OLYMPIA —Negotiators are making progress on a budget compromise that would cover the state's operating costs for the next two years, Gov. Jay Inslee said this morning.

But not enough that Inslee could say for certainty whether the Legislature will be working full-time starting Monday, when the special session starts.

“I think progress was made this week,” Inslee told reporters after ceremonial bill signings in his office conference room. He expects negotiators from both parties and both chambers will “start making the hard compromises necessary.”

The Legislature failed to pass a two-year operating budget during its 105-day regular session which ended April 28. Inslee called a special session to begin May 13, but budget staff and key leaders have spent parts of the last two weeks trying to find areas for compromise. Operating budgets passed by the Senate and House are more than $1 billion apart in terms of total spending, and the House budget calls for changes in tax exemptions the Senate does not.

When the Legislature adjourned on April 28, Inslee described the sides as “light years apart.” Budget negotiators met on Tuesday and today, he said. Other than to say they were making progress, Inslee said he couldn't elaborate. “We've agreed not to talk about negotiations.”

After convening at 9 a.m. Monday, legislators could hold hearings on some other issues that they or Inslee would like brought up in the special session. Among those are tougher rules for repeat drunk-driving offenses which had strong support when introduced but hit a few roadblocks over questions of funding in the final weeks of the session. Inslee said he thought negotiators were “99.5 percent of the way” to a compromise that would save counties and cities money on drunk-driving cases but may cost the state more money. If that's the case, budget negotiators will have to be sure the operating budget will have money to cover those changes, he said. 

OLYMPIA – House Democrats want to spend about $1.9 billion more on education over the next two years, paying for much of it by extending some taxes set to expire in June and closing more than a dozen tax breaks now on the books.

As expected, they released a budget Wednesday with significant differences from the plan that passed the Senate last Friday in how it raises, spends and saves money over the two years that start July 1.

It fanned the rhetorical flames over taxing and spending, with one Senate Republican saying House Democrats should “put on their big-boy pants” and make tough budget choices, and Democrats saying the Senate plan was akin to a family putting its groceries on the credit card. . . 

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OLYMPIA — House Democrats released their 2013-15 budget proposal this afternoon with calls for adding $1.9 billion to public schools, extending taxes set to expire at the end of June and closing a series of tax preference.

It's in sharp contrast to a budget that passed the Senate Friday on a bipartisan 30-18 vote that has no tax increases — in fact, there are about a dozen new credits — and about $1 billion extra for schools.

It also spends more on public colleges, allowing for some tuition increases. That's different from a Senate plan that would cut tuition by 3 percent.

“It's a responsible, honest and sustainable budget,” House Majority Leader Pat Sullivan said at the official “rollout”. “It actually funds the reforms (in education) that we said we would do.”

Among the tax exemptions the proposal would close is the ability for residents from some other states to avoid paying sales tax on purchases in Washington. Under the House Democrats's proposal, that would disappear except for auto sales.

The largest amount of “new” revenue would come from making permanent an increase in some business taxes enacted as temporary in 2011. It also extends, at a lower rate, a temporary tax on beer enacted at the same time. Together, that would raise an additional $593 million over two years.

With the state under orders from the Supreme Court to do a better job of paying for public education, the House Democrats propose increasing spending by $1.3 billion for programs that address the court mandate, and an extra $1.9 billion total for education.

OLYMPIA — House Democrats will release their proposals for two-year operating and capital projects budgets at noon today.

As dismissive as leading House Democrats have been about the Senate budget which passed last Friday, we can expect that it will have some new revenue, probably through the closing of some tax preferences, have more for social services and not suggest a cut in tuition for public universities and colleges. 

For those who want to see the budget drama unfold live, it will be broadcast on TVW.

Just how far apart the two budgets are at this point will offer some insight on whether the Legislature can wrap up its work by April 28, the last day allowed for the regular session.

Based on the last three years, a betting person would probably take the over, not the under, on any wager involving that subject.

OLYMPIA — The House Appropriations Committee is expected to release its general operating budget sometime Wednesday, giving everyone a chance to see how far apart that chamber is with the Senate, which passed its “no-new taxes” budget on Friday.

