Elect Shannon Barnett State Representative 18th District

The Daily News reports that only 22% trust government

2010-04-19T06:56:00.000-07:00

The Daily News published a story that details poll results that show only 22% of voters trust government. I would venture to guess that were they to be polled that the results would be similar for the level of trust for State Government as well.
State Government is focused on the wants instead of the needs, and threatens the needs to get the wants. When the checkbook does not balance state government continues to formulate a budget that continues with the wants and puts the needs at risk. That is not leadership, that is not priority, that does not instill trutst.
But here is the story from the Daily News;

America's "Great Compromiser" Henry Clay called government "the great trust," but most Americans today have little faith in Washington's ability to deal with the nation's problems.

Public confidence in government is at one of the lowest points in a half century, according to a survey from the Pew Research Center. Nearly 8 in 10 Americans say they don't trust the federal government and have little faith it can solve America's ills, the survey found.

The survey illustrates the ominous situation President Barack Obama and the Democratic Party face as they struggle to maintain their comfortable congressional majorities in this fall's elections. Midterm prospects are typically tough for the party in power. Add a toxic environment like this and lots of incumbent Democrats could be out of work.

The survey found that just 22 percent of those questioned say they can trust Washington almost always or most of the time and just 19 percent say they are basically content with it. Nearly half say the government negatively affects their daily lives, a sentiment that's grown over the past dozen years.

This anti-government feeling has driven the tea party movement, reflected in fierce protests this past week.

"The government's been lying to people for years. Politicians make promises to get elected, and when they get elected, they don't follow through," says Cindy Wanto, 57, a registered Democrat from Nemacolin, Pa., who joined several thousand for a rally in Washington on April 15 _ the tax filing deadline. "There's too much government in my business. It was a problem before Obama, but he's certainly not helping fix it."

Majorities in the survey call Washington too big and too powerful, and say it's interfering too much in state and local matters. The public is split over whether the government should be responsible for dealing with critical problems or scaled back to reduce its power, presumably in favor of personal responsibility.

About half say they want a smaller government with fewer services, compared with roughly 40 percent who want a bigger government providing more. The public was evenly divided on those questions long before Obama was elected. Still, a majority supported the Obama administration exerting greater control over the economy during the recession.

"Trust in government rarely gets this low," said Andrew Kohut, director of the nonpartisan center that conducted the survey. "Some of it's backlash against Obama. But there are a lot of other things going on."

And, he added: "Politics has poisoned the well."

The survey found that Obama's policies were partly to blame for a rise in distrustful, anti-government views. In his first year in office, the president orchestrated a government takeover of Detroit automakers, secured a $787 billion stimulus package and pushed to overhaul the health care system.

But the poll also identified a combination of factors that contributed to the electorate's hostility: the recession that Obama inherited from President George W. Bush; a dispirited public; and anger with Congress and politicians of all political leanings.

"I want an honest government. This isn't an honest government. It hasn't been for some time," said self-described independent David Willms, 54, of Sarasota, Fla. He faulted the White House and Congress under both parties.

The poll was based on four surveys done from March 11 to April 11 on landline and cell phones. The largest survey, of 2,500 adults, has a margin of sampling error of 2.5 percentage points; the others, of about 1,000 adults each, has a margin of sampling error of 4 percentage points.

In the short term, the deepening distrust is politically troubling for Obama and Democrats. Analysts say out-of-power Republicans could well benefit from the bitterness toward Washington come November, even though voters blame them, too, for partisan gridlock that hinders progress.

In a democracy built on the notion that citizens have a voice and a right to exercise it, the long-term consequences could prove to be simply unhealthy _ or truly debilitating. Distrust could lead people to refuse to vote or get involved in their own communities. Apathy could set in, or worse _ violence.

Democrats and Republicans both accept responsibility and fault the other party for the electorate's lack of confidence.

"This should be a wake-up call. Both sides are guilty," said Sen. Claire McCaskill, D-Mo. She pointed to "nonsense" that goes on during campaigns that leads to "promises made but not promises kept." Still, she added: "Distrust of government is an all-American activity. It's something we do as Americans and there's nothing wrong with it."

Sen. Scott Brown, a Republican who won a long-held Democratic Senate seat in Massachusetts in January by seizing on public antagonism toward Washington, said: "It's clear Washington is broken. There's too much partisan bickering to be able to solve the problems people want us to solve."

And, he added: "It's going to be reflected in the elections this fall."

But Matthew Dowd, a top strategist on Bush's re-election campaign who now shuns the GOP label, says both Republicans and Democrats are missing the mark.

"What the country wants is a community solution to the problems but not necessarily a federal government solution," Dowd said. Democrats are emphasizing the federal government, while Republicans are saying it's about the individual; neither is emphasizing the right combination to satisfy Americans, he said.

