Revenue forecast puts legislative focus on taxes, McCleary

OLYMPIA — Last week’s release of the state revenue forecast put an extra $1.3 billion into play for the 2019-21 period and brings a few tax and spending measures into focus.

In short: What to do with that windfall?

With just three weeks remaining in the current legislative session, lawmakers are under the gun to approve a supplemental budget, HB 2299, and add to the $44.3 billion two-year plan approved in 2017.

According to the state Legislature’s website at leg.wa.gov, HB 2299 is scheduled for a public hearing in the House Committee on Appropriations on Tuesday and an executive session in that committee Wednesday.

Sen. Doug Ericksen, R-Ferndale, sponsored SB 6439 to reduce state property taxes in 2018 and 2019, and to offer property owners a credit on their October 2018 tax bill. Ericksen’s measure has been sitting in the Senate Ways and Means committee since Jan. 17.

A House bill to enact a capital gains income tax, HB 2967, is scheduled for executive session today. It would impose a tax of 7 percent on long-term capital gains income to reduce the state property tax levy and fund exemptions for seniors and others.

In the Senate, SB 6609 proposes to lower property taxes by creating new taxes on the sale of candy, on carbonated drinks, and on luxury automobiles, as well as reduce the threshold for estate taxation.

Despite the passage of last year’s bipartisan agreement to fully fund K-12 public education with a property tax hike, the state is still about $1 billion short of what the state Supreme Court thinks should be spent to resolve the 2012 McCleary decision.

In November, the court ruled that the Legislature needs to ramp-up funding for teacher and other school staff salaries to meet its imposed September 2018 deadline, despite the billions that have already been allocated last year.

House Rep. Steve Tharinger, D-Sequim, said Saturday that about 75 percent of the extra $1.3 billion from the revenue forecast is held in reserves. A three-fifths vote will be required to release those funds for education, he said.

Tharinger represents the 24th District with Rep. Mike Chapman, D-Port Angeles, and Sen. Kevin Van De Wege, D-Sequim. The 24th District includes all of Jefferson and Clallam counties and a part of Grays Harbor County.

Democrats currently control both houses and Tharinger sees a good chance of the funds from the revenue forecast being used to resolve the McCleary decision.

In the end, Tharinger said he does not see a “full billion” dollars going to education but he does think the package will be “pretty robust” and will “strengthen the K-12 system.”

Tharinger also chairs the House Capital Budget Committee and his group will release a supplemental measure for school and mental health facility construction Wednesday.

Following negotiations next week with budget colleagues in the Senate, Tharinger said he’ll be able to talk about what the extra spending might mean for the 24th District — including “important things” in Port Angeles and Grays Harbor County.

Chapman bill

A House rural jobs bill sponsored by Chapman passed Feb. 8 with support from Democratic and Republican lawmakers.

“High skills are the pathway to high wages,” Chapman said in a news release. “There are good jobs going unfilled in rural counties because businesses can’t find workers with the right technical qualifications and certificates. This legislation is aimed at closing that skills gap so local families can get those middle-class jobs out in timber and farm country.”

House Bill 2177 creates a public-private partnership to offer one-year scholarships at community colleges in rural counties. The program is aimed at high-demand fields in each region and degrees or certificates that can be finished in a year. Examples of high-demand fields in Washington state include firefighting, early childhood education, accounting, law enforcement and computer science.

The legislation now goes to the Senate for consideration.

Timber boosts

Two bills supported by Van De Wege are designed to spur job growth on the Olympic Peninsula and other rural areas of the state by boosting the timber industry.

Having passed the Senate, both are now being considered in the House.

A Van De Wege-sponsored measure, SB 6140, could create jobs by directing the state Department of Natural Resources to evaluate state land, forestland, revenue streams and related management methods to make it easier to transact land swaps and help spur mill activity.

The second bill, SB 5450, would add cross-laminated timber to the state building code, making it easier for businesses to incorporate timber-dependent technology in residential and commercial construction.

Net pen fishing

A bill co-sponsored by Van De Wege, SB 6086, would prohibit commercial net pens used for farming invasive Atlantic salmon.

If approved in the House, it would terminate existing net pen leases by 2025. The bill, which passed the state Senate, follows the collapse of the Cooke Aquaculture net pen off the shore of Cypress Island last August.

The bill has been referred to the Agriculture and Natural Resources Committee in the House.

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Assistant Managing Editor Mark Swanson can be reached at 360-452-2345, ext. 55450, or [email protected].

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