Article by Erik Smith. Published on Tuesday, March 09, 2010 EST.

New Plan Has Some Major Differences

State Rep. Hans Dunshee, D-Snohomish.

By Erik Smith

Staff writer/ Washington State Wire

OLYMPIA, March 9.—Just when it seemed that a plan to raise taxes on oil and other hazardous substances was dead for the session, green lawmakers and environmental groups are mounting a strong last-minute effort for a $100 million tax increase.

            The new plan is somewhat smaller than the tripling of the tax that had been pushed earlier in the session. And now it’s a question of whether advocates can round up votes before the final gong sounds on this year’s legislature, two days from now.

            Lobbyists on both sides spent Monday under the dome of the state Capitol building, sending notes in to members and begging for support. By the end of the day, House Capital Budget Chairman Hans Dunshee, D-Snohomish, said he had 24 votes for the plan in the Senate – one vote shy of the magic number required for passage. Meanwhile, House Democrats will discuss the plan behind closed doors Tuesday.

            “People realized we’re at the end of the session and we haven’t done anything about jobs,” Dunshee said.

            “For us to come out of the session and say all we’ve done is balance the budget – I think people are mostly concerned about jobs, and we ought to do something about it.”

            Within the House Democratic caucus, however, Dunshee will face opposition from House Ways and Means Chairwoman Kelli Linville, D-Bellingham, and other highly placed lawmakers.

            What Plan Does

            The new plan is significantly different than the early version touted at the beginning of the session. Environmentalists had hoped to nearly triple the state’s hazardous-substances tax, which is paid mainly by oil companies, but also by users of such products as pesticides. The tax currently generates $114 million a year and is supposed to be earmarked for environmental cleanup, but lawmakers raided the fund last year to bail out the state budget and may do so again this year.

            Environmentalists, aligned with city and county lobbying organizations, say the tax should be increased for stormwater-drainage projects in the Puget Sound area. But to make the deal sweeter for lawmakers, they originally suggested that a large portion of the money be diverted to the ailing state general fund for the first few years.

            The new proposal doesn’t provide money for the state general fund in a direct fashion. The money would go to the state capital construction budget, and it would replace money that lawmakers have taken from the capital budget and placed in the general fund, Dunshee said. And the entire proceeds would be dedicated to water-pollution projects.

            The state would be able to bond against the money to launch projects sooner, Dunshee said. The tactic also would boost the state’s debt limit, allowing more bonds to be issued for other projects.

            The plan would slightly more than double the current tax rate, from 0.7 percent to 1.55 percent.

            It also would provide a tax credit for Washington refiners selling products beyond the state line.

            “You create 20,000 jobs building stormwater projects, and gee, you make the polluters pay,” Dunshee said. “I’m more optimistic about it than I was a week ago.”

            Strong Opposition

            The push comes as the House turns its attention to the capital budget, the last remaining budget to be passed by the Legislature before negotiations begin. Though not much time is left before the Legislature’s scheduled adjournment, Dunshee said passage of the capital budget puts the issue front and center before the Legislature. “There’s lots and lots of time – all the important time is left,” he said.

Your support matters.

Public service journalism is important today as ever. If you get something from our coverage, please consider making a donation to support our work. Thanks for reading our stuff.