Archive for Budget

Governor Inslee proposes new teacher pay raises paid for by closing tax breaks

By | December 17, 2015 | 0 Comments

New teachers in Washington would garner higher salaries under a proposal introduced Thursday by Democratic Gov. Jay Inslee.

Governor Jay Inslee News Conference

Governor Jay Inslee unveils his 2016 supplemental budget proposal.

In his 2016 supplemental budget proposal, the governor would raise the starting salary for teachers to $40,000. The estimated cost is $80 million dollars next year, and $100 million every year after that.

To pay for the raises, Gov. Inslee wants to close or alter four “outdated” tax breaks.

Refund the state portion of sales tax to nonresidents: Shoppers from states with no sales tax, like Oregon, would have to apply for a state sales tax refund on purchases in Washington. No longer would the discount be applied instantly. Saved over three years = $79.3 million

-Repeal the sales tax break on bottled water: Saved over three years = $82.9 million

-Limit the real estate excise tax exemption (REET) for banks: Connected to foreclosed properties. Saved over three years = $106.7 million

-Repeal the use tax exemption for extracted fuel: Claimed by the state’s oil refineries. Saved over three years = $58.6 million

“Having a classroom teacher to teach algebra right now is more important than some oil industry tax break that ended up getting done 20 or 30 years ago that doesn’t even apply anymore,” Gov. Inslee said during a press conference.

Washington is struggling to find qualified teachers and substitutes, according to a recent survey by the Office of Superintendent of Public Instruction and the Association of Washington School Principals. Of those responding, 45-percent say they could not fill all classroom teacher positions with fully certified teachers who met job qualifications.

Retirements, hiring freezes and economic uncertainties that have discouraged students from choosing a teaching career, and new teacher burnout are cited as reasons why. Research shows half of beginning teachers opt out of the profession in the first five years, many blame low pay and a lack of support. To address that, the governor’s plan allots $5 million for mentors.

The minimum teacher salary would be raised by $4,300 starting next school year. That increase is in addition to the 4.8% cost-of-living adjustment already worked into the current budget. Teachers with more experience, along with administrative and classified staff, would also get a raise of at least one-percent.

This proposal is only one part of the changes Gov. Inslee would like to make to the state’s current two-year $38 billion budget.  

Washington brought in another $245 million in new revenue since the budget passed, but the Governor says costs have gone up. Separate from the teacher salary plan, his proposal includes $700 million in additional spending to pay for increased Medicaid caseloads, urgent mental health care needs, and to cover the costs of fighting last summer’s wildfires. One million acres and hundreds of homes burned in what’s considered the worst fire season in state history, costing Washington nearly $180 million.

For mental health care, Governor Inslee proposes spending an additional $137 million, both in state and federal money. The money would be spent on new programs, hiring more doctors and nurses at state psychiatric hospitals, and community-based housing and recovery services.

“We know we have to do more for mental health in this state. We have urgent short-term needs, but we also need to take a long view on how to build a stronger mental health system,” Gov. Inslee said.

Governor Inslee’s supplemental budget sources that addition $700 million from fund transfers from the state’s Budget Stabilization Account, which would leave close to $1 billion remaining in reserves.

Republicans quickly responded to the Governor’s proposal. Senate Budget Chair Andy Hill sent an email saying it does not balance over four years. “Unfortunately, as has become a yearly tradition, the governor continues to offer plenty of ways to spend taxpayer dollars, but fails to provide a sustainable way to pay for it,” wrote Sen. Hill.

In the House, Republican budget writer Rep. Bruce Chandler wrote, “The 2015-17 biennial budget was signed into law less than six months ago. Significant policy additions – outside of emergency caseload adjustments – are better suited for the deliberation and scrutiny of a 105-day session during budget-writing years.”

Republican Gubernatorial Candidate Bill Bryant

Republican gubernatorial candidate Bill Bryant criticizes Gov. Inslee’s 2016 supplemental budget proposal.

Republican gubernatorial candidate Bill Bryant appeared on the steps of the capitol to say while Washington does need to do more to recruit and retain teachers, it should be done in the existing budget. “This is the governor who said he would not do anything that would take the state in the wrong direction if elected, and that passing new taxes would take the state in the wrong direction, and yet for four out of four years he has continued to propose new taxes,” said Bryant.

