- Climate change is not one of their priorities (taxes and education are).
- He expressed some personal preference for carbon taxes over cap-and-trade because of simplicity &etc, which reminded me of Puget Sound Energy's statement of "support for a carbon tax... [because it's] straightforward and transparent... A carbon tax would give the utility sector the cost certainty required to make prudent long-term resource planning decisions and achieve regulatory approval for recovering capital investments."
- He was interested in relative tax burdens on households v. business---claiming that the lack of a state income tax pushed the tax burden onto business---so I shared with him, e.g., Bruce's research on the property tax burden (and hence any property tax relief) being split about 60/40 between households and business.
- He was keen on reducing the B&O (business) tax burden.
- He worried about the impact of a carbon tax on Boeing. (His language was stronger than that :) But he also said that Boeing probably had a large property burden that they'd love to reduce. He gave me the name of a contact there and I've already emailed him.
- He also gave me a contact at Microsoft (I've emailed her too) and suggested that they might be receptive to a carbon tax.
- Because education is one of their priorities, we talked a bit about setting aside a chunk of money for education, but I didn't get a strong sense that this would make the proposal more attractive in their eyes.
Wednesday, May 13, 2009
Notes from meeting with WA Roundtable's Steve Mullin
I met today with Steve Mullin, head of WA Roundtable. Detailed notes are below, but the overall impression I got (not unexpected) was that neutrality was pretty much the most we could hope for, and in order to get that we'd need to look at impacts on Boeing, Microsoft, Weyerhaeuser, etc. Details:
Thursday, May 7, 2009
Notes from May 7 meeting
In attendance: Bruce, Catherine, Dorothy, Jim, Yoram.
Policy: There wasn't much said either for or against the new spreadsheet (linked here). Bruce favors $50/ton over $30/ton but also recognizes that there might be political advantages to going with $30/ton, e.g., because that's what BC has done. Bruce also suggested increasing the low-income offset. (I'm still waiting to hear back from my friends at Resources for the Future who are running some numbers on that.)
Website: We agreed that (1) having an internal website (to use, e.g., for signature-gathering volunteers) was more important at the moment than having an external website, but we also agreed that we didn't need either one in order to start reaching out to potential signature-gathering volunteers. FYI, the draft website is here but it's still not ready to go public.
Outreach: We made minor modifications of the email (see below), and this afternoon I sent it out to some folks (including most of the people on the carbonWA email list :) Also Dorothy said she would take the idea back to her group (Citizens Climate Lobby) and Jim said he would spread the word with some colleagues, and also on his widely read e-newsletter when we get our ducks a little more in a row. Thanks to everyone for doing the same!
Next steps: Next meeting downtown is Thursday June 4, 12-1pm. If you want to get more involved between now and then (research/outreach/etc) just holler!
PS. Below is the email asking for signature-gathering volunteers.
Cheers,
yoram
Hi [Pat]: I hope you're enjoying this spring and summer, and I want you to keep enjoying it, but I'm writing to ask for some of your time next spring and summer, i.e., about 10 months from now. Here's the skinny:
* Climate change is not going away, so I'm part of a group that is determined to push a ballot measure here in Washington State if state and federal action continues to stall. Getting on the ballot in November 2010 would mean gathering signatures in February-June 2010, so I'm asking for your help to make that happen. (You'd also be helping one of my dreams come true: I've been serious enough about this that I've practiced over the past few years by personally gathered about 900 signatures each year for a ballot measure I support :)
* We're still working on the policy details, but the gist of it will be (1) imposing a carbon tax of $30-50 per ton of CO2, which amounts to about $0.30-$0.50 per gallon of gasoline or about $0.03-$0.05 per kWh of coal-fired power, with the tax rate increasing over time; (2) using the majority of the revenue to repeal the state portion of the property tax; and (3) using a smaller portion of the revenue to offset impacts on low-income households and perhaps also reduce business taxes and/or increase funding for clean energy research and for K-12 math/science education. FYI this proposal is roughly similar to the award-winning carbon tax currently in effect in British Columbia.
