House Bill 2038 eliminates certain tax preferences and extends temporary taxes in order to raise more than $900 million in additional funds, which would go to the education legacy trust account for K-12 and higher education. It makes permanent the 0.3 percent business and occupation (B&O) surtax on service businesses; eliminates the preferential B&O tax rate of 0.275 percent for travel agents and tour operators, eliminates the preferential B&O tax rate of 0.138 percent for resellers of prescription drugs; and repeals the sales and use tax exemption for bottled water. It also changes the nonresident sales and use tax exemption for tangible personal property into a remittance program and narrows the high technology tax credit for research and development. Under the act the high technology sales and use tax deferral program will expire on July 1, 2013. As amended and passed, the bill does not impose an additional per-barrel tax on beer. It passed the House on April 24 by a vote of 50-47.
Reps. Brian Blake, D-Aberdeen, Dean Takko, D-Longview, Steve Tharinger, D-Sequim, and Kevin Van De Wege, D-Sequim, all voted for the bill.
Senate Bill 5895 exempts state education costs from the state expenditure limit for the years 2015 to 2023, including the costs of court rulings imposing new state costs, expenditures of extraordinary revenue growth, and the cost of extraordinary growth in the caseloads of state entitlement programs. It increases funds in the education legacy trust account by shifting receipts from real estate excise taxes, public utility taxes, solid waste collection taxes, and unclaimed state lottery prizes to the fund. If federal law or court decisions allow states to collect sales taxes on out-of-state Internet sales, any additional revenue must be deposited in the education legacy trust account. It also declares it is the intent of the legislature that first priority for the state’s general obligation bond capacity must be to support the state assistance program for school districts in the construction and ownership of local school facilities; and to meet its obligation to fund the common school system of the state by reducing future debt service payments by the state. It passed the Senate on April 23 by a vote of 25-23.
Sen. Jim Hargrove, D-Hoquiam, voted for the bill. Sen. Brian Hatfield, D-Raymond, voted against it.
Senate Bill 5024 is the Senate version of the transportation budget that provides $8.7 billion for state transportation agencies and programs for the 2013-15 fiscal biennium that allocates money for maintenance, infrastructure, and existing large-scale projects such as the SR 520 floating bridge and Seattle’s Alaskan Way Viaduct tunnel ($900 million). This budget also includes about &82 million for design work on the I-5 Columbia River Crossing project. The bill also modifies appropriations for the existing the 2011-13 transportation budget. It passed the Senate on April 19 by a vote of 47-0.
Hatfield and Hargrove voted for the bill.
Public employee insurance
Senate Bill 5905 establishes and takes steps to implement the following goals: for school districts and the state to take advantage of the federal Affordable Care Act, including the Washington health benefits exchange, premium tax credits, and subsidies to make more affordable health benefit plans available to part-time public employees and to provide more affordable options for low income, part-time employees. A portion of the resulting savings would be dedicated to reimbursing premium or out-of-pocket costs, or to compensation increases. A portion of the savings from reduced state spending for part-time employees’ health benefits would also be dedicated to other public school needs. Beginning with the 2013-14 school year, school districts must identify opportunities for using the health plans, premium credits, and subsidies available through the Washington health benefit exchange to provide affordable health insurance benefits for part-time employees. It passed the Senate on April 22 by a vote of 25-23.
Hargrove voted for the bill. Hatfield voted against it.
Public Employee retirement plans
Senate Bill 5851 creates a new retirement plan, the Washington Public Employees Savings Plan (PESP), as a defined contribution plan option for employees who were first hired in an eligible position on or after July 1, 2014. Members of existing retirement plans as of July 1, 2014, have the option to make an irrevocable choice to transfer to PESP between January 1, 2015, and July 1, 2015. Under the new plan, members must contribute to their defined contribution accounts at a rate equal to 5 percent of salary up to age 35 and 7.5 percent beginning at age 35. Public employers must contribute to members’ accounts at a rate equal to 80 percent of the employee contribution rate. The department of retirement systems will be responsible for the administration and management of the savings Plan, and the State Investment Board will develop investment options for PESP member accounts. The act takes effect July 1, 2014, however, the legislature retains the right to alter or abolish these benefits any time before July 1, 2014. It passed the Senate on April 25 by a vote of 25-22.
Hargrove voted for the bill. Hatfield was excused from the vote.