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WA Lege Day 74: Earlier primary, Ed Department

OLYMPIA — Committees are trying to wrap up "policy" bills with the approach of Friday's deadline that says they must be out of the committee in the second chamber if they want to stay alive.

So the Senate Government Ops has a hearing on moving the primary up a couple weeks in August so the state can get general election ballots to overseas voters sooner (and comply with federal law). It could  also be voting on whether booking photos are open to the public as soon as the suspect is charged. Senate Early Learning has a hearing on new version of a bill to create a state Department of Education, something Gov. Chris Gregoire is pushing to improve education systems from pre-school to grad school.

House Education is scheduled to vote on whether technology should be added as a "core concept". House Higher Ed has a hearing on changes to the GET program that supporters say are needed to keep it solvent, and may vote out a bill involving a proposed University of North Puget Sound.

It is Science Day with folks from the Pacific Science Center in the Rotunda, and Catholic Advocacy Day, with the state Catholic Conference in the conference room.

In honor of the latter, dominus vobiscum.

Supplemental budget signed (most of it, anyway)

Gov. Chris Gregoire shakes hands with House Budget Chairwoman Kelli Linville and offers Linville the ceremonial pen after signing the supplemental budget.

OLYMPIA — Gov. Chris Gregoire signed a new spending plan Tuesday designed to close an estimated $2.8 billion gap in the state’s operating budget with what she said were a “fair mix” of cutting staff and programs, taking federal money and raising taxes.
Before the ink was dry, the Republicans’ top budget expert criticized it as relying on taxes rather than needed government reforms, and an analyst for a conservative think tank said the state was placing too much trust in Congress to come through with money for medical programs.
The budget, technically a revision for the fiscal biennium that runs through June 2011, closes or shrinks five state institutions, including the Pine Lodge Correctional Center for Women in Medical Lake.
Gregoire used the veto pen to remove some sections, including an exemption from increased liquor charges the Legislature approved for restaurants and bars, a commission to study public school district consolidations and legislative demands that various state agencies produce reports.

Soda tax exemption fell flat

OLYMPIA – Not to be a nag about the value of public hearings for important stuff government wants to do to us, but legislators’ penchant for closed-door, back-room discussions of the tax plan they passed may have bit them in the posterior.

Or more appropriately, bit them in the soda bottlers.

The tax on soda pop goes up 2 cents per 12-ounce can on July 1. Among all the taxes considered by the Legislature this year, the pop tax got the least public airing. There were no committee hearings on the pop tax comparable to some other taxes in the plan that passed – or even compared to some that didn’t pass and were never gonna pass, like Sen. Rosa Franklin’s state income tax proposal.

Gov. Chris Gregoire suggested a soda tax early in the session, but it didn’t bubble up in the Legislature until the final days, when word leaked out the weekend before the special session ended. The state’s bottlers and distributors stormed the Capitol on that Friday and Saturday, but there was no bill to look at. Instead, they got assurances of a “break,” with the first $10 million in sales exempt from the tax.

“Every one of my legislators said, ‘You’re going to be exempt,’ ” Tim Martin, president of the Washington Beverage Association, said recently.

No one outside the handful of legislators and governor’s staffers negotiating the budget saw the wording of the bill until about noon on the session’s last day, and if they’re honest, some legislators will admit they didn’t read the tax bill before voting on it that night.

Correction on tax initiatives

OLYMPIA — Initiative sponsor par excellance and alert reader Tim Eyman points out an inaccuracy in last Saturday’s item about the tax increases Gov. Chris Gregoire signed.

He and other tax foes in his camp have filed initiatives to repeal six of the taxes passed by the Legislature in its special session. The story said they had filed initiatives to repeal most of the taxes, and that’s numerically incorrect. The Legislature raised 17 taxes, so their initiatives only cover about a third of them.

Through various initiatives, Eyman et al want to repeal the new soda tax, the bottled water tax, the beer tax, the candy tax, the cigarette tax and the service industry business and occupation tax increase.

While these are the most recognizable (some might say notorious) tax changes coming out of the special session, there are about a dozen other smaller ones, such as the clarification of taxes on electricity from Public Utility Districts, taxes for officers of a failed limited liability corporation or the end to the sales tax exemption for handling livestock nutrients at dairies.

In terms of dollar figures, they are seeking to repeal taxes that would provide more than half of the new revenues the state expects to collect. But that’s different than “most of the taxes,” which is the phrase used in the item.

Gregoire signs, defends tax hikes

Gregoire signs tax bill as crowd that includes Rep. Ross Hunter (right) looks on.

