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Legislative Update – Feb 2

Weekly Legislative Report
February 2, 2020

WEEKLY HIGHLIGHTS

Since the start of session on January 13, 1,717 new bills have been introduced in the Washington State Legislature, making for a grand total of 4,198 bills this biennium. With six weeks left, February 7 is the last opportunity for a bill to exit policy committees in its house of origin, unless the bill has a fiscal component. 

Airport Labor Standards

This week, the Senate Labor & Commerce and House Labor & Workplace Standards committees heard 6217 (Keiser, D-Des Moines) and companion 2715 (Gregerson, D-SeaTac) respectively, which seek to clarify the role of municipalities operating airports in enacting minimum labor standards. In 2013, voters passed Proposition 1, making SeaTac the first city in the nation to adopt a $15 per hour minimum wage, now $16.34 per hour. However, businesses that prepare food or beverage to be served in-flight by an airline were excluded, and are subject instead to the state’s minimum wage, currently set at $13.50 per hour. This bill would authorize, but not require, municipalities operating airports, such as the Port of Seattle, to meet or exceed minimum labor standards of surrounding jurisdictions, such as the City of SeaTac. The Port of Seattle has expressed an eagerness to find a solution for the workers not covered by Prop 1, but in coordination with other ports, have voiced concern about shifting the role of ports from operating transportation and industrial facilities that support economic development, to regulatory wage setting and enforcement, which they claim is the role of the cities. They emphasize this could result in a patchwork of different wage requirements for workers in the same city. 

B&O Tax Surcharge for Workforce Education

The Senate surprised lobbyists and constituent visitors to Olympia by remaining on the floor Wednesday and Thursday afternoons through scheduled committees to debate 6492 (Pedersen, D-Seattle), revisions to a policy passed in the final days of the 2019 session. Last April, the Washington State Legislature passed 2158 (Hansen, D-Bainbridge), which applied a 20% B&O surcharge on income from approximately 80,000 service businesses such as lobbyists, engineers, accountants, doctors, and lawyers; a 33.33% B&O surcharge on income from some advanced computing businesses; and a 66.66% B&O surcharge on advanced computing businesses like Microsoft with revenue of more than $100 billion. 2158 (Hansen, D-Bainbridge) was supposed to raise $970 million to provide tuition-free public college and apprenticeships for families earning less than $50,000 per year, and partial scholarships for families earning up to the state’s median income. However, the Department of Revenue estimated after adoption that the measure would raise only $750 million and with a revenue structure too complicated to implement. This bill and the amendments proposed on the floor seek to simplify the concept and provide clarity to who is impacted. It also taxes approximately 4,000 new businesses that 2158 did not but exempts around 14,000 other small businesses earning less than $1 million. In total, 6492 raises approximately $1 billion. A solution will need to be agreed upon soon and signed into law by February 10 to give the Department of Revenue time to implement before the tax is collected April 1. 

Gaming & Casinos

After the United States Supreme Court lifted a federal ban on sports betting in 2018, 13 states have legalized it, and most others, including Washington are now considering legalization. In this state, the Legislature is considering proposals that amend tribal gambling compacts with the state to allow Las-Vegas-style sports betting at the 29 tribal casinos. Tribal leaders say their casinos are already trusted entities in Washington, and employee 30,000 people in what used to be the poorest areas of the State of Washington, pay $722 million in taxes, and are a $5.7 billion part of the state economy. Maverick Gaming, a Nevada-based operation that has steadily built a footprint in Washington purchasing 19 card rooms employing 2,200 people is also hoping to break into brick and mortar sports betting, as well as electronic betting using cellphones and computers. The tribes and the Superintendent of Public Instruction are opposed to electronic gambling given the ease of access for young people.   

The Senate voted once again to abolish the death penalty in Washington on Friday. 5339 (Carlyle, D-Seattle) would make permanent a 2018 Washington State Supreme Court ruling that struck it down as arbitrary and racially biased, instead mandating a life sentence without the possibility of parole as the sentence for aggravated murder. It has passed the Senate every year for three years but failed in the House. The measure will be another test of a Jinkins House. Governor Inslee has already agreed to sign it should the bill reach his desk. 

