allowable” levy amount, exclusive of new construction.

The “highest allowable” amount is usually their prior year’s levy. Because our assessed value increased dramatically from 2002-2007 levy rates were driven down to a point where they generally are not a factor unless voters have recently approved a levy rate increase.

The problem creating all the confusion here is that while annexing districts (e.g. fire, library and cities) who are increasing the size of their district get to add an appropriate amount above the 1% to their “highest allowable” levy amount, there is no corresponding reduction to the “highest allowable” levy amount from the district that is losing property (emphasis mine, CTH). Logic would suggest that there should be a required reduction to the levy amount when a service area is reduced.

In this case with the proposed annexation of the City Port Orchard to the regional library district, even if the city chooses not to take the bonus levy capacity of about $370,000 in the year following annexation, the money is still banked and available for future use.

It seems to me it is going to take a very strong resolution on the part of the city council to convince the voters in the city that they will not see higher taxes as a result of annexation to the library. And then of course any resolution made by this council can be undone by future councils.
Jim Avery
Kitsap County Assessor

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Health Care War Continues in Washington

On Tuesday the president signed the health care reform bill, which to some is a BFD, and I’m not talking about fire departments. Locals were talking about it. Also on Tuesday some state attorneys general, including ours, joined in a lawsuit questioning the constitutionality of some of the bill’s provisions.

In response the Legislature might write into the budget a provision limiting the AG’s ability to offer such a lawsuit.

It all made for interesting radio on KIRO Tuesday. State Attorney General Rob McKenna, Gov. Chris Gregoire and U.S. Rep. Jay Inslee, D-Bainbridge Island, were all on the Dave Ross show. McKenna made a repeat appearance on the Dori Monson show.

If you’ve got a few minutes, and if you’re here you clearly do, listen to the conversations. They’re available after the jump.

McKenna is clearly in the position that elements of the bill are unconstitutional, and he goes to some length to argue why. Gregoire and Inslee both say his interpretation is wrong, but spend more time talking about what impact it would have if McKenna’s case is ultimately upheld in the courts. If you’re a fan of the bill, that should worry you.

The U.S. Justice Department plans to defend the bill, so it isn’t as if no one thinks the bill passes muster. The problem comes, though, because the attorneys general could win. McKenna argues that they’re only going after particular elements of the bill, but Inslee and others argue that the elements they’re going after are pins that hold the whole thing up. Kill the mandate and you’ve essentially killed the bill.

The next question, then, is do Republicans really want to win this fight? If they do, will it give Democrats the opening to put forward something closer to a single-payer system? Dave Ross argues that if you turn this whole thing into a tax, rather than a forced entry into the market, you probably don’t get the same constitutional debate. At least those kind of cases have been argued and settled in the past.

Continue reading →

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(Don’t) Stop Smoking – Others’ Health Depends on It

South Kitsap Reporter Chris Henry here:

I noticed a nicotine connection between two pieces of legislation, one proposed, one signed into law today.

President Barack Obama signed the State Children’s Health Insurance Program Reauthorization, calling it a “down-payment” on health care reform. The program, which provides health care to millions of low income children, was set to expire March 31. The new $32.8 billion package expands the program to include 4.1 million more children over four and a half years.

According to the press release we received, “Funding will come from an increase in the federal tobacco tax, which is expected to generate $31.3 billion in the next four years.”

On a related note, 160 volunteers with the American Cancer Society and American Heart Association, along with cancer survivors and family members visited Olympia today to advocate for Senate Bill 5626, which would increase the state cigarette tax by $1 a pack.

Among the group was Tessie Goheen of Bremerton. “We need to find ways to cut smoking and help prevent costly incurable disease without harming every day taxpayers,” said Tessie, a 20-year old who is currently undergoing treatment for breast cancer. “All of us are feeling the pinch of the bad economy, and this is all the more reason why we need to get creative about solving problems.”

Tessie, whose family has a rare genetic predisposition to cancer, has worked to start a cancer center in Kitsap County. She and other supporters of the bill hope to see the state avoid impending cuts to smoking prevention and cessation programs through the relatively “steady revenue stream” that would be provided by the tax.

I understand the concept of a “sin tax” is at once to discourage a detrimental behavior and to see some good come out of the inability or unwillingness of many to let it go. It’s the “stick” half of the carrot-and- combined with the lemonade out of lemons thing.

As for the effectiveness of the stick, I’m sure it’s been suggested elsewhere that, when it comes to addiction, price points don’t hold a lot of sway. I’m thinking if you want to apply the stick where it counts, let’s tax the tobacco companies for the privilege of adding chemicals to cigarettes that increase the addictiveness of their products.

I think everyone can agree that health care for children, smoking prevention and smoking cessation are noble goals. But does anyone else find it just a little ironic that the funding, as proposed in both pieces of legislation, absolutely relies on a certain percentage of the population continuing to smoke?

If you’re a smoker, how much would a pack of cigarettes have to cost to get you to quit?

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Government Money for Sports

Congress, specificly U.S. Rep. Dennis Kucinich, D-Ohio, is looking at government money being used on professional sports facilities. The subcommittee looking at it is being postponed to give time to figure out why land under the new Yankee Stadium was valued at $21 million in one appraisal, but a month earlier was appraised at $204 million. There does seem to be one plausible explanation, plausible to me, anyway. From New York Newsday:

A city Department of Finance spokesman said the land values were taken from separate city appraisals. The lower figure was estimated by the city’s Parks Department in May 2006, appraising the land as if it were undeveloped real estate.

The higher estimate was by the finance department, which appraised the land in April 2006, as if the new stadium were complete, the spokesman said.

The Yankees declined to comment.

The Yankees also declined to comment on why they’re willing to move from the sacred ground once patrolled by Babe Ruth, Lou Gehrig, Joe Dimaggio and Mickey Mantle. The new place being Yankee Stadium, I think not. From now on I’m calling lemons bananas.

Thank you to Jake Metcalf for the tip and this link in which you can find Kucinich saying:

I think that it’s very important to understand that we’re looking at a public policy matter here that relates not only to New York and not only to the Nets and the Atlantic Yard project, but it also relates to the whole country, as your other guests have said, because it’s quite possible that there are billions of dollars in tax benefits that should be going to municipalities for the purposes of repairing their infrastructure and for schools and other things and that are instead being diverted for these private sports complexes.

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