OLYMPIA — Gov. Chris Gregoire signed two major tax increases Friday, insisting the state had no choice but to raise taxes on a wide range of businesses and consumer goods to protect key services.

She discounted any potential electoral backlash for Democrats from the tax increases in November, saying the budget isn’t a partisan issue.

“This is not about partisan politics. This is about tough times in the state of Washington,” Gregoire said.

When Washington was in a major economic downturn in the early 1980s, the governor was a Republican and both house of the Legislature were controlled by the GOP. They raised taxes, too, she said.

But voters gave the Legislature back to Democrats in the 1982 election, and defeated Gov. John Spellman in 1984.

“I’m not forgetting that,” Gregoire said. But she did consult with Spellman during the tax discussions, and he said the biggest mistake he made was extending the sales tax to food, a move which was overturned at the ballot box. “That’s why I’ve said let’s go for things that are discretionary.”

Between May 1 and July 1, taxes will go up on a wide range of goods and services.

Cigarettes will cost an extra $1 per pack. Candy, gum and bottled water will be subject to state and local sales taxes (they’re currently exempt as food). Soda pop will cost an extra 2 cents per 12 ounce can. Beer from major breweries will cost an extra 28 cents per six-pack, although microbrewed beer will be exempt from the new tax levy.

The service industry, which includes a wide range of businesses from lawyers and accountants to barbers and musicians, will pay an extra .3 percent on gross revenues. Out of state businesses will see new tax formulas, and companies that supply goods to in-state distributors will continue paying a tax that the state Supreme Court ruled last fall was improperly being levied against one major food supplier, DOT Foods.

Gregoire said Washington residents could avoid many of the consumption taxes by changing their habits — drinking tap water instead of bottled water, for example, or giving up smoking. Or they could continue buying those items and pay the increases, which would find everything from education programs to health care to senior programs: “I believe in the people of the state of Washington. I’m asking them to stand up.”

Republicans, who spent the 60-day regular session and the 30-day special session fighting any tax increases, called them job killers. Sen Janea Holmquist, R-Moses Lake, dubbed it the 7-11 Kwik-E-Mart tax package because so  many of the items are the stables of convenience store sales.

“This package exempts things like expensive microbrews, but taxes those items that most impact working class and low-income Washingtonians like canned meat,” said Holmquist. “This is no way to balance a budget.”
Gregoire said Republicans who complained about taxes never proposed a budget that showed what services they would cut without raising taxes: “Everyone could easily say waht the didn’t like. It’s easy to sit in the minority and say ‘No.’”
Initiative promoter Tim Eyman has filed a series of initiatives to give voters the chance to repeal most of the taxes if his organization collects enough signatures. Another group has filed an initiative to remove some of the current taxes and replace it with an income tax on people making more than $200,000 or couples making more than $400,000.
Gregoire said she would sign the income tax initiative petition, welcome the debate over it if the proposal makes it to the ballot, and may support it after studying it further:”I have been opposed to an income tax. This is a different kind of income tax.”
That prompted swift criticism from state Republican Party Chairman Luke Esser, who said Gregoire campaigned for re-election in 2008 by saying it wasn’t time to raise taxes and that she did not support a state income tax.
“Taxpayers should note that Gov. Gregoire never wahts to ‘have a good discussion’ and a ‘debate’ over lowering taxes or keeping them constant but is always open to discussing tax increases,” Esser said in a press release.

WA Lege SpecSess: Looking back

OLYMPIA – Most years when the Legislature goes home, the winners and losers are pretty obvious. You count the scars and tote up the pork.
This year, everyone has scars and the Lege wasn’t cutting on a fat hog, so the final judgment may wait at least until November when voters decide whether half the Senate and the whole House should be rehired.
But some folks are better or worse off after the session lurched to its close early Tuesday morning than they were when it started in January with all the yada-yada about bipartisan cooperation.
Bipartisanship was a clear loser. Democrats had such a big majorities in both chambers that the real fight was among their factions, rather than a Republican/Democrat struggle.
The “business moderate” wing of the Democratic Party, which would include Spokane Sen. Chris Marr and Rep. John Driscoll, argued for more cuts and fewer tax hikes. They lost. They consistently voted against the budgets, but the budgets passed. Republican opponents might not be able to pound them quite so hard this fall, but the biz Ds will still have to work to distance themselves from the rest of the pack if voters are torqued.

