I-1033 will penalize Federal Way | Guest column

By Dini Duclos, Federal Way City Council member

I am writing this letter to the editor as a private citizen in regard to Initiative 1033.

I am hoping that what I write will help you understand the full impact of this initiative so that you can make a more informed decision when you vote.

On Sept. 2, 2009, the Federal Way City Council had a briefing on Initiative 1033 to present the impacts on the City of Federal Way, if passed by the citizens of Washington. The measure limits growth in state revenues subject to state expenditures limit. While we might not think about it initially at the state level, this initiative would also greatly impact our local school districts by reduction in state funding.

In addition to this, it also limits growth in county and city revenues. This limit is adjusted on annual growth in inflation and population.

Like many of my neighbors, I don’t like receiving my annual property tax evaluation and the tax bill that accompanies the “good” news. Most years we have seen increases in our evaluations; however, this year we saw that our homes are down in value. So our taxes should be lower also.

Our state, counties and cities are facing revenue reductions and have already reduced expenditures. Federal Way is impacted less than other cities because we have budgeted conservatively. But even so, our city had to make reductions in our workforce and has frozen other vacant positions — including in our police department.

If I-1033 passes, it does more than limit the amount of property tax a city can have to provide necessary services. It limits how the city can use the money it does have. For example, in Federal Way’s case, we transferred some of our utility taxes from our capital budget to offset expenses in the operating budget ($600,000 of the $1 million transfer was for police protection). This was to be a temporary action until revenues through sales tax, real estate investment taxes and other funds start coming back to normal. If I-1033 passes, there will be no normal to come back to.

I-1033 would not allow us to transfer this money back to the capital budget’s street fund. In 2011, Federal Way would feel the real impact of I-1033. Any revenue received below the established spending limit I-1033 established would be OK. Any revenue above the limit would have to be put into an account to cut property taxes the next year. Our level of services will be held to the reduced recession levels.

Many feel that government is already too big and should operate leaner. Anyone who knows me knows that I am very conservative when developing budgets, especially when they involve public funds. I have brought my private philosophy of financial conservatism to my council life also. But even fiscal conservatives realize that budgets have to grow or you cannot sustain even a minimal level of services. The cost of doing business increases in the normal course of life.

If you were to look at I-1033 as if it were being applied to your business or household income, I think you might see the dilemma and havoc this initiative will cause. During a recession, household and businesses reduce expenditures to offset drops in sales/revenue/salaries etc., to stay afloat until the worst is over. What would happen if everyone had to follow the proscriptions in I-1033 — any future raises of individuals/families would not be allowed to be kept in your household, but given back to those who made the raises possible. Same with businesses — any increases over 1 percent in profits would have to be given back to their customers. No one could increase their income or grow their businesses.

One final point I would like to make before I close is the amount of property tax that Federal Way actually receives from your payments. The Federal Way School District gets $4.196, state gets $1.963; then the county gets $1.098 and finally Federal Way could get $1.683 per thousand. However, our city has been very frugal in taking your money. Out of the amount of $1.683 it could legally take, Federal Way elects to only receive $0.972 per thousand of property tax dollars. In essence, I-1033 is penalizing Federal Way for being good stewards of your money and not taking every cent to which it is legally entitled.

I hope you will think about this when you are filling out your ballots this November.

Dini Duclos is a member of the Federal Way City Council and CEO of the Multi-Service Center. Contact: dini.duclos@cityoffederalway.com

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