By Jim Hedrick, GSI WA State Lobbyist and Spokane Regional Advocate
On Tuesday the Senate Labor and Commerce Committee heard the latest version of an ergonomics proposal, SB 5217 (Dhingra, D-45). In 2000, the Department of Labor and Industries (L&I) adopted specific workplace ergonomics regulations. Initiative 841, passed by the voters in 2003, repealed the regulations and prohibited L&I from adopting similar regulations or otherwise regulating working practices to prevent musculoskeletal disorders until and to the extent required by federal law. SB 5217 seeks to reinstate L&I’s ability to regulate ergonomics. Last year, a more expansive bill, HB 1837 (Bronoske, D-28), narrowly passed the House with seven democrats joining republicans in opposition during an all-night session, but later died in the Senate.
Thursday was all about taxes. It began at 9 am when the Washington State Supreme Court heard oral arguments in the capital gains case. In 2021, the legislature enacted a capital gains tax applicable to individuals at a rate of 7% on net gains in excess of $250,000 in a calendar year, with the proceeds going to the education trust account and the common school construction account. The tax was challenged on the basis that it violates the state constitution’s uniformity provision. In Washington, income is considered property, and the constitution mandates all state taxes on property be uniform or taxed at the same rate. In addition, any tax on property cannot exceed 1%. Opponents of the tax argued and a lower court agreed that the capital gains tax was not uniformly applied because the tax was only imposed on a certain threshold of income and the rate exceeded the constitutional maximum. Supporters contend the tax will improve equity, while critics argue it damages the state’s competitiveness. Regardless, in the event the capital gains tax is found to be unconstitutional, legislative budget writers will have to look elsewhere in the state coffers to fund their education and childcare priorities.
Later in the morning on Thursday, the Senate Business, Financial Services, Gaming, and Trade Committee heard a proposal to replace the state B&O Tax with a modified gross receipts tax, or what is known as a Margin Tax. Since 2017, the Washington Tax Structure Work Group, a group of bipartisan Washington legislators, representatives from the Governor’s office, the Department of Revenue, the Washington State Association of Counties (WSAC), and the Association of Washington Cities (AWC) has been tasked with reviewing Washington’s tax structure. The primary goal of the group’s review was to identify ways to make “Washington’s tax code more fair, adequate, and transparent.” SB 5482 (Frame, D-36), a product of that workgroup, has bipartisan support, but the bill was not well received by members of the public, with no one testifying to support the bill. Conservatives decried the unknowns and possible increase in taxes paid over current B&O tax rates and progressives criticized the overall possible reduction in revenue to the state.
There are now three weeks until the “policy committee cutoff,” the first procedural milestone in the legislative process. By Friday, February 17 all bills must receive a recommendation – to pass the bill out of the committee it was originally referred to by that date. Committees will now spend more time working bills with amendments, caucusing, debating bills, and voting on bills. This leaves much less time to take testimony. Thus, any bill not scheduled for a hearing by next week is going to have a much tougher time getting through the legislative process.
Next week it is expected the legislature will reveal its strategy on a bill to address the state Supreme Court’s Blake decision concerning the possession of narcotics with three bills scheduled for public testimony addressing police pursuits.
For More Information
Public Policy developments change fast. Note this is a wrap-up of the week of January 23-27. You can find prior week wrap-ups here: January 16-20 and January 9-13. Check out GSI’s 2023’s State Agenda. 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.