When asked about critics who say he’s proposing “new taxes,” the governor argued this is a “modest” and “reasonable” proposal. “Our tax code is infested with the barnacles that are encrusted on our ship of state of these loopholes that corporate lobbyists have come down here year after year, decade after decade, and they have carved out these special little deals for their special little interest, and they never get reviewed. Even though the industry changes hugely and the needs of our state change hugely, they just remain,” said Gov. Inslee. “We have to realize as the needs of our state change and the industries change, this is the best way to finance the education of our children.”

The governor did receive support from House Democratic Majority Leader Representative Pat Sullivan. In a written statement he said, “The governor has given us a good starting point for discussion. While some legislators may have other ideas on how we reach these goals, his priorities are on target.”

The governor’s budget adjustment suggestions will be considered when the 2016 legislature convenes for a 60-day session starting January 11th.

To read the supplemental budget proposal and highlights:

Watch the Governor’s news conference here:

‘Legislative Year in Review’ recaps the extended 2015 session

By | July 15, 2015 | 0 Comments

The state Legislature adjourned on July 10 after a record-setting 176 days. In this hour-long edition of “Legislative Year in Review,” we recap the highlights of the significant bills that passed — and failed to pass — during the regular and overtime sessions.

Lawmakers narrowly avoided a state government shutdown by passing a two-year operating budget that was signed into law just before midnight on June 30 by Gov. Jay Inslee. But the session didn’t end there. Senate leaders were drawn into an additional week of negotiations after a debate in the chamber over Initiative 1351, a class size reduction initiative passed by voters that came with a $2 billion price tag.

Senate Democrats and Republicans eventually reached a deal to delay implementation of the class size initiative for four years, while also suspending a new high school biology graduation requirement for two years. That agreement allows nearly 2,000 high school seniors who failed the exam this year to earn a diploma.

As part of the overall budget, college students will get a tuition cut and additional money will be funneled into early education and preschool with the Early Start Act.

Lawmakers also passed a $16 billion transportation package funded by a 11.9-cent gas tax increase that pays for projects across the state — marking the first time in a decade the state has made a significant investment in transportation infrastructure.

Also on the show: We recap debate over several bills that passed this year, including an oil train safety measure, an involuntary commitment bill known as Joel’s law, medical marijuana reform, the establishment of a new Washington State University medical school and a gun notification bill known as the Sheena Henderson Act.

Plus, details about the bills that generated heated debate but failed to pass — including the creation of a new type of payday loan, a proposed $12-an-hour statewide minimum wage, restrictions on initiative signature-gathering and eliminating personal exemptions for vaccines.

“Legislative Year in Review” airs at 6 and 11 p.m. every night on TVW through July 19. Or watch the show online below:

Senate reaches deal on Initiative 1351, high school biology exams

By | July 8, 2015 | 0 Comments

Senate Democrats and the Majority Coalition Caucus have reached a deal on two key education issues that pave the way for the Legislature to adjourn the third special session.

The agreement reached Wednesday morning suspends the state’s high school biology graduation requirement for two years, according to a press release.

About 2,000 students failed the biology test in the first year it has been required to graduate high school. The Democrat-controlled House three times passed House Bill 2214 eliminating the graduation requirement, but the measure was not taken up by the Republican-majority Senate.

The bill’s prime sponsor, Democratic Rep. Chris Reykdal, said in a statement the deal is “excellent news” for the thousands of students who can now attend college or pursue careers. “I’m happy for the 2,000 seniors who will receive their diplomas, but this compromise only delays a serious problem that must be fixed,” he said.

A new bill suspending the requirement for two years must pass both chambers.

The Senate also agreed to delay Initiative 1351, a class size reduction measure passed by voters last year that is estimated to cost $2 billion in the current budget cycle. The budget signed on June 30 by Gov. Jay Inslee does not include funding for the measure. Without action by the Legislature, it would leave a $2 billion hole in the operating budget.

The House passed House Bill 2266 suspending Initiative 1351 for four years until 2019. Several Senate Democrats voted against the bill in a 5 a.m. floor debate, and it failed to garner the two-thirds majority required to alter an initiative.

The Senate will meet Thursday afternoon to vote on the biology exam bill and the measure delaying Initiative 1351, as well as “any other bills necessary to complete its work,” according to the caucuses.

TVW will carry the debate live.

Categories: Budget, Education

Legislature stalled over Initiative 1351 debate

By | July 1, 2015 | 0 Comments

The state Legislature is stalled over a bill that would delay implementation of Initiative 1351, leaving a $2 billion hole in the budget signed Tuesday night by Gov. Jay Inslee.

Voters approved Initiative 1351 last year requiring smaller class sizes in K-12 grades, but the measure did not come with a funding source attached. It is estimated to cost $2 billion in the first two-year budget cycle, and billions more in subsequent years.

