Lu Hill: Initiative will line the pockets of the ultra-wealthy at the expense of jobs, schools and our economy

One of the many things I love about living in Spokane is how engaged people are in making this a great place to live. As a lifelong Spokanite, I’ve seen firsthand what happens when people come together to call for meaningful change in this city. In recent years that has included the redevelopment of Riverfront Park, improvements to Spokane Public libraries, as well as development of the North Spokane Corridor and the Nevada Street affordable housing project for global refugees and people with low incomes.

All of these public services enhance our region and have real impacts on people’s lives. And they are all made possible by taxpayer dollars.

Now, as Spokane continues to face a school budget deficit and child care crisis, it has been especially timely that a new source of state revenue to support kids and families went into effect in 2023. The state capital gains tax – paid by fewer than 1% of the wealthiest people in Washington – is on track to bring in more than $1.3 billion for early learning and schools around our state in its first two years. In Spokane County so far, it has funded approximately 1,285 child care and prekindergarten slots, provided almost $2 million in grants toward child care providers (which translates to new jobs), and made two school construction projects possible.

Community advocates, nonprofit organizations, teachers, students, wealthy people who want to pay what they owe, and many others in Eastern Washington and around the state fought for the passage of this tax for years. They wanted to fix our state’s inequitable tax code and ensure we have better funding for critical public services.

Initiative 2109, which is on the ballot next month, is a serious affront to these efforts to make our shared future brighter. This initiative, part of a slate of initiatives brought forth by a small group of ultrawealthy people and special interests, would overturn the capital gains tax. The people behind the initiative – some of whom got even richer during the pandemic while so many others struggled to make ends meet – seek to line their pockets instead of paying a small tax to support kids, teachers, and child care workers. I know I’m not alone when I say that giving rich people a tax cut shouldn’t take precedence over our kids’ well-being.

If it passes, I-2109 would also undo an important fix to Washington’s tax code, which has long over-relied on people with low and middle incomes while millionaires pay much lower tax rates. This would be a step back for racial and economic justice. (In case this is new information for you, allow me to explain: Black, Indigenous and people of color are more likely to make lower incomes as a result of a long history of policies that exclude us from wealth and opportunity. Washington’s tax code, which requires people with low incomes to pay higher tax rates as a share of income than rich people, is therefore especially harmful to BIPOC. But by ensuring rich, mostly white, people are starting to pay what they owe, the capital gains tax is helping to address this inequity.)

What’s more, I-2109 is bad for our economy. New research shows that repealing Washington’s capital gains tax would lead to job losses in the public and private sector and hurt Washington’s gross domestic product. Spokane County would see an estimated annual loss of more than 510 jobs and $55 million in its GDP. The jobs affected are not just those directly providing services funded by the capital gains tax, like early learning providers and construction workers. Funding for child care also helps make it easier for parents to work in a range of jobs. Further, when communities have more child care centers and construction workers, local businesses see a boost in spending.

Only the wealthiest of the wealthy pay this modest excise tax on profits from the sale of high-end stocks and bonds. The average annual income for households that pay the capital gains tax is more than $2 million. In Spokane County, fewer than 85 households had enough wealth to pay the tax in 2023. And the sale of small businesses, homes, retirement accounts, and farms are among the many exemptions to this tax.

So to sum up: A vote for Initiative 2109 is a vote against jobs, our economy, and school funding. If you want to continue to help Spokane be a great place to live for all of us – and not just the wealthy few – vote no on I-2109.

Lacrecia “Lu” Hill is a fourth-generation Spokanite who has long been involved in supporting the community in the nonprofit, philanthropic, and small business sectors. She currently is the community engagement and strategy director at Empire Health Foundation. These thoughts are her own.

Read this column in The Spokesman-Review