Initiative seeks to restore I-601 spending rules

Initiative seeks to restore I-601 spending rules

By DAVID AMMONS The Associated Press
3/19/02 9:29 PM

OLYMPIA (AP) -- A citizen group has launched an initiative to try to
restore the state's voter-approved spending limits law, Initiative 601,
that lawmakers partially suspended this year.

The Democratic-controlled Legislature, with the blessings of Gov. Gary
Locke, passed a bill last week that allows simple majority approval of tax
increases, repeal of tax exemptions and use of money from the state's
"rainy day" reserve fund.

Before the change, I-601 required a two-thirds vote in both houses. But
when Republicans refused to provide votes to help balance the state budget,
the Democrats voted to suspend the supermajority requirements for this year
and next.

As part of a plan to erase $1.6 billion worth of red ink, Democrats spent
$325 million from the state reserves, leaving about $53 million in the
"rainy day" fund. Counting the ending fund balance, the state has total
reserves of $306 million.

Democrats also rescinded about $30 million in tax exemptions and approved a
number of fee increases. Some lawmakers said a general tax increase may be
required next year, since the state may have a $1 billion budget problem.

In previous sessions, both parties have amended the spending limits to
allow use of outside funds, including federal dollars, without lowering the
General Fund spending limits.

I-601 says spending should grow by no more than population growth plus
inflation.

A citizen group advised by former state GOP Executive Director Lance
Henderson and state Sen. Dino Rossi, R-Sammamish, on Tuesday announced an
initiative drive to restore I-601.

"The Legislature has defied the will of the people," said Stephanie
Linklater, a North Bend real estate agent who is prime sponsor of the
initiative. "The voters need to tell the Legislature that we are still
concerned about state spending growth and tax increases."

The initiative would:

--Restore the I-601 spending-limit formula, with no provision for
transferring programs and money to other accounts or off-budget. The
measure would apply to most state funds, not just the main General Fund as
currently.

--Restore the supermajority requirement for tax increases or use of "rainy
day" reserves. Taxes and fees in excess of the spending limits would also
require voter approval.

--Require that any surplus above the spending limit be placed in a "rainy
day" fund. After the equivalent of 5 percent of the two-year budget was
set aside, excess funds would go for school, college and road
construction. Currently, the reserve account accumulates to 5 percent of
one year's budget and the spillover goes for school and college construction.

The sponsors, Save Our Spending Limits, will try to gain the backing of Tim
Eyman's tax rebels, business and professional groups, and grassroots groups
concerned about state spending and taxes, said Henderson, who was director
of the GOP from 1992 to 1995.

"It will be extremely popular," he predicted.

The group will have until July 5 to gather roughly 225,000 voter
signatures. The initiative has not yet been assigned a number or ballot title.

Key lawmakers had no immediate reaction late Tuesday, but the original
sponsor of I-601, former U.S. Rep. Linda Smith of Vancouver, was
delighted. She's running a nonprofit humanitarian group, Shared Hope
International, and doesn't plan to work on the initiative, but likes what
she hears.

"It has been effective, and I hate the idea of the Legislature going back
to the era of binge and purge" with overspending during good times and
leaving inadequate reserves for down times, she said in an interview.

"What the Legislature has been doing, you wouldn't do with your own family
budget. They are putting people in jeopardy."