___

Here is some important information you need to know about I-1082 which I fully support

2010-04-16T07:15:00.000-07:00

The hard working folks at BIAW have an initiative to reform Washington State Workers Compensation. Erin Shannon has a press release to forward some important information about the intitiative

April 14, 2010
CONTACT: Erin Shannon
FOR IMMEDIATE RELEASE
Public Relations Director
800-228-4229
BIAW FILES INITIATIVE TO PRIVATIZE WORKERS’ COMP
OLYMPIA–The Building Industry Association of Washington has filed an initiative with the Secretary of State allowing private insurers to compete with the state Department of Labor & Industries (L&I) to offer employers workers’ compensation coverage.
“BIAW warned that if the Legislature refused to do anything this session to reform our state’s broken and nearly bankrupt workers’ compensation system, BIAW would,” said BIAW President Matthew Clarkson. “BIAW’s initiative makes good on that promise.”
Initiative 1082 will bring Washington State in line with the 46 other states that allow competition from private insurers in the industrial insurance market. Washington’s monopoly on workers’ comp means employers have no choice but to pay L&I’s ever-increasing workers’ comp taxes to obtain the industrial insurance coverage they need to protect their workers. The result has been a costly and inefficient workers’ comp system on the verge of insolvency. While workplace
injuries have decreased 55 percent in recent years, L&I’s costs to manage these fewer injured worker claims have increased by more than 80 percent, and injured workers stay off the job more than two times longer in Washington than any other state. Thanks to L&I’s inability to efficiently manage the workers’ comp system,
employers in Washington State have shouldered workers’ comp tax increases of 54 percent over the past decade and now pay the second-highest cost per employee for workers’ compensation—and they are facing doubledigit workers’ comp tax hikes next year.
I-1082, which has already been endorsed by the National Federation of Independent Business, ends the state’s monopoly on workers’ compensation and injects much needed competition into Washington’s failing system.The initiative creates a Joint Legislative Task Force on Private Competition for Industrial Insurance charged
with developing proposed legislation to conform current statutes to the provisions of the initiative and make recommendations by December 2011. The Legislature must adopt legislation to fully implement the policy directives of the initiative by March 1, 2012.
The initiative also eliminates the worker-paid share of workers’ comp taxes, leaving workers with more money in their paychecks. Washington is the only state that allows employers to deduct a portion of workers’ comp taxes from employee’s wages. I-1082 will require employers to pay the full amount.
“The provisions of I-1082 are a win-win for businesses and their workers,” said Clarkson. “Allowing private insurers to compete with L&I will create a more business friendly environment that will give existing Washington businesses some much needed relief and help attract new businesses, while scrapping the arcane rule that forces workers to pay workers’ comp taxes will put more money in the wallets of working families.”
BIAW, along with most of the business community, has pleaded for workers’ comp reform for years. Boeing specifically identified Washington State’s unreasonable and costly workers’ comp system as one of the reasons they awarded South Carolina the second production line of the 787. Despite these pleas, no changes have been
made and costs have continued to spiral out of control. Meanwhile, other states that have moved from government-run workers’ comp systems to privatization have
experienced lower workers’ comp taxes for employers, better claims management for injured workers and a more efficient workers’ comp system. Oregon, West Virginia, Nevada, Maine, North Carolina, Colorado and California are just a few of the states which allow private insurers to sell workers’ comp policies whose
workers’ comp rates decreased this year. Contrast to Washington’s 7.6 percent increase this year—the biggest workers’ comp increase of any state in the country.
“Monopolies don’t work, especially government monopolies,” said Clarkson. “Monopolies breed incompetence, inefficiency and lack of accountability,” he said. “Forty-six states have figured this out; it is time for Washington to do the same.”

For more information on I-1082, visit www.SAVEOURJOBSWA.com.
###
Known as the “champion of affordable housing,” the Building Industry Association of Washington is the largest trade association in Washington State, representing over 250,000 families and more than 11,000 member companies involved in the homebuilding business.

Orcutt releases statement on Democrats’ passage of largest tax increase in state history

2010-04-15T06:21:00.001-07:00

The 18th District has been blessed with three conservative representatives in Senator Joseph Zarelli and Representatives Orcutt and Herrera. They are doing the peoples work, and we need to let everyone know just how hard they are working for our values and principles just as I will when I am elected.
When Joe, ED and Jaime send us information we need to make sure we do all that we can to share that with our friend, family and co-workers when ever possible.
To that end I would like to share with you a great e-mail I got from Representative Orcutt that details exaclty what came from the legislature this session as the Democrat Majority version of a solution. This is an example of the challenges that lay ahead, and the reason we need to give Ed, Joe and Jaime the partners they need, and a partner that will work hard to take back the House and Senate.