Transportation 

After two long and acrimonious floor debate sessions, The House of Representatives passed 1110 (Fitzgibbon, D-West Seattle), the Low Carbon Fuel Standard bill on Wednesday. The bill advanced on a final vote of 52-44, with Representatives Springer, Sullivan, and Blake joining Republicans in opposition. The divisive policy would reduce the carbon intensity of fuels in Washington State by 10% below 2017 goals by 2028, and by 20% by 2035. Fuel producers unable to meet these targets would be required to buy credits from companies that can. Transportation is the primary source of climate pollution in the Puget Sound region, creating over 40% of the Puget Sound region’s greenhouse gas pollution. The intention is to drive consumers toward electric vehicles and away from gas-powered ones, and influence producers of fuel to change their operations to favor low-carbon products such as biofuels. BP, which operates a refinery in Northwest Washington has attracted the ire of many legislative Republicans in recent weeks for its changed position and support of a carbon cap, just two years after the company spent $13 million to oppose Initiative 1631, a carbon pricing ballot measure. The initiative was rejected by voters 56% to 43%, a point not overlooked by opponents of 1110.  Opponents also site a 2019 study commissioned by the Puget Sound Clean Air Agency, suggesting the policy could add $0.22-0.57 per gallon of gasoline, and from $0.24-0.63 per gallon of diesel by 2030, which they say deals a major blow to farmers, trades workers, and residents of rural Washington who are both high users of fuel for agriculture and commuters to jobs that pay significantly less than those found in Western Washington. Governor Inslee and legislative Democrats reject these claims and praise the policy as a critical piece in staving off disasters like the Australian wildfires. 

The Senate, House and Governor continue to work towards an agreement in response to Initiative 976. Chair Hobbs expressed his desire to find a way to release the projects that are currently on the Governor’s request WSDOT pause list. On February 5th, Chairman Hobbs has scheduled a work session, open to public comment, on the Senate proposed transportation package. Details of the package have not yet been released but he has said it will be similar to the Forward WA proposal from 2019. Click here to view the agenda. 

Sen. Hobbs has released the balance sheet for the hearing on Forward Washington, which is a $17-$18 billion transportation package. It provides a side-by-side comparison with his original proposal from last year. Note that he replaces the carbon tax with a cap-and-invest program and extends the time horizon out to 2035. The hearing is scheduled for Wednesday at 3:30 in the Senate Transportation committee. Here is the link to the balance sheet.

Given the passage of a low carbon fuel standard (LCFS) in the House, AWB and others in the business community will be testifying on Hobb’s package with concerns. While the business community believes there is a need for additional transportation revenues, the combination of passing an LCFS, (estimated to increase fuel prices up to .57 to .63 cents per gallon), on top of a .06 cent gas tax increase and a carbon pricing scheme, raises serious concerns from businesses trying to remain competitive.

Chairman Hobbs also discussed the road usage charge (RUC) pilot project final report, which provided information on the legal, fiscal, operational, and policy implications of a RUC and offered recommendations to the Legislature on how RUCs could be implemented in Washington. One of the recommendations of WSTC was that the Legislature enact an RUC system initially on a small number of vehicles as part of a longer term transition away from the gas tax. Senate Bill 6586, sponsored by Senator Salda?a, would repeal the transportation electrification vehicle fees and beginning July 1, 2024, at the time of initial application or annual vehicle registration renewal, electric and hybrid vehicles will be subject to specific per mile fee.

Important Dates

Feb 7 – House of Origin Policy Cutoff 
Feb 11 – House of Origin Fiscal Cutoff
Feb 19 – House of Origin Floor Cutoff
Feb 28 – Opposite House Policy Cutoff
March 2 – Opposite House Fiscal Cutoff
March 6 – Opposite House Floor Cutoff
March 12 – Sine Die

Upcoming Hearings

Labor & Commerce (Senate) – SHR 1, JACB – 2/3 @ 10:00am

  • SSB 5717 – Public Hearing – Concerning employer and employee scheduling.

Environment & Energy (House) – HHR B, JLOB – 2/3 @ 1:30pm

  • HB 2892 – Public Hearing – Authorizing the department of ecology to regulate greenhouse gas emissions associated with persons who produce or distribute fossil fuel products that emit greenhouse gases in Washington.