WA Lege SpecSess: At the end of the day…it’s the middle of the night

OLYMPIA – By the time the Legislature wrapped up 90 days of heated and sometimes confusing debate over taxes and spending Tuesday, it had raised taxes on a wide array of consumers and businesses, cut some programs, boosted others, moved hundreds of millions of dollars around, and penciled in hundreds of millions more by betting on the federal government to come through.
But the final hours of the special session did not go smoothly, and at one point the governor made a rare visit to the Senate floor to keep the state from facing cash flow problems in the fall. The Senate had not passed a bill to move some $230 million from the state’s Rainy Day account into the general operating budget and without it, the state’s cash reserves could dip perilously low at some point before the two-year budget cycle ends in June 2011.
“I have a problem,” a visibly angry Gregoire said as she stormed passed reporters, into the wings of the Senate chamber and Senate Majority Leader Lisa Brown’s office at 11:12 p.m….

State treasurer to Lege: OK, we can pay the bills.

OLYMPIA — State Treasurer Jim McIntire added his kudos to the just concluded legislative session with a note that should make all Washingtonians feel a little better.

The state now probably has enough money to pay its bills through June 2011.

Not that the state would be bouncing checks or anything. But earlier in the session, McIntire notified legislators and the governor that the rate that money was coming in was not keeping pace with the way it was going out, and Washington could hit a point in the fall were its reserves were so low it might have to borrow short-term to pay some of its obligations. Like payroll.

“Based on a preliminary assessment of the tax and budget package, we believe we have a sufficient cushion to ensure we have the cash necessary to pay our bills,” McIntire said.

Other states, most notably California, had to issue I.O.U.s at one point because of cash flow problems.

Gregoire says new taxes worth paying

OLYMPIA — Repeating a mantra that “tough times require tough choices”, Gov. Chris Gregoire patted the Legislature on its collective back as members headed out of town Tuesday.

She sought to minimize the impacts of new taxes, which Republicans have predicted will be job killers. The average Washingtonian drinks 345 cans of soda a year, she said, and the extra 2 cents per can tax that passed Monday amounts to about $7 and the tax on large brewery beer is only 28 cents per six pack.

The extra tax money is going into the operating budget to help with such essential services as public schools, college student aid, health care, child care and help for the disabled and elderly, she said. “I think these things are worth paying for. All of us should be willing to step up.”

But some people — those who chew gum, drink bottled water, soda or mass-production beer — are being asked to step up more than others. Beer drinkers who favor micro brews don’t pay the new beer tax, and wine drinkers get no increase.

Gregoire defended the dichotomy on state grounds, not personal taste preferences. She drinks Washington wines because it supports Washington jobs, her husband Mike drinks Washington microbrews for the same reason, she said.

The governor’s office also parsed the amount of “new” money the state will be collecting, listing it at $613 million. That’s significantly below the $757 million listed by legislators just a day earlier.

That doesn’t mean Gregoire  has decided to line-item veto one of the taxes in the menu. Rather, she said $613 represents the “new revenues” the state didn’t have before. Not counted in the “new” are some $155 million in taxes the state used to collect from some out-of-state companies until the state Supreme Court struck down an old tax law last fall in what’s known as the DOT Foods decision. That’s a restored tax.

(Math whizzes already know in their heads the total still doesn’t come to $613 million, but the Legislature was counting a net total that also sliced off about $15 million from the lottery and s a $10 million shift in sales tax from the Seattle Convention Center account. To get its, net, however, the Lege added back in about $12 million worth of tax reductions that affect the bottom line…but, who’s counting? OK, so other than the Office of Financial Management.)

Meanwhile, the state’s premier initiative promoter filed a series of proposed ballot measures Tuesday to repeal many of the taxes— bottled water, macro-brew, soda pop,  cigarettes, the business and occupation tax hike on service businesses and the changes to home mortgage taxes —  the Legislature passed Monday. Tim Eyman, whose operation is already on the streets collecting signatures to reinstate the two-thirds requirement to pass any tax increase, will try to add eight more initiatives to the November ballot.

Gregoire said she told Democrats who voted for the tax increases and the underlying budget to “be proud about iit, do not be defensive” when they return home to voters, and promised to  campaign for them in the fall. But it’s too soon to predict how voters will react, she said.

“What happens in November is very dependent on what happens to the national economy as well as the state economy,” she said.

Legislature adjourns

OLYMPIA — It’s over.

The Legislature’s special session sloshed into the 30th and final day before being gaveled to a close.

The two chambers packed significant activity into the final evening Monday, passing a supplemental operating budget, a supplemental capital budget, higher cigarette taxes, increased business and consumer taxes.

