Washington Budget Stabilization Account Amendment, SJR 8206 (2011)

SJR 8206
Type	Constitutional amendment
Origin	Washington Legislature
Topic	State budgets
Status	Approved a

Washington Budget Stabilization Account Amendment, SJR 8206 was on the November 8, 2011 statewide ballot in Washington as a legislatively referred constitutional amendment where it was approved a.

The measure requires the transfer of additional funds to the budget stabilization account if the state has received "extraordinary revenue growth."

Election results

See also: 2011 ballot measure election results

Washington SJR 8206
Result		Votes	Percentage
a Yes		1,186,069	66.6%
No		594,687	33.4%

Source: Washington Secretary of State, official election results

Text of measure

Title

The ballot title read:

This amendment would require the legislature to transfer additional moneys to the budget stabilization account in each fiscal biennium in which the state has received “extraordinary revenue growth,” as defined, with certain limitations.

Should this constitutional amendment be:

[ ] Approved

[ ] Rejected

Gov. Chris Gregoire and Secretary of State Sam Reed officially certify the 2011 General Election returns, 12-5-11

Constitutional changes

SJR 8206 amended Article VII, Section 12 of the Washington Constitution.

Note: Hover over the text and scroll to see the full text.

Article VII, section 12.

(a) A budget stabilization account shall be established and maintained in the state treasury.
(b)

(1) By June 30th of each fiscal year, an amount equal to one percent of the general state revenues for that fiscal year shall be transferred to the budget stabilization account. Nothing in this subsection (b) shall prevent the appropriation of additional amounts to the budget stabilization account.

(2) By June 30th of the second year of each fiscal biennium, three-quarters of any extraordinary revenue growth shall be transferred to the budget stabilization account. However, no transfer of extraordinary revenue growth under this subsection (b)(2) shall occur in a fiscal biennium following a fiscal biennium in which annual average state employment growth averaged less than one percent per fiscal year. "Extraordinary revenue growth" means the amount by which the growth in general state revenues for that fiscal biennium exceeds by one-third the average biennial percentage growth in general state revenues over the prior five fiscal biennia. In making this determination, the comparability of data shall be maintained by adjusting historical general state revenues to reflect statutory changes to the dedication of state revenues. The transfer under this subsection shall be made only to the extent that it exceeds the total transfers under (1) of this subsection for that fiscal biennium.

(c) Each fiscal quarter, the state economic and revenue forecast council appointed and authorized as provided by statute, or successor entity, shall estimate state employment growth for the current and next two fiscal years. (d) Moneys may be withdrawn and appropriated from the budget stabilization account as follows:

(i) If the governor declares a state of emergency resulting from a catastrophic event that necessitates government action to protect life or public safety, then for that fiscal year moneys may be withdrawn and appropriated from the budget stabilization account, via separate legislation setting forth the nature of the emergency and containing an appropriation limited to the above-authorized purposes as contained in the declaration, by a favorable vote of a majority of the members elected to each house of the legislature.

(ii) If the employment growth forecast for any fiscal year is estimated to be less than one percent, then for that fiscal year moneys may be withdrawn and appropriated from the budget stabilization account by the favorable vote of a majority of the members elected to each house of the legislature.

(iii) Any amount may be withdrawn and appropriated from the budget stabilization account at any time by the favorable vote of at least three-fifths of the members of each house of the legislature.

(e) Amounts in the budget stabilization account may be invested as provided by law and retained in that account. When the balance in the budget stabilization account, including investment earnings, equals more than ten percent of the estimated general state revenues in that fiscal year, the legislature by the favorable vote of a majority of the members elected to each house of the legislature may withdraw and appropriate the balance to the extent that the balance exceeds ten percent of the estimated general state revenues. Appropriations under this subsection (e) may be made solely for deposit to the education construction fund.
(f) As used in this section, "general state revenues" has the meaning set forth in Article VIII, section 1 of the Constitution. Forecasts and estimates shall be made by the state economic and revenue forecast council appointed and authorized as provided by statute, or successor entity.
(g) The legislature shall enact appropriate laws to carry out the purposes of this section.
(h) This section takes effect July 1, 2008.