* I am asking for you to commit to gathering 900 signatures between early February 2010 and late June 2010. This will not be super-easy, but it will also not be impossible: at an average signature-gathering rate of 25 signatures per hour (or 100 in a 4-hour shift), that means finding nine friends to join you for just a single 4-hour shift, or finding three friends to join you for three 4-hour shifts, or doing nine 4-hour shifts on your lonesome (which is mostly what I've done during my volunteer efforts these last few years, and it's really not that bad---36 hours goes by fast :). And of course we'll provide you with training and lists of good signature-gathering locations &etc... all we need is your time and enthusiasm!
* Just for the record, what I am really asking for is an _option_ on your time and enthusiasm: If federal or state action makes the ballot measure unnecessary, or if we fail to interest enough people in gathering signatures for the ballot measure, you'll be free to devote your time and enthusiasm elsewhere. But we'd like to count on your participation IF we can drum up a critical mass of support and IF there is no state or federal action by early 2010.
Let me know if you have any questions, let me know if you're game, and thank you!
PS. Please do share this with friends who might be interested, and if you and/or they want to be on our once-a-week email list, the more the merrier :)
Regards,
yoram
Policy: There wasn't much said either for or against the new spreadsheet (linked here). Bruce favors $50/ton over $30/ton but also recognizes that there might be political advantages to going with $30/ton, e.g., because that's what BC has done. Bruce also suggested increasing the low-income offset. (I'm still waiting to hear back from my friends at Resources for the Future who are running some numbers on that.)
Website: We agreed that (1) having an internal website (to use, e.g., for signature-gathering volunteers) was more important at the moment than having an external website, but we also agreed that we didn't need either one in order to start reaching out to potential signature-gathering volunteers. FYI, the draft website is here but it's still not ready to go public.
Outreach: We made minor modifications of the email (see below), and this afternoon I sent it out to some folks (including most of the people on the carbonWA email list :) Also Dorothy said she would take the idea back to her group (Citizens Climate Lobby) and Jim said he would spread the word with some colleagues, and also on his widely read e-newsletter when we get our ducks a little more in a row. Thanks to everyone for doing the same!
Next steps: Next meeting downtown is Thursday June 4, 12-1pm. If you want to get more involved between now and then (research/outreach/etc) just holler!
PS. Below is the email asking for signature-gathering volunteers.
Cheers,
yoram
Hi [Pat]: I hope you're enjoying this spring and summer, and I want you to keep enjoying it, but I'm writing to ask for some of your time next spring and summer, i.e., about 10 months from now. Here's the skinny:
* Climate change is not going away, so I'm part of a group that is determined to push a ballot measure here in Washington State if state and federal action continues to stall. Getting on the ballot in November 2010 would mean gathering signatures in February-June 2010, so I'm asking for your help to make that happen. (You'd also be helping one of my dreams come true: I've been serious enough about this that I've practiced over the past few years by personally gathered about 900 signatures each year for a ballot measure I support :)
* We're still working on the policy details, but the gist of it will be (1) imposing a carbon tax of $30-50 per ton of CO2, which amounts to about $0.30-$0.50 per gallon of gasoline or about $0.03-$0.05 per kWh of coal-fired power, with the tax rate increasing over time; (2) using the majority of the revenue to repeal the state portion of the property tax; and (3) using a smaller portion of the revenue to offset impacts on low-income households and perhaps also reduce business taxes and/or increase funding for clean energy research and for K-12 math/science education. FYI this proposal is roughly similar to the award-winning carbon tax currently in effect in British Columbia.
* I am asking for you to commit to gathering 900 signatures between early February 2010 and late June 2010. This will not be super-easy, but it will also not be impossible: at an average signature-gathering rate of 25 signatures per hour (or 100 in a 4-hour shift), that means finding nine friends to join you for just a single 4-hour shift, or finding three friends to join you for three 4-hour shifts, or doing nine 4-hour shifts on your lonesome (which is mostly what I've done during my volunteer efforts these last few years, and it's really not that bad---36 hours goes by fast :). And of course we'll provide you with training and lists of good signature-gathering locations &etc... all we need is your time and enthusiasm!