Orcutt releases statement on Democrats’ passage of largest tax increase in state history
Published Saturday, April 10 2010
Nearing the end of the 30-day special session called by Gov. Gregoire, Democrats in the House tonight approved nearly $1.7 billion in new and increased taxes for the 2011-13 biennium, over $794 million in the first year alone.
Rep. Ed Orcutt, R-Kalama and ranking Republican on the House Finance Committee, released the following statement:
“This is an $800 million-a-year financial hit that our families, our employers and our economy cannot afford. If Democrat budget writers had put half as much effort into balancing the budget through true government reforms and efficiencies as they put into arguing with each other over which taxes to raise, we’d have a balanced budget, no tax increases and no special session.
“Instead of spending 30 days sharpening our pencils, applying the priorities of government process and implementing meaningful government reforms, budget writers from the majority party haggled over who would be the ‘winners and losers’ while resorting to tax increases.
“This is a sad day for struggling families and employers. This tax increase represents the largest tax increase in state history and it will have a negative impact on our chances for economic recovery.
“Washington’s employers are hit especially hard with B&O tax increases and our convenience stores are brutalized with new and increased taxes on bottled water, beer, cigarettes, soda, candy and gum making our tax system even more regressive. Border counties, like those in my district in Southwest Washington, are going to lose precious jobs because of these tax increases.”
New and increased taxes approved by House Democrats amount to nearly $1.7 billion for the 2011-13 budget cycle ($794 million in just the first year alone) – the largest tax increase in state history. They include:
A 0.30% increase in the B&O tax on all services except hospitals and scientific R&D = $242 million;
DOT foods = $155 million;
Cigarette($1 per pack) and other tobacco products = $101 million;
B&O tax on economic income (Nexus) = $84.7 million;
50-cent per gallon (28-cents per six pack) beer tax = $59 million;
Sales tax on bottled water = $32.6 million;
Sales tax on candy/gum = $30.5 million;
2-cent per 12-ounce soda tax = $33.5 million;
Taxes on business structure transactions = $8.5 million;
B&O tax increase on property management salaries = $6.9 million;
B&O increase on certain canned meat products = $4.1 million;
B&O tax increase on mortgages = $3.6 million;
B&O tax increase on corporate officer salaries = $21 million;
Tax increase on bad debts = $1.7 million;
Tax increase on livestock nutrient management = $1.3 million;
Tax increase on PUD electric bills = $1.2 million;
Personal liability for tax debts = $1.1 million.
The 2010 regular legislative session ended March 11. Gov. Gregoire called the Legislature into a special legislative session so majority Democrats could finalize their operating budget and tax increase proposals. The 30-day special legislative session is scheduled to end on Tuesday, April 13.
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For more information, contact: Brendon Wold, Senior Information Officer, (360) 786-7698.
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Gregoire believes in tearing down the wage payer to build up the wage earner

2010-04-10T09:49:00.000-07:00

Gregoire and Democrats in the Washington Legislature have decided to add additional tax burden upon a business climate in Washington State that already has business drowning in a sea of over regulation and taxation. Gregoire is attempting to build up the wage earner by tearing down the wage payer in the middle of an economic recession that has soaring unemployment.
Reports indicate that Gregoire and the Democrats are turning to an increase in the B&O tax which does nothing but harm to an employers ability or desire to look at bringing on additional employees at this time.
Gregoire and the Democrats are not making the tough choices that will bring economic stability and sustainability in the future, but are instead looking more to tax increases,one time federal money
bombs, and raiding the "Rainy Day" state savings account. These are band-aids not cures!

There was a good post at "Sound Politics" blog that I wanted to share.

Gregoire and Demos helping Idaho even more
Christine Gregoire and her molasses Democrats finally agreed on their beloved tax increases after 26 days. Though EFF WA sees signs of continued discontent. And who benefits? Idaho.

A business-and-occupation tax surcharge would raise the single largest amount of money, about $246 million through June 2011. It would increase from 1.5 percent to 1.8 percent the B&O tax paid by service businesses, with exemptions for hospitals and research and development. A tax credit for small businesses would be doubled. Seattle Times
Increase the taxes that hurt businesses. That will reduce the creation of jobs. That must be their thinking? What did they do about their increases in spending and pay increases for state employees during those 26 days? Nothing, of course.

Gov. Otter of Idaho didn't expect more help so soon. Actually, he did, but still can't believe it. He welcomed Areva, a $3 billion plant and up to 400 jobs in March

Should Washington State look to an Iowa model for budget help and inovative ideas?

2010-04-06T08:22:00.000-07:00

Charter Agencies

By Amber Gunn and

Charter Agencies: Moving beyond promises to achieve extraordinary outcomes
Washington may be taking another step toward accountable government and measurable results. Governor Christine Gregoire’s office recently sponsored a presentation for state agencies offered by Jim Chrisinger of Iowa’s Department of Management. The presentation highlighted Iowa’s successful charter agency reform.
Charter agencies were spotlighted for the positive results they are bringing to Iowans. In the first year alone, they reported a collective savings of $22 million. Charter agencies are also making outstanding efficiency gains in terms of the quality of service provided and the number of people assisted. They are a revolutionary concept in the realm of government management intended to unravel the bureaucratic red tape that plagues many state agencies and replace it with results-driven motivation that promotes flexibility and innovation.

Iowa Case Study
Charter agencies came about as the result of a collective push by Governor Tom Vilsack and others who wanted to end the status quo and improve the state’s fiscal accountability during Iowa’s budget crisis of 2003. Six government agencies, representing almost 30 percent of general fund appropriations, voluntarily opted into the program.

The deal allowed state agencies to sign agreements with Iowa's Governor specifying their status as "chartered.” This designation holds them accountable for measurable results in return for exemption from many of the state's bureaucratic requirements. In return for the operational flexibility and freedom from some bureaucratic rules, they were required to collectively return at least $15 million to the state’s general fund each year.

The results of this experiment surprised even the most fervent supporters of the charter agency proposal. In the first year alone, the six charter agencies surpassed their collective savings goal by more than $7 million. The projected savings rate for 2006 has nearly doubled that, at $40 million.

