Tax initiative victory limits state spending; impact on UW uncertain

UW officials are worried that, with the passage of Initiative 601, higher education may be a target when lawmakers look for cuts to balance future state budgets.

The initiative, which passed with just over 50 percent of the vote, puts a strict limit on the growth of state spending. Expenditures may not grow faster than the three-year average of growth in population and inflation. To exceed that lid, two-thirds of the legislature must approve any new revenues and then voters must approve the increases at the next election.

A different tax-limit initiative, I-602, failed in the Nov. 2 election with 56 percent of the voters rejecting the proposal. I-602 would have had an immediate effect on the state and UW budgets by rolling back new taxes and fees passed last May. State officials said there would have been a $1-billion hole in the budget. The UW estimated its share of the cuts could have been $70 million to $75 million.

“The election was a defining moment for this state, and we deeply appreciate the decision of the voters to defeat Initiative 602,” says UW President William P. Gerberding.

“The passage of Initiative 601 is of considerable concern to us. Dramatically rising costs in the prison system, in K-12 education, and in social and health services may leave state government with little ‘discretionary’ money for higher education. For many years the percentage of the state budget devoted to higher education has been declining. With the constraints imposed by Initiative 601, we fear this regrettable trend may accelerate.”

“We dodged a big bullet with the defeat of 602,” adds UW Government Relations Director Bob Edie. “We’re not happy that 601 passed, but we have some time to work with the governor and the legislature on how to survive in the post-601 world.

“The fear is that higher education will once again become the budget balancer in the state,” warns Edie, alluding to the early 1980s when lawmakers cut higher education to keep state budgets in the black.

UW officials are particularly concerned that, with the “baby boom echo” arriving at college age, there will be pressure to take more students but no more money to accommodate them.

Lawmakers meet in January to write a supplementary budget and pass new legislation. “We’re not looking at the budgetary chaos and kind of reductions that 602 would have precipitated,” notes Edie, “but there will be pressure on the legislature to reduce the budget.”

A gathering of UW alumni to meet with their state representatives is tentatively scheduled for Wednesday, Feb. 2, in Olympia. For more information on this meeting or the upcoming legislative session, alumni should call the UWAA Legislative Support Network at 543-0540 or 1-800-AUW­ALUM.