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Setting Priorities in Washington: Raising revenue to invest in our future

December 22, 2010

Continued state budget cuts are dragging down Washington's economy, undermining opportunity for our children, and threatening the health of our most vulnerable citizens. We can choose a better path that builds a stronger future for our state.Over the past three years, Washington's budget has been slashed by roughly $6 billion. Reductions affect everyone -- with larger classes and fewer staff in public schools, higher tuition and fewer course offerings at universities and community colleges. And with 137,000 people on the wait list for the Basic Health Plan, fragile seniors losing in-home services, and low-income children losing quality childcare, budget cuts will also mean more layoffs in every community in the state.

Washington State Budget Cuts $5.2 Billion -- and Counting

September 1, 2010

Over 3 budget years from 2009 to 2011, Washington State has grappled with a $12 billion shortfall between the projected need for public services and state revenues -- which have plunged because of the recession. Federal stimulus money and the rainy day fund made up some of the difference, and the state raised $918 million with tighter standards and new taxes. Still, Washington's legislature has cut $5.2 billion, impacting schools, childcare centers, health clinics, assisted living facilities, families, and individuals across the state.Despite continued population growth, inflation, and increased needs caused by the recession, Washington's 2-year General Fund budget for 2009-11 is barely above the 2005-07 level and $2.7 billion below the amount originally budgeted for 2007-09 -- an 8% drop.

Why Initiative 1098 is right for Washington

September 1, 2010

Initiative 1098 will reduce taxes for most Washington households by cutting property taxes and exempting small businesses from the business and occupation tax. I-1098 will also raise new revenue dedicated to education, health and long-term care by adding a modest tax on the wealthiest 1.2% -- the group that is now paying the lowest proportion of income in state and local taxes.Washington has fallen behind in providing the education system and public services our people and businesses need to thrive in the global economy. The state struggled to fund upgrades to education and health care even before the recession. Budget cuts of the last two years have pushed us further behind. I-1098's reforms lay the foundations for stronger economic growth and greater opportunity for all people in Washington.

2010 Social Security Trustees' Report Key Facts

August 5, 2010

Often thought of as simply a retirement system, Social Security provides benefits to millions of disabled workers and their families, survivors of deceased workers, and retirees. Altogether one in every six Americans benefits directly from Social Security, and many more live in households with a Social Security beneficiary.The program has been the bedrock of economic security for working and retired Americans for 75 years.Every year, the Social Security Trustees are required by law to project the program's finances 75 years into the future. Doing so requires making numerous assumptions about productivity, economic growth, wages, fertility, longevity, immigration rates, and other factors. Three different scenarios are created.The 2010 Trustees' Report has once again confirmed the health and the long-term vitality of the Social Security system. Let's take a look at the facts:Social Security provided benefits to 53 million Americans in 2009: 68% of them retirees and their dependents, 19% disabled workers and family members, and 11% survivors of deceased workers.Social Security's total income from payroll taxes, interest on the Trust Fund and taxes on benefits exceeded benefit and administrative expenses by $122 billion in 2009, increasing the Trust Fund to $2.5 trillion.The Trust Fund is projected to continue growing until 2025. From 2025 to 2037, Social Security will draw on the Fund to finance the retirement of the baby boomers, according to the plan adopted in the early 1980s.Projecting into the future using "Intermediate" scenario assumptions, in 2037 the assets of the Trust Fund will be depleted and payroll taxes alone will cover 78% of benefits. Under a slightly different set of assumptions in the "Low Cost" scenario, the Trust Fund will never be depleted and will begin growing again by the 2050s and continue growing through the rest of the century.By 2037, average wages after accounting for inflation are expected to increase from $43,000 in 2010 to $60,000. Typical retirement benefits are projected to increase from $17,676 to $24,700 annually. If the Trust Fund is exhausted in 2037, payroll taxes alone at the current level would cover benefits averaging $19,300 -- about $1,600 more than today's typical retiree receives (after inflation).

Initiative 1098: How will Washington's effective income tax rates stack up?

August 1, 2010

The top 1% of taxpayers in Washington will have an average effective tax rate of 4%. That puts Washington's ranking for this group of wealthy taxpayers at 27th out of the 44 states (including Washington, D.C.) that tax income.

Initiative 1098: The Right Tax Reform for Stronger Schools and Health Care

August 1, 2010

I-1098 will lower taxes for most state residents. The average homeowner will save $111 annually in property tax. Over 80% of businesses will be exempt from the business and occupation tax (B&O) -- retail businesses with revenues up to $1 million and service businesses up to $320,000. A new tax on the wealthiest 1.2% of filers will replace lost revenues and generate an additional $1.58 billion per year.

Social Security Works

August 1, 2010

For 75 years, Social Security has provided a foundation of economic security for American workers, retirees, and their families. It represents the best of American values, rewarding hard work, looking out for family and community, and honoring the contributions retirees have made to our current prosperity. Social Security is well structured to continue serving future generations as well.

The Straight Facts on Social Security

August 1, 2010

Social Security is the bedrock of economic security for millions of children, as well as working and retired Americans.Social Security benefits are progressive, replacing half the earnings for a low wage worker, one-third for median wage earners, and one-quarter for high wage workers. Social Security has almost eliminated poverty among the elderly, thanks to lifetime retirement benefits, annual cost of living increases, and family benefits.

Status of Washington's Family and Medical Leave Insurance Program

July 30, 2010

Working people throughout the United States struggle to meet their responsibilities both to their families and to their jobs. Some collective bargaining agreements and individual companies provide generous paid leave benefits. But many middle and lower income workers have little if any paid leave, and workers in smaller companies have no job protection if they must take time off to care for a new baby or a serious illness.The lack of paid leave undermines family economic security, threatens the health and wellbeing of children and seniors, raises health care costs for everybody, and reduces the productivity of businesses.

Initiative 1098: Fixing the most regressive tax system in the country

June 1, 2010

A regressive tax is one that takes a larger percentage of the income of low-income people than of high-income people. The Institute on Taxation and Economic Policy (ITEP) has concluded Washington State has the most regressive tax system in the country. According to their most recent report, published in 2009 based on 2007 data, the 20% with the lowest incomes in Washington pay 17.3% of their income in state and local taxes, compared to 10.8% for the middle group and 2.6% for those in the top 1%.

How will Initiative 1098's property tax reductions affect business and property owners?

June 1, 2010

Initiative 1098 includes a 20% across-the-board cut in the state portion of the property tax levy, which will reduce property taxes for both businesses and individuals that own property.Background: Two-thirds of Washington households own their homes. These households will receive a direct reduction of 20% of the state portion of the property tax. Businesses of all sizes that own property will also benefit from the property tax cut.Statewide, the average decrease in commercial and manufacture property tax will be $394 a year (on the current average combined local and state tax of $9355). For King County, the average property tax for commercial and manufacture business will drop by $1,058.

Initiative 1098: What is Considered a 'Small Business'?

June 1, 2010

The B&O tax is based on a business's gross receipts, without deductions for equipment, supplies, rent, employee pay, or other necessary costs of business. Rates are lower on types of companies that typically have high overhead, such as retailing and manufacturing, and higher on services that usually have fewer expenses to operate.I-1098 will raise the small business credit from $420 to $4,800 per year. Businesses that owe less than that amount would pay nothing in B&O tax -- and most would not have to file. The credit phases out gradually, so firms owing between $4,800 and $9,600 per year would see a reduction in their state tax. Companies owing above that level would see no change.