This Washington

Inslee Proposes Raising Minimum Wage and Other Surprises from his State of the State Speech

Some news and analysis from Gov. Inslee's speech today.

By Josh Feit January 14, 2014

First, a couple of headline makers from Gov. Jay Inslee's 2014 State of the State speech to a joint session of the state house and senate, held in house chambers, today

1. Inslee called for an increase in the state's minimum wage. Washington state currently has the highest minimum wage in the country, $9.32 an hour. Inslee suggested an increase of between $1.50 and $2.50. 

"There are tens of thousands of jobs that people depend on that don’t provide a living wage in our state," Inslee said. "Too many Washingtonians struggle. There are thousands of working moms and dads with full-time jobs—sometimes two or three jobs—who some days cannot afford to put adequate food on the table." (Erica here: Hey, Gov. Inslee: It isn't just "moms and dads" who deserve a living wage.)

And trying to make the issue appeal to the GOP members (and perhaps differentiate it from the efforts in socialist Seattle), he added: "I know that we can’t measure the success of our economy by how things are going in the shadow of the Space Needle. Our rural areas, for example, still lag in this recovery."

And perhaps as another way of wooing conservatives on the seemingly lefty issue, Inslee coupled his minimum wage pitch with a proposal to eliminate the business and occupation tax for small businesses, which he defined as bsusinesses with less than $50,000 in annual revenue.

His politic pitch: "As I look out at this chamber today, I recognize the political realities of the split control of Olympia. But we must spend time and energy — and yes, political capital — helping make sure everyone in Washington is paid a fair wage. In building a working Washington ... we need to help our small businesses.

"I will introduce legislation that says if your small business earns less than $50,000 in annual revenues, you will pay no business and occupation tax. Zero. This reform will help tens of thousands of businesses across Washington, and I’m asking you to join me in taking this step to unleash the creativity of small businesses in every corner of this state. Besides, you never know which of these businesses in a kitchen or a garage will grow up to be the next Microsoft or Amazon."

2. Inslee cited last week's Washington State Supreme Court decision that the legislature had fallen short in its effort to meet the Court's earlier McCleary mandate to fully fund K-12 education by 2018, with measurable down-payments along the way—$1.3 billion extra in the current 2013-15 biennium, and $3.3 billion extra in the next biennium, for example—to announce that he was adding $200 million to the $982 million extra the legislature put into the 2013-2015 biennium K-12 budget last year.

The money, Inslee indicated, would come from closing tax breaks, though he didn't identify them. He proposed closing a slate of tax breaks last session, but  the Republican-dominated senate squashed that plan, and instead found most of the K-12 $982 million with one-time fund transfers.

Inslee also subtly challenged the emerging and destructive Republican frame on the court's K-12 funding mandate (that it's a green light to otherwise decimate government), explaining that other government spending is directly tied to K-12 funding.

Inslee directly addressed last year's failure:

"Last year I proposed a $1.2 billion down payment on our obligation to schools, funded mostly by closing tax breaks that aren’t as high a priority as our education needs. We weren’t able to do as much of that as I thought we should.

"The court now says what we did wasn’t enough and the need for immediate action could not be more apparent.

"We’re going to have to do that in a way that doesn’t rely on gimmicks [or] one-time fixes.

"Again, we must weigh tax breaks against the increasing call for action."

Inslee also subtly challenged the emerging (and destructive) Republican frame on the court's K-12 funding mandate (that it's a green light to otherwise decimate government), explaining that other government spending is directly tied to K-12 funding: "For too long the easy answer in Olympia was to cut those services. I was proud we stopped that last year, and we should not let it happen now. Here’s why. Our job is to educate every child in the state of Washington, and it is very difficult to educate a homeless, hungry or sick child."

More newsworthy, and also in sync with the last week's stern court directive (the court demanded that the legislature come up with a funding plan by April 20), Inslee said he was calling for teachers to get cost-of-living increases, something they've been denied, despite a voter initiative, for the past six years.

After his speech, the teachers' union, which was shopping a COLA increase bill to representatives yesterday (getting 47 signatures and 52 as of today), announced they had a new one: Gov. Inslee's.