A glitch on a bill to move money from the Rainy Day Fund to keep the state’s ending fund balance at an acceptable level causes a brief stir in the Senate around 11:30 p.m., and Rep. Lynn Kessler’s announcement she’s retiring prompted about a half-hour of improptu tributes in the House.

Gavel came down in the House at 1:05 a.m. Senate followed suit a few minutes later.

Kessler moved to adjourn sine die at 1:10 a.m. All ayes. House adjourned

WA Lege SpecSess: Capital budget passes

OLYMPIA — The House passed the supplemental capital budget, the “bricks and mortar” budget that spends money on things like school buildings and sewer plants, as well as fire reduction, water projects and corrections.

It passed 61-36. Republicans, including Rep. Gary Alexander of Olympia, warned of the rising debt level the state is amassing. But Democrats said the bill provides jobs as well as needed infrastructure.

The end of the session is near.

Wa Lege SpecSess: Lynn Kessler retiring

OLYMPIA — Rep. Lynn Kessler is bowing out after 18 years in the House. “I’m retiring, I’m almost 70 for God’s sake.”

As the Legislature moved beyond midnight, Kessler, D-Hoquiam, made an emotional farewell speech, celebrating the fact the state has worked to provide health care and education, protects victims of domestic violence

“Because of the positions we all have, we have been able to do great and small things, together,” she said. “Sometimes those trenches are deep, and very difficult. I hope we all appreciate our differences, because that’s what makes this place special.”

“I wish you all well, please be kind to one another,” she said as the House stood to applaud.

WA Lege SpecSess: Gregoire lobbies Senate

OLYMPIA — The session was winding down about 11:12 p.m., when Gov. Chris Gregoire chargedup the stairs between her office and the Senate with aides in tow.

Reporters moving to ask her for comments on the closing were cut off with the governor holding up her index finger and stating “I have a problem.”

Problem turned out to be the Senate’s failure to pass a bill that would move some $255 million from the state’s Rainy Day fund into the general fund to be spend in the remainder of the biennium. Without it, the state’s general fund end balance would be far below the $480 million the Legislature planned — the money the state needs to carry it over into the next biennium or use as a cushion should the revenue not come in as planned.

She had words with Majority Leader Lisa Brown, then talked with several senators on the floor, securing their votes to move the bill and pass it before the session concluded.

WA Lege SpecSess: Capital budget passes Senate

OLYMPIA — Moving rapidly toward adjournment, the Senate passed the supplemental capital budget with almost no debate, 33-13, and went at ease for a few minutes.

Capital budget now goes to the House, which, if the pattern holds should pass it and allow both to move toward adjourment.

If they can do all this in less than 80 minutes, they will technically be done before midnight and technically be done on the 29th Day of the 30 Day session.

So that’s a small victory, unless one considers it was only supposed to last 7 days is another matter.

WA Lege SpecSess: Senate passes budget

OLYMPIA — The Senate passed the supplemental budget Monday evening, joining the House in a spending plan that tries to fill an estimated $2.8 billion hole in the state’s two-year operating budget.

On a 25-21 vote, it added its approval to the budget approved a few hours earlier across the Capitol.

Republicans, who were unanimous in their opposition, said the bill was being forced through without careful consideration, in the closing hours of the session, and has significant problems.

“Voting on a budget is a big decision,” Sen. Mark Schoesler, R-Ritzville said. “Those who are going to vote for it, have you read it?”

Sen. Mike Carrell, R-Lakewood, said the Legislature spent the month of a special session, figuring out how to raise taxes, not making any changes to a broken system.

Some Democrats also refused to support the budget. Sen. Rodney Tom of Bellevue said it doesn’t grasp the reality of the economy, and sets up education to fail.

But Majority Leader Lisa Brown, D-Spokane, said the economy is cyclical, and when times are tough, the demand for state services go up. “Just when the gap opens up, we need it the most. Many things are going to cost more, but we did the right thing..”

The budget has cuts as well as tax increases, Brown said, and no one say it’s perfect. “We are not a Legislature of 1. This job gets done by working together.”

Sen. Cheryl Pflug, R-Maple Valley, an economic downturn is not the time to implement all day kindergarten or a major energy savings construction plan. “How can we say it suddenly became a crisis to add these programs?” It may not be a Legislature of 1, she added “but it is a Legislature of one party.”

WA Lege Spec Session: House passes budget, Senate passes tax plan

OLYMPIA — The Legislature chugged toward adjournment tonight as budgets and tax plans passed by narrow margins.

The Senate just passed the $668 million tax package 25-21, the bare minimum it needed.

About an hour earlier, the House passed the supplemental operating budget with spending, cuts and tax plans to fill the state’s estimated $2.8 billion budget gap.