There may actually be two full budgets released, one from Democrats who are in the minority, and another from Republicans, who would be finishing up their “fund education first” proposal which spelled out last month what they wanted to spend on public schools, but didn't spell out where they'd cut the rest of the budget to pay for extra education programs.

On Monday and Tuesday, the budget committees will be working to get bills from the other chamber out of their committees to beat the April 9 cutoff deadline. House and Senate Transportation committees have marathon hearings Monday on the transportation plans.

OLYMPIA — It's a sunny day, at least outside the Capitol. As for inside, the outlook may depend on the outcome of this afternoon's Senate Ways and Means Committee hearing, where the growing list includes the operating budget passed yesterday in the House, along with a list of reforms being negotiated between the two parties.

The agenda has been fluid since the meeting was announced yesterday with both time and bills “to be announced.” The blanks began being filled in late yesterday afternoon and Chairman Ed Murray said this morning the operating budget would be added to it.

Senate Democrats are also talking about floor votes Saturday on bills that come out of that committee. But the budget may need significant revisions in order to pass. It's essentially the same one Senate Republicans and their breakway Democratic allies trashed earlier in the week.

Among the reforms being negotiated are changes to the state pension system, combining school employees' health insurance with the state system to save money and eliminating Initiative 728 (the smaller classroom size law passed in 2000 by voters).

That last one is still in the House, which has votes later today.

OLYMPIA — House Democrats offered a budget plan that doesn't call for a state tax increase and doesn't make some of the cuts to public schools and state services that Gov. Chris Gregoire proposed in November.

The school year wouldn't be shorter. The money the state sends to school districts to help make up for the differences in property values between rich areas and poor areas, known as levy equalization, wouldn't be cut. Inmates wouldn't be released early from state prisons.

But House Democrats did propose pulling back some state money currently going to counties and cities, then giving local governments the authority to raise local taxes to cover the difference. They do delay payments to school districts, in what some Republicans call an accounting gimmick. They reduce state employment by more than 1,500 full-time workers. They would leave less money in the treasury at the end of the fiscal period than either Gregoire or the House Republicans. . .

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OLYMPIA – House Republicans, who say they are fed up with the slow pace of budgeting process in a session where that was supposed to be the main thing the Legislature tackled, argued Thursday for a new approach.

The state should set aside what it wants to spend on K-12 education first, then figure out what’s left for other state programs. They call it “Fund Education First” and say it’s in line with both the state Constitution’s declaration that education in the state's public schools is the state’s “paramount duty” and a recent state Supreme Court ruling that the Legislature must do more to meet that duty.

“This is not a gimmick. It’s a workable solution,” said Rep. Kevin Parker, R-Spokane, a co-sponsor of a bipartisan bill that would make that change in budgeting.

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OLYMPIA — House Republicans, who say they've been essentially shut out of the budgeting process in a session when the budget was supposed to be the main thing the Legislature tackled, will be releasing their plans for K-12 programs today.

They call it “Fund Education First”, something that various Republicans of both chambers have suggested over the years in pointing out that basic education in the state's public schools is the “paramount duty” under the state Constitution.

This effort, however, would be more than a slogan because it would put down on paper what education programs they think the state should pay for. It's not a full budget — other spending priorities will be released later — but it would provide voters with a view of how their education priorities would differ from the supplemental budget Gov. Chris Gregoire proposed in November. At this point, that's the only other budget that exists in a form to which comparisons can be made.

OLYMPIA – School officials from across the state urged legislators to reject plans to cut four days out of the school year or reduce payments designed to help poor districts keep pace with richer ones.

The Legislature should consider other ways to cut education costs, they said, like state spending per student or teacher bonuses, or eliminating things the state requires, but doesn’t pay for.

A key player in the ongoing budget debate floated an idea to stave off the cuts proposed by Gov. Chris Gregoire by increasing the state’s property tax levy and spreading it among districts throughout Washington. But House Ways and Means Committee Chairman Rep. Ross Hunter, D-Medina, acknowledged his plan was in its early stages, and represents a shift in the way tax rates are currently calculated…

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OLYMPIA — While the Final Days didn't begin with the Rapture at 6 p.m. Saturday as predicted, the final day of the special session has arrived.

The list of things to do is long. Expect the day to be likewise.

The House starts with a vote on restricting the debt limit, then moves on to the capital budget this morning.

