House Dems' budget to include new taxes, spending
The House Democrats have released their budget proposal, which includes increased spending in education and social services as well as several new taxes.
The operating budget will be an overall $44.9 billion with nearly $1.9 billion going to K-12 education.
Timm Ormsby, D-Spokane, Appropriations Committee chair and prime sponsor of the budget, said the House Democrats’ budget differs significantly from the Senate Republicans’ budget, as well as the governor’s budget.
“We anticipate there being some differences in how we think about things,” Ormbsby said. “These aren’t apples-to-apples comparisons, these are apples to zucchinis.”
The Democrats’ plan fully funds the salary increases the governor’s office collectively bargained for last summer, which the Republicans in the Senate rejected in their budget. The negotiated salary increase calls for a $682 million raise for state employees.
One of the biggest increases in education spending is raising salaries for teachers and school staff, which accounts for $1.7 billion of the near $1.9 billion education budget. The plan includes the delaying the reduction of levies local schools are allowed to collect, known as the levy cliff, which was signed by the governor on Mar. 15.
To cover the increases in spending, the Democrats have proposed creating a capital gains tax which would generate $715 million by charging a 7 percent excise on the sales of stocks and bonds.
Rep. Laurie Jinkins, D-Tacoma, said the tax was a more progressive way to fund their budget and would only affect a small number of individuals across Washington.
“We’re even on the low end of our neighboring states when doing this,” Jenkins said. “We are so outside of the mainstream in how we’re handling capital gains in the state. In fact, we’re not handling it at all.”
The plan also includes provisions to increase property tax for high-value homes, increasing the rate of taxes for homes valued above $1 million from a 1.28 percent tax rate to 2 percent. Homes valued above $5 million would increase to 2.5 percent and homes below $250,000 would see a decrease to 0.75 percent.
Sen. John Braun, R-Centralia, Chair of the Ways and Means Committee and Ormby’s counterpart in the Senate, criticized the House’s proposal for the new taxes and increased spending. He said he doesn’t believe their budget will solve McCleary and does not address the differences in levy amounts across the state.
“If you look at their K-12 proposal, it’s very light on actual reform,” Braun said. “It’s basically dump more money in the current unequitable system and hope for better results and that’s just not a good approach.”
He said the spending and tax increases were ultimately necessary to solve the Supreme Court’s McCleary mandate that the state carry the primary burden of funding K-12 education.
“We addressed the issues that are pressing in the house budget, Ormsby said. “We think it would be unnecessarily malicious for us to not address our social safety concerns that we saw reflected in the Senate budget.”
In addition to K-12 education, the Democrat’s proposal would freeze tuition increases for state universities and expands spending on childcare centers and ECEAP preschools.
The budget sets aside $3.3 million for the creation of a new Department of Youth, Children and Families (DYCF), in addition to the funds that would be transferred from the Department of Social and Health Services (DSHS). The bill to create DYCF was passed through the House last week sponsored by Rep. Ruth Kagi, D-Seattle and supported by Rep. Tom Dent, R-Moses Lake.
The bill was scheduled for a hearing on Monday afternoon and goes into executive session today. Ormsby said the Senate was trying to find a balance between giving legislators and the public time to understand the bill and making their deadline.
“They are two very different documents, and we’re very happy about that.” Ormbsy said. “We will go through our process so we can initiate those discussions with our counterparts in the senate as soon as possible.”