* Just for the record, what I am really asking for is an _option_ on your time and enthusiasm: If federal or state action makes the ballot measure unnecessary, or if we fail to interest enough people in gathering signatures for the ballot measure, you'll be free to devote your time and enthusiasm elsewhere. But we'd like to count on your participation IF we can drum up a critical mass of support and IF there is no state or federal action by early 2010.
Let me know if you have any questions, let me know if you're game, and thank you!
PS. Please do share this with friends who might be interested, and if you and/or they want to be on our once-a-week email list, the more the merrier :)
Regards,
yoram
Monday, May 4, 2009
Agenda for Th meeting downtown 12-1pm
Hey everyone: Here's a tentative agenda for Thursday's meeting, which is 12-1pm in the 5th floor conference room at 1402 3rd Ave downtown. Hope to see you there!
* Updates (5 minutes): News about WCI, federal action, stakeholder meetings, etc. FYI, here's my update in a nutshell: I've gotten a good response from some green energy Venture Capital folks and a UW student group (UW SEED), a less good response from some environmental groups---having lost the battle at the state level, they have apparently decided to join the battle at the federal level---and am looking forward to discussions in the next week or two with some social justice folks, with some folks connected to big business, and with economic researchers at RFF who are going to tell us about impacts on different income deciles.
* Policy (15 minutes): Here's an updated spreadsheet that includes stronger GHG targets (which makes our revenue estimates more conservative), a lower initial tax rate, and rate increases of inflation plus 5% annually: carbonwa7.xls. It hasn't changed that much from the previous version (carbonwa6.xls), and I look forward to hearing your thoughts, but my 2 cents are that the changes make it more stable in the long-run and more politically attractive in the short-run (e.g., by starting at $30 per ton rather than $50 per ton we can truthfully say that we're just mimicking the carbon tax already in place in British Columbia).
* Website (15 minutes): After a long delay I think we need to get cracking again on having a bare-bones but functional website, so let's talk about who our target audience is and what we need on the website and how to get it done.
* Outreach (15 minutes): I've drafted an email (copied below) to start drumming up support for signature-gathering, and I'm looking for feedback.
* Next steps (10 minutes): To-do list and next downtown meeting Th June 4 from 12-1pm.
Let me know if you have additions/corrections/suggestions for the meeting agenda, and if you can't make the meeting but want to chime in via email please do!
HERE'S THE DRAFT EMAIL (written from my perspective but not hard to modify):
Hi [Pat]: I hope you're enjoying this spring and summer, and I want you to keep enjoying it, but I'm writing to ask for some of your time next spring and summer, i.e., about 10 months from now. Here's the skinny:
* Climate change is not going away, so I'm part of a group that is determined to push a ballot measure here in Washington State if state and federal action continues to stall. Getting on the ballot in November 2010 would mean gathering signatures in February-June 2010, so I'm asking for your help to make that happen. (You'd also be helping one of my dreams come true: I've been serious enough about this that I've practiced over the past few years by personally gathered about 900 signatures each year for a ballot measure I support :)
* We're still working on the policy details, but the gist of it will be (1) imposing a carbon tax of $30-50 per ton of CO2, which amounts to about $0.30-$0.50 per gallon of gasoline or about $0.03-$0.05 per kWh of coal-fired power; (2) using the majority of the revenue to repeal the state portion of the property tax; and (3) using a smaller portion of the revenue to offset impacts on low-income households and perhaps also reduce business taxes and/or increase funding for clean energy research and for K-12 math/science education. Some details are online at www.ourwebsite.org, and FYI this proposal is roughly similar to the award-winning carbon tax currently in effect in British Columbia.
* I am asking for you to commit to gathering 900 signatures between early February 2010 and late June 2010. This will not be super-easy, but it will also not be impossible: at an average signature-gathering rate of 25 signatures per hour (or 100 in a 4-hour shift), that means finding nine friends to join you for just a single 4-hour shift, or finding three friends to join you for three 4-hour shifts, or doing nine 4-hour shifts on your lonesome (which is mostly what I've done during my volunteer efforts these last few years, and it's really not that bad :). And of course we'll provide you with training and lists of good signature-gathering locations &etc... all we need is your time and enthusiasm!