The two houses still have bills to work on, but members are expecting to be done before midnight.

WA Lege SpecSess: Budgets released, vote to come

OLYMPIA — Democratic legislators released their spending plan  with a combination of cuts and assumed tax hikes, designed to fill a $2.8 billion hole in the state’s operating budget.

If passed as expected later today or Tuesday, the budget pulls in $757 million in new taxes, cuts $840 million in programs, pulls in at least $618 million in federal funds, and moves nearly $600 million around from other accounts and reserves.

Among the cuts are nearly $55 million by closing or reducing state prisons. Slated for closure is  the Pine Lodge Correctional Facililty for Women in Medical Lake.

In making the closures, budget negotiators “looked closely at a report done last year…and tried to minimize politics,” Rep. Kelli Linville, D-Bellingham, said. Pine Lodge is in the Spokane area, which has Senate Majority Leader Lisa Brown among its legislative delegation.

That report,  however, recommends leaving Pine Lodge open to have a corrections center for women inmates in Eastern Washington. Asked about the difference, Linville replied: “We used the report as a basis. We were trying to use real information first, and then we negotiated the budget.”

The budget also cuts more than $150 million in  K-12 programs, $73 million from colleges and assumes almost $49 million in savings through temporary layoffs of state employees.

It uses money from the tax increases to maintain all-day kindergarten, gifted program and levy equalization for public schools, state need grants for college students, the current levels for Basic Health and the Apple Health for children programs. Temporary assistance for needy family levels would remain at their current levels, as would most foster care payments and nursing home payments, and some nursing home cuts would be restored.

Approved by the Senate Ways and Means Committee was a supplemental Capital Budget Plan that would spend nearly $241 million for major and minor construction projects.

Included in the supplemental capital budget are $3.5 million for the Biomedical and Health Sciences Building at Washington State University Spokane’s Riverpoint Campus and about $3.5 million in repairs, maintenance and improvements to buildings at Eastern Washington State University. The proposed Spokane Aerospace Center also would receive $400,000.

The budgets have been under discussion since before the session began because the two-year budget approved by the Legislature last year has been out of balance almost from the day it went into effect on July 1, 2009. The gap between what the state can expect to take in from taxes and fees compared to what that original budget planned to spend grew to $2.8 billion by February. In ability to agree on a spending plan and tax increases forced a 30-day special session that is scheduled to end Tuesday.

But Monday afternoon was the first chance the public and some members of the Legislature got to see the finished product, which has been the subject of intense negotiations by Democratic leaders. Republicans who are in the minority and have refused to vote for any tax increases until significant reforms are made, have been largely shut out of the process.

Democratic budget negotiators defended the short notice and review time before legislators vote.

“We have gone through this time after time,” Sen. Ed Murray, D-Seattle, said. “I believe our members know what’s in this. There aren’t any surprises.”

“It was mostly our budget 30 days ago,” Linville said.

WA Lege SpecSess: Cigarette tax passes

OLYMPIA — Smokers should expect to pay another $1 for a pack of cigarettes soon.

The Senate just passed a tax hike for cigarettes as the Legislature moves towards adjournment. It would raise an estimated $100 million in new tax revenue, an amount that’s being factored into the new taxes Democrats are raising to come with $800 million in new revenue as part of the “balanced solution” to the state’s $2.8 billion budget hole.

The House has already passed higher cigarette taxes.

The Senate vote was 28-17. To see the roll call, go inside the blog.

WA Lege SpecSess: Could this be last day?

OLYMPIA — This may be — emphasis on may — the final day of the special session.

The Senate is moving toward passing the same tax hike approved Saturday by the House. They both expect to vote on the changes to the operating budget and the capital budget today.

Democrats are saying this will be the final day, although Senate Minority Leader Mike Hewitt of Walla Walla said he’d be willing to vote the last day technically will be Tuesday…perhaps some time after midnight?

Most vote schedules to be determined, but the Senate is expected to vote this morning on a House bill involving bonds for retrofitting schools to make them more energy efficient, just to get the ball rolling.

One complicating factor: The trip south to Olympia from the Seattle area is extremely slow today because of a major construction project on Interstate 5. Some of the Puget Sound legislators have yet to arrive..

A different way to chew on the tax debate

OLYMPIA – When talking about the Legislature, it’s easy to get wrapped up in parliamentary details and arcane political jargon. To avoid that, here’s a simple way to look at the budget and tax plans as the “seven-day” special session enters Day 28.