Next. A couple of "Isn't it Weird Thats..." from today's speech.

Isn't it Weird That

1. Inslee did not, as he did last year, call on the legislature to pass the Reproductive Parity Act. He did, however call on the senate to follow the house and pass the DREAM Act.

The DREAM Act, which makes children of undocumented immigrants eligible for college financial aid, and the RPA, which mandates that all small and individual health care plans in the state that cover maternity care also cover abortions, are two of the Democrats' "message bills," as front-and-center policy bills are known in Olympia. The Democratic house passed both bills last year, but the Republican-dominated senate ignored them.

Yesterday, the house, with hefty GOP support, passed the DREAM Act on the first day of the legislative session; no one can remember when the house has passed a bill on the first day of session before.

They also held a hearing on the RPA, though the testimony in favor of the bill elicited antagonistic testimony from Republican members of the committee.

After his speech, Inslee spokeswoman Jaime Smith told PubliCola: "He’s as committed to RPA as ever, and will continue urging passage."

2. Inslee also mentioned (the $170 million over-budget) SR-520, calling on the state to step up and complete the funding package. However, he made no mention of the freaky and scary headlines about the other megaproject, downtown Seattle's deep-bore tunnel.

Asked about the clunky omission, Inslee's spokeswoman Smith told me simply: "On transportation, Governor Inslee wanted to make the point that the need for a transportation package remains—and using issues with megaprojects is not an excuse [for not funding it]. We’re dealing with those and moving forward."

(And it is cool that in his speech, Inslee squarely called out the illegitimate bargaining position of the senate Republicans in the transpo negotiations—namely, that they've yet to prove they can deliver.)

"The next logical step is for the senate to produce a package of transportation improvements that has 25 votes"—that is, a majority—Inslee said in a direct rebuke of Majority Coalition Caucus leader, Sen. Rodney Tom's (D-48, Medina) peculiar excuse and backwards position that he needs an agreement with the house before reconciling the senate's position with the house's position.)

Anyhow, Inslee's non-tunnel commentary leads us to the two most awkward moments of today's State of the State speech.

And I'll just quote them:

1. "I couldn't be more pleased with the creative problem-solving by our secretary of transportation, Lynn Peterson, and her team at the Department of Transportation. This is the new direction of our Washington State Department of Transportation. The team that got [the emergency replacement for the Skagit River] bridge up is changing the way the department works. They’re fixing problems, putting important reforms in place and being accountable for the essential work they do.

"There are legacy problems the team at DOT still wrestles with, and I understand some of you are frustrated with that. You know what? So am I. But we can’t let issues on megaprojects stop us from moving forward."

The other painful moment? Inslee's attempt to salvage Boeing's big win over labor, who he alienated by publicly pontificating about the contract negotiations. The losing labor vote—the machinists gave up defined pensions—has now also set up state workers to be the next victims

"The Machinists took a difficult vote, a vote that demands our respect because their work will benefit everyone in Washington state," Inslee said

"We should not forget that in both the public and private sector, Washington’s outstanding work force is our state’s greatest asset. That includes our hard-working state work force, whose members I want to thank personally."

Final note: Delta CEO Richard Anderson was in the house for Inslee's speech. The reason: Delta Airlines is adding flights to Asia—Seattle to Seoul and Seattle to Hong Kong (and adding flights to Heathrow in London)—making Seattle a new Delta hub, expanding from 33 peak-day departures to 13 destinations last spring to Delta's current schedule of 44 departures to 18 destinations, including six overseas destinations. (Erica here again: Josh sounds a little like Delta's corporate shill here, but he sent me a link to this book—about how airports are the future—that he says proves his point.)

Another example of our state's corporate slavishness? Au contraire. It's exciting that SeaTac is expanding as an international gateway. And in the context of our longstanding allegience to Alaska Airlines (which, by the way, happens to be challening Sea-Tac's voter-approved $15 minimum wage in federal court), the burgeoning relationship with Delta, and Anderson's VIP statuts, demonstrated the opposite of what we recently saw with Boeing.

I wish we thought in the same open-relationship terms—the Everett workforce is seriously desirable to other aerospace suitors—when Boeing makes its threats.

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