Finance (House) – HHR A, JLOB – 2/4 @ 8:00am

  • HB 2907 – Public Hearing – Authorizing counties with populations over two million to impose an excise tax on business.

Financial Institutions, Economic Development & Trade (Senate) – SHR 2, JACB – 2/4 @ 8:30am

  • SB 6642 – Public Hearing – Providing a tax preference for rural and nonrural data centers.

Environment, Energy & Technology (Senate) – SHR 1, JACB – 2/4 @ 10:00am

  • SB 5981 – Public Hearing – Implementing a greenhouse gas emissions cap and trade program. (Hearing is on the Draft Proposed Substitute.)

Environment & Energy (House) – HHR B, JLOB – 2/4 @ 3:30pm

  • HB 2892 – Exec Session – Authorizing the department of ecology to regulate greenhouse gas emissions associated with persons who produce or distribute fossil fuel products that emit greenhouse gases in Washington.

State Government & Tribal Relations (House) – HHR E, JLOB – 2/5 @ 1:30pm

  • HB 2577 – Exec Session – Concerning agency responsibilities to regulated businesses and professions.

Ways & Means (Senate) – SHR 4, JACB – 2/5 @ 3:30pm

  • SSB 6053 – Public Hearing – Establishing wage liens.

State Government & Tribal Relations (House) – HHR E, JLOB – 2/7 @ 8:00am

  • HB 2593 – Exec Session – Promoting economic development through enhancing state agency permitting.

Finance (House) – HHR A, JLOB – 2/7 @ 1:30pm

  • HB 2907 – Exec Session – Authorizing counties with populations over two million to impose an excise tax on business.

Bill Status

CLIMATE CHANGE/CARBON TAX

Bill # Title Short Description Status Sponsor Priority Position
E2SHB 1110 Reducing the greenhouse gas emissions associated with transportation fuels. Reducing the greenhouse gas emissions associated with transportation fuels. S Environment, En Fitzgibbon High Oppose
HB 2892 Authorizing the department of ecology to regulate greenhouse gas emissions associated with persons who produce or distribute fossil fuel products that emit greenhouse gases in Washington. Authorizing the department of ecology to regulate greenhouse gas emissions associated with persons who produce or distribute fossil fuel products that emit greenhouse gases in Washington. H Env & Energy Fitzgibbon Medium Oppose
SB 5981 Implementing a greenhouse gas emissions cap and trade program. Implementing a greenhouse gas emissions cap and trade program. S Environment, E Carlyle High Oppose

CTE

No bills.

GENERAL BUSINESS PRIORITIES

Bill # Title Short Description Status Sponsor Priority Position
SHB 2171 Concerning vested vacation or paid time off upon an employee’s termination. Concerning vested vacation or paid time off upon an employee’s termination. H LAWSDPS Santos High Oppose
HB 2577
(SSB 6408)
Concerning agency responsibilities to regulated businesses and professions. Concerning agency responsibilities to regulated businesses and professions. H State Govt & T Barkis High Support
HB 2593 Promoting economic development through enhancing state agency permitting. Promoting economic development through enhancing state agency permitting. H State Govt & T Boehnke Medium Support
HB 2602 Concerning hair discrimination. Concerning hair discrimination. H Civil R & Judi Morgan Medium Neutral
HB 2907 Authorizing counties with populations over two million to impose an excise tax on business. Authorizing counties with populations over two million to impose an excise tax on business. H Finance Macri High Concerns
SB 5473
(HB 1445)
Making unemployment benefits accessible to persons with family responsibilities and other availability issues and making clarifying changes.   S Labor & Commer Salda?a Medium Oppose
SSB 5717 Concerning employer and employee scheduling. Concerning employer and employee scheduling. S Labor & Commerc Salda?a High Oppose
SSB 6053 Establishing wage liens. Establishing wage liens. S Ways & Means Conway Medium Oppose
SB 6233 Concerning employee’s rights concerning personnel files and disciplinary actions. Concerning employee’s rights concerning personnel files and disciplinary actions. S Labor & Commer Kuderer High  
SB 6235 Concerning exceptions to disqualification for unemployment insurance benefits when voluntarily leaving employment due to increases in job duties or changes in working conditions. Concerning exceptions to disqualification for unemployment insurance benefits when voluntarily leaving employment due to increases in job duties or changes in working conditions. S Labor & Commer Kuderer High Concerns
SSB 6408 Concerning agency responsibilities to regulated businesses and professions. Concerning agency responsibilities to regulated businesses and professions. S Ways & Means Wilson High Support
SB 6548 Allowing employee choice and flexibility in the executive, administrative, and professional exception to the minimum wage act. Allowing employee choice and flexibility in the executive, administrative, and professional exception to the minimum wage act. S Labor & Commer Braun High Support
SB 6552 Eliminating the three-day waiting period for receiving industrial insurance compensation. Eliminating the three-day waiting period for receiving industrial insurance compensation. S Labor & Commer Stanford High Oppose
SB 6669
(HB 2907)
Authorizing counties with populations over two million to impose an excise tax on business. Authorizing counties with populations over two million to impose an excise tax on business.   Keiser High  

