This Washington

Republican State Sen. Zarelli is Emerging as 2011's Most Important Legislator

By Josh Feit March 15, 2011

Ascendant state Republican budget star, Sen. Joseph Zarelli, could bring a bit of Wisconsin to Washington as budget talks to address a $5 billion shortfall (or more) start in earnest.



Sen. Joseph Zarelli (R-18, Ridgefield)

We've given a lot of attention to the Roadkill Caucus, the conservative Democrats in the state senate, who have wielded clout this session by teaming up with the minority Republicans to call the shots and override the liberal leadership in their party. Thanks to the conservative alliance, several liberal bills failed, including a bill to regulate paid signature gathering
; a bill to regulate toxic toys; and a labor bid for extra benefits.

The Roadkill Caucus certainly deserves attention. But their key member happens to be a Republican: Senate Ways and Means chair Joseph Zarelli (R-18, Ridgefield), a financial consultant for businesses at his own firm, JP Zarelli, Inc.

"It's a different dynamic [this year]," Democratic leadership spokesman Jeff Reading says.

The Roadkill Caucus' power will certainly come into relief after the latest revenue forecast hits this week, forcing a stark conversation on the budget. With the state already facing a $4.6 billion shortfall, Thursday's forecast—some fear the shortfall could be another $2 billion—could make negotiations even more intense.

But let's pause here. It's not the Democratic Roadkill Caucus (or the "Road Rage Gang," as some liberal senators call them) that's in the driver's seat. Their power-by-numbers clout comes from, well, their numbers—and their numbers come from their Republican allies.

Specifically, the legislator in the driver's seat this year is Sen. Joseph Zarelli (R-18, Ridgefield), the ranking Republican on the senate ways and means committee. Zarelli, who may be stepping into a Dino Rossi budget moment of his own this session, already had a big win during the supplemental budget talks (the $1.1 billion fix for the final six months of the 2009-2011 biennium that budget leaders hammered out earlier this session). It was Sen. Zarelli who pushed for, and got
, tighter eligibility requirements for the Basic Health Plan—lowering eligibility to from 200 percent of the federal poverty level, or $37,000 for a family of three, to 133 percent of the federal poverty level, or $24,000 for a family of three.

Zarelli tells PubliCola that his goal for the supplemental budget was just an emergency fix to balance it, but he sees his next job—the 2011-2013 budget—as much larger, an opportunity to "clean up" government. "Let's not just whack and hack to get rid of things," Zarelli says. "Let's come out of this getting more out of our programs, let's clean them up so we're serving the most vulnerable—not just everybody we want.  Let's focus on the right group of people."

Referring to the Disability Lifeline, for example, health care coverage and a stipend for people whose disabilities prevent them from getting jobs, Zarelli says "there are no clear expectations" about moving people off the program and it can "become enabling."

As opposed to the "band-aid fixes" the senate made to the $34 million Disability Lifeline—an $18 million cut to the cash stipend during the emergency supplemental budget negotiations—Zarelli recommends going with substantive changes to the program for 2011-2013.  He wants to "get away from the cash [stipend] piece" and spend directly on services in the program.

He also wants to change eligibility to the Basic Health Plan, subsidized health care for the poor. "This is a point of consternation for some, but I believe we need to serve our citizens first," he says, referring to the GOP push to knock undocumented immigrants off the program.

Zarelli—teaming up with conservative Democratic Sen. Rodney Tom (D-48, Bellevue)—has already come out with a bill he hopes will guide the budget discussions. The bill
, calling for more concessions from state employees, throws out Gov. Chris Gregoire's agreement with the Washington Federation of State Employees, the state workers' union. Zarelli, for example, suggests that workers pay up to 25 percent of their health care premiums, as opposed to the 15 percent Gregoire negotiated.

Zarelli tells PubliCola that "what burns me" about Gregoire's agreement "is that it's just temporary"—using one-time reserve funds and furloughs to cover costs that "we're just going to have to make up next biennium." For example, he argues that workers didn't agree to a pay reduction, they simply agreed to furloughs that Gregoire has characterized as a three-percent pay cut.

In fact, judging from Zarelli's priorities, the state employee discussion that has transfixed Wisconsin may now take center stage in Olympia as the legislature struggles with the 2011-2013 budget shortfall.

Of the nine bills Zarelli introduced this session, five directly take on state workers. They include: one that would have made state employee contracts null and void in the instance of a budget shortfall (it didn't go anywhere); one, which passed the senate, that creates high-deductible health plans for public employees (the Washington Federation of State Employees opposed the bill, arguing that younger workers would enroll and drive up overall costs for state employees, undermining the basic concept of insurance); and one
that would encourage outsourcing state functions to private firms.

When Zarelli, first elected to the senate in 1995, introduced his latest challenge to state employees last week
, the bill that rejects Gregoire's deal with state employees, he was certainly sensitive to the charge that state employees have become a scapegoat:
Let me be clear: This is not about scapegoating our fine public employees, or in any way impugning those who on a day-in/day-out basis work hard for the citizens of this state.  Nor is it in any way an attempt to limit their right to negotiate wages and benefits.

This is about giving the Legislature – in a time of crisis – maximum flexibility to allocate state government’s anticipated revenue so that the areas of greatest need – such as K-12 education, the safety net”and natural-resource protection – are addressed in a way that Washington taxpayers and service recipients expect.

Zarelli's Democratic counterpart, ways and means chair Sen. Ed Murray (D-43, Capitol Hill), says "if it [Zarelli's new bill] was in my committee, I wouldn't even give it a hearing." Nonetheless, Murray credits Zarelli for being "willing to compromise."

"He could have acted like the house Republicans and criticized and not participated," Murray says—referring to house Republican budget leader Rep. Gary Alexander, (R-20, Olympia), who voted "No" on the supplemental budget deal and scoffed at Zarelli
for playing along with the Democrats.

Calling Zarelli an "honest broker," Murray says, "Zarelli has chosen to be a player. We're playing in each other's sandboxes. He gets his cuts, which is part of his agenda,  and I get to preserve some programs, which is part  of my agenda."

Murray credits Zarelli's team work with saving the Basic Health Plan and the Disability Lifeline—albeit, at reduced levels—during the supplemental budget talks. Both programs had initially been cut by the governor.

Zarelli returns Murray's compliment, saying, "He worked really hard and made a lot of cuts he didn't agree with. In the senate, we realize the only way we're going to get things done is if we work together as much as we can."

As for the house, where the Democrats have a much bigger majority—56-42 as opposed to 27-22—Zarelli says, "they're still focused on going the majority way."

What are Zarelli's differences with the Democrats, particularly in the house? "We cannot take this out of the hide of higher education and K-12," he says. "They believe the social safety net is perfect and we have to keep all of it. We believe we can make it better by serving those truly in need. And saving education prevents all the social satey net cost in the long run." (For the record, the social safety net was hit harder in the supplemental budget than education—$170 million in cuts vs. $90 million in cuts.)

Some of Zarelli's top contributors during his last campaign in 2008 include Spokane power company Avista, Bellevue developer Kemper Freeman, Moneytree founder Dennis Bassford, and the Service Employees International Union 925.
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