Gov’s Office downplays former state economist’s claim of pressure to lie about gas prices

The Governor’s Office has preliminary, tentative findings regarding a former state economist who says he had to resign after suffering retaliation for his analysis that Washington’s cap-and-trade policy would significantly increase gas prices.
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Scott Smith says he was threatened to keep his prediction of higher gas price hikes as a result of the state’s carbon auction from the public and told not to put anything in writing that could be subject to a public records request

Brett Davis
The Center Square Washington

The Governor’s Office has “ascertained a few very preliminary, tentative findings” regarding a former state economist who says he had to resign after suffering retaliation for his analysis that Washington’s cap-and-trade policy would significantly increase gas prices.

Under the Climate Commitment Act of 2021, emitters are required to obtain “emissions allowances” equal to their covered greenhouse gas emissions at quarterly auctions hosted by the Department of Ecology.

The Citizen Action Defense Fund on Thursday filed a demand letter on behalf of Tumwater’s Scott Smith, 64, who worked for the state Department of Transportation as an economist. The complaint against the WSDOT, the Office Financial Management and the Gov. Jay Inslee administration argues Smith was threatened to keep his prediction of higher gas price hikes – 45 cents to 50 cents per gallon – as a result of the state’s carbon auction from the public and told not to put anything in writing that could be subject to a public records request.

Inslee had predicted a gas price increase of only “pennies” per gallon once the CCA took effect. Washington currently has the third-highest gas prices in the country, behind only California and Hawaii, according to AAA.

A Friday evening email to The Center Square from Inslee spokesperson Mike Faulk claimed, “The OFM individual named in the letter has expressed surprise and no recollection of events matching Mr. Smith’s claims regarding how his analysis would be used. He does not recall ever talking with this individual about the Climate Commitment Act and does not recall needing to ‘approve’ or review reports from Mr. Smith.”

Faulk went on to say, “There is a quarterly meeting to review the assumptions of the forecast that includes staff members from the Legislature as well as multiple state agencies. The OFM individual named in the letter does not recall the issue of CCA prices coming up during the quarterly meetings.”

Jackson Maynard, CADF executive director and counsel, who filed the claim for Smith, hit back when asked to respond to Faulk’s comments, saying in an email to The Center Square that “not remembering is not the same as denial. My client looks forward to the discovery process which may aid memories of executive officials and employees in this matter.”

Maynard continued, “Second, the statement is silent as to the recollection of the WSDOT employees referenced in the letter which is interesting.”

In his email, Faulk balked at the notion that Smith’s position was eliminated by the WSDOT prior to the economist’s November retirement, explaining that the state Legislature had passed House Bill 1838 “earlier this year that would eventually move the essential functions that were performed by Mr. Smith from WSDOT to the Economic Revenue Forecast Council.”

Again, Maynard had a different take.

“WSDOT did not oppose HB 1838 which eliminated his position and transferred it to another entity,” he said. “The bill was introduced late in session (on Feb. 20) and about 30 days after my client was first pressured to ‘jimmy the numbers’ of his fuel estimates for the Governor’s Office of Financial Management.”

Maynard noted, “OFM’s legislative liaison (accompanied by ‘the OFM individual named in the letter’) testified in favor of the bill in both the Senate and House hearings. She specifically mentioned that WSDOT had requested the bill.”

In Maynard’s estimation, that means “that not only did WSDOT request that my client’s position be eliminated, but the Governor’s office of financial management did as well. The Governor’s office cannot blame the legislature for its political hit job.”

Faulk said Smith planned to retire in June 2024 and had requested to be able to work out of state until his planned retirement and that the WSDOT was making “a good-faith effort to consider his request, but Mr. Smith did not finalize the process for further consideration.”

Finally, Faulk dismissed Smith’s claims he was denied leave to spend time with his mother around Thanksgiving as part of a “vendetta,” explaining that Smith “was the expert presenter at a meeting that conflicted with his date requests.”

Maynard noted that “the remainder of the points do not actually conflict with my client’s position and will be addressed in the course of litigation.”

He concluded, “In short, it would be prudent for the Governor’s Office to truly understand this matter before drawing conclusions and reporting on claims that it has not yet investigated.”

Smith is requesting damages in the amount of $750,000 for loss of salary and benefits, as well as damage to his reputation.

This report was first published by The Center Square Washington.


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