It’s Time to Get Rid of Washington State’s Corrupt and Counterproductive Carbon Tax

W ashington State residents in November will decide whether to keep a CO₂ tax levied under the Climate Commitment Act (CCA) of 2021. The tax has increased the cost of home-heating and pushed gas prices up more than 40 cents per gallon last year.

Supporters of the tax, including oil giant BP, argue that it will reduce the state’s CO₂ emissions and fund projects that help the state adapt to climate change. Instead, politicians and the state bureaucracy have used the billions they have collected in new tax revenue to fund government programs and reward political allies in the guise of environmental protection. Moreover, the state government is using taxpayer funds to campaign for keeping the CO₂ tax, while regulators have banned utilities from showing consumers its costs.

It would be more appropriate to call it the “Climate Corruption Act.”

Both of us believe that we have a moral obligation to address climate change to protect future generations. We both supported a revenue-neutral carbon tax that would have replaced other, regressive taxes and protected low-income people. Emission-reduction decisions should be in the hands of individuals and businesses who are best positioned to respond to market signals. What we don’t support are regressive taxes, such as the CCA’s, that have high costs and do little to reduce greenhouse-gas emissions.

For example, the state is spending $67 million on “Community Decarbonization Grants” intended for clean-energy infrastructure projects or hard-to-decarbonize sectors. The criteria favor new applicants and those who don’t include individual-arbitration clauses in their employees’ contracts. There are no guaranteed points, however, for the decarbonization potential of proposed projects. In fact, staff of the state’s commerce department explicitly note that they reserve “the right to award contracts to the applicants whose applications are in the best interest of Commerce and the state of Washington,” rather than, say, to the applicants most likely to reduce CO₂ emissions.

Other programs funded by the CO₂ tax are also designed to help the government rather than the environment. A $4 million program to reduce flooding in Northwest Washington is being used to hire more government staff. There is also money for bike racks, “grant writing support” for federal funding, and even “World Cup transportation planning.” To be sure, not all funding is wasteful. There is a $12 million allocation to make forests more fire-resilient — something that Washington desperately needs. But four times as much is spent on local-government planning.

Taxpayer funds have also been misused to campaign against repealing the CO₂ tax. When Initiative 2117, which would repeal the tax, was certified for the November ballot, the legislature quickly approved onetime, election-year $200 payments to utility customers. Legislators required that the checks arrive just weeks before voters received their ballots. When one utility refused, the state’s commerce-department staff instructed the utility to deliver the checks “before the state votes on the initiative,” all but admitting that they are meant as bribes to influence voters.

Governor Jay Inslee’s administration has also required any organization — including sub-grantees — that receives funds under any CCA program to display a state-created CCA logo with specific brand guidelines. Grants may be rescinded if the logo isn’t displayed. The logo is everywhere. A letter sent to parents about a bike-safety program at an elementary school, for example, which featured the logo, threatened that even this use of state funds would be gone if voters didn’t keep the CO₂ tax.

State regulators have been equally aggressive. Washington State’s utilities commission, for instance, has prohibited one utility from showing the cost of the CO₂ tax on customers’ bills, claiming that it would be confusing. Commissioners then required the utility to display on its bills a rebate that was funded by the CO₂ tax. That, apparently, isn’t confusing.

Washington’s record of climate promises has been abysmal. Emissions increased for a decade leading up to 2019, when the Inslee administration stopped releasing data. A major reason is that climate funding has focused more on politics than on the environment. The CCA continues that corrupt and ineffective trend. The state can do better for taxpayers and the climate. But, like any twelve-step program, the first step is to admit that we have a problem. Voters can do that by voting yes on Initiative 2117 — as we both are — and repealing the state’s wasteful CO₂ tax.

Todd Myers is the vice president for research at the Washington Policy Center. Joe Ryan is the former president of the Washington Environmental Council.