Courtesy of King County
Late last night, Ron Sims posted the following on his Twitter page: "Just revised King County's budget shortfall from 86 to>"/>
Courtesy of King County
Late last night, Ron Sims posted the following on his Twitter page: "Just revised King County's budget shortfall from 86 to 90 million dollars. Inflation and a sluggish economy are reducing revenue growth."
The ever rising projected 2009 general fund budget deficit is the source of endless political back and forth between Sims and the council, particularly council member Larry Phillips, who is considering a run for the Executive's seat next year. But the latest upward revision comes with a twist. Chris Bushnell, Chief Economist for the executive controlled budget office from 2002 to 2008, says the underlying problem isn't revenues stunted by Tim Eyman's 2001 initiative capping property tax hikes at 1 percent. Bushnell says both the council and the Executive inflated spending--specifically among their staffs--well beyond the plan four years ago. Bushnell created a Power Point presentation to that effect in early August and took it to Sims. Printouts of the slides have been circulating among county personnel and staff ever since.
Bushnell says he started the project as the deficit number began climbing and county officials started bickering about it, he heard “a lot of concern about the economy, concern about health care, concern about Tim Eyman.”
“My goal was to raise awareness that its their spending choices that will determine the county’s financial health,” Bushnell, who holds a PhD in Economics from the University of Washington, says. The presentation argues that when large deficits in the early part of this decade were finally erased in 2005, the budget office projected revenues that have been relatively close to the actual revenues through the first two quarters of 2008. The money coming in is about what he expected in 2005, Bushnell says, not dramatically less as a result of a bad economy.
It’s the expenditures that are way up. Bushnell has a chart, he says created from publicly available budget documents, showing that from 2006 through the first two quarters of 2008, spending is about $116 million more than what was projected in 2005. Most of that, he says, is rising salaries and expanded full time staffs.
The budget has been a source of endless sparring in King County government. The Sheriff toured the county saying Sims was slashing her budget and putting public safety at risk. The council put an amendment on the November ballot to create an independent office of economic forecasting. Phillips and Sims argued over credit for the county’s AAA bond rating.
But the Power Point is getting Sims’ office and Phillips to agree on something--that Bushnell has it wrong. Beth Goldberg, budget office deputy director, says the presentation is misleading. For instance Bushnell argues that even without I-747, the county would only get an additional $14 million next year to chip away at that $90 million deficit. But Goldberg says that if the county had been raising property taxes above 1 percent since 2001, they would have an additional $100 million in revenue cumulatively.
Phillips says he agrees with Goldberg on that point. On top of that he criticizes the scope of Bushnell’s presentation, which runs from 2005 to 2008. “His study only examines a three year period, which is way, way too narrow a view,” Phillips says. “It would be like saying to people in Seattle after three weeks of sunny weather ‘well that’s the way it’s going to be.’ We have a lot of dark, rainy grey days in Seattle.”
Both Phillips and Goldberg justify the rising employee salaries pointing to studies done by both the executive and council branches that found people were paid less than their counterparts in similar counties. So many people got raises.
The short moment of accord is hardly a turning point in the budget wars and there’s likely to be more finger pointing to come. On top of that, predicted budget woes are now being projected well beyond next year. County Budget Director Bob Cowan created his own budget Power Point last month stating that if additional revenue sources aren’t found and pricey unincorporated urban areas annexed, more than $70 million will have to be cut from the general fund budget by 2012, on top of the now $90 million that has to go.