Think of solving the budget deficit as a family dinner. Like parents who profess to know what’s good for us, top legislative Democrats are about to make Washington residents eat our Brussels sprouts for the next 30 months.

They’ve treated options on the budget and taxes like menu choices. There’s stuff we all like, other things we’re OK with, and some things we’re going to turn our collective nose up at. Just as mom and dad don’t ask the kids to plan the menu, lest we ask for pizza and ice cream three times a day, they didn’t give us much say in what to serve.

For those who say “No fair!” parents can argue that when you’re going to serve Brussels sprouts, you certainly don’t tell the kids at noon, because they’ll just talk friends into having their moms invite them over. So the Democratic parental units held the menu close to the vest, not even releasing it until about a half-hour before the other grown-ups showed up Saturday. By then the menu was a done deal, with the Brussels sprouts purchased, in the pot, about to be put on the stove.

In the living room, the Republicans are arguing that we don’t need to eat Brussels sprouts.

Tax plan passes House, heads to Senate

OLYMPIA – Democratic leaders began pushing a package of some $668 million in higher taxes through the Legislature Saturday, suspending rules as they tried to beat the Tuesday deadline to adjourn.
The House of Representatives voted 52-44 to approve the tax plan that was just made public a few hours earlier after more than a week of closed-door negotiations between Democratic leaders and Gov. Chris Gregoire.
Some Democrats who voted yes conceded it was a less than perfect plan. Rep. Timm Ormsby of Spokane said he liked some of the earlier House tax proposals which closed off more tax exemptions and hit consumers of certain items less.
The proposal would raise taxes on candy and gum, soda, bottled water and mass-production beer.
“These are some of the things that people use to reward themselves,” said Ormsby, the sole Spokane-area representative voting yes. But the bill couldn’t be amended because of legislative rules governing the way it was presented, so it was an up or down vote on a plan to balance the budget, he said.
Republicans were united against the bill, contending it wouldn’t treat people equally. Rep. Doug Ericksen, R-Ferndale, noted that beer from large out-of-state breweries is taxed an extra 50 cents a gallon, or about a nickel for a 12-ounce can, but more expensive beer from microbreweries is exempt from the tax.
“This Legislature couldn’t even be fair on how it raises the tax on beer,” he said. “You stick it to the working man and give the high-fallutin’, high-paid guy in Seattle a break.”

House passes tax plan

OLYMPIA — The House of Representatives passed a plan to raise taxes by nearly $700 million dollars over the next 15 months.

In a 52-44 vote, Democratic leaders pushed through a package that raises taxes on soda, bottled water, candy, gum, mass-produced beer, most service businesses

Among Spokane area legislators, only Rep. Timm Ormsby, D, voted yes. Reps. Larry Crouse, Susan Fagan, Joel Kretz, Kevin Parker, Shelly Short, Joe Schmick, all R, and John Driscoll, D, voted no. Alex Wood, D, and Matt Shea, R, were excused.

WA Lege SpecSess: Tax plan cometh

OLYMPIA — Democratic leaders released their tax plan this afternoon, and as expected, it would raise taxes on the service industry, candy and gum, bottled water, mass-production beer, out-of-state companies with business in Washington, property management firms, some bank costs for servicing mortgages.

Some items discussed in previous hearings or approved in one chamber or the other over the last three months, were struck from the final plan. Spared new taxes are private plane owners, people who buy houses that are in foreclosure, machiinery used for wind powered turbines, coal purchased for for a power plant in Centralia, out-of-state shoppers hitting the stores in Washington, and consumers in general who at one point were facing a jump in the sales tax.

In total the tax package would raise about $668 million through the rest of the biennium, if Democrats have enough votes in the House and the Senate to pass it. Another $100 million would be raised in a separate bill, through higher taxes on tobacco.

Both chambers returned for floor debates and votes on the budget, taxes and several other issues at 2 p.m. Democrats quickly huddled in caucuses to see if they had the votes needed to pass the plan.

The House of Representatives, who has the tax package bill because the most recent vote on it occurred in the Senate, could vote on the proposal as soon as this evening if leaders determine they have the necessary 50 votes to pass it.

Legislators have until midnight Tuesday, when the special session expires, to complete all their work.

Gregoire on tax plan: Don’t go changin’, rearrangin’

OLYMPIA – The Legislature returns Saturday with time running out in its special session and only two options on its unbalanced budget, Gov. Chris Gregoire said. Pass an array of taxes that covers everything from soda and bottled water to candy and cigarettes, or go home and have her cut the general fund budget by 20 percent.

