State treasurer candidates differ over proposed 'baby bonds' plan that seeks to address wealth gap in Washington
Sep. 23—A dozen years after her first run, a West Side accountant is making a new effort to unseat an incumbent state treasurer.
Republican Sharon Hanek made it out of the Aug. 6 primary with 42% of the statewide vote for treasurer, making her the underdog in her race against Democratic Treasurer Mike Pellicciotti, who picked up 58% of the vote. The two agree that financial education should be mandatory in the state, but they disagree on a proposed law aimed at addressing the state's growing wealth gap.
Hanek, 68, has spent her entire career working as a certified public accountant. A longtime Washington resident, Hanek said she's running for treasurer because she wants to use her 40 years of experience in financial accounting systems to fix disarray she's observed in the executive office and give back to her community.
"The one thing that makes me a contrast, not just the current treasurer but to treasurers of the past, is my strength and understanding in financial accounting systems," Hanek told The Spokesman-Review in a phone interview. "Over and over again, we're seeing that there's some mismanagement of funds. A lot of that is because of what is called a lack of adequate internal accounting controls."
Specifically, Hanek pointed toward improper documentation from the state for billions of dollars worth of COVID-19 pandemic relief spending. She vowed to take a look at who's in charge of state agencies, particularlparticular
the ones called out in recent audits.
Pellicciotti, 46, was elected to his post in 2020 after serving two terms as a state representative. The Democrat said investment returns for local governments in the state are 50 times greater than they were in 2021 when he took office. Pellicciotti is running for another term, he said, to continue his work on financial education and stability for state residents.
He pointed to his experience.
"There's no greater experience to be state treasurer than to be state treasurer," Pellicciotti said in an interview. "As someone who's always rejected all corporate campaign donations, it's allowed for me to put forward policies that have put the people's financial interest ahead of corporate interest."
While managing the treasurer's office the last four years, Pellicciotti said he is proud the state earned a "AAA"from the Moody's credit rating system during that time. He also said his office's refinancing of existing bonds to redirect more than a half-billion dollars that would otherwise go to Wall Street back into the state as something that will help residents of the state "for years ahead."
Last year, Pellicciotti pitched a bill called the Washington Future Fund to state lawmakers that would create trust funds for low-income babies born in the state. The proposed law, nicknamed "baby bonds," would set aside money for the roughly 40,000 children born each year under the state's Medicaid program, Apple Health.
That number accounts for nearly half the babies born every year in Washington.
Pellicciotti's baby bonds bill was modeled after Connecticut and Washington, D.C., which recently passed their own baby bond bills to address centuries-old racial and economic inequalities in the United States. Children qualifying for baby bonds would be granted access to a trust fund after turning 18 up until they reach age 35 to be used toward buying a home, launching a small business or pursuing higher education.
The Washington Future Fund didn't make it through the state Legislature this year, but Pellicciotti said if he gets re-elected, pushing for it to become a law is at the top of his to-do list.
"I care a lot about creating economic opportunity and economic empowerment for the people of our state," Pellicciotti said, adding that, along with the baby bonds law, he wants to pass legislation to mandate financial education be taught in all Washington high schools.
Hanek criticized the proposed baby bonds law, saying she thinks there are some good programs out there, but the baby bond idea negates the necessity for people to have "individual responsibility."
"Sometimes, when you start just giving away money, for example baby bonds, I'm a little concerned that it just becomes a giveaway," Hanek said. "I'd like to see that things are not just given away just because you're born, but given away because you have a purpose."
Hanek said she agrees with Pellicciotti's proposal that financial education be taught in schools, but that she would seek to expand that program to young adults up to 25.
As it stands now, the proposed baby bonds law would require the state to set aside $4,000 for each child born on Medicaid to access when they're 18 to 35 years old.
Hanek argued that the baby bonds program would be unfair to babies who aren't born on Medicaid but still end up needing help down the line. She said the concept of the plan is good, but that she would like a different system to identify who qualifies for state assistance.
Pellicciotti argued that today, more than 40% of Washingtonians don't have the ability to set money aside, let alone set up savings accounts or buy stocks, often making it impossible to overcome financial barriers such as college or technical school needed to even begin making money.
Before he got into politics, Pellicciotti worked as an assistant attorney general for the state, a deputy prosecutor and a state Supreme Court Clerk. He also received a Fulbright Scholarship for economic development. He holds a bachelor's degree in business administration and a law degree from Gonzaga University. The treasurer currently serves on a five-person state committee dedicated to helping state residents save for college and other educational expenses.
In 2016, Hanek was elected to the Pierce County Charter Review Commission. Four years earlier she mounted a write-in candidacy for state treasurer that earned her enough votes to advance to the general election, but she was defeated by then-Democratic incumbent Jim McIntire. Hanek earned her Certified Public Accountant license in 1980. She holds a bachelor's degree in business administration and accounting from the University of Washington.
The Washington state treasurer serves a four-year term and manages the state's investments, checkbook and debt.
General election day is Nov. 5, and Washington ballots will be mailed out in mid-October. Voters must mail their ballots with a postmark of Nov. 5 or before, or place them in official county-designated dropboxes no later than 8 p.m. on Election Day.
Ellen Dennis' work is funded in part by members of the Spokane community via the Community Journalism and Civic Engagement Fund. This story can be republished by other organizations for free under a Creative Commons license. For more information on this, please contact our newspaper's managing editor.