The fiscal savings that charter agencies bring in are not the only benefit, nor even the main one. The Department of Human Services, one of the agencies that opted into the charter program, oversaw a 33 percent increase in the number of low-income children that have access to health care coverage via its hawk-I program. They also increased the number of eligible Iowans receiving food and nutrition benefits by 69,000 (a 44 percent increase) in the last 2 ½years. The Department of Natural Resources, another charter agency, reduced turnaround time for air quality construction permits from 62 to 6 days and eliminated a backlog of 600 in six months.

These are just a few of the measurable benefits Iowa has seen as a result of its bold experiment in government management. Charter agencies have received recognition and praise from multiple organizations and were the recipient of the 2004 Council of State Governments Innovation Award and 2005 Innovations in American Government Award. The charter program has allowed agencies to improve their services while focusing on results and has given citizens the opportunity to perceive greater value from government services.

How does a charter agency work?
Traditionally, if government agencies obeyed the rules and avoided mistakes, they would be rewarded with continued funding. This generates incentives for agencies to pour resources and energy into regulatory compliance and bureaucratic perfection, rather than creating benefits for the citizens they are meant to serve. The charter agency alternative—management freedom in exchange for results accountability—is a basic reinvention of agency management. Charter agencies agree to be accountable for measurable results while contributing to the budget fix. In exchange, they are granted increased authority and more autonomy from bureaucratic regulations.

It was decided from the outset that agencies would enter into charter status completely voluntarily. Most agencies heads were initially skeptical about the program since they were not convinced that the administrative freedom would materialize or that the benefits of that freedom would be worth risking further budget cuts. Suffice it to say, no agency stepped forward as an eager volunteer. Rather than force agencies to participate, the governor sent a letter to 11 agency heads explaining that they would all be temporarily designated as charter agencies, and would have the chance to opt out before the final designations.

Though not true volunteers, the agency directors that made up the final six charter agencies became enthusiastic about the idea. One observer commented, “There is a lot of good will, patience, and tolerance on the part of the directors, and a willingness to think of fresh opportunities. It has been fun to watch them open up to new forms of experimentation and I'd like to see them take even bolder steps in innovation.” Another noted, “All of the directors are very positive about having taken the risk to become charter agencies. For most it exceeded their expectations.”

The authorizing legislation requires the director of each charter agency to enter into an annual performance agreement with the governor. The governor and each charter agency must also submit annual reports to the General Assembly. In Iowa, up to five agencies (later revised to include the Lottery Authority) were offered the chance to volunteer greater flexibility for a 10 percent reduction in their general fund operating expenses. Separate legislation was included to allow additional revenue that an agency brings in to offset the 10 percent reduction targets, since it made little sense for the Iowa Lottery to volunteer a budget cut.

Rather than attempt to identify every incommodious rule that a charter agency director could waive, the legislation granted charter agency directors equal authority to that of the directors of personnel, general services, and information technology—bureaucracies that typically frustrate operation managers. Employment caps were the only specific regulation that the legislation addressed—and they were prohibited.

Some confusion came out of the initial legislation, since the first few paragraphs appeared to grant charter agencies broad authority to waive any administrative rule regarding personnel, procurement, general services, and information technology, but then laid out a lengthy procedure “for granting a temporary waiver or suspension of any administrative rule.” The governor’s lawyer had to clear things up and explain which rules could be waived and which had to go through the approval procedure.

Iowa’s experiment with charter agencies is not meant to be a prototype for agency reform. Charter agency legislation in Washington will have to be adapted to accommodate our state’s particular needs. The most important factor in drafting charter agency legislation is to make results a key objective. Citizens want to know that state agencies are creating value and meeting goals rather than solely following rules. By spotlighting agency output rather than just input, charter agencies are helping to restore public faith in government

Charter agency success: The undeniable proof
It is a common misconception that it is too difficult to measure what government does because there is no “bottom line” in the public sector. In the private sector, profit, rate of return or shareholder values indicate success or failure. However, there is a bottom line in the public sector, and it is “public benefit”. The question citizens and government should be asking of every program or appropriation is, "What public benefits resulted from the expenditure of money?"

Iowa is asking its charter agencies this question, and they are quick to respond.

The Department of Human Services saw $1.7 million in savings on its preferred drug list for Medicaid prescription drugs.
The Department of Natural Resources reduced the time for corrective action decisions on leaking underground storage tanks from 1,124 days to 90 days.
The Iowa Veterans Home has improved their admissions process, increasing the percentage of admissions completed within 30 days from 69 percent to 90 percent in a two year period.
The Alcoholic Beverages Division increased alcoholic beverages-related General Fund revenue by $9.7 million in Fiscal Year 2004 through variable wholesale pricing, increasing investment in supplier-discounted products, and decreasing operating expenses.
The Department of Corrections provided good work experiences for 50 percent more women inmates, while reducing operating costs by $700,000/year.
All of these outcomes were achieved in a one to three year period. Charter agency directors are praising the results. One commented, “Together, I believe we've been able to accomplish some incredible things in such a short time. For instance, [my agency has] been able, so far, to transfer an additional $6 million to the general fund (and I have high hopes of directing an additional $2 million yet this fiscal year). At the same time, we've been able to work on the other side of our ledger and significantly reduce our operating expenses.”

