Senate Tries Its Hand at a Budget
The Washington Legislature may have been in session since January, but it's not until sometime this week that budget negotiations will begin in earnest. That's when the Republican-controlled Senate is expected to unveil its budget proposal for the 2015-2017 period.
House Democrats unveiled their $38.8 billion proposal, which included almost $1.5 billion in new taxes and tax break closures, last Friday. The Republican proposal is expected to be in the neighborhood of $37 billion, without any new taxes.
What to watch for in the Senate plan: Still unclear is how the Senate plan will fund $240 million in proposed tuition cuts at state universities, whether the plan will cut health and social services and how much the Republican-controlled Senate will allocate between 2015 and 2017 to reduce K-3 class sizes.
In its 2012 McCleary decision, the Washington State Supreme Court ruled that the state is not meeting its constitutional duty to fully fund K-12 education. According to the court's ruling and the Legislature's own definition of 'fully funded public education', teacher-student ratios in grades K-3 must be drastically reduced by the 2018-2019 fiscal year.
So far, the Legislature is not on track to hit that deadline. Last September, the Supreme Court justices threatened sanctions if a catch-up funding plan is not in place by the end of this session. Read more from Crosscut writer Dan Chasan on what those sanctions might entail.
Democrats and Republicans have been mostly at loggerheads over how to close the funding gap for education. The House Democrats' plan culls $1.4 billion for education work from a proposed capital gains tax, a B&O tax increase and tax break closures, but Senate Republicans don't believe the state's educational obligations should be funded through new taxes.
The Business Tax Debate Continues
On Monday, the House Finance Committee will hold a hearing on a major plank of the Democrats' plan to raise $1.4 billion to meet the Supreme Court mandate — a bump in the business and occupation (B&O) tax that would raise $532 million in 2015-2017.
Currently, service businesses such as doctors and lawyers pay a 1.5 percent B&O tax on their gross receipts. The Democrats' plan would increase that rate to 1.8 percent, but exempt businesses that make less than $100,000 a year. Democrats claim that would make about 15,000 current B&O taxpayers in the service category exempt from the tax bump.
A Minimum Wage Bump for WA?
Also on Monday, the Senate Commerce & Labor Committee will hold a hearing on House bills to create a $12-an-hour minimum wage by 2019 and to require most employers to grant mandatory sick leave to their workers. The Senate Republicans oppose those measures.
Who Audits the Auditor?
On Wednesday, in response to a federal investigation of Washington Auditor Troy Kelley, the Senate Accountability & Reform Committee will be briefed on legislative subpoena powers. There have been rumblings in the Senate about whether the Legislature can subpoena Kelley to quiz him on the details of the investigation.
Federal agents have obtained state records of Kelley and part-time employee Jason Jerue, who worked with Kelley prior to his election. They also searched Kelley's Tacoma home. Kelley has so far refused to speak publicly about the investigation, citing a risk of being charged with obstruction of justice for talking about an ongoing federal investigation.
Committee Chairman Sen. Mark Miloscia, R-Federal Way, made an unsuccessful run for state auditor in 2012. Miloscia, who has been critical of Kelley's refusal to speak publicly about the investigation, has invited Kelley to the Wednesday briefing.