A crop of Democrats who make up the commanding state house majority—moderate and conservative Democrats from suburbs and small towns—have let Speaker Frank Chopp (D-43, Seattle) know they heard a lot of grousing about property taxes in November and they need to do something about it.
The quick fix, one proposed by Democratic Representative Christopher Hurst (D-31, Enumclaw) would play well with the moderate crowd that Democratic house leaders are hung up on impressing. The bill would codify Tim Eyman's I-747 property-tax cap before the Washington State Supreme Court has a chance to uphold a King County Superior Court ruling from last summer that tossed the initiative.
Certainly, property-tax reform is a good idea—people on fixed incomes, for example, shouldn't get hit with unwieldy property-tax increases. Nor should poorer people be paying a greater percentage of their incomes in property taxes than rich people.
But why lock in a system that jeopardizes local services? Conventional wisdom has it that local governments need to increase their budgets by about 3 percent annually to keep pace with inflation. I-747 has been in effect since 2002. So why, if Democrats are actually hung up on addressing voters' angst about property taxes, would they want to enshrine something that is evidently failing to address people's complaints?
Moreover, handing Eyman a victory (especially when his 15 minutes have been over for about 20) seems like a dumb priority for this year's Democratic majority.
So, I was pleased when Hurst's bill didn't make it out of committee before the February 28 and March 5 cutoffs. Pleased until I realized: Maybe the Democrats are trying to sneak this one by.
The house Democrats are meeting in caucus this week to move it out—which they're allowed to do with "dead" bills if they believe the bill is "essential to the budget."
If Democrats are going to act on property-tax relief, they shouldn't rubber-stamp Eyman's pseudo-populist fix. They should get real about addressing the system.
Voilà: enter the Washington State Budget and Policy Center. Last week, it released an intriguing idea that the Democrats should consider when they resurrect the Eyman bill.
The liberal Budget and Policy Center's property-tax reform would target the state's poorest homeowners. The idea works like this: When property-tax bills reach a certain percentage of a homeowner's income, they get a tax credit. The proposal developed by the Budget and Policy Center is, it claims, revenue neutral. It would give the poorest 20 percent of homeowners a 14.9 percent tax cut; the next 20 percent would get about a 12 percent cut, the middle 20 percent would get a 1.9 percent cut, and the top 40 percent would see a 2 percent increase.
That'd be a nice change from the regressive setup of the current system: According to the Budget and Policy Center report, the poorest homeowners pay 6 percent of their income in property taxes while the richest bracket pays 2.8 percent. Which doesn't speak very well of 747.