* Just for the record, what I am really asking for is an _option_ on your time and enthusiasm: If federal or state action makes the ballot measure unnecessary, or if we fail to interest enough people in the ballot measure, you'll be free to devote your time and enthusiasm elsewhere. But we'd like to count on your participation IF we can drum up a critical mass of support and IF there is no state or federal action by early 2010.
Let me know if you have any questions, let me know if you're game, and thank you!
yoram
* Updates (5 minutes): News about WCI, federal action, stakeholder meetings, etc. FYI, here's my update in a nutshell: I've gotten a good response from some green energy Venture Capital folks and a UW student group (UW SEED), a less good response from some environmental groups---having lost the battle at the state level, they have apparently decided to join the battle at the federal level---and am looking forward to discussions in the next week or two with some social justice folks, with some folks connected to big business, and with economic researchers at RFF who are going to tell us about impacts on different income deciles.
* Policy (15 minutes): Here's an updated spreadsheet that includes stronger GHG targets (which makes our revenue estimates more conservative), a lower initial tax rate, and rate increases of inflation plus 5% annually: carbonwa7.xls. It hasn't changed that much from the previous version (carbonwa6.xls), and I look forward to hearing your thoughts, but my 2 cents are that the changes make it more stable in the long-run and more politically attractive in the short-run (e.g., by starting at $30 per ton rather than $50 per ton we can truthfully say that we're just mimicking the carbon tax already in place in British Columbia).
* Website (15 minutes): After a long delay I think we need to get cracking again on having a bare-bones but functional website, so let's talk about who our target audience is and what we need on the website and how to get it done.
* Outreach (15 minutes): I've drafted an email (copied below) to start drumming up support for signature-gathering, and I'm looking for feedback.
* Next steps (10 minutes): To-do list and next downtown meeting Th June 4 from 12-1pm.
Let me know if you have additions/corrections/suggestions for the meeting agenda, and if you can't make the meeting but want to chime in via email please do!
HERE'S THE DRAFT EMAIL (written from my perspective but not hard to modify):
Hi [Pat]: I hope you're enjoying this spring and summer, and I want you to keep enjoying it, but I'm writing to ask for some of your time next spring and summer, i.e., about 10 months from now. Here's the skinny:
* Climate change is not going away, so I'm part of a group that is determined to push a ballot measure here in Washington State if state and federal action continues to stall. Getting on the ballot in November 2010 would mean gathering signatures in February-June 2010, so I'm asking for your help to make that happen. (You'd also be helping one of my dreams come true: I've been serious enough about this that I've practiced over the past few years by personally gathered about 900 signatures each year for a ballot measure I support :)
* We're still working on the policy details, but the gist of it will be (1) imposing a carbon tax of $30-50 per ton of CO2, which amounts to about $0.30-$0.50 per gallon of gasoline or about $0.03-$0.05 per kWh of coal-fired power; (2) using the majority of the revenue to repeal the state portion of the property tax; and (3) using a smaller portion of the revenue to offset impacts on low-income households and perhaps also reduce business taxes and/or increase funding for clean energy research and for K-12 math/science education. Some details are online at www.ourwebsite.org, and FYI this proposal is roughly similar to the award-winning carbon tax currently in effect in British Columbia.
* I am asking for you to commit to gathering 900 signatures between early February 2010 and late June 2010. This will not be super-easy, but it will also not be impossible: at an average signature-gathering rate of 25 signatures per hour (or 100 in a 4-hour shift), that means finding nine friends to join you for just a single 4-hour shift, or finding three friends to join you for three 4-hour shifts, or doing nine 4-hour shifts on your lonesome (which is mostly what I've done during my volunteer efforts these last few years, and it's really not that bad :). And of course we'll provide you with training and lists of good signature-gathering locations &etc... all we need is your time and enthusiasm!
