2007: Initiative 960 | Overview and Impact

On the ballot

Ballot Title: Initiative Measure No. 960 concerns tax and fee increases imposed by state government. This measure would require two-thirds legislative approval or voter approval for tax increases, legislative approval of fee increases, certain published information on tax-increasing bills, and advisory votes on taxes enacted without voter approval.
Filed on: January 8th, 2007
Before Voters In: November of 2007
Sponsor:
Tim Eyman, Mike Fagan, Jack Fagan
Fate: Passed, but subsequently declared unconstitutional in part by the Washington State Supreme Court
Election Results: Yes: 51.24% (816,792 votes) No: 48.76% (777,125 votes)
Election Turnout: 50.04% (percentage of registered voters who voted)
Petition Drive:
  • 314,504 signatures were submitted to the Secretary of State’s Elections Annex (see qualification announcement).
  • Validation was conducted by random sample check. 9,607 of the I-960 signatures (a 3% sample) were checked. From that inspection, it was determined that the measure had an invalidation rate of 17.1%. (8,410 signature were valid, 1,197 were determined invalid.) 
  • A minimum of 224,880 valid signatures were required to qualify an initiative to the people in 2007 (8% of turnout in 2004 gubernatorial election)
Complete Text: Available (PDF)
Ballot Summary: This measure would require either a two-thirds vote in each house of the legislature or voter approval for all tax increases. New or increased fees would require prior legislative approval. An advisory vote would be required on any new or increased taxes enacted by the legislature without voter approval. The office of financial management would be required to publish cost information and information regarding legislators’ voting records on bills imposing or increasing taxes or fees.

I-960 County-by-county election results

Counties that voted yes are shown in gray; counties that voted no are shown in purple.

See full breakdown on the archived election results website.

Explanatory statement

The following is the explanatory statement prepared by the Attorney General’s office in advance of the November 2007 general election.

 The law as it presently exists:

An existing law states that the legislature may only take an action that raises state revenue if two-thirds of the members of each house of the legislature vote to do so. The same statute also states that if the action to increase revenue will result in expenditures that exceed the state expenditure limit, then the action to raise revenue will not take effect unless approved by a vote of the people. With limited exceptions, the state expenditure limit is the maximum amount that may be spent from the state general fund and related accounts in each fiscal year and is calculated using a formula based partly on average growth in personal income. The state expenditure limit is increased when the cost of a state program and related revenues are transferred to the general fund or a related account from another fund or account.    State law also authorizes some state agencies to charge various fees. Fees are different from taxes in that fees generally provide money to pay for specific services that the agency provides or to fulfill a particular regulatory purpose, while taxes ordinarily are designed to raise revenue for governmental services more generally. Where agencies are authorized to set fees, state law limits the size of any increase in fees during any fiscal year. Agencies are generally prohibited from raising any fee in any year by more than the rate of average growth in state personal income over the prior ten fiscal years. Greater increases require legislative approval.

State law establishes that the office of financial management is responsible for providing a fiscal note, which is a statement of fiscal impact, for all bills and resolutions which increase or decrease or tend to increase or decrease state government revenues or expenditures. A fiscal note indicates by fiscal year the impact for the remainder of the biennium in which the bill or resolution would take effect as well as the cumulative impact for the next four fiscal years. A completed fiscal note is filed immediately with designated legislative committees. Whenever possible, a fiscal note is provided prior to or at the time the bill or resolution to which it relates is first heard by the applicable legislative committee. A fiscal note remains attached to the bill or resolution throughout the legislative process whenever possible.

The state constitution requires that each house of the legislature maintain a journal of its proceedings. The state constitution also requires that the names of the members of the legislature voting for and against the final passage of a bill be entered in the journal.

The state constitution authorizes the legislature to refer legislative bills to the people for their approval or rejection at a general or special election. State law neither specifically authorizes nor specifically prohibits the use of non-binding advisory votes on legislative bills.

The effect of the proposed measure, if it becomes law:

The measure applies to the existing requirement that any action taken by the legislature that “raises taxes” must be approved by a two-thirds vote. Specifically, the measure would clarify that the term “raises taxes” includes any legislative action that increases state tax revenue deposited in any fund, budget, or account, but does not include revenue neutral tax shifts.

The measure would recognize that the legislature may, if it chooses, submit a tax increase to the voters for their approval or rejection in a referendum.

With limited exceptions, the measure would also require legislative approval for all new fees and fee increases. Agencies would no longer be authorized to increase fees by administrative action.

