A state policy response to COVID- 19s economic crisis: what can - - PDF document

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A state policy response to COVID- 19’s economic crisis: what can lawmakers do?

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• Goal: learn about state fiscal situation in months ahead and solicit

feedback about what we should prioritize in our advocacy

• Agenda
• Introductions
• Federal response
• What should we expect for the state?
• Budget & Policy Center’s response
• Feedback
• Questions

Agenda & Goals

State budget reflects values

Budget investments by Budget & Policy Center Progress Index value area 2019-21 operating budget, enacted

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Source: Institute on Taxation and Economic Policy, average effective state and local tax rate by income group in 2018

Washington’s tax code exacerbates racial injustices

Source: Institute on Taxation and Economic Policy; distribution of income groups by race/ethnicity in 2015

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Expansions to unemployment and cash assistance will help Washingtonians but will be inadequate

The Federal CARES Act:

• Bolsters our state unemployment benefits

and expands eligibility

• Provides one-time cash payment of $1,200

to many individuals earning less than $75,000, with an additional $500 per child.

• Excludes ITIN filers in our state, other

groups

Education-specific funding from CARES Act

$30.75 billion nationally, $475 million for Washington state:

• $213.6 million for k-12
• $202.5 million for higher education
• $59.5 million for emergency education relief grants

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Federal aid to Washington will be dwarfed by revenue shortfalls

• Washington will receive $3 billion (including education funds) from

the CARES Act but this will run out quickly

• Coming out of the Great Recession, WA state faced a $12 billion

budget shortfall in 2009-2011 biennium

• State and local revenues in Washington are largely reliant on sales

taxes

• Revenue will likely decline for months and years ahead
• Gov. Inslee vetoed millions in new spending

to mitigate economic downturn

• Governor cut $445 million over the next

three years

• Threats to programs, agencies, and

departments as well as rising costs due to bigger health and economic needs

• Underscores the need to fix the

regressive structure of our tax code

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Budget & Policy Center’s response

• Preparing for the possibility of a special

session and for the 2021 legislative session ahead

• In the process of partner outreach and

listening

• Developing principles for state

policymakers to address the crisis and mitigate the impact Policy platform priorities to guide us through this health and economic crisis:

• Basic needs
• Cash assistance
• Raising progressive revenue

Budget & Policy Center’s response

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What else should we be prioritizing?

• How has COVID-19 affected your organizations?
• How has COVID-19 affected people you serve?
• What will your organizations be prioritizing next

session or in a special session?

• How can Budget & Policy Center support your

work?

• Other questions for us?

Thank you!

Misha Werschkul, Executive Director mishaw@budgetandpolicy.org Margaret Babayan, Policy Analyst margaretb@budgetandpolicy.org

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