By Jim Hedrick, GSI WA State Lobbyist and Spokane Regional Advocate
While Martin Luther King Jr. Day is a holiday for many, it is one of the busiest days in the legislative calendar, with constituents arriving by busload to meet with their delegations. Bills are moving quickly in committees already and there are plenty to track. This year, over 1,000 new bills have been introduced for this “short” session.
Capital Gains Tax
Early Tuesday morning, Democrat majority budget writers received good news that the U.S. Supreme Court will not review Quinn v. Washington, the lawsuit challenging Washington’s 7% tax on capital gains above $250,000. The tax brought in nearly $900 million in revenue in the first year, which budget writers are counting on to fund education. This is not the end of the story as the issue may still appear as an initiative on the November ballot, pending signature verification and action by the Legislature. Later that morning, Secretary of State Steve Hobbs notified the Legislature that signature verification of Initiative 2117 (concerning carbon tax credit trading) has been completed and has been certified. The legislature must now approve that initiative or send it to voters with or without an alternative measure. The signatures on the other pending initiatives, including capital gains, are currently being verified by the Secretary of State.
Tuesday was gift card day, with four bills being heard in both chambers. While gift cards do not expire in Washington State, if a person does not use a gift card or funds on a mobile app from a Washington-based retailer after three years, current law allows that money to return to the company as profit. Rep. Emily Alvarado (D-34) and Senator Yasmin Trudeau (D-27) are proposing a pair of policies (HB 2094, HB 2095, SB 5987, SB 5988) that would send the unused balances to the Department of Revenue’s unclaimed property website, where gift card users could locate those balances. Any unreturned money held by the state could eventually go toward state spending on education, healthcare, or housing. Additionally, the legislation package would allow consumers to cash out a gift card up to $50, would require large corporations to notify consumers about unspent funds, and would let consumers reload gift cards and mobile apps at any amount. This is another highly contentious issue this session, with the business community coming out in force to oppose.
Initiative 2117 (I-2117), an initiative to the legislature, has now qualified for the November 2024 ballot. If passed by the voters it would repeal the state’s cap and trade carbon market program. The cap and trade program, as part of the state’s Climate Commitment Act (CCA) is the crowning policy achievement of Governor Inslee. The legislature is not expected to give I-2117 a public hearing much less pass the measure, thus the voters will determine its fate next November.
Complicating matters is HB 2201 (Rep. Doglio, D-22) and SB 6058 (Sen. Nguyen, D-34), which would facilitate the “linkage” of Washington’s carbon market with the California-Quebec carbon markets. Both bills have received public committee hearings. Both bills are expected to advance and be scheduled for committee votes next week. Privately, there are many discussions among Democrat legislative leadership and state constitutional attorneys whether the “linkage” bill, if passed, would need to be sent to the voters as an alternative to I-2117 under the state Constitution. There is very little legal guidance or body of case law from which to draw upon as to what the Washington State Constitution considers an alternative to an initiative. Legislators are moving cautiously as they contemplate whether to pass the linkage bill, a priority for Governor Inslee in his last year of office, or if constitutional interpretations will make legislators reluctant to pass the linkage bill. Stay tuned.
Modeled on an approach enacted in California, SB 6052 (Sen. Nguyen, D-34) would create a new commission to oversee oil industry pricing and profits and establish a new commission to investigate allegations of market manipulation and price-gouging. SB 6052 was heard before the Senate Committee on Environment, Energy & Technology on Wednesday. It is not scheduled for a committee vote at this time.
Wednesday, HB 1589 by Rep. Doglio (D-22), a decarbonization bill and a priority for the Inslee Administration had a major setback this week. A necessary procedural vote in exchange for an agreed to bipartisan amendment came unraveled after it was revealed (leaked email) the prime sponsor was already secretly negotiating with Senate members to return the bill to its original form. The amendment removes the prohibition on natural gas service to commercial and residential locations by a large electric and natural gas utility company. House Democrats planned to bring 1589 to a floor vote on Thursday but that didn’t happen either. Regardless,
even if Democrats now move HB 1589 “as is” off the House floor it has no pathway to passage in the Senate.
Gas Powered Equipment
In the guise of neighborhood noise abatement, the legislature is considering HB 2051 by Rep. Amy Walen (D-48) that would adopt the California small off-road engine and equipment (SORE) standards. Walen, a self-proclaimed moderate business-Democrat is sponsoring the bill. The conventional wisdom is that Walen is sponsoring the bill to stave off a political challenge from the left and give her some “enviro cred”. The bill is scheduled for a in the House Environment & Energy Committee this week and is expected to be amended to exempt agricultural equipment. HB 2051 also establishes a temporary sales and use tax exemption for zero emission outdoor power equipment.
On Wednesday, the House Civil Rights and Judiciary committee heard HB 2119 (Riccelli, D-3) which would prohibit the garnishment of wages for medical debt. In his remarks, the sponsor noted that medical debt is increasing and is worse in lower income communities and communities of color and that the University of Washington, PeaceHealth, Providence and a few other hospitals have already moved away from garnishment. But the bill received harsh criticism from the Washington State Medical Association (WSMA) and the Washington State Hospital Association (WSHA), who cite already available charity care.
If legislators have their way this session, there will be several additions to requirements for public education in the future. On Wednesday, the Senate Early Learning & K-12 Education committee heard four bills addressing additional topics of education. SB 5813 (Dozier, R-16) would require instruction on agricultural literacy; SB 5819 (Valdez, D-46) makes financial education a graduation prerequisite; SB 5849 (Wellman, D-41) creates a computer science competence graduation requirement; and SB 5851 (Braun, R-20) requires genocide and Holocaust education.
January 31 – Policy Committee Cutoff
February 5 – Fiscal Committee Cutoff
February 13 – House of Origin Cutoff
February 21 – Opposite House Policy Committee Cutoff
February 26 – Opposite House Fiscal Committee Cutoff
March 1 – Floor Cutoff
March 7 – Last day of Regular Session
For More Information
Public Policy developments change fast. Note this is a wrap-up of the week of January 15-19. You can find the prior week wrap-up here: January 8-12, 2024. For more details about any of the bills in this article, visit the Washington State Legislature page to search by bill number. For more information contact Jake Mayson, Director of Public Policy.