For any bill introduced in the legislature raising taxes or fees, the measure would require the office of financial management to promptly determine and provide to the public and members of the legislature a ten-year projection of its cost to taxpayers, including a yearly projection. The cost projection would be required for each revenue source in any such bill.

The measure would require that the office of financial management report the cost projection analysis in a press release to be posted on its website, including the names and contact information for the sponsors and co-sponsors of any such bill. When a legislative committee schedules a public hearing for a bill raising taxes or fees, the measure would require the office of financial management to promptly report the most recent cost projection analysis and provide notice of the hearing to legislators, the media, and the public. When a bill raising taxes or fees is approved by a legislative committee or a majority of members of either house of the legislature, the measure would require the office of financial management to expeditiously update the cost projection and report the updated analysis to the legislature, the media and the public.

The office of financial management would be required to prioritize the preparation of cost projection analyses and reporting and dissemination of cost projection information for bills raising taxes or fees. Such projections would take priority over producing fiscal notes. The measure would require that whenever possible, the cost projection analysis be provided, along with the fiscal notes, prior to or at the time the bill or resolution is first heard by the applicable legislative committee. As with fiscal notes, the cost projection analysis for bills increasing taxes or fees would be attached to the bill or resolution throughout the legislative process insofar as possible.

The measure would eliminate the current allowance for an increase in the state expenditure limit when the cost of a state program and related revenue are shifted to the general fund or a related fund from another fund or account if the revenue previously had been shifted from the general fund or a related fund.

The measure would require an advisory vote of the people to be placed on the next general election ballot if legislative action raising taxes is not subject to a referendum vote. If such legislative action involves more than one revenue source, the measure requires that each tax increase would be subject to a separate advisory vote of the people. The measure would not require an advisory vote of the people if legislative action raising taxes is otherwise subject to a vote of the people.

In order to implement the advisory vote, the measure would require the attorney general to determine legislative action that is subject to an advisory vote, send written notice to the secretary of state, and formulate a short description of each advisory vote measure.

The measure would require county auditors to print advisory vote measures and their short description on the official ballots under a separate heading on the ballot entitled “Advisory Vote of the People.” The measure would also require the general election voters’ pamphlet to contain certain information about each advisory vote appearing on the ballot, including the short description written by the attorney general, the most recent ten-year cost projection analysis, each legislator’s vote on final passage of the tax increase, and contact information for each legislator.

Source: Archived Washington State Voter’s Pamphlet

Fiscal impact statement

The following is the fiscal impact statement prepared by the Office of Financial Management in advance of the November 2007 general election.

Summary of Fiscal Impact
Initiative 960 would result in added costs to prepare ten-year cost projections for proposed state tax and fee increases, to notify legislators and the public about proposed revenue legislation, and to conduct advisory votes on tax increases approved by the Legislature. Costs are estimated to be up to $1.8 million a year, including $1.2 million for local election expenses. Local government pays election costs in even-numbered years. The state pays a pro-rated share in odd-numbered years. Actual election costs for any particular year will depend on the number of tax measures referred to an advisory vote.

Assumptions Supporting Fiscal Impact Statement
The Office of Financial Management (OFM) will need up to $205,000 in the first year, and $154,000 in subsequent years for computer system modifications and staff dedicated to new responsibilities, including:

  • Determining which proposed legislation and fee increases require a ten-year cost projection.
  • Conducting analysis of costs to taxpayers from tax and fee increases and/or obtaining such analysis from other state agencies with the appropriate expertise.
  • Updating cost projections for legislative amendments to the original proposal.
  • Reporting the results of the ten-year cost analyses to legislators, the media, and citizens.
  • Notifying legislators, the media, and citizens when bills that raise taxes or fees are scheduled for a legislative committee hearing, pass a legislative committee, or pass one house of the Legislature.
  • Maintaining a web site with cost and legislative contact information for each proposed tax or fee increase.

The Office of Financial Management will work with state agencies that collect revenue from tax or fee increases to obtain data on ten-year costs, which is expected to require up to $280,000 per year for staff in the Department of Revenue and an indeterminate amount in other agencies. OFM will review agency projections prior to publication. State agencies will also have to identify all proposed fee increases that would be subject to legislative approval under Initiative 960, but the additional cost to do this cannot be determined.

