Hello Friends and Neighbors,
The final day of our 105-day session is a week from this Sunday. I mentioned in my previous report how there’s no excuse for going past that deadline when one party controls both houses of the Legislature… but sure enough, the chatter about an overtime session is now being reported as news.
I understand why this is happening, because a lot of big pieces of legislation ARE still in motion. Here’s a rundown on some:
Look for ‘conference’ operating budget to be even larger: The House majority could have approved its 2021-23 operating budget as a standalone bill (HB 1094), to go along with the Senate operating budget (SB 5092). Instead, it took a different but familiar path, and replaced the language in the Senate bill with its own – then sent it back to us for concurrence.
When the Senate and House do not concur on legislation, it can cause the bill in question to “die” – but the more common outcome is for the bill to go to “conference,” meaning a selected group of legislators from both chambers meet separately to seek a compromise.
That’s what happened with this year’s budget – and I’m expecting the conference committee’s report Monday. My guess is the Senate and House negotiators (as a member of the minority I’m not included in this stage) won’t do a lot of haggling; they’ll do a lot of combining instead. It won’t surprise me if the bottom line in the conference budget is even larger than the $59.5 billion in the Senate budget – maybe north of $60 billion, which would be astounding (to put it nicely).
There’s one more twist: no matter what a bill concerns, a conference committee’s report cannot be amended. The Senate and House simply get to vote “up” or “down.” I have misgivings about that when it comes to the budget, because it puts more control over taxes and spending into the hands of a small group, but it’s the process we have.
Will possession of hard drugs become a crime again? The state Supreme Court’s controversial ruling in the case of State v. Blake was issued February 25. It effectively decriminalized the possession of heroin, methamphetamine, oxycodone and similarly lethal drugs. To put it in perspective, the Blake ruling means a 15-year-old would be in more trouble for possessing cigarettes than for possessing a controlled substance. Also, the drug courts that have done such good for so many people have effectively been put on hold. Six weeks later, the majority Democrats finally seem to realize what Republicans have known from the start – the Legislature HAS to respond before this session ends.
Over the past week or so I and the Republican leader on the Senate Law and Justice Committee were engaged in talks with the Law and Justice chair and the prime sponsor of Senate Bill 5476 – which is the Senate Democrats’ response to the Blake ruling. Having served for years on the Senate Law and Justice Committee, and being Republican leader on the Senate Ways and Means Committee, I was able to argue both the policy and budget sides of the issue. And there IS a budget side, because the Blake decision put the state on the hook for a massive amount of costs: an estimated $24-47 million to repay “legal financial obligations” going back many years; $20-33 million to pay for resentencing hearings; $23 million for additional courtroom space to handle the volume of Blake-related proceedings; and $4-5 million to vacate convictions as appropriate.
During our discussions, the Democrats seemed more interested in minimizing the penalties for drug possession, going forward, and allowing legal possession of certain amounts of these drugs for “personal use.” Our position was focused on making sure people who need treatment still have a path into treatment, using the possibility of a felony charge as leverage. In a bipartisan vote yesterday, the Senate supported a version of SB 5476 that doesn’t allow possession for personal use, or an automatic path to legalization, and also limits the charging to a gross misdemeanor, rather than a felony. It’s not quite what I would have wanted, but it’s a reasonable path toward a reasonable response, and I believe it will save lives.
Limits on governor’s emergency powers? My Democratic colleagues are sensing the importance of dealing with the Blake court decision, but they have yet to show interest in revising the state law that grants the governor certain powers during a state of emergency.
If the law is allowed to stand, the Legislature will be in the same position it was after we adjourned in 2020: when an emergency proclamation from the governor suspends a law (to allow things like renewing driver’s licenses by mail) we can decide whether to extend it past 30 days, but we have no say at all if the proclamation prohibits a specific behavior (like attending school). My SB 5039 is a very reasonable step toward balancing the scales, because it would simply allow us to review ALL proclamations. There’s still time for the Legislature to take action on my bipartisan bill, or related legislation in the House, but the Democrat leaders seem afraid to even have a discussion. I can’t believe their constituents want to go back to being under one-person rule once the Legislature adjourns… any more than my constituents do. My bill isn’t aimed at Governor Inslee personally, it’s about revising the law based on the lessons we’ve learned over the past year.
House committee endorses income-tax bill, with change that would again block public vote: Well, there they go again. As introduced, the bill to create a billion-dollar state tax on capital-gains income (SB 5096) included language to keep voters from having the chance to reject the tax, if it became law. That wording – known as the “emergency clause” – was removed when SB 5096 came to the Senate Ways and Means Committee, but the House Finance Committee put it back in a slightly different form (highlighted in yellow below) before endorsing the bill this morning.
Why would anyone want to keep the voters from challenging a new law through a referendum, as the state constitution allows? In this case, it’s obvious: the people have opposed 10 attempts to impose an income tax, and I’m sure the Democrats are afraid the people will tell them for the 11th time that they don’t want an income tax! We’ll see if the House majority passes the income-tax bill as it came out of the committee this morning. If they don’t remove the emergency language, SB 5096 will have to come back to the Senate where I will continue to fight this unconstitutional tax.
