Legislation would change tax to benefit small businesses

Taxes to fuel help with community college tuition

OLYMPIA — Legislation sent to Gov. Jay Inslee has changed a tax for a fund that a District 24 lawmaker says has the potential of making higher education accessible for all on the North Olympic Peninsula.

Senate Bill 6492, sponsored by Sen. Jamie Pedersen, D-Seattle, modifies the business and occupation (B&O) tax set up to pay for the fund when the Workforce Education Investment Act package was approved in 2019, replacing the original three-tiered tax with a 1.75 percent rate for most businesses that gross more than $1 million annually.

Most small businesses will see a tax cut, according to Mike Chapman, D-Port Angeles, who co-sponsored the bill in the House and spoke for it on the House floor.

“It will be a game-changer,” Chapman said, adding that his District 24 colleagues — Rep. Steve Tharinger, D-Port Townsend, and Sen. Kevin Van De Wege, D-Sequim — also voted for the legislation.

The bill, SB 6492, was sent to Gov. Jay Inslee’s Office on Friday. If he signs it — which he has said he expects to do — the law would take effect April 1.

The new version of the tax would raise about $234 million over the 2021-23 budget cycle to fund the Washington College Grant, which replaced the State Need Grant, which ran out of money every year.

The workforce education investment fund created last year provides reduced or even free community college tuition to low- or median-income students.

“The benefit is unbelievable in a district like ours,” Chapman said. “Virtually all will have access to reduced tuition.”

Open carry

Chapman also introduced a bill to add the state capital grounds to those sites where open carry of firearms is banned after a Jan. 31 rally at the capital protesting gun legislation and action against Rep. Matt Shea of Spokane.

Shea was expelled from the House Republican Caucus and stripped of his committee appointments after a private investigative report accused him of domestic terrorism.

Chapman’s proposed bill would amend an existing law that already outlaws guns in places like jails, courthouses and public mental health facilities. Concealed guns would still be allowed if the person has a concealed handgun license.

Chapman says he does not expect the bill to go anywhere this session, but he is satisfied with getting the conversation going.

“We had about 100 people show up a week ago Friday with open carry weapons and it cleaned out the capital campus because people didn’t know why they were there,” Chapman said Saturday.

Groups of people in tactical gear and carrying assaults weapons walked into the capital campus a dozen at a time, Chapman said, adding they had no permit for the rally.

‘They were yelling and screaming. … They were not a friendly group,” he said, adding that the protesters were so intimidating that “kids left, families left.”

“The capital campus has to be a place where families can come,” he added. “They shouldn’t have to be afraid of what circumstances they would find themselves in.”

Offices were locked and staff members were told to stay put, he said.

“As a former law enforcement officer, I didn’t feel it was a safe work environment that day,” said Chapman, a former U.S. Border Patrol inspector.

“The work of the people ground to a halt for about two hours,” he said.

The cutoff for policy bills to be out of committee is today in the short session that ends March 12.

Appropriations bills have until Tuesday, said Tharinger, who serves on the Appropriations Committee as well as chairing the House Capital Budget Committee.

Insulin costs

He spoke of a bipartisan bill on insulin intended to help with costs.

“Prices have gone up 600 percent,” Tharinger said. “The increase over the last six or seven years has not been warranted by any research and development costs.”

He said legislators are looking at ways that the state could step in and buy in bulk, perhaps in a consortium with other states, to lower prices for diabetics.

“The federal government is not doing its job as far as drug prices. States are having to take action,” he said.

Timber and carbon

Van De Wege’s Senate Bill 6355, which passed out of the Senate Agriculture, Water, Natural Resources & Parks Committee that he chairs on Thursday, would create a Forest Carbon Reforestation and Afforestation Account to provide grants to landowners that advance the state’s carbon sequestration goals and would direct the state Department of Commerce to promote markets for the state’s forest products.

“I think it’s a good for our timber economy,” Van De Wege said. “It will help stabilize it and be better situated if Washington ever passes a carbon tax.”

He said the measure has support from timber industry leaders and some environmental groups.

“There’s a presumption out there that timber harvesting and environmental protection are mutually exclusive, but we’re learning that the opposite is true,” Van De Wege said.

“By aligning timber practices and cycles with the state’s carbon reduction goals, we can boost our rural economies and improve our environmental health at the same time.”

Carbon sequestration is the process by which trees and other plants absorb carbon from the air through photosynthesis and store it in trunks, foliage and soils.


Van De Wege also has proposed legislation to accelerate the schedule of Medicaid reimbursement rate increases to skilled nursing homes. Senate Bill 6515 would require rate adjustments annually, instead of every other year, and adjust the methodology to factor in inflation using the most recent calendar year’s consumer price index.

He said Friday that nursing homes have been closing at an increasing rate, partially because the rate of Medicaid reimbursements to nursing homes has not kept up with actual costs, he said.

Van De Wege said that not only are those in need of skilled nursing a vulnerable population, but also that care of the elderly is a major employment sector in the 24th district, with some 2,806 employees in Clallam County, 819 in Jefferson County and 2,881 employees in Grays Harbor County working in assisted living and skilled nursing facilities.


Executive Editor Leah Leach can be reached at 360-417-3530 or at lleach@peninsuladailynews.com.

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