No Transportation Deal Before Christmas – Impasse is Announced

Debate over a transportation package is being kicked forward to the 2014 legislative session.

Debate over a transportation package is being kicked forward to the 2014 legislative session.

OLYMPIA, Dec. 18.—Looks like there won’t be a transportation deal before Christmas – and with it goes any thought of a pre-session special session.

Negotiators for the House and Senate announced Wednesday evening that they failed to reach an agreement after a dozen meetings behind closed doors. It doesn’t mean the issue is dead. But it does kick it forward to the 2014 legislative session, which begins Jan. 13. And suddenly that raises any number of possibilities about the way the issue will play during the 60-day sojourn at the Capitol. It could mean, for instance, that the chance lawmakers will take on worker’s comp and water-quality standards next session just got a whole lot better.

The announcement came in the form of a news release issued just after 6 p.m. Wednesday night – a joint statement from the office of Gov. Jay Inslee and the negotiators representing House and Senate caucuses. It reads:

“Through 12 negotiating sessions we made progress on finding a compromise package of statewide transportation improvements. But today it has become clear this phase of the process has run its course and we have not reached an agreement.

“We agree that transportation infrastructure is important to our state and we remain committed to finding a solution in the regular legislative session that works for everyone.

“The next step in this process will be to continue this dialogue in the legislative process.”

Reforms are the Issue

Lawmakers are contemplating a gas-tax hike in the neighborhood of 11 cents a gallon – 10.5 cents under a proposal that passed the House earlier this year, 11.5 cents under a proposal released by the Senate Majority Coalition Caucus last month. The more-expansive Senate proposal would raise $12.3 billion for road projects and avoid the prospect of tolls on the I-90 bridge over Lake Washington. The sticking point has never been the amount of the increase, but rather a package of transportation reforms favored by House Republicans and the Senate Majority Coalition.

About a billion dollars’ worth of issues have dogged the negotiations for the last month. For one thing, Democrats hope to continue the diversion of gas tax money to the state general fund by levying a sales tax on construction materials. The longstanding taxation practice gets around a constitutional prohibition on the use of gas-tax money for non-transportation purposes. By eliminating the sales tax, the Senate plan would free up $690 million for road projects over the next decade.

The other major dispute has to do with the financing of highway-related stormwater drainage projects. The Senate has proposed that the money come not from the gas tax but from another tax, the state’s tax on hazardous substances, which is levied mainly on gasoline and diesel fuel. The Model Toxics Control Act tax, passed by initiative in 1988, was sold to the public as a means to pay for cleanup of contaminated sites. But as gas prices have dramatically increased over the years, it has become a lucrative catch-all fund for other Department of Ecology projects, such as shoreline planning and burn-barrel reduction. By shunting responsibility for stormwater projects to that fund, the Senate plan would free up another $270 million for transportation. But green groups are raising stiff opposition as it would mean less money for other projects they would like to see funded – and they wield considerable influence in the Legislature’s Democratic ranks.

Other issues include proposals to change the state’s prevailing-wage and apprenticeship rules – which raises the hackles of the Washington State Labor Council and union organizations. Transit advocates argue they deserve a bigger share of the proceeds, and Seattle lawmakers raise the traditional complaint that more money should come to the Queen City.

Kicks Things Forward

By declaring a pre-Christmas impasse, lawmakers appear to be shunting the transportation issue forward to the 2014 regular legislative session. Even if lawmakers were to reach a deal immediately after the holidays, the bill-drafting process is a lengthy one, and the chance of a pre-session special session becomes remote.

And by kicking it forward, the impasse creates a whole new political dynamic. Part of it is that members might insist on adding local pet projects to the project list in return for their votes. But in the bigger scheme of things, transportation also might become a bargaining chip in other legislative debates. The other issues include reforms to the state’s worker compensation program and a possible effort to slow down a Department of Ecology plan to impose stringent new water-quality standards.

Those three issues – transportation, water quality and worker’s comp – all have something in common. All three of them have been cited by the Boeing Co. as top priorities. The debate will come as sensitivity toward Boeing’s wishes is at a peak. The homegrown jetmaker, of course, is trying to decide whether it will build a production line for the next-generation 777X airliner in the state of Washington. Resistance by the Machinists Union to pension concessions may improve chances for other sweeteners.