Though the financial numbers speak for themselves, charter agency mandates differ from traditional agency mandates in that they ask, “How much?” in terms of public benefit instead of just public spending. For instance, a traditional government agency might brag that it reduced the number of uninsured children by 15 percent. A charter agency would look deeper and ask, “How many children are actually healthier as a result of that extra expenditure of money?”

Charter agencies are revolutionizing the way people view government management. They are highlighting the “bottom line” in the public sector and achieving extraordinary outcomes. It is no surprise that Washington and other states are eyeing them as a plausible and appealing alternative to the status quo.

Change on the horizon: Bringing charter agencies to Washington
Governor Gregoire’s sponsorship of the charter agency presentation represents a substantial first step for Washington. If lawmakers want to get serious about the concept, the Iowa Charter Agency website offers a “how to” guide for implementing charter agencies in other jurisdictions. It recommends tailoring charter agencies to fit specific needs and circumstances rather than following Iowa’s example exactly. The website points out, “what is important is that your deal creates better results, that it makes producing results more important than following rules.”

In its four step plan for implementing charter agencies, the website recommends getting key people involved that can take risks, be involved day-to-day, and meet with authorities who can make or break the deal. It also suggests deciding what specific new authority and autonomy the charter agencies will have and revising this list based on political and legal realities. Testing the charter agency deal with stakeholders and implementing their feedback is also a vital step. Additionally, the website details some recommended accountability mechanisms. Above all, constant improvement, learning, and information-sharing are essential to breaking down barriers as they appear. Charter agencies should be flexible and responsive to new problems or changes that arise—that means adapting rather than giving up or becoming immobilized.

Charter agency reform is a perfect fit with Washington’s new performance audit authority and the Government Management Accountability & Performance (GMAP) initiative. Understandably, some citizens and lawmakers may be concerned about liberating state agencies from various rules designed to protect taxpayers from fraud and abuse. However, with the internal check of GMAP, which uses performance measures to inform day-to-day operational decisions, and the external check of performance audits by the State Auditor’s Office, charter agencies should have adequate oversight to ensure this does not occur.

A likely obstacle in implementing charter agencies in Washington will be the collective bargaining authority that unions were granted in 2002. In this agreement, an agency’s right to competitively contract for services is subject to collective bargaining, which means that for some agencies, the option was eliminated altogether by union negotiations.

The collective bargaining agreement also severely restricts an agency’s capacity to manage personnel. The ability to independently add or eliminate positions is a key flexibility that goes hand-in-hand with charter agency reform. When agencies are forced to navigate lengthy negotiations and approval processes as regards personnel decisions, valuable time and resources are squandered. Agencies may be handicapped when subjected to arbitrary full-time employee caps, or conversely, weighed down by duplicative or unnecessary positions.

Ultimately, the state will have to move away from the collective bargaining agreement if charter agencies are to be effective. Competitive contracting is a major part of providing services efficiently and effectively so that taxpayers get the best return for their investments. Charter agencies will give agency directors the ability and freedom to deliver on performance expectations.

Conclusion
The potential for incredible reform in government management is knocking at our door in the form of charter agencies. Ridding state agencies of duplicative rules and burdensome protocols that drain the energy and ingenuity out of public employees can only produce positive results. Rather than costing taxpayers extra money, these extraordinary changes actually contribute to balancing the budget. Iowa has boldly cleared the path for charter agency reform and demonstrated fast and extraordinary outcomes that are garnering national attention. They are the next logical step on Washington’s path toward accountable government and measurable results.

Amber Gunn is Director of EFF’s Economic Policy Center. She serves as a voting member on the American Legislative Exchange Council’s Tax and Fiscal Policy Task Force and is often consulted by media outlets and legislative staff for issue briefs and policy analysis. Prior to joining EFF full time, she was a Charles G. Koch Fellow in partnership with the State Policy Network. Amber holds a B.A. in Political Science and Spanish from the University of Washington.

In cased you missed it..The Daily News gets it right again!

2010-04-06T08:17:00.000-07:00

I am really gaining some respect for what seems to be a new direction for the Longview Daily News. Case in point....look at this editorial that hits on one my key complaints with state government and the way that it places an undue burden on business.

Feb. 17 Daily News editorial

The state's business lobby, led by the influential Building Industry Association of Washington (BIAW), worked hard this year trying to push workers' compensation reform bills up a steep legislative hill. But the business lobby's influence with the Democratic majority proved to be no match for that of the labor lobby. Workers' comp bills in both the House and Senate were bottled up and allowed to die in committee.

The BIAW isn't backing off. The builders association filed paperwork last month for a ballot initiative that would end the state's monopoly on workers' comp coverage, allowing private insurers to compete in the system.

There is a good deal of frustration behind this initiative filing, no doubt. The Legislature has been largely unresponsive to the business community's complaints about the escalating costs of workers' comp and repeated pleas for reform. Breaking the state's hold on the system in order to contain those costs has been a top priority of the business lobby for many years.

Washington businesses — knocked on their heels by this historic recession - had brought a new sense of urgency to their lobbying effort this year. Workers' comp insurance rates jumped by 7.6 percent on Jan. 1. It was the third year in a row that rates had increased. Workers' comp rates rose 3.2 percent in 2008 and another 3 percent in Jan. 1, 2009.

