Washington Business Fall 2017 | Legislative Review & Vote Record | Page 35

issue area reports | environment
Nicole Luckey of Invenergy testifies before the House Technology and Economic
Development Committee.
HB 1555/SB 5127
governor inslee’s carbon
tax proposal
Failed/AWB Opposed
The governor began the legislative session
with a proposed budget assuming $3.9
billion of new carbon tax revenue for the
2017-2019 biennium. The carbon tax policy
bills were sponsored by Rep. Kristine
Lytton, D-Anacortes, and Sen. John Braun,
R-Centralia; as chairs of House and Senate
budget and tax committees. The proposal
would have taxed carbon equivalents at $25
per metric ton beginning in May 2018, and
would have allocated almost 60 percent of
revenues toward education, 25 percent for
utilities, transportation and water projects,
10 percent for carbon-reducing projects,
and 5 percent for energy-related social
support such as the aged, blind, or disabled
cash assistance program, the temporary
assistance for needy families program, and
the low-income home energy assistance
program. The business community strongly
Bill considered as part of
AWB’s voting record
opposed using carbon tax revenues in the
state’s General Fund for education, social
services, or other programs without a
“logical nexus” to carbon reduction for
two distinct reasons: education costs are
expected to increase into the future, while
collections from a well-designed carbon
excise tax should decrease over time;
and tying future fiscal needs to carbon
emissions creates an incentive to increase
emissions standards to gain tax revenue.
The governor’s proposal was not heard in
the House Finance Committee, and was
referred to the Senate Rules Committee
without recommendation.
HB 1646/SB 5509
House Bill 1646 (with Sen. Reuven Carlyle,
D -Seattle, sponsoring the companion
Senate Bill 5509). HB 1646 envisioned an
“equitable transition” to a future without
carbon-based transportation and electricity
by taxing carbon at a $15 per ton annually,
escalating to over $100 dollars plus inflation
in 2047. The proposal would have set aside
a $50 million appropriation through the
state operating budget to compensate
and retrain workers displaced in the
transition, such as those with careers in
petroleum engineering at Washington’s
five refineries. Remaining funds would have
been dedicated to dozens of programmatic
grants at over eight state agencies through
a complex allocation formula toward
infrastructure, transit, housing, water,
fire and other projects. Additionally, 25
percent of all funding would have been
required to benefit disproportionately-
impacted communities as defined by a new
state Department of Health study, and a
low-income tax direct deposit (based on
marital status, dependents, and income)
was included in a section of the bill without
a specified funding source. HB 1646 also
would have increased the state’s statutory
emissions reduction targets by 60 percent.
The bill was not moved out of the House
Environment Committee, but the Alliance
for Jobs and Clean Energy has stated the
group will collaborate with other groups
to introduce a similar policy via ballot
initiative in 2018.
clean energy economy
transition carbon tax SB 5385
Failed/AWB Opposed Failed/AWB Opposed
The Alliance for Jobs and Clean Energy —
a coalition of roughly 160 environmental,
labor and social groups — worked with
Rep. Joe Fitzgibbon, D-Burien, to draft Sen. Steve Hobbs, D -Lake Stevens,
introduced a carbon tax bill in an attempt
to reconcile Gov. Jay Inslee’s carbon-based
budget proposal with a more predictable
Favorable outcome for
Washington businesses
carbon pollution tax
Missed Opportunities
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