Initiative 1033 Offers Taxpayers Free Lunch

No one likes to pay taxes but it is how we fund public services. And who wouldn’t like to get a break on your property taxes as I-1033 proposes. Yet beware, there is no free lunch.

I-1033 basically proposes to freeze government services. Government will not grow under I-1033 and it is false and misleading for Eyman to suggest it will.

Local and state government spending is frozen next year at this year level and will only increase to adjust for inflation and population. And so on for every year thereafter.

If government spending to pay for services increased exactly as Eyman’s consumer price index adjustment allows, all that you’re doing is paying for the same services at their increased cost due to inflation. The problem is that many services government provides like Medicaid for seniors has historically grown faster than the consumer price index.

And any population adjustment just means you can pay for providing services for new members of your community. Individual taxpayers will not see any increase in services provided to them.

So if the economy improves and more sales tax revenue comes in next year compared to this year, any revenue above the I-1033 limit will have to go to pay property taxes. But this is a reverse Robin Hood scheme of transferring wealth to just property owners despite everyone paying sales tax.

There are two problems with this. First not everyone owns property. The US Census Bureau says that only 65% of the households in Washington State are owner occupied. So 35% of households will not see any benefit from I-1033 despite paying sales taxes.

And second the real estate tax reduction covers all property. Some 40% of real estate taxes are commercial. So large corporations like Boeing or Weyerhaeuser and shopping malls like Bellevue Square will also get the same tax break. That’s probably why Kemper Freeman gave Eyman $25,000 to help get I-1033 on the ballot. The more property anyone owns the more of a tax break they will get. Of course Eyman didn’t tell you that you will be helping to pay Kemper Freeman’s real estate taxes.

So besides freezing government services, I-1033 is also a complex wealth redistribution scheme that benefits wealthy property owners. The average homeowner will not see much benefit and will lose much more in terms of public services that we take for granted but which are not free. These include police and fire protection, public libraries, public health, K-12 schools and college and universities, parks and open space, road repair and public transit, services for seniors and disabled people, environmental protection, clean drinking water and clean air, our judicial system and much more.

Read the initiative and understand its impacts before you vote. If you want to keep local control over the quality of life in your community, vote No on Initiative 1033 this November 3rd, 2009. If something sounds too good to be true, it probably isn’t.

for more information on I-1033 go to .

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