2016 legislative review
at issue is the question of what B & O tax classification is appropriate. Proponents of the bill believed it was a fair compromise and reduced the risks of litigation over time. However, a number of questions and disagreements persisted to the end and this complicated issue wasn’ t able to find final resolution before the end of session.
SB 6668 pension merger
Failed / AWB Neutral
In order to defray costs associated with an unfunded pension liability in one of the state’ s older pension plans, Senate Bill 6668 would have merged the assets, liabilities, and membership of Plan 1 of the Law Enforcement Officers’ and Firefighters’( LEOFF) Retirement System with Plan 1 of the Teachers’ Retirement System( TRS), and established a funding policy for the merged plan. It also would have provided a one-time, lump-sum defined benefit payment of $ 5,000 to all retired LEOFF Plan 1 members, payable on Jan. 3, 2017. Active or“ term-vested” members would have received the lump-sum benefit payment, with interest, on their retirement date. The reduction in the TRS Plan 1 employer contribution would result in $ 75 million in state General Fund savings in the 2015-17 biennium, with an expected additional savings of $ 243.8 million in the 2017-19 biennium. The 25-year savings to the state General Fund is estimated at $ 1.5 billion. Initial criticism slowed progress of this bill early on. However, some legislators began to warm to the idea as session advanced. Not adopted by the Legislature, it is currently being reviewed by the Select Committee on Pension Policy, and will be a topic for discussion in 2017. in the state General Fund over a four-year period. It has been an effective tool for reducing fluctuations in state budgeting, minimizing the use of short term fixes, and reducing the number of unfunded future liabilities. However, because this provision is merely in state law, and not in the state Constitution, there are a number of ways to work around it. In order to strengthen the effectiveness of the law, Sen. Andy Hill, R-Redmond, put forward Senate Joint Resolution 8213. SJR 8213 would have taken the current four-year balanced budget law and placed it in the state Constitution. AWB supports this approach and looks forward to working on it again next year.
SJR 8215 voter approval to raise taxes
Failed / AWB Supported
Sponsored by Sen. John Braun, R-Centralia, Senate Joint Resolution 8215 cut straight through the middle of a discussion that has been going on in earnest since the passage of Initiative 601 in 1993. I-601 made statutory changes requiring a supermajority vote of both the House and Senate for any action that raised taxes. Over the years, this concept has continued to play a significant role in the legislative process. In 2013, the statutory supermajority requirement for tax increases was declared unconstitutional by the state Supreme Court. Since then, the conversation has refocused on making changes to the state constitution. SJR 8215 would amend the state constitution to require referral to the voters for any legislative action that raises taxes unless the action receives a supermajority vote, or the action is temporary and in response to a catastrophic event. AWB continues to support the supermajority approach to raising taxes and SJR 8215 is a commendable approach that represents an improvement to the status quo.
additional information
Budget Bills and Documents: fiscal. wa. gov / BudgetOBillsEnacted. aspx
Interactive Budget Reports: fiscal. wa. gov / BudgetO. aspx
SJR 8213 four-year balanced budget
Failed / AWB Supported
In 2012, the Legislature enacted a statutory four-year balanced budget provision. This provision requires the Legislature to leave a positive projected ending fund balance
Rep. Kristine Lytton, D-Anacortes, chairs the House Finance Committee.
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