This Washington

What Each Side Wants as Likely Special Session Looms

A day of news conferences and votes in Olympia cues up budget negotiations.

By Josh Feit April 24, 2013

The news out of Olympia today? The house passed a revenue package—$900 million from closing tax exemptions (about $400 million) and extending a business and occupation surcharge on some professional services (about $500 million)—on a straight 50-47 party line vote.

The proposal, ushered through by Seattle Rep. Reuven Carlyle (D-36, Queen Anne),  the new house finance chair who's been critical of unchecked tax exemptions for years, funds a $33 billion budget, keeping social services intact and, in response to the Washington State Supreme Court's McCleary decision, adds $1.2 billion in new funding to K-12 education on top of the $14 billion maintenance level.

The unprecedented vote for nearly a billion dollars in revenue including cash from closing tax breaks (something Democrats have been threatening to do for years) adds credibility to the Democrats' bargaining position.

It's not entirely surprising that the liberal Democratic house passed a revenue package that they say prioritizes education for kids over tax breaks, such as a $41 million tax exemption for oil companies. Nor is it surprising that the Republicans voted against it, speaking out against ending exemptions, which they see as tax increases that will kill jobs.

What's newsworthy, however, is this: The unprecedented vote for nearly a billion dollars in revenue including cash from closing tax breaks (something Democrats have been threatening to do for years, but haven't done beyond taking on an easy target last session that even Republicans agreed with—big banks) adds credibility to the Democrats' bargaining position.

Democratic budget leader Rep. Ross Hunter (D-48, Medina) is now in a position to sit down with his Republican senate counterpart, Sen. Andy Hill (R-45, Redmond), with a mandate and a majority of votes backing him up on revenue. Hill isn't it a bad position himself; the senate budget was approved in a bipartisan 30-18 vote with seven members of the Democratic caucus plus two conservative Democrats who have chosen to caucus with the Republicans this session—Sens. Tim Sheldon (D-35, Potlatch) and Rodney Tom (D-48, Medina)—voting 'yea.'

The senate budget adds $1 billion to K-12 education, rejects new revenue, and cuts deeper into social services. As the two sides prepare to begin negotiations (and as everyone acknowledged they would not meet this Sunday's end-of-session deadline, and a special session was inevitable, perhaps lasting into June), another thing was going on in Olympia today: "Go Home" issues—top priorities from each side that will likely be bargaining chips in the negotiations—began to emerge. 

Democratic Gov. Jay Inslee—whose own budget outline looks much like the house Democrats' plan, relying on revenue from closing tax exemptions and extending the B&O tax surcharge—outlined his top issues at a press conference this morning.

Jay Inslee announces his priorities/photo Josh Feit

Inslee said: "There is much work to be done. We need to act on gun violence, women's privacy, the DREAM Act," he said, referring to: a bill that would prevent perpetrators of domestic violence from owning guns that failed in the senate after passing the house; a bill, known as the Reproductive Parity Act, that would require insurance companies that cover maternity care to also cover abortions (it too passed the house, but never got a vote in the senate); and a bill that would make children of undocumented immigrants eligible for financial aid that passed the house, but never came up for a vote in the senate. (Inslee also stumped for a bill to crack down on drunk driving and said funding transportation was key.)

"To leave this session without dealing with gun violence doesn't make sense," Inslee said, noting the "tragedy just a few days ago [in Federal Way], apparently a domestic violence siutation."

And referring to the recent failure of the U.S. Congress to pass a gun control bill, he concluded: "Common sense did not prevail in the other D.C., so it's up to common sense in this Washington."

As for the RPA, he said: "Protecting the privacy of women was not even given a chance. We need to see some votes."

However, Inslee did temper his wish list: "I was elected as governor, not as dictator, and I understand that distinction. We're going to try to make progress on as many fronts as we can."

As for the GOP "Go Home" issues, I talked to a couple of Republican leaders, and while there are several bills in play, here are the ones that emerged: A bill they passed yesterday to cap non-education spending; a workers' comp reform bill they passed earlier this session (the first set of high-profile bills they passed); and a whole batch of education reform bills including one that would give principals the right to refuse to accept reassigned teachers, another that would hold third graders back if they failed to meet reading standards, and another that would put failing schools under state supervision. 

There are certainly other GOP priorities, but they vary from member to member, and it's unclear which ones have momentum or support in the caucus; Sen. Doug Ericksen's (R-42, Ferndale) bill to rewrite the rules governing the toxic cleanup account is one that has gotten a lot of attention. And, Sen. Don Benton (R-17, Vancouver), an active ideologue in the GOP caucus, has Democratic negotiators on edge with his seemingly limitless agenda. His latest play revives a payday lending bill that liberals fear would sock low-income borrowers.

I asked Inslee about the GOP list, and he focused on the non-education spending cap (an idea his former gubernatorial rival, Republican Rob McKenna had hyped.)

"I think actual dollars is better than demagoguing," Inslee said. "Real dollars are better than dramatic political statements. What's going to help is paying for teachers and paying for books, not statements of political intent. We need real dollars."

I wasn't able to get specifics from the lead Democratic budget negotiator, Rep. Ross Hunter (D-48), though told about Inslee's list, Hunter nodded in agreement and said they matched the priorities of his caucus. He also noted that they matched the priorities of a majority of the members of the senate (the Majority Coalition Caucus has a couple of social liberals in their ranks, including Sens. Steve Litzow (R-41, Mercer Island) and Tom).

By the way, someone else was rolling out a wish list in Olympia today. Initiative hawker Tim Eyman filed his latest initiative—a non-binding measure asking voters if they want the legislature to send a constitutional amendment to the ballot box mandating a two-thirds vote requirement for the legislature to raise taxes. Eyman's two-thirds rule was declared unconstitutional by the Washington State Supreme Court earlier this session. 

Tim Eyman announces his new initiative/photo Josh Feit

Critics of Eyman, Democratic Party activists Steve Zemke and Andrew Villeneuve, staged a press conference of their own immediately after Eyman filed his initiative and complained that his measure would be funded by big corporate interests that are opposed to tax increases. In the past, Eyman's anti-tax measures have indeed been bankrolled by companies like BP and ConocoPhillips, which contributed at total of $210,000 to Eyman's last anti-tax initiative, I-1185, in 2012.

Eyman didn't dispute this analysis. After his press conference, when I asked him if he was opposed to the tax break repeals that the Democrats were pushing (such as taking away an ancient exemption for big oil that was actually created to help the wood products industry in the late 1940s), Eyman warned: "whoever gets hit with a tax is going to help fund this initiative." 

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