House Bill 2266 suspends the initiative, delaying its implementation by four years until 2019. It passed out of the House with a vote of 72-26, with supporters noting that the operating budget funds smaller class sizes in grades K-3 when it is shown to have the most impact.

Because it alters an initiative, the bill requires a two-thirds majority in both chambers to pass.

The bill reached the Senate floor around 5 a.m. Wednesday after lawmakers in the chamber pulled an all-nighter.

Several Senate Democrats spoke in opposition to the bill, saying they believe the Legislature should phase-in Initiative 1351 rather than suspend it.

“We’re completely punting,” said Sen. David Frockt, D-Seattle. He said if the Legislature doesn’t do anything about the initiative this year, he has “serious doubts” it will ever be implemented.

Sen. Cyrus Habib, D-Kirkland, also spoke against the bill, saying the Senate was meeting at 5:30 a.m. to “undo the will of the people.”

Budget writers argued that the bill is necessary to balance the budget approved after six months of negotiations by both chambers.

“If we can’t pass this bill, we have a $2 billion hole we have to fill,” said Sen. Andy Hill, the lead Republican budget writer. Failing to pass the bill puts the budget at risk, he said, and it is “not the way we do things around here.”

Sen. Jim Hargrove, D-Hoquiam, said a failure to pass the bill threatens other services. “You are playing Russian roulette with the social safety net next session,” he told members.

The Senate voted 27-17 on the bill, failing to garner the necessary two-thirds majority required for it to pass. The Senate adjourned until noon Friday.

The Spokesman-Review reported that some Democratic members may consider changing their votes if the Senate Republican majority approves a bill passed by the House that eases a rule requiring high school students to pass a biology test in order to graduate. About 2,000 students have failed the test this year and are not expected to graduate. It’s the first year the test has been required.

Gov. Jay Inslee released a statement Wednesday praising the budget, and urging lawmakers to finish their work.

“There is one important operating budget item to resolve – when and how to implement last year’s Initiative 1351, which would cost an additional $2 billion that was not provided in the budget the Legislature passed,” he wrote. “I believe it is important for the Legislature to find a solution that results in a balanced budget sooner rather than later. We are so close. I encourage legislators to complete their work.”

Watch the Senate floor debate on the bill below:

Categories: Budget

Gov. Jay Inslee signs compromise budget into law

By | June 29, 2015 | 0 Comments

Gov. Jay Inslee signed the two-year operating budget into law late Tuesday night, just before the midnight deadline that would have forced a partial state government shutdown.

“It’s forward-thinking, it’s responsible and it’s fair. It’s taken a long time to get here, but the final result is a budget that does respond to the fundamental needs of the people of the state,” Inslee said as he signed the document around 11:30 p.m. Tuesday.

Watch the bill signing here.

The budget passed out of both chambers on Monday. The Senate voted 38-10, while the House voted 90-8.

The compromise budget spends $38.2 billion over the next two years, reduces K-3 class sizes, gives teachers a total 4.8 percent pay raise through 2017, slashes tuition by 20 percent at four-year regional universities and by 15 percent at the University of Washington and Washington State University.

An outline of the agreement was announced by Inslee and legislative leaders on Saturday afternoon, but details were not released to the public online until Monday afternoon.

Among the highlights:

-An additional $1.3 billion will be spent in K-12 education to meet McCleary obligations, including smaller class sizes in kindergarten through third grade, all-day kindergarten and fully funding maintenance, supplies and operating costs.

-$173 million for pay raises for state workers, fully funding collective bargaining agreements.

-$153 million for pay raises for teachers. Combined with a cost-of-living pay raises, that will amount to a 3 percent raise for the 2015-16 school year and a 1.8 percent raise for the 2016-17 school year.

-Colleges and universities will see varying tuition cuts. The state’s two research universities, UW and WSU, will get a 15 percent tuition cut. Four-year regional universities such as Western Washington University or Evergreen State College will get a 20 percent cut. Community and technical colleges will get a 5 percent reduction. The tuition cuts will be phased-in starting with a 5 percent reduction this year.

-An increase in revenue of about $200 million will come from repealing tax breaks, increasing certain fees and transferring lotto funds. The budget repeals a tax break for software manufacturers, eliminates a preferential business and occupation tax rate for royalty income and increases Dept. of Revenue late fee penalties.

-A decrease of about $35 million in revenue will come from extending or reinstating several tax breaks, including one for food processors and another tax break for data server farms.

