On this special one-hour edition of “Legislative Year in Review,” we recap the highlights from the 2014 session — from opening day to Sine Die. The show includes debate over issues such as the Dream Act, minimum wage, gun control, abortion insurance bill, death penalty, mental health, teacher evaluations, taxing e-cigarettes and the supplemental budget. Plus, a quick wrap-up of several of the bills that passed this year. Watch the show below:
Archive for economy
Washington’s legislative leaders will adjourn the 2014 session Thursday, unless a special session extends the deadline. But before they go back to their districts TVW will air back-to-back live interviews with more than 20 lawmakers starting at 8 a.m. Thursday.
Anita Kissée, host of The Impact, will sit down with Gov. Jay Inslee, House Democratic Majority Leader Rep. Pat Sullivan and House Republican leader Rep. Dan Kristiansen.
Other guests include Sen. Linda Evans Parlette, R-Wenatchee, Rep. Ross Hunter, D-Medina, Rep. Joe Fitzgibbon, D-Burien, and Sen. Steve Litzow, R-Mercer Island. The lawmakers will talk about a range of issues from education to the capital budget to the environment.
Plus, Austin Jenkins, host of TVW’s “Inside Olympia” and reporter for the Public Radio Northwest News Network, and Brian Rosenthal, a state government reporter for The Seattle Times, will stop by to talk about some highlights from the past 60 days and what to expect when the election process begins.
Coverage will be here on the blog, and you can watch live on TVW or via webcast.
State officials estimated that legalized recreational marijuana could bring in $51 million to the state’s general fund in the 2015-17 biennium.
It’s the first time that the state has included marijuana in its revenue projections, since Initiative 502 passed in 2012, which legalized recreational marijuana, according to the Office of Financial Management.
The Economic and Revenue Forecast Council discussed the estimate, and projections for the next six years at meetings broadcast on TVW Wednesday.
The forecast for the remainder of the 2013-15 biennium showed general fund revenue coming in $30 million higher than in the November forecast, according to the Office of Financial Management. The general fund revenue over this biennium is expected to be $33 billion.
The state’s general fund collections in the following biennium, 2015-17, are projected to be $35.7 billion, an increase of $82 million over the November projection and including the $51 million expected in marijuana taxes.
The rest of that increased forecast was due to slowly growing economy, said Steve Lerch, chief economist of the Economic and Revenue Forecast Council.
Lerch told lawmakers Wednesday that council staff has been reluctant before this forecast to include marijuana tax revenues in general fund projections because of uncertainties about the retail stores, including when the the stores would launch and the potential for marijuana businesses to have problems with banks.
The projection includes an assumption that marijuana retail stores would not start until June 2015, Lerch said. Initiative 502 earmarks other revenue from marijuana, such as licensing revenue, to a dedicated marijuana fund, which pays for social and health services and research, he said.
According to OFM, the next revenue forecast is scheduled for release June 18.
A bill that would allow people to perform community service to fulfill a requirement for unemployment benefits passed out of the Senate Commerce and Labor Committee Friday morning.
The Employment Security Department requires people collecting unemployment benefits to perform three job search actions a week — either applying to a job or attending an employment workshop. SB 6392 and HB 2690 would allow the option of performing two hours of community service as one of those three activities.
Two high school students, Marissa Martz and Kristen Hoffmann of Snohomish High School, approached legislators with this proposal, according to Jerry Cornfield of The Herald of Everett.
The bill considered Friday was amended from the students’ original version of the bill, which would have required the community service in addition to the existing unemployment benefit requirements.
They testified to Senate committee on Friday and to the House Labor and Workforce Development on Wednesday.
They argued that the requirement could help the unemployed find work.
“Instead of just a piece of paper given to an employer, like a resume, you actually get to show what you’re doing and what you’re worth,” Hoffmann told the Senate committee Friday.
Several people signed in opposition to the bill, including representatives from Legal Voice, Unemployment Law Project, Washington State Labor Council and the Washington Education Association.
Neil Gorrell, Unemployment Insurance Director, said the original bill would have violated federal law, but making the community service optional instead of mandatory takes care of the issue.
The department was neutral on the version of the bill considered Friday, he said.