* Just for the record, what I am really asking for is an _option_ on your time and enthusiasm: If federal or state action makes the ballot measure unnecessary, or if we fail to interest enough people in the ballot measure, you'll be free to devote your time and enthusiasm elsewhere. But we'd like to count on your participation IF we can drum up a critical mass of support and IF there is no state or federal action by early 2010.
Let me know if you have any questions, let me know if you're game, and thank you!
yoram
Thursday, April 16, 2009
Updates and Thursday May 7 meeting downtown
Hey folks: Now that I've mostly finished the cartoon book about economics I've been working on (including a section on carbon taxes!) I have lots of time and energy to work on this. Let me know about your availability too... there are lots of projects to work on :)
Status: For better or worse, the hypothetical scenario that our effort is based on seems to be coming true: the WA state legislature appears to have killed cap-and-trade for this year, and despite optimism from Sightline and others I have a hard time seeing serious federal action coming anytime soon. That leaves an opening for our proposal.
Our proposal: There are plenty of policy details to work out, but my belief is that there is general agreement about the major elements of our proposal, i.e., about having a mostly revenue-neutral carbon tax of $30+ per ton of CO2 (e.g., $0.30+ per gallon of gasoline), with revenue devoted to eliminating the state portion of the property tax, offsetting impacts on low-income households, and other features TBD (to be determined).
Next steps: I propose that we start committing to and working towards a 2010 ballot measure. In addition to continuing to get feedback on the proposal and work out policy details, I am going to start asking folks about their willingness to commit time and energy. (No need for money... yet :) So please think about your own constraints and abilities and what it would take to bring you and your friends and colleagues on board!
Next meeting: Thursday May 7, 12-1pm downtown. Agenda TBD.
Status: For better or worse, the hypothetical scenario that our effort is based on seems to be coming true: the WA state legislature appears to have killed cap-and-trade for this year, and despite optimism from Sightline and others I have a hard time seeing serious federal action coming anytime soon. That leaves an opening for our proposal.
Our proposal: There are plenty of policy details to work out, but my belief is that there is general agreement about the major elements of our proposal, i.e., about having a mostly revenue-neutral carbon tax of $30+ per ton of CO2 (e.g., $0.30+ per gallon of gasoline), with revenue devoted to eliminating the state portion of the property tax, offsetting impacts on low-income households, and other features TBD (to be determined).
Next steps: I propose that we start committing to and working towards a 2010 ballot measure. In addition to continuing to get feedback on the proposal and work out policy details, I am going to start asking folks about their willingness to commit time and energy. (No need for money... yet :) So please think about your own constraints and abilities and what it would take to bring you and your friends and colleagues on board!
Next meeting: Thursday May 7, 12-1pm downtown. Agenda TBD.
Tuesday, February 24, 2009
Updates and Thursday March 5 meeting downtown
1) Our very own Todd Myers has an op-ed in today's Seattle Times, "Create incentive to cut emissions with carbon price." (For the record, the piece is paired with a piece in yesterday's Times, "Cap-and-invest approach good for environment and economy" by Michael Butler of Cascadia Capital.)
2) Our next downtown meeting is Th March 5 12-1pm at the usual location (1402 3rd Ave, 5th floor conference room). The agenda includes a WCI update and next steps on the spreadsheet and other updates below. I feel like we're building some momentum, so keep it up! One thing that everyone can do is try to get feedback on the proposal below from friends, local businesses, etc. (I've found that talking to local business owners is great fun! You'll certainly learn a lot about the tax burden on businesses :)
3) I've had valuable conversations with lots of different folks (see the list below), and this updated spreadsheet reflects the resulting proposal. In a nutshell, here's what the current proposal includes and how it differs from the last version:
PS. Here are some of the folks I've talked to lately. Many thanks to them for their feedback, and as always being on this list does not mean that any individual or group is supporting or endorsing anything.
