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2010 Olympia Re-cap April 15, 2010 |
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East King County Chambers of Commerce Legislative Coalition Olympia Round-up
Special update
The Washington State Legislature has completed work on a revenue package and budget to end a 30 day Special Legislative Session.
Now that the session is complete, we would like to highlight some key areas where the Legislature acted in regard to the East King County Chambers of Commerce Legislative Coalition's agenda.
Transportation:
Governor Gregoire signed Senate Bill 6392 authorizing the state to use future tolling money from the SR 520 bridge to pay for renovations along the entire corridor - whereas it was previously limited to the bridge itself. This allows the Eastside to begin work on the project while final details for the bridge are sorted out. This was a success for the Coalition. Read more in about this from the SeattlePI.com.
Economic Development:
As the Legislature faced a difficult budget situation, priorities were weighed as to how best to balance the $2.8 billion budget deficit. Here are some of the choices made by the Legislature in order to balance the budget. For a detailed summary of supplemental budget, please click here.
- $49 million in savings from 10 furlough days for 25% of state employees in the public education system.
- $79 million cut from the class-size reduction initiative, I-728.
- $73 million cut from state colleges.
- $15 million cut from public school teacher training.
- The budget relies on $633 million in federal aid, rainy day funds and shifting funds from different accounts.
Business Taxation:
After a 30 day special session, the Legislature finally came to an agreement on a revenue expected to generate $794 million over two years while cutting $755 million to help close a $2.8 billion budget gap. Please click here to view a chart compiled by the Association of Washington Business outlining the new taxes. The session was framed largely as a debate over whether to raise the state sales tax or a select number of targeted tax increases. The targeted tax package prevailed and the state sales tax will not be raised.
Among the new taxes signed into law are:
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Business and occupation tax increases on service businesses (except hospitals and research and development) from 1.5% to 1.8%. This affects professions like doctors, lawyers, accountants, real estate agents and hairdressers. This tax is set to expire in June 2013. This is expected to generate $242 million.
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Taxes on beer, soda, candy and bottled water would bring in more than $150 million combined. The tax on mass-market beer would charge an additional 50 cents per gallon, or 28 cents per six-pack. Microbreweries would be exempt from the increase. The tax is projected to raise about $59 million. The soda tax of 2 cents on each 12-ounce can or bottle would raise $33.5 million. The taxes on beer and soda will expire in June of 2013.
Going Forward:
Now that the Legislature has completed their business what implications will it have on the future of our state? While the Legislature was able to balance the budget this time, they may have just delayed addressing some of the state's most serious structural budget issues. Some are projecting Washington State will continue to face multi-billion dollar deficits into the future.
Ultimately, this budget did not meet the priorities outlined in the Coalition's 2010 Legislative Agenda. Taxes were raised, cuts to education were made and it is likely that the budget is not sustainable for the future. However, in spite of attempts to slow down, the 520 bridge continues to proceed on schedule and this is an important victory for the Coalition.
Don't forget:
The Coalition's Legislative Wrap-up is Thursday, April 29th. If you haven't done so already please register online and come hear our Eastside Legislators' view on what happened in Olympia. See below for more information. |