Here’s what TVW is covering on this holiday week:
Monday, Nov. 25 at 9 a.m.: TVW is live webcasting the Economic Forum for Women and Families in Seattle. Speakers include U.S. House Democratic Leader Nancy Pelosi, U.S. Rep. Adam Smith, U.S. Rep. Suzan DelBene and Marilyn Watkins of the Washington Work and Family Coalition. Watch the webcast here.
Monday, Nov. 25 at 7 p.m.: TVW is live webcasting the 24th Annual King County Legislative Forum. The forum focuses on issues for those with developmental disabilities.King County Executive Dow Constantine and statewide elected officials are expected to attend. Watch the webcast here.
Wednesday, Nov. 27 at 7 & 10 p.m.: This week’s edition of “The Impact” looks at the big issues addressed during Legislative Committee Days, including transportation funding and fish consumption. Plus, Sen. Sharon Nelson talks about her new role as minority leader.
Economic updates released Wednesday show the state is experiencing flat revenue and job growth, along with a slowing of new home construction.
The Economic and Revenue Forecast Council projected the state will collect about $25 million more in tax revenue through 2015 than expected. The total general fund balance is expected to be $33 billion for the current two-year budget cycle.
“If we look at changes in the forecast, they’re quite small,” said Steve Lerch, the state’s chief economist. “We continue to forecast slow economic and job growth for both the national and state economies.”
Lawmakers use the forecast as a guide when writing the state’s budget. Gov. Jay Inslee will release a supplemental budget proposal in December.
David Schumacher, director of the Office of Financial Management, said the projections make it “difficult for us to spend money on any new incentives or programs.”
“It’s enough to hold steady and not much more than that,” Schumacher said.
On the positive side, sales of existing homes in Washington continues to be strong, Lerch said.
But those homes have become slightly less affordable because of rising prices and mortgage rates, he said.
At the same time, new home construction appears to be slowing. “The thing we’re a little concerned about is we’ve seen a decrease in housing permits since April 2013,” Lerch said.
The latest unemployment figures were also released Wednesday.
Washington lost 9,500 jobs over the last two months, reversing a nearly two-year trend of positive job growth in the state.
Still, the state’s unemployment rate remained mostly the same — 6.9 percent in September and 7 percent in October. That’s compared to 7 percent in August.
September and October jobless numbers were released at the same time because the federal government shutdown prevented the employment agency from releasing the figures on time.
Paul Turek, a labor economist with Employment Security Department, said in a statement the drops are likely a result of “statistical adjustments and some softening of the economy.”
“We enjoyed a very long growth streak, but we should expect there will be ups and downs over time as the recovery gradually strengthens,” Turek said.
The state previously reported 22 straight months of job growth.
TVW taped Wednesday’s meeting of the Economic and Revenue Forecast Council – watch it here.
Economic figures released today show that Washington state is on a slow path to economic recovery, with strong growth in retail sales, construction activity and car sales.
Overall, the state is on track to collect $345 million more in tax revenue in the current two-year budget cycle than forecasted in June. Of that $345 million, a significant chunk comes from legislation approved during last session.
A telephone tax increased revenue by $110 million, and the state netted another $34 million by redirecting liquor taxes away from local governments and into the state general fund.
Chief economist Stephen Lerch said that after accounting for the legislation, the forecast changes are “not all that big.” Lerch presented the quarterly revenue forecast on Wednesday during a meeting of the Economic and Revenue Forecast Council.
Washington state saw a drop in wheat exports following the discovery of GMO wheat in a field in Oregon last spring, Lerch said. Japan and Korea suspended wheat purchases for several months as federal inspectors examined the herbicide-resistant plants, which were never approved for production.
No other genetically modified plants have been discovered and Lerch said he’s hopeful that wheat sales will increase again.
The forecast does not include any money from Initiative 502, which legalized marijuana in Washington. Retail marijuana stores are expected to open next June. Asked when the state will begin to include tax revenue from marijuana sales in the forecast, Rep. Ross Hunter replied: “When we can actually count it.”
“I believe we will see far less revenue from this source than other people anticipate,” said Rep. Terry Nealey.
Washington’s total revenue for the 2013-15 biennium is expected to be $33 billion, according to the report.
