Upcoming Conference | 2019 Re-Wire Policy Conference, Dec 10, 2019 Register

In Spending Packages, Reform-Minded Senate Republicans See Chance to Overhaul State Government

In the unveiling of their $15 billion transportation package proposal that featured support from two Democratic Senators last week, Republicans in the Senate held true to a theme they’ve reiterated since the election last fall, and years before that: reform measures in exchange for revenue.

In all, eight policy proposals were included that would overhaul everything from shifting sales tax on road construction equipment to transportation rather than the state’s operating fund, to changing prevailing wage requirements for off-site workers who build infrastructure, to environmental permitting, and a host of other changes.

And that’s not to mention the one that some Democrats will find the most objectionable: tying transit funding to the scuttling of a low-carbon fuels standard, which the Department of Ecology released a discussion draft on earlier this month, and is a policy favored by Gov. Jay Inslee.

Whether these end up in the final bill that lands on the governor’s desk, or if any transportation package will make it that far this year, remains to be seen.

The overarching goal has been to reshape the way government operates and funds programs, based on the belief that this is the path to sustainable budgeting. A key question looming over this session is how aggressively they’ll push this agenda as the negotiations over the state budget begin in earnest.

The approach has seen considerable pushback thus far from Democrats and labor unions, arguing it’s attaching political agendas to spending bills that aims to dismantle government protections and programs. Jeff Johnson, president of the state Labor Council, AFL-CIO, wrote in a commentary last week that the reforms were “getting wrapped around an ideological axle by taking hostage important policy provisions that support working families and promote clean, healthy communities.”

Typically in a 105-day session, the final sprint on the budget negotiations begins around the first day of spring; this year, due to agreement between the House and the Senate to move up the budget forecast, they could kick off sooner. On Friday, the Economic and Revenue Forecast Council will spell out what money it expects the state to have at hand in the next two years, earlier than the original schedule, which was in the third week of March.

There’s about a $2 billion difference between the rough budget figures Sen. Andy Hill offered before the session began, and the one proposed by Inslee in December. House Democrats will be the first caucus to propose a budget, and while the historical standard has been to issue the budget proposal within a week of the final revenue forecast, Majority Leader Pat Sullivan said he expects they will be more patient this year. So, don’t expect it in February.

Almost all of this has been playing out behind the scenes in the Legislature in the six weeks it’s been in session, and the heavy lifting in the negotiations will undoubtedly remain that way. The Legislature will have to decide whether to fund or suspend the class-size initiative voters approved last fall, I-1351, and the suspension would require a two-thirds vote in both chambers.

The votes seem easier to acquire from Republicans in the Senate than Democrats in the House, where some lawmakers represent districts in which the initiative passed by more than 60 percent of the vote. Sending it back to voters, as the News Tribune reported last week, could only take a simple majority based on a 1995 Attorney General’s Office opinion.

Another element looming over the stretch run on the budget: What the state Supreme Court will do if lawmakers get to April 27, the day after the session ends, without a spending plan to satisfy the court’s mandate in education funding to satisfy the McCleary ruling. That could cost $750 million, the base spending for operations and maintenance, to $1.2 billion, which would also cover class size reductions in grades kindergarten through third grade, as well as fully implementing an all-day kindergarten program statewide.

Inslee and fellow Democrats in the Legislature are pushing for $440 million in employee contribution increases, as well as about $200 million in teacher salary increases required by a voter initiative that the Legislature hasn’t minded suspending in the past.

By Hill’s budget math, the state has $3 billion in extra revenue coming in for the 2015-2017 biennium, and about $2 billion is eaten up by growth in state costs. That leaves about $1 billion left over, which could fund the $750 million McCleary base costs, and the teacher salary increases.

Everything else? Cuts, tax increases, or eliminating tax incentives — or a mix of all three would work. The Senate has already adopted rules barring a new tax from coming to a vote on the floor, which they did on the first day of session. What will come out when the smoke clears? And what will Senate Republicans be pushing for in terms of reform measures in their proposal?

Leadership has been tight-lipped about these matters, and key lawmakers such as Majority Leader Mark Schoesler, Sen. Andy Hill, R-Redmond and the budget writer in the Senate, Sen. John Braun, R-Centralia and deputy leader of the Majority Coalition Caucus, did not return phone calls seeking comment.

There’s a number of reform proposals floating around in committees currently, either waiting to be passed to the Rules Committee, or are already there.

Senate Minority Leader Sharon Nelson, D-Maury Island, said she’ll be looking to see which policy measures move out of Rules as an indication of what could crop up as the budget negotiations heat up.

“We’ll see this week what they take out of policy (committees),” Nelson said. In the past, the subjects have typically dealt with labor, although that isn’t certain this year, she said. “If they follow what they do two years ago, that’s what they’ll bring up. I don’t know where this is going.”

The proposals largely deal with reforming labor policies in Washington state, health care, education, and general government operations; the MCC created a new committee this year, Accountability and Reform, devoted to transparency and efficiency issues.

Hill introduced legislation Feb. 12, SB 5944, that would add new requirements on spending on new state programs, including a statement of their purpose, a 10-year sunset clause on new programs, and a review by the Joint Legislative Audit and Review Committee, a bipartisan group of lawmakers that looks at a variety of government functions, as well as reviewing the state’s tax preference system.

The continuation of that program would be contingent on the review, and the committee determining that the program was meeting its specific policy objectives.

Two of the proposals have leaders like Braun, Schoesler, former Minority Leader Mike Hewitt, R-Walla Walla, Sen. Curtis King, R-Yakima, among others, on board.

The first would change the number of days required for members of a union to challenge a collective bargaining agreement from 30 days to 90 days, while the second would open up the sessions between union negotiators and staff from the Office of Financial Management and the governor’s office to the public. They’re closed currently, but the contracts are publicly available before they go to the Legislature for funding.

Republicans have criticized this process, which came about more than a decade ago under legislation signed by former Gov. Gary Locke, that instituted the collective bargaining process among state employee units. Prior to the change, the Legislature had retained the authority to decide which aspects of the overall collection of contracts it would be able to fund. The current process requires an up-or-down vote. But, the proposal would face stiff opposition from Democrats in the House or from Gov. Inslee, who said at a recent news conference he would not support the proposal because he felt it would undermine the union negotiations. To the unions, the word “reform” can be synonymous with clawing back a right they have currently.

Other measures look at additional changes to the worker’s compensation system, or change prevailing wage requirements, or even requiring disclosure of public sector employee financing. These are brought forth in the Legislature on a seemingly annual basis, and it’s a rare day when they finally break-through in engendering bipartisan support for inclusion in the overall budget package.

What will be proffered at the end? The end of this week may offer an early look at what’s on the table.