2) Our next downtown meeting is Th March 5 12-1pm at the usual location (1402 3rd Ave, 5th floor conference room). The agenda includes a WCI update and next steps on the spreadsheet and other updates below. I feel like we're building some momentum, so keep it up! One thing that everyone can do is try to get feedback on the proposal below from friends, local businesses, etc. (I've found that talking to local business owners is great fun! You'll certainly learn a lot about the tax burden on businesses :)
3) I've had valuable conversations with lots of different folks (see the list below), and this updated spreadsheet reflects the resulting proposal. In a nutshell, here's what the current proposal includes and how it differs from the last version:
- As before, impose a carbon tax of $50/ton of CO2 in 2010, with additional increases of $10/ton each year starting in 2015. This generates about $4.3 billion a year in 2010.
- As before, use $1.9 billion to replace the state portion of the property tax, leaving $2.4b.
- As before, set aside 10% of the revenue to offset impacts on low-income households, leaving $1.9b. (See number-crunching note about this below.)
- Instead of doubling the small business B&O tax credit, increase it 10-fold. This idea came from John Burbank of Economic Opportunity Institute, takes up "only" $260m, and means that the percentage of businesses who are exempt from B&O taxes goes up from 48% to 88%. (See details on the second sheet of the spreadsheet.)
- The Sarah Palin: Rebate local property taxes, for a total state/local property tax reduction of over 40% if all $1.7 billion goes here.
- The Van Jones: K-12 math/science education, higher ed clean energy research, green jobs, energy efficiency, etc.
- The Dick Cheney: Rebate state B&O taxes across the board, cutting state B&O taxes by over 50% if all $1.7 billion goes here.
PS. Here are some of the folks I've talked to lately. Many thanks to them for their feedback, and as always being on this list does not mean that any individual or group is supporting or endorsing anything.
- Clark Williams-Derry of Sightline Institute
- Michael Lazarus of Stockholm Environment Institute
- Jeff Chapman of WA Budget and Policy Center
- Doug Howell
- Dallas Burtraw of Resources for the Future (RFF, a DC-based environmental economics think-tank; Dallas has tentatively agreed to do some number-crunching for us on income-decile impacts, which is awesome)
- John Burbank and Marilyn Watkins of Economic Opportunity Institute
- Graham Evans of WA Clean Technology Alliance
Thursday, February 5, 2009
Notes from Feb 5 and next steps
Hey everyone: We had a small but productive meeting today; here's a summary and next steps!
In attendance: Yoram Bauman, Catherine Carey, Todd Myers
Update #1: WCI is still looking iffy (maybe 30% chance?) as far as the legislature goes, and our plan is still to be prepared to step in fast with a proposal if the WCI doesn't pass. That's a challenge because so many eyes are focused on the WCI, but I'm confident that we can make good progress in the next month or so.
Update #2: Bruce Flory tracked down some information on limitations on property tax growth (e.g., from Eyman initiatives); his whole email is below but the key message is that something in the 3.0-3.5% range is a good guess for annual property tax growth (in nominal terms), so our assumption of 4% is a good conservative assumption.
Policy: Todd Myers made a strong case that Assoc. of WA Business and other elements of the business community would be more attracted to a slimmed down proposal that focused on just three things: (1) eliminating the state property tax, (2) setting aside 10% of revenue to offset impacts on low-income households, and (3) rebating state B&O taxes. Getting business support would be amazing, so those ideas are reflected in the current spreadsheet. (If you want to compare with the previous version, there's a tab in the spreadsheet that has the old version.) However, it is also important to note that the policy discussion is still continuing (see below!) so if your favorite idea was left out then there's still hope for major changes, which I think are especially likely if the business community does not get behind this.
Next steps: In the next month we should all attempt to have one-on-one meetings with various stakeholders &etc to see (1) what they think, (2) what it would take to get their names attached to an op-ed supporting this, and (3) who else we should talk to. Todd is going to talk to the business community (and his other right-wing friends :). Yoram is going to talk to his contacts in the business and environmental and education and social justice communities, and everybody else should join in the fun. This is pretty time-sensitive stuff, so feedback via email to me would be best.
Overview: If we can get the voting public on board because of the elimination of the state property tax, the environmental community on board because of the carbon tax, the business community on board because of a hefty cut in B&O taxes, and the social justice community on board because of the offsets for low-income households, that would make one super-attractive package. Let's see if we can make it happen!