Watch the meeting below:
Budget writers got good news today in the form of a revised revenue forecast that shows Washington state will collect an extra $231 million dollars in revenue over the next two years.
Republican budget writer Sen. Andy Hill said that number should be enough to “break one of the final logjams” in budget negotiations.
Legislators have been locked in a stalemate over the budget, and a partial government shutdown could occur next month if they can’t come to an agreement.
Hill said the uptick in revenue — combined with expected savings — is enough to close the budget deficit, put $1 billion into public schools, cut tuition and protect the state’s social services.
Democratic budget writer Rep. Ross Hunter said the additional revenue “closes the gap a little bit” and he expects budget negotiations to end soon.
“We’re lucky it’s up rather than down,” Hunter said.
Not everyone is as optimistic. House Majority Leader Pat Sullivan said in a press release that it “doesn’t solve all our budget problems,” and won’t be enough to fully fund education as mandated by the McCleary decision.
“We’ve been prevented from taking even small steps toward closing outdated tax exemptions and redirecting resources toward schools….so, while today’s forecast may get us closer to a go-home budget, we can’t pretend we’ve solved the long-term problem,” Sullivan said.
The state government can expect to collect $33.7 billion dollars in tax revenue in the next two-year budget cycle that begins July 1, which is $121 million more than previously expected. The state will also collect an extra $110 million dollars in the current budget cycle.
Watch the meeting of the Economic Revenue and Forecast Council below.
The Senate Majority Coalition also called a press conference about the numbers. You can watch it here.
House Democrats unveiled a $10 billion transportation package on Wednesday that would be fueled by an increase in the gasoline tax and an increase on car tab fees.
The proposal would increase the state gas tax by 10 cents (2 cents a year over five years) and make car tab rates equal to 0.7 percent of the vehicle’s value. The proposal would also add a $25 fee on sales of bicycles over $500.
“Gas tax is about the only revenue stream you have right now,” Rep. Judy Clibborn (D-Mercer Island) said during a press conference Wednesday. “If we don’t have an investment for the jobs and economic vitality I think at some point there is a cost to not doing the gas tax.”
Washington’s gas tax currently ranks the ninth-highest in the nation. The proposal would eventually raise it to 47.5 cents per gallon.
The package identifies new or continued projects and targeted investments into the state’s transportation system, including improvements to State Route 167, funding for the Interstate 5 Columbia River crossing and the state ferry system.
House Republicans, who have been wary of any new tax proposals, were quick to criticize the new plan.
“House Republicans understand there are maintenance demands and new projects needed in the future,” Rep. Ed Orcutt (R-Kalama) said in a news release. “But any debate on transportation must begin with reforms, not tax increases on struggling workers and families, and not new project lists to entice votes in the Legislature.”
Gov. Jay Inslee released a statement saying transportation is “vital to the environmental and economic health” of the state.
“We can’t afford to not take action and this is a job I expect the Legislature to accomplish. I’ll be working with legislators on both sides of the aisle to craft a package that they can send to my desk for approval,” Inslee said.
On Wednesday’s “Legislative Review,” we have highlights from a debate in the House Judiciary committee over gun control. The most controversial measure would expand universal background checks to include private sales. We also cover Gov. Jay Inslee‘s press conference in which he announced a $120 million package of proposals to spur job growth around the state.
Last year, the Legislature passed a bill aimed at reducing the sex trafficking of minors. The bill, which was signed into law by former Gov. Chris Gregoire, would have required online escort sites like Backpage to verify the age of the girls depicted in ads. But Backpage sued, and the state ultimately stopped defending the law in court. On Wednesday, Sen. Jeanne Kohl-Welles introduced a bill that would repeal the previous law, while also imposing a $5,000 fine on people who use the Internet to arrange the sex trafficking of a minor.
Gov. Jay Inslee on Wednesday unveiled a $120 million package of proposals to spur job growth around the state.
The plan includes tax breaks for new high tech companies, funding for aerospace training programs and new oversight ensuring the success of STEM (Science, Technology, Engineering, Math) programs. The plan also includes a $50 million investment in clean energy programs.
Inslee also said he expects 10,000 new health care jobs through Medicaid expansion.
