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State House Democrats Set To Raid Hazardous Substance Cleanup Fund

By Andrew Calkins January 20, 2011

Democratic proposal to raid toxic cleanup fund account is a double whammy for environmentalists.

Tuesday’s supplemental budget released by House Democrats contained $123.8 million in fund transfers in addition to $216 million in specific cuts to state programs.

We took a look at these magical "fund transfers" to gauge their impact.

We found that one of the  major fund transfers is bad news for environmentalists. The plan proposes to transfer $17 million from the Local Toxic Accounts, a hazardous waste clean-up fund created back in 1988 when voters approved the Model Toxics Control Act (MTCA). The MTCA account is dedicated to toxic cleanup and relies on a hazardous substance tax levied largely on oil companies. Environmental advocates tried to notch up the tax last year (for the first time since '88) from .65 percent to 1.5 percent, but failed.

Rep. Ross Hunter (D-48, Medina), Chair of the House Ways & Means Committee, said that the transfer of funds out of MTCA would not cause any disruption to current projects or those planned to occur during the current budget cycle. But raiding the MTCA fund does carry some political risks for environmentalists.

When environmentalists tried to increase the hazardous substance tax last year, oil companies protested that legislators consistently raid the MTCA fund ($180 million in 2009) and suggested that if legislators weren't even using the money that was there for toxic cleanup, why the heck should they raise the fee? Was the money even needed?

By raiding the fund this year, the house's supplemental budget plan would likely give oil companies more ammunition to fuel their argument against this year's top priority for environmental advocates who want to establish a hazardous substance fee dedicated to stormwater cleanup.

While this would be a different fund than the MTCA account, the fact that Democrats are willing to raid one dedicated cleanup fund to pay for general fund programs like the disability lifeline, lends credibility to the oil companies line of defense, namely that they shouldn't be singled out for a fee that's likely going to fund porgrams that have nothing to do with their industry.

"Failing to use those existing funds as the voters intended ... undercuts the  effort to find additional dollars to address polluted runoff,  which is the number one threat to water quality across the state," says Mo McBroom, lobbyist and policy director for the Washington Environmental Council.

To build almost $124 million in fund transfers, the proposal “recaptures” transfers made during the 2010 fiscal year, including $53.4 million from the Education Savings Account and $24.1 million from the Savings Incentive Account.

Other key fund transfers include: the $17 million from the MTCA fund; $8 million from the Savings Incentive Account; $7.5 million from the Aquatic Lands Enhancement Account; and $4.5 million from an Industrial Insurance Premium Refund Account.

The proposal in total would mean 18 new fund transfers to close out the budget cycle.
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