‘Cap and tax’ bill on the move in the House: Senate Bill 5126, which would allow state government to pull in another $500 million per year by selling permits to emit carbon, is scheduled for “executive action” – meaning a vote – by the House Environment and Energy Committee this afternoon.
Seeing how the bill is already scheduled for a Monday public hearing by the House Appropriations Committee (and executive action in that committee on Tuesday) I expect today’s energy-committee vote will move the bill forward. But is that what the people want? Look at who signed in to state their position on SB 5126, without wanting to testify at the public hearing Wednesday: 484 people for, versus 1,121 against.
However, this bill is wrapped not only into the Senate Democrats’ operating budget but also the $14 billion transportation-revenue package that just came forward from the Senate Transportation Committee on Wednesday. I expect it, like the income-tax bill, will continue on through to the governor’s desk, although that may not happen until the final hours of the session.
A higher tax on mobile phones? Maybe you’ve heard that a new dialing code, 988, has been created to quickly access the National Suicide Prevention Hotline, run by the federal Substance Abuse and Mental Health Service Administration. Just as dialing 911 spares people from having to look up a 10-digit police-department phone number, 988 will essentially take the place of dialing 1-800-273-TALK, effective in July 2022.
Both the Senate Democratic and Senate Republican operating budgets would use general-fund money to support centers that handle in-state 988 calls. However, the House Democrats have passed HB 1477, which would instead impose a 30-cent per month charge through 2022, and a 50-cent per month charge thereafter, on cell phone and IP services. Washington already has the third-highest local/state cell phone tax in country, just shy of 20%; a tax of 50 cents per month equals an estimated $116 million per year statewide! That might very well be enough to move our state up to second nationally – and to me, a higher ranking means we’re going in the wrong direction. Important services should be supported from the general fund; there’s no need to make cellphone bills more expensive.
Here are two other actions from this week I want you to know about.
Important change to the upcoming payroll tax: If you’re thinking “WHAT upcoming payroll tax?” you’re not alone. The tax will be collected as a payroll deduction starting next January, which is why it’s flown under the radar since being approved in 2019 as part of the Long-Term Services and Supports Trust Program created by HB 1087. The tax rate is .58%, which means $290 would be collected yearly from the paycheck of someone making $50,000. The tax is expected to total more than $1 billion annually.
The intent of the law (and the upcoming tax) is to make sure Washington residents have some kind of long-term care insurance. It’s pretty underwhelming, though. No matter how many years you pay into the program, the benefit tops out at $36,500, which doesn’t pay for more than several months in most long-term care facilities. If you retire and move out of state, the benefit does NOT move with you. And what worries me most is – unlike other insurance policies – unless you opt out, you’re stuck paying as long as you’re working. Under the 2019 law, you could only opt out by demonstrating that you’d purchased your own long-term care insurance.
We learned late last year that this new program was headed for a $15 billion shortfall because the state has limited options for investing the tax revenue. I don’t know if that’s why the Democrats introduced HB 1323, but in its original form the bill essentially eliminated opt-outs, which would mean more people paying the tax. In the Senate, Republicans salvaged the opportunity to opt out – but only until November 1 of this year – as long as you demonstrate to the state that you have a private long-term care policy. Remember, if you don’t opt out now, you never can as long as you’re working!
To summarize: This new payroll tax was a really bad idea in the first place, if for no other reason than the high cost and limited benefits (and government’s never been good at managing things like this anyway). People need to know the payroll-tax wolves are almost at the door, and how to exempt themselves. If you’re interested, I’d suggest a visit to the National Association of Insurance Commissioners website; search for “long term care.” (I did an extensive interview this week with a Tri-Cities radio station; click here to listen.)
State audit indicates ESD loss to fraud was way higher than admitted: You may remember how this past year, the state Employment Security Department let its guard down and got taken for hundreds of millions in taxpayer dollars by Nigerian scammers who submitted fake unemployment claims after the COVID-19 pandemic shutdown put so many out of work. The agency eventually acknowledged the loss could be as high as $650 million.
This week the state auditor’s office released the findings of two audits (the accountability audit is here, the performance audit is here) of ESD, one of which indicates the loss could reach a whopping $1.1 billion once all claims marked for investigation are reviewed. The agency fired back, challenging the accuracy of the audit – but in my mind, ESD has little if any credibility left.
- On a related note: If you had interaction with ESD in the past year, you may be among the estimated 1.3 million people who had their personal information exposed due to a massive data breach at the state auditor’s office.Because of this egregious breach, the auditor’s office is offering free credit monitoring to those affected. Reportedly, emails were sent to those whose personal information was exposed in the Accellion data breach, with information about receiving free credit monitoring – but if you didn’t get that email, click here for more information.
I’m sorry I can’t invite you to come and visit me at the Capitol, but if you have a question or concern, please contact me by email, letter or phone. To make an appointment for a virtual meeting, please sent me an e-mail! Stay safe!
Yours in service,
To read this e-newsletter in other languages, click here to visit my Senate news page and find the “Select Language” menu in the upper left corner!