He characterized the plan as a “first step” in a broader jobs package. The $120 million price tag does not include funding for transportation projects, he said.
The state’s unemployment rate dropped to 7.8 percent last month, but the Employment Security Department has said recent drops in unemployment may be tied to unemployed job seekers who have stopped looking for work.
When asked how many jobs he hoped the plan would create, Inslee did not offer a specific number.
“More than we have today and enough to justify the investment and enough that it would be inexcusable not to adopt these common sense measures,” he said.
Republican leaders who met with the governor earlier to review the plan said they were open to many of the proposals, but questioned the timing.
“I think we are a little behind schedule. If he is going to run out a 75-part plan, I’d like to see it soon,” said House Minority Leader Richard DeBolt (R-Chehalis). “It’s one thing to go out and say you are going to change the world and do something different, but if you miss your timelines that doesn’t work for anybody.”
Republican Senate Caucus Leader Mark Schoesler (R-Ritzville) said they were trying to find common ground with Inslee’s proposals instead of just “throwing rocks.”
“I think we are all very interested in some of the STEM (Science, Technology, Engineering, Math) programs,” he said. “The problem is for our committee chairmen, we are extremely close to cutoff so if they don’t have budget implications they are going to be hard-pressed for time.”
Republicans have also called Inslee’s tax incentive proposals for high tech companies unfair, claiming he is “picking winners and losers.”
The governor defended the tax breaks on Wednesday, saying the plan identifies sectors where there is a potential for significant industrial growth.
“We want to target the companies that can offer innovative ways to do business,” he said.
TVW taped Inslee’s press conference. Watch it here.
Lawmakers are considering legislation that would create a new “training wage” lower than the state minimum wage for employers with less than 50 workers.
House Bill 1150 would allow some employers to pay 10 percent of their employees a wage set at 75 percent of the state minimum wage or the federal minimum wage, whichever is greater. It would apply to the employee’s first 680 hours. The federal minimum wage is currently $7.25 an hour.
The bill’s sponsor, Rep. Cary Condotta (R-East Wenatchee), told the House Committee on Labor and Workforce the program would help get teens back into the workforce and off the street.
“I believe it is reasonable. I want a solution to this problem because it has gotten very serious,” Condotta said.
Grant County Prosecuting Attorney Angus Lee agreed, telling committee members the program would help solve the gang problems he sees everyday in his community.
“It benefits people who need a chance,” he said. “I look at it as somebody who cares about my community. This is a bill about saving lives.”
Opponents of the bill say the law would hurt working families who depend on the state’s minimum wage to get by.
“These working families are barely hanging on. I’ve heard of training wheels and training pants but I’ve never heard of a training wage,” said Pamela Crone, a lobbyist with Legal Voice.
Teresa Mosqueda with the Washington State Labor Council called the proposal a “poverty creation bill.”
“This is about all workers and this is taking money off the kitchen table,” she said.
Erin Shannon with the Washington Policy Center told lawmakers the state has one of the highest teen unemployment rates in the country at 28 percent. Shannon said employers need an economic incentive to take a gamble on young workers.
Those feelings were echoed by Pam Pellegrino, owner of Pellegrino’s Italian Kitchen in Olympia.
“When we go to hire to fill a position, at this point we don’t look for teenagers. We can’t invest the time at the minimum wage to train them,” she said.
The committee took no action on the bill Tuesday.
Opponents of a bill that would repeal Washington’s Family and Medical Leave Insurance Act told lawmakers the state has a moral responsibility to keep the law on the books during a Senate Commerce and Labor Committee hearing Monday.
The 2007 act, which gives new parents paid leave of up to $250 a week for five weeks, has yet to be implemented due to lack of funding associated with the state’s economic downturn in recent years.
“It should never be a matter a luck that a parent can take time with their new child,” said Marilyn Watkins with the Economic Opportunity Institute. “We, as a state, have no greater moral responsibility than to move forward and fund this program.”
Sen. John Braun (R-Centralia), who is sponsoring Senate Bill 5159, argued that the current law is a liability and will never be funded.
“We should stop fooling around with something we don’t ever plan to properly fund and take it off the books,” Braun said.