The Senate's schedule isn't set yet, but they've got the operating budget and the capital budget to do, sometime today.

And both chambers have a series of separate bills that are necessary to make the operating budget work. Add to that various bills that individual legislators have nursed through the last 134 days, and need just one more vote in one house or the other, to turn someone's dream into a law.

Today is Day 30 of the 30-day special session. Stoppage time is about to run out.

Gov. Gregoire points to a chart Monday that shows revenue for the ferry system is falling dangerously low.

OLYMPIA – Gov. Chris Gregoire signed the state's 2011-13 transportation budget Monday and issued a warning to the Legislature to hurry up on other spending plans for the next biennium that seem to be hostage to a disagreements between the two chambers.

Agree on a general operating budget “no later than the end of the week”, she said, or risk running out of time for the special session. If that happens, Gregoire said she’d let legislators go home and stay there until they can strike a deal on the operating budget and a list of other proposals creating a roadblock to compromises.

“Things are not moving as fast as I think they should be,” a clearly unhappy Gregoire said after signing the 2011-13 transportation bill.

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OLYMPIA — School districts around the state might have to “eat” a cut in teacher salaries proposed by Senate budget writers rather than lower pay, Gov. Chris Gregoire warned Wednesday afternoon.

She said some aspects of the Senate general operating budget proposal are improvements over the House spending plan released last week, but the Senate's plan to cut $251 million by cutting public school employee salaries by 3 percent won't work.

“Many of the school districts have already negotiated their contracts, so their salaries are already set,” Gregoire said. “The districts will simply have to eat” the reductions by cutting their budgets in other places.

The Senate also estimates almost $100 million can be saved by keeping better track of truancy in schools. It's a creative approach, but “if it doesn't work, they're going to eat another $100 million,” Gregoire said.

But the latest spending plan is free of gimmicks, the governor said. She's been skeptical of a House plan  to sell or lease the state's wholesale liquor distribution system as a way to raise some $300 million in revenue.

She wouldn't say that either the Senate public school provisions or the House liquor warehouse provisions were deal breakers.

“We're now in the negotiating stage. We're not in the vetoing stage,” she said.

Sens. Ed Murray, D-Seattle, (left) and Joe Zarelli, R-Ridgefield, announce the proposed Senate operating budget.

OLYMPIA — The Senate released proposed operating and capital budgets this evening. Good news and bad news time.

Bad news for schools, colleges, people who rely on the state for social services, particularly health care programs.

Good news for folks in Spokane who want a new medical school at Riverpoint campus, and for those who enjoy going to the Museum of Arts and Culture.

To read more about it, click here to go inside the blog and get a look at Wednesday's newspaper story.

OLYMPIA — A $32.4 billion spending plan, which would cut colleges, public schools, social services and employee salaries, not raise taxes and try to sell the state's liquor distribution center was released today by House Democrats.

House Ways and Means Committee Chairman Ross Hunter, D-Medina, called it “thoughtful, responsible and sustainable,” but still full of bad news for people involved in state programs.

“I wish the budget we're about to present to you had more good news. It does not,” Hunter said as the 450-page budget, and several summaries were released.

It proposed cuts including:

$482 million in higher education institutions, which the colleges will be able to offset in part through higher tuition.
$362 less for increases to retired state employees on the state's oldest pension plans.
$216 million from programs to have smaller class sizes in Kindergarten through Grade 4
$177 million less for wages for state employees.
$108 million less for the state's Basic Health plan by shrinking the income a family can have to qualify for the plan.
$100 million less for the Disability Lifeline program, getting rid of cash grants but substituting some of the loss money with vouchers for housing.

It has no money for cost-of-living increases for teachers, which are mandated by a statewide initiative in 2000, and does not reduce class sizes in public schools, also required by voters in an separate initiative that same year.

It proposes the state sell its liquor distribution center for $300 million, if it can get an offer from private industry to do that. Hunter said that's been proposed, and the state has had some inquiries that suggest it's possible. If not, the state would have to cut another $300 million in spending.

What the budget does not have is any proposal to levy a new tax, raise an existing tax or close a tax exemption already on the books. House Democrats said they don't believe it's possible to get the required two-thirds majority for any tax increase.