This is money out of pockets of workers and employers, alike. The cost of this insurance is shared. Employees are paying 27.8 percent of the costs this year, up from 27 percent last year. Workers' comp taxes have increased almost 54 percent over the past decade, according to the BIAW. The association's deputy legislative policy director, Amy Brackenbury, cited a mandated state audit in a recent press release showing that the system is headed for insolvency absent big increases in workers' comp taxes. "Based on the state's audit, it is not a question of if, but when, the workers' comp system will run out of money," Brackenbury said.

The state Department of Labor & Industries, which runs the insurance program, initially considered a 2010 rate increase of from 15 percent to 20 percent. The agency opted for the lower, 7.6 percent increase in light of the difficult economic climate faced by businesses and workers. But larger increases may be in the offing. According to the BIAW, the audit showed that a 33 percent increase in workers' comp taxes would be needed next year to keep the system solvent.

It's time Washington allowed private insurers to compete in the workers' comp system, as 46 or the 50 states do. This state has some of the highest workers' comp rates in the West — higher than in Oregon, where private insurance companies are allowed to compete. The current system makes Washington an expensive place to do business. It's a drag on the state's economy that we can no longer afford to tolerate. Fundamental reform of workers' comp - similar to the reforms that introduced competition into Oregon's workers' comp system 20 years ago — is overdue in Washington.

Posted in Opinion, Editorial on Wednesday, February 17, 2010 12:15 am Updated: 7:41 pm.

Washington State's version of the "Three Card-Monte"

2010-04-05T21:39:00.000-07:00

If you ran this scam on a city sidewalk, the cops would run you off, if not lock you up for the night. Thank you to the Washington Policy Center for bringing this to my attention. You should read as well. Ask yourself if this is the common sense legislation you send your rep to Olympia to support?

Introduction
The Medicaid program to provide health coverage for low-income people
began in 1965 with the passage of Title XIX of the Social Security Act. It has
always been an entitlement, with no defined limit on the number of beneficiaries
or the cost of the program. As long as a person meets the legal criteria for
participation in the program, that person receives Medicaid benefits, regardless of
total cost to taxpayers.
The cost of Medicaid is shared between federal and state governments.
Each state receives federal money on a sliding scale based on average personal
income, with poorer states getting a higher percentage of federal funds. The
Medicaid match for Washington state is 52% in federal money and 48% in state
funds, significantly higher than the average state match of 43%.
When enacted in the mid-1960s, Congress estimated Medicaid would cost
around $500 million the first year. The actual cost was double that, $1 billion.
By 1970 the cost of the program had grown five-fold, to $5 billion. In the years
following the cost of Medicaid ballooned, reaching a total of $336 billion a year
by 2007. Medicaid spending is expected to double by 2017. Total spending on
Medicaid in Washington state was $4.13 billion in fiscal 2008.
State officials routinely game the Medicaid program to receive extra
matching money. Washington state’s proposed “bed tax” on nursing homes is
an example of how state officials try to leverage more federal funding from the
Medicaid program. Since Medicaid is an entitlement with no statutory limit on
spending, there is no limit to how much state officials can try to gain from the
program.
To get increased matching funds, state officials exploit four paymentmechanisms:
1. Intergovernmental Transfers (IGTs)
2. Upper Payment Limits (UPLs)
3. Disproportionate Share Hospital (DSH) payments
4. Provider Taxes
1. Intergovernmental Transfers
Intergovernmental transfers (IGTs) are shifts of public funds among
different levels of governments (for example from counties to states) or government entities (for example from public hospitals to state agencies). The
federal government does not have control of a state’s funding that is transferred
within the state. IGTs are a legal way for a state to pay for its share of Medicaid.
Since 2001, twenty states, including Washington, have adopted this practice.
However, the policy can be financially abusive when used in association with the
three other payment mechanisms.
2. Upper Payment Limits
Upper Payment Limits (UPLs) set a ceiling on how much the federal
government will pay a state in Medicaid funds. The UPL was originally created as
a regulation tool to control federal spending. However, since the early 1980s, state
officials have exploited loopholes to obtain federal funding far exceeding the limited amounts.
State officials used the loophole to pay local public hospitals extra
Medicaid payments. This allowed hospitals to receive higher federal matching
funds, which hospital administrators then sent to the state treasury in the form of
Intergovernmental Transfers. In essence, state officials used public hospitals to
launder federal Medicaid funds. In return, public hospitals were often allowed to
keep a small percentage of the proceeds. Here is an example of how it worked:
Step 1. The state Medicaid agency made a $41 million supplemental
payment to a local public hospital. The payment consisted of $30.5 from
federal taxpayers and $10.5 from the state.
Step 2. The local public hospital then sent $39 million to the state treasury
as an Intergovernmental Transfer.
Step 3. The result was federal taxpayers paid $30.5 million, hospital
officials kept $2 million, and the state treasury netted $29.5 million.
As of 2004, Washington’s estimated total UPL payments are almost $500
million.
3. Disproportionate Share Hospitals
The purpose of DSH payments is to encourage hospitals to serve more
Medicaid and low-income uninsured patients than other medical facilities. Similar
to UPLs, states can make excess payments to government-owned hospitals which
then use Intergovernmental Transfers to return the excess state payments back to the
state’s treasury, while keeping the federal matching funds that came with the original state payments.
As an example of how this manipulation of Medicaid works, in one year
Michigan officials made DSH payments of $458 million, which included $256
million in federal Medicaid matching funds, to 53 public hospitals. These hospitals
used only $208 million to pay for medical services for Medicaid patients and then
sent the balance of $250 million to the state treasury. By manipulating the Medicaid
program, Michigan lawmakers gained control of $250 million in public money to
which they would not otherwise have had access.
4. Provider Taxes
State-imposed provider taxes count as Medicaid expenditures through
DSH or UPL payments. The state taxes providers pay qualify for federal matching
payments and are paid to the providers. The providers then return most of the
federal payments to the states. Between 1991 and 1992, these state taxes accounted
for 25% of Medicaid’s annual spending growth.
Recommendations More top-down rules imposed by federal regulators will only open
opportunities for state legislators, including those in Washington state, to further shift their Medicaid costs on to federal taxpayers. Instead of imposing futile regulations,federal and state government officials should take the following actions.
First, they should repeal the Medicaid Safety Net Act. This would
reintroduce the restrictions and oversight on exploiting financing schemes established earlier by the Government Accountability Office. In order for these restrictions to
actually limit mistreatment of federal funding, Congress should freeze funding at
fiscal 2007, or even fiscal 2005, levels.
Second, Congress should restore entitlement eligibility requirements to the
original 1965 level. This step would dramatically reduce excessive federal funding
and help control costs. Returning to the original intent of Medicaid would target
state and federal health care funding to people who need it most: low-income
families that lack access to affordable health coverage. Restoring Medicaid’s original purpose would place the program on a firmer and more sustainable basis going
forward, forestalling the day when Medicaid goes bankrupt, or when program
growth consumes the majority of annual state budgets.
Third, state officials should refrain from implementing new provider taxes,
such as a nursing bed tax, in an effort to use federal Medicaid matching funds to pay
for general state programs. If state officials face budget problems, they should reduce expenditures rather than adding a state tax that is designed to game federal dollars.
Summary of Recommendations
1. Place heavy limits and restrictions on DSH payments and UPLs.
2. Increase oversight over state use of IGTs and provider taxes.
3. Tighten Medicaid eligibility requirements.
4. Avoid imposing a nursing homes bed tax.
State officials have been gaming with federal dollars since the 1980s.
Instead of freezing their funding levels and tightening eligibility requirements, state governments have used the following financial schemes to not only help pay for
their Medicaid program but to pay for other state programs too – Intergovernmental
Government transfers (IGTs), Upper Payment Levels (UPLs), Disproportionate
Share Hospitals (DSHs) and Provider Taxes.
Imposing yet more government regulations, or enacting sweeping
government control of American health care, will not solve the issue at hand.
Experience verifies that even as the federal government intervened to stop this
exploitation, other schemes perpetually materialize. The advancement of
transparency and oversight to protect the financial integrity of the Medicaid program
will allocate scarce resources efficiently.
Limited public safety net programs will always be needed to provide health
care for the poorest and most vulnerable people in our society. However, state
officials’ use of financial schemes to exploit an important federal program to pay for general state spending demonstrates one reason the cost of Medicaid is the fasting
growing line item in every state budget. Only thorough financial reform will ensure
that Medicaid is placed on a sound long-term basis, so it remains reliably available to provide vital health services for low-income families in the future.