The legislature delayed funding the program twice – in 2009 and 2011 – and former Gov. Chris Gregoire did not include it in her final budget before leaving office.
The bill has wide support in the new Senate Majority Coalition, including its two Democrats, Senate Majority Leader Rodney Tom (D-Medina) and Sen. Tim Sheldon (D-Potlach).
Meanwhile, Sen. Karen Keiser (D- Kent) has introduced her own bill which would fund an expanded version of the original act.
Keiser’s proposal would extend the leave time to 12 weeks and pay two-thirds of a worker’s pay, up to $1,000 a week. It would be funded through a .01 percent payroll tax on employees and employers. The program would start paying benefits in 2015.
“At a time when middle-class working families are struggling, it makes no sense to cut this benefit,” Keiser said.
Keiser’s proposal is similar to legislation passed in California and New Jersey.
Next month will mark the 20th anniversary of the Federal Family Medical Leave Act, which provides up to 12 weeks of unpaid family leave.
The committee took no action on the bill Monday.
Senate and House Republican leaders outlined a number of concerns with parts of new Gov. Jay Inslee’s inaugural address during a press conference Wednesday afternoon.
House Republican Leader Richard Debolt (R-Chehalis) said he was disappointed that Inslee was picking winners and losers by supporting tax breaks for programs delivering clean energy.
“State government shouldn’t decide who is successful and who is not. We have to do what we can to help all businesses,” Debolt said.
Debolt said he was also surprised the governor mentioned his support for the Reproductive Parity Act, which would require insurance companies to cover abortions if they also cover live births.
“It was funny that he would take a day of unification and try to make it a politically dividing event,” DeBolt said. “Social issues are not as important as it is getting people back to work again. That should be the focus of our governor.”
Senate Republican Leader Mark Schoesler (R-Ritzville) said the governor’s speech lacked detail, especially concerning gun control.
“The governor hasn’t given us any specifics on gun safety. We all agree it’s important, but there were no details prior and none today in the speech,” Schoesler said.
All the Republican leaders praised Inslee for the making jobs his top priority and said they plan to help Inslee keep his campaign pledge to not raise taxes.
“We have to have those jobs to get people off public assistance,” Rep. Dan Kristiansen (R-Snohomish) said.
Rep. Kevin Parker (R-Spokane) gave a videotaped official Republican perspective prior to the news conference.
Parker focused on funding education and balancing the budget without introducing new taxes.
For the first time in nearly four years, Washington’s unemployment rate has dropped below 8 percent, according to figures released Wednesday by the state’s Employment Security Department.
The state’s jobless rate was 7.8 percent in November, down from 8.2 percent in October. The employment department said that’s the largest month-to-month drop the state has seen since 1977.
Gov. Chris Gregoire called the unemployment rate “welcome news.”
“We are clearly heading in the right direction as we slowly emerge from the Great Recession but we cannot rest until every Washingtonian who wants a job has one,” Gregoire said in a statement.
An estimated 270,000 people in Washington were unemployed and looking for work in November.
The industry with the biggest job gains was retail trade, which added 2,500 jobs last month. The construction industry came in second with 1,400 jobs, followed by the leisure and hospitality industry with 1,200 jobs.
A quarterly economic snapshot released today shows that Washington state is “marginally worse” compared to the last quarterly report in September, said Stephen Lerch, executive director of the Economic and Revenue Forecast Council.
Lerch said personal income and GDP is growing slower than expected in Washington. He’s also concerned about issues outside of the state, such as the slowdown in Europe and the coming “fiscal cliff” that must be addressed by Congress before the end of the year.
On the bright side, consumer confidence is at the highest level since Oct. 2007. Housing is also doing well — home prices have gone up for four months in row in Seattle. Nationally, prices have been on the rise for the last three months.
Revenue tax collections are coming in $37 million higher than expected, but Lerch attributed that to a “timing issue” and said he expects it to be back on track for the next quarterly revenue forecast on Nov. 14. The previous revenue forecast showed the state can expect to collect about $30.5 billion in revenue in the current two-year budget cycle.
Washington economists forecast an increase in state revenue in the current budget cycle, as well as the two that follow.