Next meeting: Th March 5, 12-1pm, same downtown location.
PS. Todd is also going to investigate the "tax creep" issue that was brought up by one Republican legislator who was concerned that local governments would respond to the elimination of the state property tax by just raising local property taxes.
PPS. Here's the property tax info, from Bruce Flory: OK, here's the scoop. The Eyman initiative that is operative is I-747. Although it passed in 2001, it was actually overturned by the Supreme Court in 2007 but then immediately reinstated by the legislature. It provides that property tax revenue from existing properties can increase by no more than 1% or the rate of inflation (as measured by the U.S. Implicit Price Deflator) - whichever is LESS - from the highest revenue over the prior 3 years. However, this restriction does not apply to new construction (anything requiring a building permit), "improvements" to property (e.g. the increase in value from subdividing a parcel even if it isn't built on), and a few odds and ends like the value of new wind turbines. Statewide, the value of new construction, improvements, etc., averages around $20.5 billion per year. With an average state property tax rate of about $1.75 per $1000, that works out to revenue of almost $36 million which is 2% of total annual revenue of $1.8 billion. This implies that the maximum increase in state property tax revenue is about 3% per year. This is confirmed by some figures I was able to get on actual and forecast increases in revenue from 2005 thru 2015. They are: 2005->2006: 3.4%, 2007: 3.8%, 2008: 3.6%, 2009: 3.1%, 2010: 0.0%, 2011: 3.1%, 2012: 3.2%, 2013: 3.2%, 2014: 3.2%, 2015: 3.1%. So I'm pretty comfortable using something in the low 3% range for our forecast of annual growth in NOMINAL state property tax revenue. For our purposes, using 4% would be very conservative. This of course assumes no change in the regulatory environment. My source for information on the I-747 limits is Kathy Beith in the Dept of Revenue Property Tax Division. My source for historical and forecast revenue growth is Valerie Torres, a tax policy specialist in the Research Division of the Dept of Revenue.
In attendance: Yoram Bauman, Catherine Carey, Todd Myers
Update #1: WCI is still looking iffy (maybe 30% chance?) as far as the legislature goes, and our plan is still to be prepared to step in fast with a proposal if the WCI doesn't pass. That's a challenge because so many eyes are focused on the WCI, but I'm confident that we can make good progress in the next month or so.
Update #2: Bruce Flory tracked down some information on limitations on property tax growth (e.g., from Eyman initiatives); his whole email is below but the key message is that something in the 3.0-3.5% range is a good guess for annual property tax growth (in nominal terms), so our assumption of 4% is a good conservative assumption.
Policy: Todd Myers made a strong case that Assoc. of WA Business and other elements of the business community would be more attracted to a slimmed down proposal that focused on just three things: (1) eliminating the state property tax, (2) setting aside 10% of revenue to offset impacts on low-income households, and (3) rebating state B&O taxes. Getting business support would be amazing, so those ideas are reflected in the current spreadsheet. (If you want to compare with the previous version, there's a tab in the spreadsheet that has the old version.) However, it is also important to note that the policy discussion is still continuing (see below!) so if your favorite idea was left out then there's still hope for major changes, which I think are especially likely if the business community does not get behind this.
Next steps: In the next month we should all attempt to have one-on-one meetings with various stakeholders &etc to see (1) what they think, (2) what it would take to get their names attached to an op-ed supporting this, and (3) who else we should talk to. Todd is going to talk to the business community (and his other right-wing friends :). Yoram is going to talk to his contacts in the business and environmental and education and social justice communities, and everybody else should join in the fun. This is pretty time-sensitive stuff, so feedback via email to me would be best.
Overview: If we can get the voting public on board because of the elimination of the state property tax, the environmental community on board because of the carbon tax, the business community on board because of a hefty cut in B&O taxes, and the social justice community on board because of the offsets for low-income households, that would make one super-attractive package. Let's see if we can make it happen!
Next meeting: Th March 5, 12-1pm, same downtown location.
PS. Todd is also going to investigate the "tax creep" issue that was brought up by one Republican legislator who was concerned that local governments would respond to the elimination of the state property tax by just raising local property taxes.
