NEWS: Lawsuit challenges attorney general's plan to put 'warning labels' on initiatives

For immediate release – June 3, 2024

Contacts:

Jim Walsh –  (425) 460-0570

Deanna Martinez – (509) 760-3608

Lawsuit challenges attorney general’s plan to put ‘warning labels’ on initiatives

New law requiring AG to write statements for voters’ pamphlet doesn’t apply to this year’s initiatives, plaintiffs say

OLYMPIA – A plan to put ‘warning labels’ on this year’s initiatives is being challenged in Thurston County Superior Court with a lawsuit arguing that a new law does not apply to three measures that will appear on the Washington ballot this fall.

The law, passed by legislative Democrats in 2022, requires the state attorney general to write a fiscal impact statement of up to 15 words for the state voters’ pamphlet, whenever an initiative might affect state tax collections. This year’s measures would overturn the state’s new cap-and-trade program, repeal the state’s new income tax on capital gains and allow workers to opt-out of a new insurance program for long-term care. Attorney General Bob Ferguson maintains the warning-label law gives him the right to declare whether they are hazardous to the state’s health.

But plaintiffs say the attorney general is misreading the law and that he has no right to inject himself into the election. The suit was filed by Jim Walsh, chairman of the state Republican Party, and Deanna Martinez, chair of Mainstream Republicans of Washington. They are set for a hearing June 7, and are represented by Seattle attorney Joel Ard.

“Our friends outsmarted themselves,” said Walsh, a state representative from Aberdeen who filed the three measures. “They were very specific when they passed the warning-label law. But they were so specific that the law doesn’t apply to any of the initiatives that go before voters this year. The case is so clear-cut I am surprised we have to take this to court.”

The lawsuit names Washington Secretary of State Steve Hobbs as lead defendant in the case and seeks a writ prohibiting him from certifying or publishing any statement about the initiatives in the voters’ pamphlet. Ferguson also is named as a defendant, as is David Schumacher, director of the Office of Financial Management, which is responsible for producing fiscal estimates.

This is the first time the statute has come into play, because no initiatives qualified for the ballot in 2022 and 2023. It spells out three conditions before the attorney general is allowed to write a fiscal impact statement. The ballot measure must impose, repeal or modify a tax or a fee. OFM must produce a fiscal estimate, and the estimate must show that adoption of the measure would cause a net change in state revenue.

The lawsuit observes that none of the initiatives meet those conditions. They are:

• Initiative 2117, overturning Washington’s cap-and-trade program. The scheme requires industries and utilities to purchase emissions credits at auction, and has been called a “hidden gas tax” because it has added about 50 cents to the cost of a gallon of gas. But the legislation defines itself as a “greenhouse gas cap and invest program” and not as a tax or fee.

• Initiative 2124, allowing Washington workers to withdraw from a new insurance program for long-term care. Although the mandatory paycheck deductions are frequently described as a payroll tax, the original 2019 legislation defines payments by workers to be insurance “premiums” rather than taxes or fees.

• Initiative 2109, repealing Washington’s new income tax on capital gains. Although this ballot measure clearly affects a tax, plaintiffs argue it has no fiscal impact because Washington lawmakers already voted this year to pass Initiative 2111, which bans any tax on income. The suit therefore argues that banning the capital gains income tax imposes no additional cost on the state.

These three ballot measures as well as I-2111 were among six filed by Walsh and presented to the Legislature this year, following a drive from the Let’s Go Washington campaign that collected more than 2.6 million voter signatures. The six-pack of initiatives challenged elements of the agenda passed by Democratic lawmakers since they gained control of the Washington Legislature in 2018. Majority Democrats this year passed three of the initiatives and allowed the other three to proceed to the ballot, in hopes of defeating them there.

The warning-label law was devised to make that task easier. Two years ago, legislative Democrats backed HB 1876 and argued that fiscal impact statements would allow voters to make better-informed choices. All Republicans voted against the measure, observing that the law abandons the principle of political neutrality and gives a single elected official a chance to intrude in elections using state resources.

“The law should never have been passed in the first place, because it gives one of the most partisan elected officials in Washington state an opportunity to blast away at ballot measures he doesn’t like,” Martinez said. “That’s bad enough. People trust the voters’ pamphlet as an objective source of information. They aren’t expecting a partisan political attack that masquerades as a neutral financial statement.  

“But this ill-conceived law doesn’t allow the attorney general to say a word about these initiatives, because two of these ballot measures aren’t about taxes and fees, and the third has no fiscal impact. Washington voters never asked for Bob Ferguson’s help. Now we need a court to tell him not to interfere.”

The lawsuit has been joined by Amber and John Goldade, who have moved to intervene in the case. Their daughter Immaculee was struck and killed by the driver of a stolen truck in January 2022 whom the police were prevented from pursuing and arresting weeks earlier. The Goldades spoke out in favor of I-2113, restoring police pursuits, one of the three initiatives passed by the Legislature this year. The Goldades say that when voters consider the remaining initiatives in November, they want to ensure voters are not misled or confused by inaccurate fiscal statements. They are represented by Jackson Maynard of the Citizens Action Defense Fund.