57-cent gas hike? How Washington’s carbon fee plan could affect a key House race

Fighting to keep a key House seat in the Republican column, Washington state’s Dino Rossi is trying to tar his Democratic opponent Kim Schrier as a supporter of steep gasoline taxes, partly because she backs a carbon fee proposal on the state’s November ballot.

“Kim Schrier’s 57 cents per gallon price increase via the carbon tax won’t alleviate WA’s traffic,” Rossi tweeted recently against his 8th Congressional District seat opponent. “The funds would go towards politicians’ pet projects.”

Yet Rossi’s claims that the carbon fee, known as Initiative 1631, will cause a 57-cent gas price hike is disputed, and is triggering charges he is repeating the oil industry’s talking points. Not surprisingly, the oil industry opposes the carbon fee proposal.

“I think it is going to backfire on him,” said Nick Abraham, a spokesman for the Yes on 1631 campaign. “We have seen that people want to take action on climate change. For Dino Rossi to be tying himself so strongly to the oil industry is a bad strategy.”

Rossi and Schrier are competing in Washington state’s tightest House race, one with national implications for the midterm elections. Recent polls have either given Rossi a big edge or suggested a deadlocked contest in a district that stretches from the eastern suburbs of Seattle and Tacoma to more rural areas on both sides of the Cascades.

Ballots will be mailed to voters starting Friday. Along with choosing members of Congress, voters will be deciding on several ballot initiatives, including 1631, which will place a $15-per-ton fee on carbon pollution, potentially generating billions of dollars for clean energy projects. Opponents — particularly BP and Phillips 66, which operate oil refineries near Bellingham — have raised more than $21 million to defeat the initiative, claiming it lacks accountability on how the money would be spent.

The initiative also has given anti-tax Republicans ammunition against Democrats supportive of 1631. Schrier, a pediatrician making her first run for office, told the Seattle Times in August that she favored the initiative, at a time when she was in a primary battle against two other Democrats.

Talking to a group of seniors at a gated retirement community in Issaquah on Monday, Rossi again made mention of Schrier’s support for a “50-cent gas tax increase” and added that if elected to the House, she would also help roll back recent Republican tax cuts. “Folks, I think you are spending enough,” said Rossi, a real estate developer and former state lawmaker.

In recent appearances and tweets, Rossi has stated that the proposed carbon fee would cause a gas price hike of 43 cents, 50 cents and 57 cents, without stating what years those hikes would occur. Rossi told a reporter on Monday that some of those figures come from a study by the No on 1631 campaign, which hired NERA Economics, a consulting firm, to estimate the projected economic impacts.

NERA concluded that the carbon fee, if enacted, would cause a 13-cent gas price increase in Washington state by 2020, a 59-cent increase by 2035 and a total annual cost per household of $990 by 2035, in today’s dollars. Supporters reject all those claims.

Abraham, the Yes on 1631 spokesman, said the NERA study exaggerates the impacts and assumes that oil companies and other industries would pass on the total cost of the carbon fee to consumers, which he says is misleading. Even if industry did pass on those costs, he said, the campaign estimates it would only add $120 to $180 annually to a household’s total energy costs.

“The oil companies would not be spending $20 million trying to fight us if they could just pass on the costs,” he said. “The reality is there are lot more inputs that go into gasoline prices than what is happening in one state.”

Although opposed by many conservatives, carbon taxes are not a radical concept. Numerous countries have enacted them, and they are supported by industries such as Exxon and Reagan administration Republicans such as James A. Baker III and George P. Shultz. Proponents argue that putting a price on carbon encourages energy conservation and creates funding for alternatives to fossil fuels.

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Following Monday’s event, McClatchy asked Rossi if he was concerned about climate change and whether he’d support a carbon fee or tax in some other form than Initiative 1631.

“I am not in favor of taxes, period,” said Rossi, adding that he’d work to minimize greenhouse gas emissions by maximizing the Northwest’s use of hydroelectric power.

In signaling her support for a carbon tax in August, Schrier said the Northwest was increasingly feeling the impacts of climate change. “It really makes sense to put a price on carbon,” said Schrier, staking out a position that many fellow Democrats have not taken in competitive races.

In the 3rd Congressional District race in southwest Washington, for instance, Democrat Carolyn Long hasn’t publicly endorsed in Initiative 1631, making it a non-issue in her race against incumbent Republican Jaime Herrera Beutler.

Two years ago, Washington state voters overwhelmingly rejected a carbon tax, Initiative 732, a revenue-neutral measure that would have taxed carbon emissions while reducing other taxes. That initiative was opposed not just by oil companies but several social justice groups, who wanted money dedicated for mass transit, green infrastructure and other job-creating projects.

This year, many social justice groups and public sector unions are supporting Initiative 1631, in part because it would create a multi-billion-dollar pot of money. Several political analysts say the measure stands a good chance of passing, in part because Washington state just endured a summer of high temperatures, wildfires and intense smoke, conditions that could be attributed to climate change.

Voters in the 8th District can expect a flurry of television advertising in coming weeks. The congressional race was already poised to be the most expensive in Washington history, and on Monday, Schrier’s campaign reported she had raised nearly $3.8 million in the third quarter, three times more than Rossi.

The two candidates are scheduled to hold their first and only debate Wednesday night, at 7 p.m. in Ellensburg. That showdown that will be broadcast live on KING 5 and could influence the final Nov. 6 vote.

Stuart Leavenworth: 202-383-6070, @sleavenworth
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