OLYMPIA — Sen. Kevin Van De Wege, D-Sequim, and Rep. Mike Chapman, D-Port Angeles, voted against the basic education funding plan passed Friday by the Legislature.
“This plan satisfies our K-12 education obligations primarily through a tax plan that will raise property taxes across the 24th Legislative District,” Van De Wege said of the Legislature’s response to the 2012 McCleary court order mandating full funding of public education.
“It’s basically a Democratic policy plan and a Republican tax plan. That was the unfortunate compromise we had to make to avert a statewide government shutdown.”
Rep. Steve Tharinger, D-Sequim, the third member of the 24th District group, voted in favor of the measure.
District 24 includes all of Clallam and Jefferson counties and a portion of Grays Harbor County.
As the chairman of the House capital budget committee and being responsible for policy for the caucus, Tharinger reasoned that he needed to vote for the measure.
“When I was campaigning last fall, I was pretty clear that this would be the fix for McCleary,” said Tharinger.
The resulting tax is “higher than I would have liked,” he added, saying he would have wanted “something more progressive” but the “Senate was just not willing to go there.”
Rewind to spring. The Senate Republicans passed a funding bill that called for a property tax mechanism.
The House Democrats proposed but did not vote on a funding bill which called for a number of revenue enhancements via a capital gains tax, real estate transaction taxes and others.
When it came time to negotiate the budget, the Republicans argued that the Democrats had no bargaining position because they had never passed a funding bill.
They were, Tharinger said, also unwilling to accept new taxes on capital gains. When it came to property taxes, he said they sensed a “real disparity” in how property taxes are levied in Washington state.
“We clearly had better options when it comes to how we will pay for education, and I’m very upset that we were not able to pursue those options,” Chapman said.
“There were tax loopholes we could have closed and we could have adjusted the business and occupation tax rates, which would have helped small businesses at the same time.”
Democrats had attempted to tax higher-wage earners and other sources that would spare lower- and middle-class households but, facing a state shutdown, relented to Republican demands for statewide property tax increases, he added.
Initial projections for the final product, House Bill 2242, indicate homeowners in Clallam, Jefferson and the upper half of Grays Harbor counties could see some property tax increases.
Initial projections indicate that a majority of property owners on the Olympic Peninsula will see $1,000 in new property taxes by the end of the four-year implementation period in 2021, assuming voters approve levies to provide additional funds to enhance education.
Taxpayers in Chimacum, Crescent [Joyce], Quilcene, Port Townsend and Sequim school districts all will see increases totaling around $1,000 on the median home value in new taxes after the four years.
At the same time, those school districts will receive more funding, with Sequim receiving the most at $6,314,811 and Crescent receiving the least at $766,963 in new funding each school year.
Taxpayers in two districts, Quillayute Valley [Forks] and North Beach [Ocean Shores], are expected to see increases of around $450 by full implementation on the average home.
Quillayute Valley also will see a huge increase in funding at $8,047,122 – the largest of any school district in the entire 24th district – and North Beach, $1,644,428.
The Brinnon School District will essentially see no new funding, only $24,663 by 2021, while taxpayers there will pay $280 more per year in new taxes on a median-priced home.
Taxpayers in the 24th’s largest school district, Port Angeles, will see a small decrease in taxes, $50 on the median-priced home after full implementation, while the district will be bringing in $5,460,711 in new funding in 2021, according to the projections.
Taxpayers in the remaining districts, mostly located in Grays Harbor, all will see property tax decreases under the new plan. Taxpayers in Hoquiam and Taholah make out the best and will pay $450 and $850 less respectively on the average home after full implementation in 2021.
The biggest piece remaining of the 2012 McCleary court order is figuring out how much the state must provide for teacher salaries, said the legislators.
School districts currently pay a big chunk of those salaries with local property tax levies.
The court has said that the state has until Sept. 1, 2018, to do that, but that the details — including funding — must be in place before the Legislature adjourns this year.
Already approved is an additional $456 million over the next two years coming from adding sales tax to bottled water, removing the tax break for fuel extraction used by oil refineries, and requiring online retailers based out of state to collect and remit sales tax from Washington state customers.
The overall plan also would lower the business and occupation rate on state manufacturers from 0.484 percent to 0.2904 percent — the same preferential rate given to Boeing and others in the aerospace sector.
The outline of the education plan provided Thursday sets a minimum starting salary for teachers at $40,000, with adjustment for inflation and regional differences. Under the plan, the average minimum salary for instructional staff will be $64,000, and adding in regionalization, it will range from $66,194 to $82,081.
School districts can pay a salary over the maximum of $90,000 by up to 10 percent for educational staff associates or teachers who teach science, technology, engineering, math or in bilingual or special education programs.
Even though the operating budget is done, lawmakers still need to address the capital budget that deals with projects across the state. That budget has been held up by a dispute over a legislative fix to a water ruling. Legislative leaders acknowledged they might need additional time this month to finish work on that.
Tharinger said that Senate Republicans were unwilling to consider the capital budget Friday, despite what he thought was a handshake deal to get it passed. The measure sits with the Senate, he said.
He is hopeful for progress on the measure this week.
Assistant Managing Editor Mark Swanson can be reached at 360-452-2345, ext. 55450, or [email protected].
The Associated Press contributed to this report.