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Dear Friends and Neighbors,
The Legislature is now in special session as the House and Senate have been unable to reach an agreement on a McCleary education-funding solution and a final operating budget spending plan. Republicans and Democrats have two very different approaches to both issues.
Regarding McCleary, both parties want to increase K-12 education funding significantly, and the total dollars each side wants to spend isn't that far apart. However, Democrats want to raise taxes by nearly $8 billion while Republicans want to reform our state property tax system to make it more equitable and fair. The Democrat plan does not fundamentally reform the levy system. My primary role is to craft language to make sure we do not end up in a McCleary 2.0 situation. In fact, I have introduced legislation that will be part of the final negotiations that prohibits the Legislature from using local levy money to support basic education. This is what led to the lawsuits in the first place. The state Supreme Court has indicated in the past the levy system was part of the problem.
The budget is more of the same. House Democrats want to increase state spending by 34 percent over four years. That is a huge increase, again relying on their massive tax proposal. Look at it this way, when I was sworn into office in 2012 the budget was about $32.2 billion. Our current 2015-17 operating budget spends $38 billion. If House Democrats had their way, they would spend more than $51 billion by 2019-21.That is close to $20 billion in a decade. Our operating budget didn't exceed $20 billion until the 199-01 biennium, and we are already talking about exceeding $50 billion under their proposal!
That said, I do not see a budget that approaches $50 billion in spending or includes massive tax increases. The House Democrats have been unwilling to vote on their tax package because I do not think they have the votes. Again, we do not need to raise taxes, but their posturing has complicated the budget negotiations. How can you negotiate your budget proposal if you cannot show you have the votes to pass the revenue that goes along with it?
Finally, their tax plan also includes a capital gains income tax. I believe that is unconstitutional and would not pass the muster of most courts. They would like to test that theory before a sympathetic court however. For more on the state income tax situation read “Constitutional amendment would prevent income tax” which was featured in the Columbia Basin Herald and the Daily Record. Late last week, the mayor of Seattle announced he would like to implement a capital gains income tax against his city's most wealthy residents. This battle is far from over. I can assure you I will NOT vote for any budget that includes a capital gains tax or increases in the B&O tax. Again, these taxes are unnecessary. Revenue is not a problem. We are expecting almost $3 billion more in taxpayer revenue – your money – this biennium.
Like most budgets, there will be some good and some bad. I am working on increasing funding for career and technical education (CTE) and protecting current CTE funding.
Another very important piece of unfinished business we must address in the special session is the Hirst decision. It doesn't matter if you own undeveloped rural property or you are an urban property owner with access to water, if we adjourn without a Hirst solution, all property owners will be affected and will pay the price in one form or another. I am at the negotiating table and I can tell you Republicans are committed to finding a solution. We must make sure the governor and House Democrats will allow a Hirst fix. They do not seem to be in a big hurry to let us bring relief to landowners and local jurisdictions around the state.
Obviously we have some big issues that have yet to be resolved, but there are some positive things that have come out of the session. Below is a description of some of those issues and bills.
Pension policy – Public Hospital Districts
It is not uncommon for the Legislature to adopt changes to retirement plans. In 2005, some changes adopted allowed EMT's to be part of the LEOFF pension system. In 2010, the Department of Retirement Systems (DRS) indicated there were possibly significant numbers of EMTs who were employed by Public Hospital Districts (PHDs) and became eligible for LEOFF Plan 2 in 2005 but had not been enrolled. The PHDs challenged this ruling because they could potentially be on the hook for costs past, present and future associated with the EMT's being part of the LEOFF system.
I primed-sponsored House Bill 2202 and worked with stakeholder groups. We were able to come up with a bill that addresses the costs, and fixes the law going forward so there is agreement about the meaning of the law in the future. We were able to save public hospital districts a large amount of money – including some PHDs in the 13th District.
Recent decisions made at the federal level, allowing internet and cable providers to sell personal data without the permission of consumers, lead legislators to take action at the state level to protect you internet privacy. I was one of the lead negotiators on House Bill 2200. The bill passed the House on Wednesday. Unfortunately, because we are in a special session, we will have to pass it out of the House and over to the Senate again.
The bill would require broadband internet service providers (ISPs) to acquire opt-in consent from customers before selling or transferring their information. It would also prohibit ISPs from denying service to customers who choose not to opt-in. This would have been a good starting point, but since we will be working on this again during the special session, I am hopeful we can make it stronger and include edge companies such as Google and Facebook. We have heard from many of you, how important the privacy is, and too keep the federal government away.
Privacy and online security have become an all new reality for most of us. As we do more and more of our daily activities online, the need for securing our personal information has moved to the forefront.
Last year I sponsored legislation to create the Historic Cemetery Grant Program to get infrastructure in place to allow cemetery property owners, communities and nonprofits a way to preserve and maintain their historic cemeteries. While we were able to get the infrastructure in place, we didn't have the funding. In this year's House version of the capital budget, I was able to secure $515,000 for the grant program.
I was also able to get $17,000 for a replacement well at the Olmstead-Smith Historical Gardens. Volunteers who work at the garden approached me earlier this year about the water problem in Olmstead Place State Park. A new well will help keep the history of the Olmstead Place alive by preserving and maintaining the surrounding gardens.
Under the House plan, the Clymer Museum and Gallery would receive $247,000 in funding to revitalize and restore the upper portion of the historical building that houses the Clymer Museum.
Central Washington University is slated for funds addressing a number of projects. I must point out this is only the House version of the capital budget. House and Senate capital budget leaders are meeting to work out the differences between the two plans. I am confident many of these local projects will be in the final version of the capital budget we are expected to pass during the special session.
Water recreation facilities, House Bill 1449: This measure clarifies dunk tanks and bounce house waterslides are not to be treated like a public pool. A local health department in the 13th District was treating them like public pools and levying fines and fees as well as requiring permits. That is tough on small community festivals and charity organizations trying to raise a little money. The governor signed this bill into law last Friday.
Workers' compensation third party settlements, House Bill 1755: Gives employers a notification about third party settlements. A settlement may be less than the claim costs and affect an employer's experience rating. This will help employers be prepared. It passed the House and Senate unanimously and awaits the governor's signature.
If you have any questions about the issues or legislation mentioned in this email update, please do not hesitate to contact me.
470 John L. O'Brien Building | P.O. Box 40600 | Olympia, WA 98504-0600
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