“We're making the most responsible decisions we can in difficult times,” House Majority Leader Pat Sullivan, D-Covington, said.

Programs the state can no longer afford remain on life support, and the footprint of government continues to be larger than our taxpayers and economy can support,”  Rep. Gary Alexander of Olympia, the ranking Republican on Ways and Means said. “I've seen go-home budgets before and this is not one of them.”

Adam Glickman of the Service Employees International Union which represents some healt care workers said the budget comes down hardest on some of the state's lowest paid workers. Michael Itti of the League of Education Voters, which tracks school issues said the budget means students will continue to struggle  or and a generation of college students will be facing “crippling amounts of debt.”

OLYMPIA — After going 84 session days without either a general operating or a capital budget in the House, we will have both by about 1:01 p.m. today.

Ways and Means Chairman Ross Hunter, D-Medina, and other House leaders are scheduled to release the 2011-13 general fund operating budget at 12:15 p.m. It'll be posted here about that time. Read fast, because there's a committee hearing at 3:30 p.m.

Capital Budget Chairman Hans Dunshee will release the 2011-13 capital budget at 1 p.m. It can be found here after that. You can take a little more time studying that. The hearing isn't until 8 a.m. tomorrow.

Why the rush? Well, for one thing there's only 20 days left in the session. Where has the time gone…

Meanwhile, teachers from around the state are coming to Olympia with their own paper, a “Resolution to Stop Crowding Our Kids' Classrooms.” They plan to be here around noon in the Senate office building, but that's not very far from the House office building where the budget releases are scheduled.

More budget hearings, votes and demonstrations planned for the rest of the week. If you don't care about budgets, this would be a good week to be on a beach somewhere warm and sunny. If you do, Olympia's the place to be, but don't expect it to be warm and sunny.

OLYMPIA — For those wondering why the state Legislature has yet to produce a 2011-13 budget (arguably the most important thing they will do this spring) State Rep. Marko Liias attempts to explain.

If there was an Oscar for the most tortured analogy, this one would at least rate a nomination.

Gov. Chris Gregoire answers a question during a press conference Thursday. Staff photo by Jim Camden

OLYMPIA — Facing a shortfall of $3 billion in the next biennium, the state has to come up with a new way of writing budgets, Gov. Chris Gregoire said today.

She announced a plan to develop a new system that includes public hearings, a 32-member panel of advisers, and the prospect of privatizing major state services like the ferry system.

Gregoire insisted that no state agency will get a free pass in the new system, that will build on the old system known as “priorities of government” by asking eight questions, starting with “Is the activity an essential service?”

If it is, the next question would be whether the state has to perform the service, or can it be provided by someone else.

Various state officials have asked such questions for years, but with varying results. In the last  legislative session, for example…

OLYMPIA – There was no drama, but plenty of theatrics, as Gov. Chris Gregoire signed a bill Wednesday making it easier for the Legislature to raise taxes.
Gregoire signed a 16-month suspension of some provisions of Initiative 960 as its prime sponsor Tim Eyman looked on, sometimes with a disapproving frown on his face, at one point holding his nose and pointing one thumb down.
“Now, you must behave,” Gregoire told Eyman at one point.
“I am behaving. This is my self-control,” he replied.

To read the rest of this story, click to go inside the blog.

OLYMPIA — House and Senate Republican leaders denounced budgets proposals from the other party for raising taxes that will touch everyone and hurt small businesses.

Sen. Joe Zarelli, of Ridgefield, the GOP’s top numbers guy in the Legislature, said the wide array of potential tax increases would hit car buyers and home buyers, both of which are needed to fuel the recovery.

They would create imbalances for communities that border another state, encouraging people to drive across state lines to buy gasoline, candy, soda or bottled water, and discourage out of state residents from shopping in Washington, he said during a sit-down session GOP leaders had with the  news media.

That’s a conglomeration of tax proposals from Gov. Chris Gregoire and Senate Democrats. The two proposals differ significantly in which taxes they’d raise or institute in an attempt to balance some program cuts with new sources of money. As of noon, the House had yet to announce a tax package to explain how it would raise an extra $857 million.

Rep. Gary Alexander, the top Republican on the House Ways and Means Committee wondered how the panel will hold hearings on a budget that doesn’t spell out taxes. “We don’t even know what the “Means” are.”