PPS. Here's the property tax info, from Bruce Flory: OK, here's the scoop. The Eyman initiative that is operative is I-747. Although it passed in 2001, it was actually overturned by the Supreme Court in 2007 but then immediately reinstated by the legislature. It provides that property tax revenue from existing properties can increase by no more than 1% or the rate of inflation (as measured by the U.S. Implicit Price Deflator) - whichever is LESS - from the highest revenue over the prior 3 years. However, this restriction does not apply to new construction (anything requiring a building permit), "improvements" to property (e.g. the increase in value from subdividing a parcel even if it isn't built on), and a few odds and ends like the value of new wind turbines. Statewide, the value of new construction, improvements, etc., averages around $20.5 billion per year. With an average state property tax rate of about $1.75 per $1000, that works out to revenue of almost $36 million which is 2% of total annual revenue of $1.8 billion. This implies that the maximum increase in state property tax revenue is about 3% per year. This is confirmed by some figures I was able to get on actual and forecast increases in revenue from 2005 thru 2015. They are: 2005->2006: 3.4%, 2007: 3.8%, 2008: 3.6%, 2009: 3.1%, 2010: 0.0%, 2011: 3.1%, 2012: 3.2%, 2013: 3.2%, 2014: 3.2%, 2015: 3.1%. So I'm pretty comfortable using something in the low 3% range for our forecast of annual growth in NOMINAL state property tax revenue. For our purposes, using 4% would be very conservative. This of course assumes no change in the regulatory environment. My source for information on the I-747 limits is Kathy Beith in the Dept of Revenue Property Tax Division. My source for historical and forecast revenue growth is Valerie Torres, a tax policy specialist in the Research Division of the Dept of Revenue.
Tuesday, February 3, 2009
Meeting downtown Th 12-1pm
Hey everyone: Our next meeting is this Thursday, Feb 5, 12-1pm, at the usual downtown location: 1402 3rd Ave, 5th floor conference room. In case of disaster call me: 206-351-5719.
Agenda:
12:00-12:10: Introductions and updates on the Western Climate Initative and other things (including Bruce's research on property tax limits). Just for the record, there are likely to be folks at the meeting who support WCI and folks at the meeting who oppose WCI. My preference is to continue to sidestep that question and instead focus our meeting on the possibility of carbon tax legislation in the event that WCI does not pass.
12:10-12:30: Policy details concerning this spreadsheet (now updated to include inflation-adjusted numbers!). In a nutshell, the current proposal is a carbon tax of $50 per ton of CO2 [$0.50 per gallon of gasoline], rising by $10 per ton per year from 2015 on, with revenue going to (1) eliminate the state property tax, (2) offset impacts on low-income households, (3) fund clean energy R&D, and (4) reduce the B&O [business] tax.
12:30-12:50: Discuss strategy, e.g., at what point to try to publish an op-ed piece and how and when to reach out to social justice folks, enviros, business folks, and education folks.
12:50-12:55: Next steps and next downtown meetings Th March 5, Th April 2, Th May 7.
Agenda:
12:00-12:10: Introductions and updates on the Western Climate Initative and other things (including Bruce's research on property tax limits). Just for the record, there are likely to be folks at the meeting who support WCI and folks at the meeting who oppose WCI. My preference is to continue to sidestep that question and instead focus our meeting on the possibility of carbon tax legislation in the event that WCI does not pass.
12:10-12:30: Policy details concerning this spreadsheet (now updated to include inflation-adjusted numbers!). In a nutshell, the current proposal is a carbon tax of $50 per ton of CO2 [$0.50 per gallon of gasoline], rising by $10 per ton per year from 2015 on, with revenue going to (1) eliminate the state property tax, (2) offset impacts on low-income households, (3) fund clean energy R&D, and (4) reduce the B&O [business] tax.
12:30-12:50: Discuss strategy, e.g., at what point to try to publish an op-ed piece and how and when to reach out to social justice folks, enviros, business folks, and education folks.
12:50-12:55: Next steps and next downtown meetings Th March 5, Th April 2, Th May 7.
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