Senate passes budget proposal

OLYMPIA – The state Senate on Saturday approved a budget plan similar to a proposal the chamber passed earlier this year during the regular session, but made some concessions on revenue if certain reform bills are passed.

The budget passed on a 25-23 vote.

The plan includes a requirement that nonresidents apply for sales tax refunds instead of getting them automatically and ends a tax break for residential phone services.

The budget proposal doesn’t seek to close additional tax exemptions as the Democratic-controlled House did in its budget proposal passed earlier in the week, which also eliminated the sales tax exemption on bottled water. The Senate plan also offers a fix to a recent ruling on the estate tax that could cost the state millions of dollars in refunds.

However, Sen. Andy Hill, a Republican from Redmond who is the key budget writer for the chamber, said the revenue-related bills won’t pass off the Senate floor “until we get the reforms we’re asking for.”

The Senate majority pulled a handful of policy bills to the floor earlier Saturday for a potential vote, including bills to make changes to the state’s workers’ compensation system, a measure to cap noneducational state spending, a bill to give veto power to principals over teachers assigned to their schools and a measure on payday loans.

Senate Minority Leader Ed Murray, D-Seattle, accused the other side of taking the revenue bills hostage for reforms.

“I think it’s immoral,” he said.

Lawmakers are nearing the end of a 30-day special session that began May 13 and is set to end Tuesday. They face a $1.2 billion budget shortfall for the two-year cycle that ends in the middle of 2015. That doesn’t include an additional approximate $1 billion that lawmakers are seeking in response to a court-ordered requirement that the state spend more on its basic education system.

Republicans control the Senate with the help of two Democrats, known as the Majority Coalition Caucus. The House and Senate have been locked in budget negotiations for weeks, and Gov. Jay Inslee has said another special session would start Wednesday if needed.

As in the original budget, the Senate’s new budget proposal repeals voter-approved cost-of-living raises for teachers, redirecting the assumed $320 million to basic education. It also redirects money from other accounts, like the construction budget.

A program that provides cash aid to blind, disabled or older people who are typically waiting for approval of federal benefits would be cut by nearly $41 million, less than the $80 million cut initially sought in the original Senate budget passed in April.

The budget leaves nearly $600 million in reserves at the end of the two-year budget cycle ending mid-2015.

The Senate budget also moves forward with Medicaid expansion, with the assumption that the move will save the state nearly $320 million.

The Senate budget also restores pay cuts to public school employees and state employees, and it pays for fulfillment of collective bargaining pay agreements for state employees.