EFF has 10 great ideas for State Government

2010-04-05T14:36:00.001-07:00

Once again the Evergreen Freedom Foundation has come up with a well though out list of 10 ideas to make state government more efficient.

1. Get a Handle on State Employee Benefits: The state should suspend STEP increases (some employees will get raises of up to 5 percent). State workers should pay more of their health premiums (taxpayers pick up 88 percent). Halt the pension system’s fiscal hemorrhaging by replacing defined-benefit plans with defined-contribution plans.

2. Reform Workers’ Compensation to Make It Work Better: The average worker claiming compensation benefits misses 257 days of work—nearly three times the national average. Injured workers’ claims have dropped by 55 percent since 1990, but L&I’s cost to administer shrinking claims have increased 28 percent. Other states have much lower costs, due to major reforms like privatization. The governor should order a freeze on compensation rates and support privatizing the system.

3. Consult the Yellow Pages for Routine Government Services: The state should use a simple “Yellow Pages test” when considering whether to open a government service to competition. If experienced companies that do the same work can be found in the phone book, they should be invited to make a competitive bid. Odds are good they can offer identical or improved service at a lower price. States that put services up for bid usually save 10 to 20 percent.

4. Let the Private Sector Do Some Government Jobs: Government does certain things it doesn’t need to do, like operating a taxpayer-funded liquor monopoly. The private sector sells and distributes liquor in the vast majority of states. In Washington, taxpayers are forced to subsidize the liquor monopoly with hundreds of millions of dollars. Our state-run ferry monopoly is a similar story. It’s time to privatize liquor and ferries—and eliminate the fiscal headaches that accompany them.

