Legislature passes supplemental budget

OLYMPIA -- The Washington state legislature approved a bipartisan budget Thursday night, supplementing the two-year budget passed last session, but some Central Washington lawmakers were critical of it.

The budget, which provides for an additional $155 million of spending new revenue, passed the senate 48-1 a few hours before the legislature was scheduled to adjourn. The house approved the budget with 85 votes in favor and 13 opposed.

Rep. Matt Manweller, R-Ellensburg, was one of the "nay" votes.

He took issue with the Democrat-controlled house of representatives not scheduling a vote this session on his bill to revive a rural tax credit, or pass Sen. Janéa Holmquist Newbry's data center tax exemption bill.

He said that after helping Boeing, the "Goliath", with tax preferences in a special session last November, he expected "a little bit for the Davids" as well.

"All of the east side of the legislature showed up to protect the west side economy but when it was time (to help us) there was no reciprocity. Until we truly become one Washington I couldn't support that budget," Manweller said.

"For every dollar we gave to Boeing I was asking for one penny for eastern Washington," he said.

Reuven Carlyle, D-Seattle, chairs the finance committee, where both tax preference bills stalled.

Carlyle said he's "not categorically opposed" to tax incentives, but wants proof they're specifically targeted and will give a return on investment.

The rural sales tax credit would go to manufacturers in counties based on population if renewed under Manweller's bill, rather than based on unemployment.

This would make 33 of Washington's 39 counties eligible for the program, Carlyle said.

"So my taxpayers would pay a higher tax rate just because they live in the city, and not in the country," he said.

He noted the current version of the rural tax exemption is not set to expire until 2020, and said the legislature should consider "major legislation" like Manweller's bill during a longer session.

Holmquist Newbry voted in favor of the supplemental budget bill, but said it was a "bittersweet" moment without the data center tax exemption, which she had proposed in an effort to help bring more data centers like Quincy's to the state.

"I was very disappointed and think it's a huge missed opportunity," she said, speaking on the floor of the senate before the vote.

Holmquist Newbry said it was proven effective, and that the state lost out on deals with Facebook, Adobe and other companies the last time the tax exemption was allowed to expire.

"I guarantee it to you that other states will give this to them," she said.

Carlyle said the tax preference is currently used by existing companies to buy new equipment rather than bringing in new business. He agreed it would be "clearly substantial" in short-term impact to Quincy, but said it would also be a substantial cost to other areas of the state.

"It's a massive expense with huge public policy issues," Carlyle said.

He didn't rule against the possibility of scheduling a vote on the bills if they were reintroduced next session, but said he wants proof tax incentives are "a good deal for taxpayers statewide."

Rep. Judy Warnick, R-Moses Lake, voted in favor of the budget. She said having a sustainable budget was a big accomplishment.

But she was disappointed the capital budget, which included $2 million for the Moses Lake Irrigation and Rehabilitation District dam replacement project, was not finalized. As of press time, the two houses had not agreed on a capital budget, which would fund construction projects in the state.

They also did not pass a measure to fund new transportation projects, such as the North Columbia Basin rail project, throughout the state. Legislators had proposed a 12 -cent increase in gas tax to pay for the projects, and disagreed over reform issues.