Gregoire threatens broad cuts if Legislature can’t agree

  • Wed Mar 24th, 2010 11:03pm
  • News

By Jerry Cornfield Herald Writer

OLYMPIA — Gov. Chris Gregoire said Wednesday if lawmakers fail to bring her a budget in the allotted 30 days of the special session, she’s unlikely to give them more time to try.

Instead, she said she’ll proceed with ordering deep cuts in spending throughout state government to close the $2.8 billion deficit.

“I wouldn’t call them back,” she said. “I’m not calling them in for another special session unless they have a deal. I’ll call them back for a day. I can’t see calling them back for another 30 days and waiting and waiting and waiting.”

Today is the 11th day of the special session, and Democrats in the House and Senate remain locked in a tug of war on how to raise $800 million in revenue to sustain funding for a slew of education, health care and human service programs.

The Senate is pulling for its package, anchored by a two-tenths of a penny increase in the sales tax, against the House and its proposal held fast by ending exemptions for large banks, out-of-state residents and buyers of custom-made software programs.

The new tax dollars will fill a portion of the deficit in the budget that runs through June 30, 2011.

To cover the rest of the hole, the governor and lawmakers generally agree on using reserves, transfers from the lottery and other funds, and roughly $800 million in cuts.

That amount of paring would at least double if Gregoire must erase the deficit without new revenue. She said she lacks authority to raise taxes on her own and would have to uniformly cut spending, and it could be as much 20 percent to get the job done.

“We’re not absolutely sure how we’d do that,” she said.

The stalemate delaying tax increases may please anti-tax advocates but is adding to the state’s fiscal challenge.

At one point, certain tax changes were to take effect April 1 if they had been in place by midnight Tuesday. They weren’t, so those dollars won’t be collected.

Gregoire said she made clear to the House and the Senate that if the deadline was missed, “that revenue was lost. I think that’s unfortunate.”

Jerry Cornfield: 360-352-8623; jcornfield@heraldnet.com.