A tax package, which has not been seen by the public because it was not final as of Friday afternoon, will be released along with a final spending plan sometime in the next four days. Democrats in both houses will have to get at least a simple majority to pass it, because Republicans remain united against any tax increase and want more cuts in wages, programs and state systems.

Based on comments by Gregoire, various legislative leaders and versions of the tax plan leaked to various news agencies or posted but later removed from a House Web site, the so-called go-home package collects an extra $800 million in taxes as part of a Democratic plan to close a $2.8 billion gap between projected revenues and scheduled expenses. The tax proposal:

• raises the tax on soda pop by the equivalent of about 2 cents a can or 50 cents a case at the wholesale level;
• places the state sales tax on bottled water, candy and gum;
• raises the tax on beer from large national breweries by 50 cents per gallon, or about a nickel for a 12 ounce can; microbreweries would be exempt;
• increases the business and occupation tax on most of the service industry from 1.5 percent to 1.8 percent of gross receipts;
• adds another $1 per pack to cigarettes, and similar tax increases to other tobacco products;
• changes systems for taxing out-of-state firms that do business in Washington.

Taxes on soda, bottled water, sweets, beer and the service industries would expire in mid 2013, although a future Legislature could change that.

Even though the public and most legislators haven’t seen the tax plan in writing, some of those affected are fighting the inclusion of their product or industry…

WA Lege SpecSess: Will they gain or lose votes before Saturday

OLYMPIA — The Legislature did just this side of bupkiss in public Friday, to the chagrin of folks who bottle, distribute and sell soda, and some state employees hoping to make a point about layoffs.

A coalition of folks opposed to a proposed soda tax gathered on the steps of the Capitol this morning, hoping to make the most of media exposure before lobbying senators showing up for a full day of work.

But the schedule changed late Thursday and the Senate held only a pro forma session in which one Democrat and one Republican were on the floor for about 90 seconds until the gavel came down to go away and come back at 2 p.m. Saturday.

The House was also in pro forma, which is Latin for “we’ll get around to important stuff eventually”, and is also due back Saturday afternoon.

So the 50 or so soda pop tax folks out numbered visible senators roughly 25 to 1. (Heck, the number of reporters outnumbered visible senators by 2 to 1.) Sen. Karen Fraser, D-Olympia, who managed the floor for the majority party, insisted that lots of work was going on behind the scenes on budget and taxes.

Out on the steps, members of the anti-soda tax coalition insisted the new tax was unfair and would cost the state jobs. Ron Bradford of the Coca Cola Bottling operation in Spokane, said a fairer tax would be an increase in the sales tax.

“Overall, I think the people of Washington would accept it if this was a tenth of a cent or two,” said Bradford. The bottling operation has about 100 employees in production and distribution in Spokane, he said, but he’s not yet sure how many jobs would be lost if the tax went through.

The soda tax amounts to about 2 cents on a 12 ounce can, or 50 cents on a case. It’s really a double tax, Joe Gilliam, president of the Northwest Grocery Association, said because the tax goes on at the wholesale level, then is part of the amount subjected to the sales tax at retail.

He, too, argued the state should raise the sales tax, rather than pick from a menu of smaller taxes on soda, beer, bottled water, candy and gum

“It’s an issue of fairness,” Gilliam said. “Why should soda drinkers be more responsible for schools or prisons?”

The anti-soda tax coalition bought full-page ads in The Spokesman-Review and the Seattle Times Friday to drive home their point.As a counterweight, Rebuilding Our Economic Future Coalition , a group supporting the soda tax and other increases in the still-not-officially-released-because-we-might-not-have-the-votes tax package put up radio ads supporting it.

A group of state workers from the Department of Social and Health Services, which announced layoffs Thursday, planned a lunchtime march from their Olympia office to the Capitol, with hopes of sitting in the Senate gallery to help make their point. Before they were even close to the building, however, the pro forma session had opened and closed.

Anti-soda tax people said they’ll be back Saturday. So too, in all likelihood, will be squadrons of folks opposed to other taxes in the package. Could be an interesting four days, which is all the Legislature will have left in the special session. The opponents will be trying to peel off votes just as hard as Democratic leaders will be trying to add and hold them.

WA Lege SpecSess: From Tea Party to Soda Party?

OLYMPIA — Democratic leaders in the House and Senate may still be searching for enough votes to pass their “go home” tax package, but some of the would-be taxed aren’t waiting for them to get a head count and reassemble at the capital.

Bottlers, convenience store owners and others opposed to the tax on soda will be protesting at 10 a.m. on the Capitol steps. Won’t be many legislators around to watch. Day 26 of the “Seven-Day Special Session” is a pro forma day, with few of the honorables even around.