HOUSING/HOMELESSNESS

Bill # Title Short Description Status Sponsor Priority Position
HB 1679
(SSB 5676)
Authorizing cities planning under the growth management act to impose certain real estate excise taxes by councilmanic action. Authorizing cities planning under the growth management act to impose certain real estate excise taxes by councilmanic action. H Finance Frame Medium Concerns
SHB 1797 Concerning local governments planning and zoning for accessory dwelling units. Concerning local governments planning and zoning for accessory dwelling units. H Local Govt Gregerson Medium  
2SHB 1938 Creating a local infrastructure investment program to support the development of affordable housing, workforce housing, and revitalization efforts. Creating a local infrastructure investment program to support the development of affordable housing, workforce housing, and revitalization efforts. H Hous, Com Dev & Steele High Support
HB 2452 Reducing the real estate excise tax for multiple-unit housing. Reducing the real estate excise tax for multiple-unit housing. H Finance Barkis High Support
SB 5219 Concerning condominium construction warranties.   S 2nd Reading Padden High Support
SSB 5366 Expanding the property tax exemption for new and rehabilitated multiple-unit dwellings in urban centers.   S 3rd Reading Wagoner Medium  
SSB 5676 Authorizing cities planning under the growth management act to impose certain real estate excise taxes by council action. Authorizing cities planning under the growth management act to impose certain real estate excise taxes by councilmanic action. S Rules 2 Takko High Concerns

OTHER CHAMBER BILLS

Bill # Title Short Description Status Sponsor Priority Position
HB 1841
(SB 5877)
Establishing minimum crew size on certain trains. Establishing minimum crew size on certain trains. H Passed 3rd Riccelli Medium Concerns
SB 5830
(HB 1897)
Concerning vehicle combinations that may be operated on public highways. Concerning vehicle combinations that may be operated on public highways. S Rules 2 King Medium  

STREAMLINED SALES TAX

Bill # Title Short Description Status Sponsor Priority Position
EHB 1948
(SSB 5862)
Supporting warehousing and manufacturing job centers. Supporting warehousing and manufacturing job centers. S Ways & Means Entenman High Support
SSB 5862 Supporting warehousing and manufacturing job centers. Supporting warehousing and manufacturing job centers. S Ways & Means Das High Support

TRADE, AEROSPACE & MFG

Bill # Title Short Description Status Sponsor Priority Position
HB 2895 Providing a tax preference for rural and nonrural data centers. Providing a tax preference for rural and nonrural data centers. H Finance Gildon High Support
SB 6642 Providing a tax preference for rural and nonrural data centers. Providing a tax preference for rural and nonrural data centers. S Financial Inst Zeiger Medium Support

TRANSPORTATION

Bill # Title Short Description Status Sponsor Priority Position
SB 5412
(E2SHB 1110)
Reducing the greenhouse gas emissions associated with transportation fuels.   S Environment, E Salda?a High Oppose
SB 5970 Authorizing bonds for transportation funding. Authorizing bonds for transportation funding. S Transportation Hobbs High Neutral
SSB 5972 Concerning additive transportation funding and appropriations. Concerning additive transportation funding and appropriations. S Transportation Hobbs High Concerns
SB 6452
(HB 2461)
Including health in the state transportation system policy goals. Including health in the state transportation system policy goals. S Transportation Billig Medium  
SB 6652
(HB 2362)
Addressing local transportation revenue options. Addressing local transportation revenue options. S Transportation Nguyen High Concerns

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