Support

• The Association of Washington Business said, "Had we had this measure in place when we had a revenue surplus in the late ‘90s and early 2000s, would have spared us some of the budget heartaches we have today. SJR 8206 puts us on the right path by requiring the state to develop a rainy-day fund so that when times are good again, we will be able to start saving."

According to the Washington Secretary of State's website, the following was a statement in favor of the measure that appeared on the state voter guide:

"Overwhelming Bipartisan Support for Strengthening Voter-Approved Rainy Day Fund: In 2007, voters approved the creation of a constitutionally-protected rainy day fund that requires state government to set aside 1% of revenues annually for hard times. SJR 8206, a bipartisan measure, strengthens this fund by requiring a portion of “extraordinary” revenue – that which exceeds 133% of historical average growth – be saved, rather than spent.

Use Good Economic Times to Prepare for Bad: State government should save more money during good times, like the housing boom of several years ago when revenue grew at more than twice the historical average. Saving more of this windfall would have better prepared the state for the downturn that followed.

Approving SJR 8206 will help: Build stronger reserves, leaving the state better prepared for difficult economic times; and Keep spending at a more sustainable level, limiting expansions based on unexpected or windfall revenue.

Protect Vital Services: A robust rainy day fund protects crucial state services like education and healthcare from deep cuts in bad economic times like we are experiencing now. Putting extraordinary revenue in the fund provides this cushion.

Plan for the Future: Just as your family would not take on unsustainable commitments if you received an unexpected windfall, neither should Olympia. SJR 8206 puts windfall revenue in the rainy day fund for extraordinary use, protecting state services from equally unexpected downturns. Help put an end to roller coaster budgeting – Vote yes on SJR 8206!"

The statement was prepared by Sen. Joseph Zarelli, Rep. Ross Hunter and State Treasurer James McIntire.

Donors

According to the state campaign finance database, there were no registered committees (PACs).

(last updated December 2011)

Opposition

According to the Washington Secretary of State's website, the following was a statement in opposition of the measure that appeared on the state voter guide:

"In 2007 voters amended the constitution to create a ‘rainy day fund’ as a way to force the legislature to save money for bad times. 1% of general funds go into savings for hard times (currently almost $300 million). It’s working well.

8206 requires more than the 1% that voters approved - it would also require that “extraordinary revenues” go into savings. While it sounds like a good idea to save more – the result is people paying taxes and getting nothing for it, except a bigger savings account.

Budget cuts from hard times couldn’t be backfilled with this money, so people would have to live with fewer teachers and nurses, less fish and wildlife enforcement, less clean air monitoring, fewer roads and job creation, all while there was money in the bank waiting for the next recession.

Many people hate it when their bank makes them keep a minimum balance on hand when bills are due. 8206 would effectively raise that minimum balance so class sizes get bigger, prisoners get released early, there is less law enforcement, and there is less help available to people in need.

8206 decreases the amount of taxpayer money that can be used for things taxpayers want and need (and paid for) so it can sit in an already existing rainy day fund with plenty of money in it. It means budget cuts become permanent and you aren’t getting the government you paid for. Please vote no."

The statement was prepared by Rep. Zack Hudgins, Rep. Sam Hunt, Rep. Mary Lou Dickerson, Rep. Bob Hasegawa, Rep. Jamie Pedersen and Washington State Labor Council AFL-CIO president Jeff Johnson.

Donors

According to the state campaign finance database, there were no registered committees (PACs).

(last updated December 2011)