They’re scheduled to start up real legislative business Saturday at 2 p.m. It’s a late start to accommodate the travel back to Olympia from their respective homes, where most of them have been for more than a week while Democratic leaders passed tax proposals back and forth.

They’ve allegedly settled on the “menu” approach: taxes on bottled water, soda, big brewery beer, a B&0 hike for service businesses; no bump in the sales tax, no trimming or gutting the sales tax exemption for out-of-state shoppers, no new tax on specialized software, no bump in taxes for private airplanes.

The plan hasn’t been released to the public yet — still needs to be tweaked — legislative sources say, but enough of it has been leaked that those who are about to get new taxes are already torqued.

WA Lege SpecSess: No deal, Howie

OLYMPIA — Democratic leaders trying to figure out a way to raise taxes that will pass both  houses of the Legislature are still looking for votes.

That’s the word after a session in Gov. Chris Gregoire’s office broke up, and Senate Majority Leader Lisa Brown and House Speaker Frank Chopp left with no announcement of a “go home” deal.

House Democratic Caucus just sent word there’d be nothing further tonight, and pro forma sessions in the House and Senate Friday with both chambers back at full strength at 2 p.m. Saturday with a chance for actual votes on…something.

(They have some non-budget bills they could take up, to get back into the swing of legislating, if they feel out of practice.)

Currently under discussion is a tax increase on many things that you can buy to drink: bottled water, soda, beer from the big national brewing companies (microbrews and wine are spared at this point); tax on candy and gum, an extra dollar a pack on cigarettes and increases in other tobacco taxes, increases in the B&O tax for much of the service industry…it’s an impressive menu with a variety of entrees and no real desserts.

WA Lege SpecSess: Supporting tax hikes

OLYMPIA — A coalition of health care, education, environment and poverty groups is coming out in favor of the still-to-be-made-public tax proposal.

Based on news accounts of the package, the Rebuilding our Economic Future Coalition says the reported combination of taxes on soda, beer, bottled water, sweets and cigarettes is a “reasonable approach to protectiong our economy and our quality of life”. They are urging legislators to buck up and “finish the job by passing this compromise proposal.”

There is no final compromise proposal at this point, although Senate sources say they expect an announcement sometime Thursday afternoon. House sources are hedging a bit more, saying nothing yet.

One consideration for the Democratic leaders’ calculus: If they are counting on any yes votes from the handful of Democrats in Eastern Washington, they’ll have to give those legislators plenty of notice. It’s snowing in the passes, and travel at times is a bit nasty.

Tax deal not yet out, but opponents are

OLYMPIA — Democratic legislative leaders have not yet formally announced their “go home” tax deal, apparently because the House caucus isn’t yet sure it has the necessary yes votes.

But while opposition to certain taxes is already cranking up.

The Washington  Beverage Association said raising the tax on soda by 2 cents for every 12 ounce serving “will result in job losses and could put local companies out of business.

The Northwest Grocery Association, which is the large grocery and supermarket group, said it opposes “hidden” taxes on candy, gum, bottled water, beer and cigarettes, and thinks a general sales tax that affects everyone would be better, if taxes need to be raised at all. At least with a general sales tax in crease, consumers would see the tax on their sales receipts every time they shop and know they are paying more for state programs, association president Joe Gilliam said.

The tax proposal, which hasn’t been released yet, allegedly does away with any plans to bump up the sales tax, instead placing taxes on the above mentioned items, increasing the business and occupation tax on services from 1.5 percent of gross receipts to 1.8 percent and enacts other hikes from a “menu” of tax choices.

Still no word on when Democratic legislative leaders — they’re the only ones involved in negotiations; Republicans have said they won’t vote for a tax increase — will make public the plan that they are explaining to their members.

WA Lege SpecSess: All quiet for now

OLYMPIA — Day 25 of the special session is starting pretty slowly, with pro forma sessions in both chambers. No official word on whether the House of Representatives has enough votes for a tax package worked out Wednesday among Gov. Chris Gregoire, Senate Majority Leader and House Speaker Frank Chopp.

The clock could become a factor by tomorrow, because any proposal that goes to the planned conference committee — a process that allows a vote on the floors with no amendments — must be public and “sit on the bar” for 24 hours.

It must also be printed up, so people know what the are voting on, which could take a day or two.

Special session ends at midnight Tuesday. If they run over…well, it’s complicated. Gregoire would have to call them back, which she’s said she won’t do, or they’d have to agree to call themselves back.

And agreement is something that has been in short supply for the last month.