Voters are in the dark on Ref. 53

If there is one thing voters on Whidbey Island know about Referendum 53, it's that they don't know anything about it.

"It's off the radar for most people," said Dave Ellis, owner of Freeland's Building Source, last week.

Ellis is in a good company of people who probably should know something about Ref. 53 but do not. The measure will change how unemployment taxes are charged to businesses statewide. A vote for the referendum will shift the costs of the state's unemployment insurance system more onto seasonal industries, such as construction and agriculture; a 'no' vote will leave the tax much as it is.

Since he sells building materials to contractors and is a small-businessman himself, Ellis said he does need to learn more about Ref. 53. But others with vested interest in the vote, not to mention the majority of voters who do not own businesses, may not be doing their homework.

Among those could not comment on the content of the measure during the past week were Sharon Hart, director of the Island's District Economic Development Council, EDC president and Whidbey Printers owner Eric King, and the executive director of the Langley-South Whidbey Chamber of Commerce, Loretta Martin. Not even the state's pre-eminent non-partisan political organization, the League of Women Voters, has come out with a position on the measure.

Jan Teague, president of the Washington Retail Association, said she doesn't blame them.

She said the referendum, sponsored by the state's building industry in opposition of the underlying legislation, Engrossed House Bill 2901, is both obscure and worded in a manner confusing to voters. She said that's the way the building industry designed it, since voters typically vote 'no' on measures they do not understand.

"They were so cunning," she said Tuesday. "Nobody gets it."

That is why she has spent the last few weeks travelling to business forums and meetings to educate at least retail business owners. It would be in their best interest, she said, to vote 'yes' on the measure, thereby supporting the legislation.

Also hoping for the referendum's approval is Boeing. The company, which has been laying off thousands of workers over the past year and thereby swelling the unemployment rolls, does not want to continue paying as much as it has for unemployment insurance -- about $200 a year per employee for companies with a history of layoffs.

"Without this bill, about 85 percent of this state's small businesses would be hit with an increase in their unemployment costs," said Cris McHugh, a spokesperson for Boeing.

Increases in the unemployment tax are expected no matter what, but by approving the referendum, McHugh said Boeing and other businesses hope to shift the costs to offset future increases.

But on the other side of the battle, professionals in the construction industry have their own arguments over Ref. 53. Rick Jones, president of the South Whidbey chapter of the Skagit-Island County Builders Association, said Monday that businesses like Boeing don't deserve what he views as a tax break if the referendum allows the new unemployment legislation to go into effect. He said the construction industry is inaccurately portrayed as one with high seasonal unemployment, and should not be expected to pay more for unemployment insurance.

"They're pulling down a heck of a lot more unemployment than we are," he said.

If the referendum is approved, Jones said voters would pay for it in higher housing costs. Fortunately, he said, the referendum is tailored toward the voting impulses of the voting public and in line with the building industry's stance. It's best for his industry that voters are generally uninformed.

"On a 'no' vote, I think it consoles me," he said.

That does not go for builders on Whidbey Island, however. Jones said he has been trying to get local builders interested in and educated on the referendum. So far, he said, he has not been particularly successful.

No matter what the vote on the referendum, the issue could still go to court. Retail and business groups, along with Gov. Gary Locke, attempted to have Ref. 53 declared unconstitutional by the Washington Supreme Court. The court unanimously ruled to hold off on judgement until after the election.

How Ref. 53 works
Ref. 53 is simply a vote of the people on a new unemployment insurance law passed this year by the state legislature. A 'yes' vote will put a referred portion of the law, EHB 2901, into effect, establishing new employer rate classes for paying unemployment taxes, increasing some taxable wage bases, and imposing some surcharges on businesses.

A 'no' vote will remove the referred portion of the legislation from the books.

To learn more about Ref. 53, consult the state's voters pamphlet, which was mailed out to most households and businesses last week. More information is on line at

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