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Millions of dollars of state projects for Spokane stalled in legislative logjam

UPDATED: Sat., July 8, 2017, 9:44 p.m.

Gov. Jay Inslee, seated, reads veto messages while legislative assistant Angie Adams looks on, Friday, July 7, 2017 in Olympia, Wash. Inslee’s veto of a plan to give manufacturers in the state  a tax cut may complicate the freeing-up of millions of dollars in construction funding. (Rachel La Corte / Associated Press)
Gov. Jay Inslee, seated, reads veto messages while legislative assistant Angie Adams looks on, Friday, July 7, 2017 in Olympia, Wash. Inslee’s veto of a plan to give manufacturers in the state a tax cut may complicate the freeing-up of millions of dollars in construction funding. (Rachel La Corte / Associated Press)

OLYMPIA – Some $114 million in state construction projects for the Spokane area, including a new science building on the Eastern Washington University campus, are in jeopardy this week as the Legislature remains in a logjam over a dispute about a possible change in water rights laws.

Dynamiting that logjam may have become more difficult Friday, after Gov. Jay Inslee and Senate Republicans traded jabs over his veto of a tax break for manufacturers.

The state Capital Budget, with nearly $4 billion in new projects around the state, passed the House in a near unanimous vote on July 1. But it won’t come to a vote in the Senate, majority Republicans say, unless the House passes a way to overcome a 2016 Supreme Court decision that is affecting development around the state.

The Democratic-controlled House has yet to find such a bill, although the Senate has sent over a Republican-backed bill four times.

The failure to pass the two-year Capital Budget would be historic, but not in a good way, said Darcy Nonemacher, government affairs director for the Washington Environmental Council. It may be the first time the Legislature has ever failed to pass a biennial capital budget, which is usually an exercise in bipartisan collaboration.

“It’s a big deal,” she said.

Usually there are two reasons for lawmakers to work together on the Capital Budget even while coming nearly to blows on the larger operating plan. One is that the state pays for some projects with bonds, and those bonds need a 60 percent majority in both chambers.

The other is that it usually has something for each of the state’s 49 legislative districts.

The biggest project in the Spokane area would be the Interdisciplinary Science Center at EWU, with a $60 million price tag. But the spending plan includes millions of dollars in projects at the community colleges, nearly $7 million in improvements at Eastern State Hospital and $5 million at Lakeland Village.

It would also spend money on local recreation facilities, water projects, dental clinics and the state veterans cemetery.

The vote is rarely unanimous because some legislators object to putting the state in debt for years by selling bonds for these projects. But it is also rarely close.

This year, however, Senate Republicans said the Legislature must come up with a solution to a court ruling from last October known as the Hirst decision. A divided court said counties must comply with the state’s Growth Management Act and make an independent decision on whether enough water is available for existing users before approving a building permit for a project that needs a new well.

The Senate passed a “Hirst fix” in early March that developers support but environmentalists and tribes oppose, and kept passing the bill with each new special session. The House members proposed several but failed to pass any.

Without a Hirst bill that could pass both chambers, the Senate Republicans refused to schedule a vote on the new two-year Capital Budget, although they compromised slightly on the last day of the fiscal year, passing a stopgap budget that would keep money flowing to existing projects, avoiding layoffs for those workers and cancellations of some contracts.

Senate Majority Leader Mark Schoesler, R-Ritzville, defended tying the new budget to Hirst. All of the state’s counties need new wells for new housing or commercial projects, and water projects are a part of the Capital Budget, he said.

“We could put it together relatively quickly if we had a deal,” he said of the budget.

Nonemacher, of the environmental council, agreed that the Capital Budget always has some water projects in it. For Spokane alone, the budget has some $9 million in stormwater management improvements that would help cut pollution in the Spokane River.

But water projects amount to perhaps $100 million out of the $4 billion total, so that’s not necessarily a good reason to jeopardize all the jobs and improvements in the budget, she said.

After a workday that stretched into the early hours of July 1, the Legislature didn’t meet last week. But each passing day came off the 30-day calendar for the special session. On Monday, they will have only 10 days left in the third special session to reach an agreement on Hirst that has eluded them in the previous 183 days.

But while most lawmakers were home for the holiday week, another barrier may have arisen.

On Friday, Inslee vetoed a tax break for the state’s manufacturers that he said was unfair and unaccountable. Republicans responded that he had reneged on bipartisan agreements that led to the $43.7 billion operating budget, which passed the Legislature just in time to avoid a partial government shutdown.

After the veto, Inslee said he never gave assurances that he would sign the manufacturers’ tax break, but it should not complicate the Legislature’s efforts to pass a Capital Budget in the time remaining in the third special session. The Legislature passed, and he signed, an operating budget that calls for more teachers and smaller class sizes, which means schools will need more classrooms. Money for school construction is a major part of the Capital Budget, he said.

“It is morally reprehensible to hold children hostage who need classrooms,” Inslee said.

But Sen. John Braun, the chief architect of the deal on the operating budget, said Inslee’s veto will complicate efforts to get a Hirst fix that will free up a vote on the Capital Budget.

“The House has to bring a reasonable Hirst solution to the floor and pass it. And the governor has to sign it,” Braun said.



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