Media editorial positions

See also: Endorsements of Washington ballot measures, 2011

Support

• The Olympian said, "SJR 8206 forces lawmakers to set aside more money when times are good and state coffers are flush. Under this ballot proposal anytime the state is experiencing “extraordinary revenue growth,” lawmakers would be required to transfer three-fourths of that additional revenue into the savings account. The measure defines what constitutes “extraordinary revenue growth.” In essence the measure says that when revenue exceeds 133 percent of historical average growth, the money must be saved rather than spent. That’s sound fiscal discipline. Voters should vote “yes” on SJR 8206 on Nov. 8."
• The Columbian said, "This proposed amendment to the state constitution would direct a portion of “extraordinary” revenue (above 133 percent of historical average growth) to the state’s rain day fund. The legislation passed unanimously in the Senate and by a 76-10 vote in the House. For this SJR as well, The Columbian strongly recommends a “Yes” vote."
• The Spokesman-Review said, "The past couple of bienniums have featured painful cutting, which is probably why Republican and Democratic budget writers are backing this change. It would’ve been nice to have larger reserves to draw upon. Plus, the spending that occurred in lieu of building reserves has made balancing the budget more difficult. Voters should adopt SJR 8206 to help prevent legislators from digging such deep holes in the first place."
• The Walla Walla Union-Bulletin said, "SJR 8206 and SJR 8205 should be approved. One makes the state's Rainy Day Fund stronger while the other fixes a conflict in the constitution by establishing a 30-day residency requirement to vote."
• Sound Politics said," This initiative requires the state to deposit a portion of extraordinary revenue, defined as growth of general state revenue that is more than one third greater than a baseline average over the previous ten years, into the rainy day fund. If passed, it will provide a restraint on the Legislature from ramping up expenditure in the good economic years as if those years will continue forever. Part of our current budget problems comes from increased pending when revenue was high but now can't be sustained as revenue falls due to the recession."
• The News Tribune said, "The time to pass this measure is now, when the folly of the feast-and-famine cycle is all too painfully apparent. Then we can all look forward to the happy day when “extraordinary revenue growth” triggers this prudent amendment."
• The Seattle Times said, "SJR 8206 would save more than the 1 percent in the best years. When state revenues grow more than one-third faster than the 10-year average, the Legislature would have to save three-quarters of the money above the one-third. That way, the Legislature would have less money to fund new programs with extraordinary windfalls."
• The Yakima-Herald Republic said, "SJR 8206 would buttress the state's rainy day fund by allocating "extraordinary" revenues during flush times, assuming they return, to the fund. This would even out budget bumps during economic downturns such as now."
• The Tri-City Herald supported SJR 8206.
• The Herald Everett said, "Most state lawmakers, it appears, recognize that they have a problem saying no to new spending. So this fall, they're asking voters to force some discipline. Voters should oblige them by approving Senate Joint Resolution 8206, a constitutional amendment that would direct big, temporary spikes in revenue into the state's rainy day fund."
• The Bellingham Herald said, "The time to pass this measure is now, when the folly of the feast-and-famine cycle is all too painfully apparent. Then we can all look forward to the happy day when "extraordinary revenue growth" triggers this prudent amendment."
• The Wenatchee World said, "It also won’t mean much now, but for future considerations it would be wise to approve Senate Joint Resolution 8206, a constitutional amendment on the fall ballot, to close the state budget’s barn door a bit during boom times."

Path to the ballot

See also: How the Washington Constitution is amended

In order to place the measure on the statewide ballot, the measure required at least a two-thirds vote in both the House and the Senate.

On May 21, 2011 the House voted 76-10 in favor of referring the proposed measure to the ballot. The Senate voted 47-0. The proposed measure was filed with the Washington Secretary of State on May 25, 2011.

Timeline

The following is a timeline of events surrounding the measure:

Event	Date	Developments
House vote	May 21, 2011	House voted 76-10 in favor of the measure
Senate vote	May 21, 2011	Senate voted 47-0 in support of the measure
Certified	May 25, 2011	The measure was certified and referred to the ballot

See also

• 2011 ballot measures
• Washington 2011 ballot measures

Articles

• Five measures to appear in the state of Washington, all three initiatives cleared

External links

• SJR 8206: status, full text
• Washington State's 2011 General Election Online Voters' Guide (dead link)
• The Freedom Foundation's 2011 Initiative Guide
• Progressive Voters Guide

Additional reading

• The Olympian, "SJR 8206: Measure would set aside ‘extraordinary’ revenue from boom times," October 10, 2011
• Edmonds Patch.com, "State Liquor Stores Not the Only Voter Initiative on the Ballot This Fall," September 18, 2011
• The Olympian, "5 issues on state’s fall ballot," August 3, 2011
• Washington Secretary of State - From Our Corner blog, "Taking the initiative," July 8, 2011