-$134 million will go to early learning, including expanded preschool, funding the Early Start Act and child care eligibility changes.

Read the budget overview here for more highlights.

Categories: Budget

Budget agreement reached, third special session begins Sunday to finalize deal

By | June 27, 2015 | 0 Comments

Gov. Jay Inslee and legislative leaders from the House and Senate announced Saturday afternoon they have reached a budget agreement that will avoid a government shutdown, although a third special session is required to finalize the deal.

Without divulging any numbers, Inslee said the budget takes a takes a “significant step” in funding K-12 schools and makes “historic investments” in early childhood learning.

Teachers and state workers will receive the first cost-of-living pay raise since 2008, the governor said.

The budget also “eases the burden” of rising tuition at the state’s colleges and universities, Inslee said. Tuition was one of the remaining sticking points between the GOP-led Senate and House Democrats. The Senate called for a 25 percent tuition cut, while the House proposed a tuition freeze. Inslee did not release the compromise figure.

State parks will also get enhanced funding in the budget.

“If you have a reservation at our state park system for next weekend, two good things will happen,” Inslee said. Parks will get additional money to “keep the roofs from falling down” at the picnic shelters, he said, and people won’t have to worry about a government shutdown cancelling their Fourth of July plans.

State government would be forced into a partial shutdown if a budget is not adopted by June 30. Inslee said he is confident that will not happen.

The second special session officially ended Saturday, and a third special session will begin Sunday.

“Hundreds of important but minor details” have yet to be resolved, Inslee said. Legislative leaders say they plan to have the budget details made public within 48 hours.

Lead Democratic budget writer Rep. Ross Hunter said the budget is likely to pass out of both chambers on Monday evening.

“We feel very strongly this is a great budget,” said House Speaker Frank Chopp.

Lead Republican budget writer Sen. Andy Hill said the budget meets the priorities laid out by his caucus this year, which proposed a no-new-taxes approach.

The final agreement does close some tax breaks, while extending other tax preferences that will result in a net gain of revenue for the state.

“It’s part of the compromise,” Hill said.

TVW taped the press conference. Watch it below.

Categories: Budget

Senate committee set to vote on budget bills, Gov. Inslee press conference at 5 p.m.

By | June 26, 2015 | 0 Comments

The Senate Ways and Means Committee is set to vote on budget-related bills Friday afternoon, one day before the end of the current second special session. A third special session would be required for lawmakers to continue past Saturday, as they negotiate a budget deal necessary to avoid a potential government shutdown.

Meanwhile, Gov. Jay Inslee has scheduled a press conference at 5 p.m. Friday, which TVW will carry live.

At 2:30 p.m. Friday, the Senate committee is scheduled to vote on Senate Bill 6051, which would continue state government funding for one month if a budget is not in place by June 30, the deadline to avoid a partial shutdown. Republican budget leaders have said the budget is intended only to be used in an emergency.

Senate Bill 6052 is the latest GOP two-year operating budget proposal, which spends $38.2 billion in the 2015-17 budget cycle. It increases spending from the previous Senate offer by about $367 million.

Also on the agenda are two measures related to tax preferences:

Senate Bill 6138 would raise $126 million in revenue by closing tax breaks, including one for software manufacturers and a preferential business and occupation tax rate for royalty income.

Senate Bill 6057 reinstates or extends a dozen tax preferences, which would decrease revenue by about $113.5 million. It reinstates a high-tech research and development tax break that expired in January, extends a tax break for the food processing industry and provides a tax exemption for server equipment in data centers, among others.

The committee will also consider an education bill, which addresses K-12 and early education. It also cuts college tuition by 25 percent.

TVW will carry the hearing live at this link.

House Democrats passed their latest budget proposal, House Bill 1106, out of committee on Tuesday, along with a bill that would raise an additional $356 million for education by closing several tax breaks.

Categories: Budget

Senate committee hears latest GOP budget, emergency one-month budget

By | June 26, 2015 | 0 Comments

The Senate budget-writing committee on Thursday held a public hearing on the latest GOP budget plan, which includes $126 million in new revenue from closing certain tax breaks.

Senate Republicans also introduced a one-month budget proposal intended to avoid a government shutdown if a budget is not in place by June 30. Lead Republican budget writer Sen. Andy Hill said it is “strictly an emergency” budget that “keeps the lights on and parks open for one month.”

Much of the focus of the hearing was on the updated two-year, $38.2 billion operating budget proposal. Senate Bill 6052 increases spending from the previous Senate budget proposal by $367 million — largely to provide a 3.8 percent raise to K-12 school employees.