5. Cut Red Tape and Bureaucracy to Save Money and Get Results: Red tape often prevents state agencies from getting things done. Charter agencies, on the other hand, are freed from many bureaucratic regulations in order to achieve better outcomes for citizens, such as streamlining the permit process. They agree to be accountable for measurable results on a reduced budget. For example, Iowa’s charter agency program has saved tens of millions of dollars. Why not here?

6. Get Money the State is Owed at No Cost: Contingency-based recovery audits are a way for the state to collect money owed without costing taxpayers a dime. Once improper payments have been found and approved, the recovery audit firm helps collect the payments due. Only then is the recovery audit firm compensated with a percentage of actual collections. In Texas, recovery audits have so far discovered millions in savings, with a potential total of up to $200 million.

7. Stop Allowing Prevailing Wage to Prevail Over Taxpayers’ Wallets: Our state has a law that costs taxpayers millions extra for public construction projects. The law requires that workers be paid “prevailing wages” when hired for public works projects or maintenance of public buildings. That means many projects have to pay workers big city prices regardless of where the construction occurs. The legislature should scrap this World War II-era law mandating excessive costs.

8. Save Money With More Efficient K-12 Funding: Washington state spends $13 billion on K-12 education. The state needs to use the power of competition to spend more wisely, by contracting out non-instructional endeavors—such as food service, janitorial, IT and housing—to private sector providers. Also, if more certified teachers move from administrative positions to the classroom, the state won’t need to spend as much money—$908 million during the last biennium—reducing class size.

9. Increase Public Safety by Making Prisons More Efficient: A public-private partnership might be the way to go to address the increasing costs of incarceration. The legislature should allow private contractors to compete for prison construction and management. Sentencing and oversight would still be managed by the state, but costs would be reduced.

10. Spend Higher Education Tax Money More Wisely: Taxpayers should not foot the bill for students’ ongoing careers in higher education. The state needs to connect money to required classes only, or give only as much money as is required to complete the requisite number of credits. In addition, the legislature should require institutions’ budgets to be online. Also, lawmakers can ensure that credits are more easily transferrable between institutions, and that far fewer high school students accepted for admission have to take remedial courses before earning college credits.

Contact: Amber Gunn | Director of the Economic Policy Center

Sen Zarelli presents common sense solutions, but politics stands in the way again

2010-04-01T16:46:00.000-07:00

It is a real shame that politics gets in the way of common sense ideas and that the people's busines takes a back seat. As an example look at this Editorial which I happen to agree with printed by the Longview Daily News that brings attention to a great idea proposed by 18th District Senator Joseph Zarelli. I wont add my own opinions because the Daily News says enough!

March 31 Daily News editorial

Sen. Joe Zarelli, R-Ridgefield, is frustrated over his Senate colleagues' ongoing refusal to give Washington public employees a health savings account option to their traditional health-care plan.

The 18th District senator issued a press release last week noting that the state House twice has passed a bill allowing the option this year by near unanimous votes — 96-1 during the regular session and 88-5 in the special session. But the legislation, Engrossed Substitute House Bill 2875, has never made in out of committee in the Senate.

Zarelli's frustration over the legislation's failure to advance is understandable. Health savings accounts would seem a win-win proposition. Both public employees and Washington's fiscally challenged State Health Care Authority stand to benefit from ESHB 2875.

The bill would have the Health Care Authority submit for bid in the next calendar year a high-deductible health plan in conjunction with a health savings account as an option for public employees, according to Zarelli. The savings account plan would have an annual deductible of at least $1,000 for individual coverage and at least $2,000 for family coverage with out-of-pocket costs not to exceed $5,000 for an individual and $10,000 for a family. Preventive care would not be subject to the annual deductible.

These health savings accounts are tax free. They can be established by individuals or employers. In either case, the accounts are held by individuals.

Zarelli cites a Wall Street Journal op-ed piece by Indiana Gov. Mitch Daniels outlining his state's experience with health savings accounts. The state of Indiana deposits $2,750 annually into an employee's account. The state also pay the premium for high-deductible plans. Accordingly, the employee has no out-of-pocket cost unless he or she exhausts all the account's funds. "By contrast," Zarelli noted, "monthly family premium costs range from $71-$343 a month for Washington state employees."

Only 6 percent of the Indiana employees used all the funds in their accounts last year, according to Daniels. More than 70 percent of the employees now choose the health savings account option. That's up from 4 percent when the option was first offered five years ago. Just 3 percent have gone back to a traditional health plan. Daniels estimates that, statewide, Indiana public employees who opted for these accounts saved $8 million last year, compared to their coworkers who stayed with traditional plans. The state's health-care costs were reduced 11 percent by the option, according Mercer Consulting.

Zarelli believes Washington's savings could amount to more than $140 million a biennium. That would be significant, he noted, given the State Health Care Authority's financial difficulties. The Public Employee Benefits' Board account is running a deficit of more than $200 million. It's partly due to unexpected demand. That's something health savings accounts would help counter, according to Zarelli. Putting employees in charge of the purse strings tends to make them smart consumers, bringing down costs.

Posted in Opinion, Editorial on Wednesday, March 31, 2010 12:15 am Updated: 4:44 pm.

So contact your local Senator and make sure that they know that this bill deserves support, and that the Senate should get on with the people's business! While you are at it...call Senator Zarelli and thank him for his support and hard work on this issue.

2010-03-29T15:32:00.000-07:00