Senate lawmakers unveiled dueling levy reform bills from both sides of the aisle Wednesday, 11 days before the Washington state legislature winds down its regular session.
The two levy concepts will get a hearing at 3:30 p.m. Thursday in the Senate Ways and Means Committee.
Under a court mandate from the McCleary decision to fully fund basic education from state coffers, lawmakers say they want to reduce the reliance of local levies from basic education and increase the burden of the cost on the state.
Many districts currently use their local levy money to pay for things that would be considered basic education, such as teacher salaries. Some districts also have a harder time getting levies approved by voters.
However, Democrats and Republicans have differing approaches for how to boost state funding for basic education.
Senate Democrats Wednesday morning rolled out their plan, which includes a levy reform bill dropped by Sen. Jim Hargrove, D-Hoquiam, that would fund teacher salaries starting in 2018, and then lower the local levy revenue dollar per dollar. The bill sets the maximum levy authority for local districts at $1 per $1,000 of assessed value, beginning in 2023.
The increased state spending would be paid through a 7 percent capital gains tax that would apply to gains higher than $250,000 for single taxpayer (or $500,000 per couple). It would not apply to houses. Sen. Kevin Ranker, D-Orcas Island, introduced that bill and said the proposal would raise $1.2 billion in the next biennium and would apply to about 7,500 people.
At the Democrats’ press conference. Sen. Christine Rolfes, D-Kitsap County, also discussed her bill that phases in an increase in education funding, including a six-year plan for teacher compensation and year-by-year roll out of class size reductions in all grades. She said that gets to the full McCleary plan.
Wednesday afternoon Sen. Bruce Dammeier, R-Puyallup, introduced a competing plan, which also would replace local levy money being used for compensation with state money, while reducing the local levy amounts dollar for dollar. His plan caps school levies at $1.25 per $1,000 of assessed value.
However, his bill would be funded through an increase of about $1.50 per $1,000 in the statewide levy for schools, which currently is set at $1.98 per $1,000 of assessed value. However, Dammeier says the change would be revenue neutral, because there would be a corresponding reduction in local levies.
So, while individual taxpayers may see a change in their tax bills, the burden would be shifted to the state common schools levy rather than the local district levy.
His bill also calls for a six-year phase in of a change in teacher pay, making it more uniform across regions of the state. The bill would repeal the teacher COLA that was approved in Initiative 732, and the state would set a statewide salary schedule with adjustments for level of education and for regional variables in costs of living. The phase-in period would allow teachers at a lower salary to catch up with more highly compensated teachers in the same region, and no teacher would see a reduction in pay, he said.
Dammeier said that his plan evens out teacher pay across regions of the state as well as district levy levels, which he says has been an issue of fairness over the the past 30 years.
The solution has “got to be fair, it’s got be equitable and it’s got to be sustainable,” he said.
But Ranker said while Dammeier’s plan will lower taxes in some districts, most districts throughout the state could see an increase in property taxes. He said that’s why he made his capital gains proposal —which would affect 7,500 people — instead.
“We looked different scenarios, and this would raise taxes for many people. That’s why we said we’re going to look at another funding source,” Ranker said.
Hargrove and Dammeier’s bills are scheduled for a hearing at the Senate Ways and Means Committee on Thursday.
TVW recorded both press conferences. They will be posted in the archives.