The state can expect to collect about $30.5 billion in the current two-year budget cycle, which is $29 million more than June’s forecast, the Economic and Revenue Forecast Council announced today in its quarterly forecast. The 2011-2013 biennium ends in July 2013.
The council’s executive director, Stephen Lerch, said there’s been positive growth in housing and auto sales. On the downside, exports are declining and job growth has been “very very slow,” Lerch said.
Consumers are paying down big chunks of debt, but that means they aren’t going out and making new purchases — which is something to “watch for,” given the state’s reliance on sales tax, Lerch said.
Liquor sales have jumped widely since stores were privatized in June. In May, liquor stores saw a 27 percent spike in sales as restaurants and consumers stocked up. Sales dropped steeply in June, then rebounded in July. Lerch said he’s raised the forecast on revenue from liquor, but it’s “hard to say where the trend is going on liquor sales.”
Budget director Stan Marshburn said the state is still expecting a $500 million shortfall in the current biennium. “This forecast changes it by $50 million, so the problem remains about the same,” he said.
As for 2013-2015, economists are forecasting revenue of about $32.6 billion, which is $23 million more than expected.
For the first time, economists also looked at the 2015-2017 biennium and expect the state will be able to collect $35.5 billion — an 8.8 percent increase.
Watch the full meeting below:
Washington’s unemployment rate rose to 8.6 percent in August, up from 8.5 percent in July, the state Employment Security Department said today. The state saw a net loss of about 1,100 jobs.
The good news is that construction jobs are on the rise — the industry added 1,900 jobs in August, the most of any sector.
“This is consistent with what we’re seeing in home construction,” said chief labor economist Joe Elling. Seattle in particular has seen “really good growth” of multi-family units, Elling said, and the construction of single-family homes is up 19 percent across the state.
Still, numbers remain far below what they were at the peak in 2007, when Washington had about 208,000 construction jobs. Today, the construction industry employs about 140,000 workers. “We have a long ways to go to get construction back to a more healthy level,” Elling said.
The state saw “unusually large losses” in the hospitality and leisure sector, which lost 2,300 jobs in August. Retail and wholesalers also saw a big drop. Elling said retail typically sees a boost in August, but that didn’t occur this time. He cautioned against reading too much into the month-to-month numbers.
The rate remains lower than a year ago. In August 2011, unemployment was at 9.2 percent.
More economic news is coming today.
At 2:30 p.m., the Economic and Revenue Forecast Council will release the quarterly revenue forecast. If trends hold from an economic update released earlier this month, the state may be bringing in more revenue than expected.
The meeting will be aired live on TVW, and we’ll also have updates here on the blog.
The Economic Review and Forecast Council released an update on the state’s economy today, providing a preview to the quarterly revenue report that will come out later this month.
The news was cautiously optimistic: Revenue is about $22 million higher than expected since the last forecast in June.
Growth has been a “bit stronger” than expected — the state has added 10,300 jobs in the last two months, which is 3,500 better than economists had predicted. Still, uncertainty remains “very high,” interim director Stephen Lerch said.
On the downside, rising rents in Seattle are driving up inflation faster than the national average. Rents in Seattle have risen 3.9 percent over the last year, compared to 2.2 percent for the rest of the nation.
The council also formally voted to hire Lerch to be the new director of the council at today’s meeting, a move that was announced earlier this week.
Full video of the meeting below:
The Economic and Revenue Forecast Council said Friday they’ll make Stephen Lerch the permanent executive director, replacing Arun Raha. Lerch has been serving as the interim director since Raha left for the private sector.
As the state’s chief economist and forecaster, Lerch will be responsible for predicting how much revenue money the state will bring in. The governor and state Legislature use the quarterly forecasts as a blueprint for writing the budget.
The council launched a national search for a new director after Raha resigned in January. At the time, the council estimated the process could take six or seven months.
In a press release, council chair Rep. Ed Orcutt said Lerch “was the top pick out of several highly qualified candidates from around the country and around the world.”
Lerch holds a PhD in economics from John Hopkins University. He was the research director for the Washington State Investment Board before coming to the council, where he has twice served as the interim director during candidate searches.
The council said it will vote for Lerch at the next economic review meeting on Sept. 6th. Read the full announcement.