Hill said the budget also moves closer to the House position by increasing spending in early learning and Temporary Assistance for Needy Families grants.

“The debate over taxes is over,” Hill said. “The debate over funding education is over and the debate over the social safety net is over.”

The last remaining sticking point between the two budgets is college tuition, Hill said. The Senate is proposing a 25 percent tuition cut at the state’s colleges and universities, while House Democrats are proposing a tuition freeze.

The House held a hearing on the latest Democratic budget proposal on Monday, including a plan to raise $356 million by closing several tax breaks.

The Senate plan would raise about a third of that by closing two tax breaks, including an exemption for software manufacturers and a preferential tax rate for royalty income. Senate Bill 6138 also makes changes to certain tax collections.

“We believe these are solid economic policy and will have a positive effect on the overall budget,” Hill said.

The committee adjourned without voting on the proposals. The House and Senate are meeting again Friday, the 29th day of the second special session.

Watch the hearing at this link.

Categories: Budget, WA Senate

House Democrats release latest budget plan, call for ending several tax breaks

By | June 23, 2015 | 0 Comments

The House Appropriations Committee on Monday held a public hearing on the latest Democratic budget plan, which does not include new taxes but would raise about $356 million by closing several tax breaks.

Lead Democratic budget writer Rep. Ross Hunter said Monday the plan does not represent an agreement with Senate Republicans, but is a “move to keep our negotiations moving forward.”

Democrats are no longer calling for a capital gains or other new taxes to pay for increased spending on early learning, mental health and other programs. Hunter said the latest budget represents only “what you can actually buy and pay for” without new revenue.

It makes the minimal expenditures required to comply with K-12 education spending for McCleary, mental health lawsuits and other settlements, Hunter said. It also freezes college tuition for a year and pays for state worker raises. Read the summary here.

House Majority Leader Pat Sullivan said in a news release the budget is a “backup plan designed to meet the very basic needs of the state and avoid a shutdown.” State government would be forced into a partial shutdown if a budget is not adopted by June 30.

Democrats are also proposing House Bill 2269 — which Sullivan called “Plan A” — to close or limit several tax breaks to raise additional money for education. Bottled water would no longer be exempt from sales tax, a preferential business-and-occupation tax rate for resellers of prescription drugs would be eliminated and a tax break for extracted fuel would be narrowed.

Revenue of about $356 million from closing the tax breaks would pay for additional teacher cost-of-living raises, more early learning spots and increased funding for the state’s colleges and universities.

Republican Sen. Doug Ericksen of Ferndale criticized the plan, saying it still amounts to a tax increase. “They say they want to close tax loopholes. But I think the people of Washington see though it and understand these are taxes on things they need in their daily lives,” he said.

TVW aired the public hearing — watch it here. The committee is scheduled to vote on the plan on Tuesday.

Categories: Budget, Democrats

Budget leaders discuss compromise options with capital gains tax off the table

By | June 19, 2015 | 0 Comments

Gov. Jay Inslee and legislative budget leaders on Friday said they are getting closer to a budget deal that will avert a government shutdown.

“There is no reason — zero — why we can’t have a budget done in one week,” Inslee said.

State government would be forced into a partial shutdown if a two-year operating budget is not adopted by June 30.

Democrats are no longer calling for a capital gains tax, which Inslee said is because the state is on track to collect about $700 million more in new revenue than expected.

Inslee said he believes closing tax breaks worth between $300 to $350 million will give “both sides big policy wins and produce a responsible, sustainable budget.” The governor pointed to a tax break for extracted fuel as an example of an exemption that should be closed, although he said he doesn’t plan to dictate a list of tax breaks to lawmakers.

House Majority Leader Pat Sullivan said Democrats took the capital gains tax off the table “contingent on the Senate agreeing to a package of tax loopholes that would allow us to make investments that we need to make.”

Democrats are moving to the middle by reducing spending in “critical areas,” Sullivan said, such as mental health and early learning.  “That’s what compromise is all about and we’re willing to do that,” he said.

Lead Republican budget writer Sen. Andy Hill said closing tax exemptions is an option. “We always said we should be looking at exemptions, some are old and not needed anymore,” he said.

Negotiations should be able to move forward quickly, he said.

“We’re looking forward to working over the weekend to close the gaps and get a final agreement,” Hill said.

TVW taped press conferences with Inslee, Democratic and Republican leaders. Find all three videos here.

Categories: Budget, Governors Office