WASHINGTON STATE LEGISLATIVE PREVIEW 2010

Information from Bill Stauffacher, PPI Lobbyist
Key Provisions PPI must protect are sales tax exemptions for capital equipment purchases and pass-thru postage costs.

On January 11, the Washington State Legislature will convene for what promises to be one of the most challenging and contentious 60-day sessions in state history.

Since passing a two-year, $31.8 billion budget at the end of the 2009 session, state tax revenues have continued to drop – leaving a $2.6 billion budget shortfall between now and mid-2011. Legislators must cut spending, raise taxes, or do some combination of both to close the gap between falling revenues and projected spending. Tax increases are clearly on the table. Democratic leaders and budget writers are considering eliminating tax exemptions (“loopholes”), repealing reduced tax rates (“preferential tax rates”), increasing sin taxes on products like alcohol and tobacco, and creating new sin taxes such as placing a tax on bottled water. Key tax provisions that PPI must protect are sales tax exemptions for capital equipment purchases and pass-thru postage costs.

Among the ideas getting kicked around are two business taxes – adding the sales tax to professional services and creating some type of financial services tax. With no details available, it’s hard to know what tax concepts may impact PPI members and our key business partners. Nevertheless, as details emerge on any and all tax increases, PPI’s top priority is defeating any tax proposal that is detrimental to the commercial printing industry.

In December Governor Chris Gregoire proposed a 2010 supplemental budget – offering deep cuts in human services, college financial aid and education programs not protected by the state’s basic education law. In her budget announcement and subsequent press interviews, Gregoire explained her constitutional obligation to propose a balanced budget but called its impacts on people unjust and unfair. She indicated a willingness to work with the legislature to find new revenue that would fund these programs and provide on-going revenue for future budgets. Editorial pages throughout the state criticized the Governor’s budget proposal in part because state employees are still receiving “step” pay increases, cutting against what many working in the private sector have experienced (wage freezes, job losses, and reduction of hours).

If legislators are to raise taxes, they will have to vote to suspend I-960 – the Tim Eyman-back initiative that was passed in November 2007 that requires legislators to obtain a two-thirds vote to pass new taxes. Initiatives can be suspended by the legislature by a simple majority (50 percent) vote once the initiative has been on the books for two years. This is the first session in which legislators will have had this option.

Do Not Mail
PPI will oppose any DNM legislation, if introduced. A similar proposal was introduced and defeated in the 2007 session.

PPI should also actively oppose the City of Seattle’s efforts to pass a resolution that encourages the state legislature to pass DNM legislation. PPI members in Seattle need to contact city councilmembers and ask them to oppose this resolution. PPI should also continue working closely with the coalition Mail Moves America, a group that PIA actively supports and funds. Mail Moves American works to defeat DNM proposals and to promote beneficial direct mail laws throughout the nation.

If you have any questions / comments please forward them onto Jules Van Sant, PPI Executive Director at 503-221-3944 or by