Last week began on a positive note with a unanimous Senate vote for our innovative, early-action school construction bill. I mentioned Senate Bill 5445 in a previous column; it would make a $475 million appropriation to the state school-construction account months ahead of the usual schedule, enough to cover the anticipated size of school-district requests for the next two years, plus $10 million for school-security improvements. This is good for jobs and education and also makes sense from a budgeting standpoint; all are key priorities for our Majority Coalition Caucus.
Senate minority tax wish-list hits $38 billion over 10 years Let's see: almost 64 percent of those voting statewide in November said "yes" to Initiative 1185, which extends by another two years the requirement of a two-thirds legislative vote to approve tax increases. I-1185 won a majority of votes in each of our state's 39 counties and passed in 44 of the state's 49 legislative districts (including the 9th). That sounds like a pretty strong "no new taxes" message, yet some of our colleagues in the Senate minority have proposed tax increases that over 10 years would amount to $38 billion. In the spirit of bipartisanship, the Majority Coalition Caucus allowed the sponsors of these bills to make their case in front of me and the rest of the Senate Ways and Means Committee at a public hearing Thursday: * Senate Bill 5166, which would create a state income tax (an idea voters have rejected many times before) to the tune of more than $32 billion in the next 10 years; * Senate Bill 5039, which would amount to almost $5 billion in the next decade by extending two taxes that are set to expire this year (sales tax on beer, business and occupation tax on services), plus a new excise tax on gasoline distribution; * Senate Bill 5042, which would increase the business and occupation tax on our state's job creators (remember, they're taxed on their gross earnings, not net earnings - no other state does this), equal to more than $400 million in the next 10 years; * Senate Bill 5248, which would be a $134 million (over 10 years) tax on plastic shopping bags; and * Senate Bill 5043, which would pare the property tax exemption for intangibles. The cost to taxpayers hasn't been calculated for 2013; it was estimated in 2011 that taxpayers saved $12.8 billion related to the exemption. During the hearing, we heard testimony from the non-partisan Washington Policy Center regarding the anticipated effect of adopting all five bills: the state would lose 70,000 jobs by 2016 (that number being the net difference between private-sector jobs lost and public-sector jobs gained). Our coalition believes Olympia should and can live within its means. We see reforming state government as a way to free up revenue and make it available for more important uses. These bills reveal a lot about the direction the minority would have gone if it still was in charge of the Senate. They also help make a stronger case for Senate Joint Resolution 8200, which would place the I-1185 tax-approval threshold into our state constitution (it received a committee hearing this past week).
Create jobs, protect environment by refocusing Legislation that would encourage jobs while protecting the environment received approval this week. Senate Bill 5296 would refocus the spending of revenue, which has become a popular target for raiders looking to sweep money into the state general fund. The MTCA law was created by a voter initiative in 1988. It imposes a "hazardous substance tax," primarily on petroleum products. However, the law's intent has been compromised by the channeling of funding to things that are far-removed from toxic cleanup. In the current two-year budget cycle, revenue from the hazardous-substance tax is expected to reach $352 million. In recent years, the account has been a frequent target of diversions, with $233 million shifted to the general fund since 2009 alone. Putting the focus back on renewing toxic sites will improve the environment and put people to work on the 1,900 sites around the state awaiting remediation.
Change in energy policy would help many Electricity is among the primary costs of doing business and maintaining a household; higher power bills mean less money in the pockets of hard-working families and small-business owners, which keeps a lid on our economic recovery. Washington has long enjoyed access to relatively cheap hydropower from dams on the Columbia and other rivers. Practically speaking, hydropower is renewable - but not in the eyes of the law created by Initiative 937 in 2006. That law gives Washington utilities with more than 25,000 customers until 2020 to adjust their power portfolios so 15 percent of the power comes from renewable energy sources, such as wind and solar (because hydropower is not considered a renewable energy source). Contrary to expectations, Washington's population and demand for power did not continue to increase at 2006 rates. The economic recession cut into demand, meaning utilities must now buy energy they don't need to satisfy the renewable requirement in the law. It also means Washington utilities are forced to ship low-cost, clean hydropower to other states then turn around and buy more expensive power from those same states, a consequence that is already costing Washington consumers millions of dollars and is just going to get more expensive. Senate Bill 5648 would begin to address this concern; it has solid bipartisan support (including mine) and received a public hearing last week before the Senate energy committee.