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Budget deal: Any winners?

There's a little extra money for schools, but nothing close to what will be needed. No new taxes, but no end to any tax breaks that benefit special interests.
Gov. Jay Inslee

Gov. Jay Inslee Photo: John Stang

Washington's 2014-2015 supplemental operating budget ended up as a zero-sum game.

No new tax breaks. No tax breaks closed. No new taxes. No real budget hikes. No real budget cuts.

"It's a modest budget. It makes no sweeping changes," said Rep. Ross Hunter, D-Medina and the House Democrats' lead budget negotiator.

Rep. Bruce Chandler, the lead Republican negotiator for the House, said, “With the economy continuing to struggle, we all know our next biennial budget is going to come with many challenges. Today’s proposal places us in a strong position to meet those challenges.

"It’s not a perfect budget," Chandler added, "but it is a good first step in gaining back the taxpayers’ trust that we will meet those budget challenges by keeping their hard work, wishes and wallets in mind."

The House and Senate overwhelmingly passed the compromise budget in separate votes Thursday.

Here are the supplemental budget basic numbers. All the additions and subjections in the negotiations ended up adding an extra $26 million to the total 2013-2015 state operating budget $33.6 billion budget adopted after six months of legislative battles last year. The budget leaves $897 million in reserve.

With some cuts elsewhere, the budget adds $58 million in books and equipment for schools to help address a 2012 Washington Supreme Court ruling that the state is not meeting its Constitutional obligations on basic education. Overall, however, the state needs an extra $4 billion to $4.5 billion to meet those requirements from 2013 to 2019. 

With $982 million appropriated last year to meet some of the educational requirements of the court's McCleary ruling, the new supplemental budget funding for books and equipment brings the Legislature just over the $1 billion mark in allocated for this effort in 2013-2015.

Hunter estimated that at least $2.2 billion in extra money -- and possibly more -- will be needed for the Supreme Court fix-it work on education in 2015-2017.

That does not count what it would cost to restore long-dormant teacher cost-of-living raises.

Republicans and Democrats essentially gave up their major preferences in order to get this budget done by Thursday, which was the last day of the legislative session.

Republicans had proposed several new tax breaks, which would have amounted to $83 million in 2014-2015. Meanwhile, Democrats wanted to close a tax break that mainly benefits five oil refineries; force out-of-state residents to pay Washington's sales tax; impose the sales tax on bottled water and eliminate a B&O tax break for drug resellers. Altogether, eliminating the tax breaks would raise $106 million in 2014-2015 and $203 million in 2015-2017 to finance education improvements and cost-of-living increases for teachers. However, Democrats withdrew those proposals as part of the budget deal.

And Democrats agreed to punt on restoring teacher cost-of-living raises for 2014-2015, although they said they will try again in the 2015 session.

Also dead is a proposed tax on electronic cigarettes by Rep. Reuven Carlyle, D-Seattle. Originally, Carlyle proposed a tax rate of 95 percent, but  that had dropped to 75 percent and then to 50 percent in the budget talks before finally being shelved. "There was very strong, fierce, overwhelming opposition from the Senate," Carlyle said. He plans to revive the electronic cigarette tax proposal in 2015.

John Stang covers state government for Crosscut. He can be reached by writing editor@crosscut.com.


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