It is assumed that the required ten-year cost projection will include an estimate of additional tax or fee revenue generated and state agency administrative expenses. Depending on the proposal, the projection may also include the additional amount of the tax or fee that is estimated to be paid by the average taxpayer.

Although the exact number of advisory votes resulting from tax increases passed during any future legislative session cannot be predicted, state and local advisory election costs are assumed to be up to $1.3 million, based on the assumptions below.

  • Local and State Government: In printing official ballots, county auditors must provide a separate list with descriptions of any tax measures requiring an advisory vote of the people. Additional costs would be incurred if the number of measures increase the number of pages required for the ballot. One additional page, which could include several tax measures, would cost 37 cents (materials, production, and mailing). It is unknown how many counties would have to add pages to their ballots. If all counties add one page, the cost would be $1.21 million for approximately 3.3 million ballots. Local government would pay this cost in even-numbered years.
    The state reimburses counties for a pro-rated share of election costs in odd-numbered years when there are statewide measures on the ballot. Additional statewide advisory measures would result in more state costs.

    Election costs would occur each year in which tax measures were referred for an advisory vote, but would vary based on the actual number of measures.

  • Secretary of State: The Secretary of State will assign a serial number to each ballot measure, file the measure, and certify the measure for county auditors. It is estimated that the description, cost projection and legislator contact information for each ballot measure would require approximately four pages in the statewide voters’ pamphlet, at a cost of $94,000 ($23,500 per page) for inclusion in 3.3 million pamphlets.
    Initiative 960 requires a minimum of two pages in the voters’ pamphlet for each tax source measure subject to an advisory vote. The need for an average four pages per measure is based on the following assumptions of space requirements: one-quarter page for the description of the measure; between one-half and one-and-one-half pages for the ten-year cost projection; and three pages for the contact information and voting record for all legislators.
  • Attorney General: The Office of the Attorney General must identify tax legislation requiring an advisory vote and write a brief description of each measure. This cost is estimated at $1,250 per ballot measure.

Source: Archived Washington State Voter’s Pamphlet

Voter’s pamphlet argument against I-960

The following is the text of the argument that appeared in the November 2007 voter’s pamphlet urging a no vote on I-960, including the rebuttal.

All of us want greater accountability and openness from government. Initiative 960 pretends to do that, but will only make things worse.

I-960 WILL LEAD TO ENDLESS, EXPENSIVE ELECTIONS.

I-960 would require a public vote on countless budget items, no matter how small. The result? Less efficient government, long and confusing ballots, and millions of dollars wasted on endless elections.

I-960 WILL MAKE GOVERNMENT LESS EFFICIENT.

Routine fund transfers to address basic needs, such as road and bridge repairs, children’s health care, or prescription drug assistance for seniors would require a two-thirds legislative vote and a public vote. This could cripple state government.

When a similar measure was enacted in Colorado, nonpartisan analysis revealed education funding dropped from 35th in the nation to 49, child immunization rates fell to dead last among the 50 states, and prenatal care fell from 23rd to 48. This must not happen in Washington State.

I-960 WILL NOT CUT TAXES, BUT IT WILL WASTE YOUR MONEY.

More elections and longer ballots are expensive to administer and process. Sorting out the many legal issues created by I-960’s confusing and poorly written language will tie up the courts, costing taxpayers time and money.

I-960 WILL SLOW GOVERNMENT’S RESPONSE, EVEN IN A CRISIS.

The initiative would leave us vulnerable in times of crisis. I-960 says the legislature can suspend supermajority legislative and public votes only during a natural disaster. Authorities would be handcuffed from responding quickly during an economic recession, pandemic flu, or even terrorist attacks.

I-960 is too risky and too expensive. Join police, firefighters, teachers, nurses, Children’s Alliance, Washington Association of Churches, Washington Conservation Voters, Washington State Labor Council, business and citizens across Washington in voting No on 960.

For more information, call (206) 501-4342 or visit www.no960.com.

REBUTTAL OF STATEMENT FOR

I-960 mandates wasteful, costly elections and would create mass confusion—not transparency and accountability. Dozens of complicated votes would only get 13-word descriptions. (Sec. 8)

I-960 is so complex even sponsor Tim Eyman admitted: “You asked for a short description of 960, I just can’t give it to you.” (Crosscut 8/13/07)

I-960 cannot be suspended due to a terrorist attack or economic crisis – only for a “natural disaster.” (Sec. 5.3(a))

Vote NO on I-960.

Source: Archived Washington State Voter’s Pamphlet

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