Category: Democratic Party

Democratic Party, Elections, Environment, legislature

Longtime Legislator Carlyle Says He’s Going Out on Top

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By John Stang

On Monday, longtime state Sen. Reuven Carlyle, D-Seattle, announced that he won’t run for re-election. In an interview with PubliCola, Carlyle said he has “a deep sense of fulfillment” and is “taking the luxury of going out on top.”

He is the second Seattle state senator to announce that he won’t seek re-election, following Democratic Sen. David Frockt (D-46), who announced his retirement in October.

Seattle’s liberal legislators have gradually shifted further left over time, a trend that led to rumors that Carlyle would face a primary challenge from someone on the left. (As PubliCola reported Thursday, Rep. Noel Frame, D-36, has said she will seek the seat Carlyle is vacating.)

Carlyle said his party’s ongoing leftward tilt (at least in the Puget Sound region) had nothing to do with his decision to leave. Citing his margin of victory in 2018, when he won 89 percent of the vote, Carlyle said he wasn’t worried about reelection. As of Thursday, he had $135,000 remaining in his campaign account, according to state Public Disclosure Commission records.

Instead, Carlyle pointed to the 2021 passage of the Climate Commitment Act  as a crowning achievement of his legislative career. The Climate Commitment Act places a cap on greenhouse gas emissions while creating a program to auction off emissions allowances to large polluters. It took Carlyle several years to get the legislation passed, after first facing a hostile Republican-controlled Senate, then opposition from moderate Democrats in swing districts after his party took over the Senate in 2018.

Carlyle said his biggest unfulfilled wishes are eliminating the death penalty and bolstering the state’ data privacy laws — efforts that have passed the Senate, but stalled in the House.

“We won the Super Bowl of climate activities,”  he said.

The 2021 law requires the state Department of Ecology to create a system by 2023 capping the state’s annual industrial carbon emissions, a cap that slowly decreases over time—from almost 100 million tons in 2018 to 50 million by 2030 and 5 million by 2050.

The state will auction off parts of the overall annual limit to large polluters—those that emit 25,000 metric tons or more of greenhouse gases annually four times a year, and companies will be allowed to trade, buy and sell those allowances. The state estimates that about 100 companies produce that quantity of greenhouse gases, including the oil, cement, steel and power industries, and predicts that the auctions will raise about $500 million a year for projects aimed at reducing carbon emissions (and alleviating the impact of climate change) across the state.

Carlyle also sponsored a bill in 2019 that will phase out all coal-fired electricity in Washington by 2025 and eventually phase out natural-gas power as well. The new law sets a goal of 100 percent carbon-free electricity by 2045. Over the past several years, Carlyle said, “we have passed the strongest suite of climate change legislation in United States history at the state level.” Continue reading “Longtime Legislator Carlyle Says He’s Going Out on Top” →

Democratic Party, Elections, legislature, Morning Fizz, race

Republican Files Anti-CRT Bill, State Senator Carlyle Bows Out, Rep. Frame to Run

UPDATE (to the second item): State Rep. Noel Frame announced this morning on twitter that she’ll be running for Sen. Reuven Carlyle’s open seat.

 

1. Like other conservative lawmakers around the country, Washington state Republicans have introduced a bill to score cheap political points off their constituents’ outrage over critical race theory. The bill would create a statewide mandatory curriculum for K-8 history classes and bar schools from including any material related to the New York Time’s 1619 Project, Dr. Ibram X. Kendi’s book How to Be an Antiracist, and critical race theory in class curricula.

Critical race theory is a form of scholarly analysis of race, racism, and the law that is taught at the college and post-college level.  Over the past year, conservative activists have pushed CRT into the forefront of the culture war by claiming, falsely, that schools are using it to teach white children that they are both individually racist and responsible for systemic racism.

Now, Washington state Republican Jim Walsh (R-19, Aberdeen) is appealing to misinformed and outraged voters by proposing his own anti-CRT legislation. Walsh’s bill would require K-8 public schools to teach “age-appropriate” civics courses based on a list of 23 required reading materials that include the Federalist Papers, Adam Smith’s The Wealth of Nations; the second of John Locke’s Two Treatises of Government; the transcript of the first Lincoln-Douglas debate; and information about historical white supremacy and how it was “combatted through peaceful protest, civic engagement, and the American courts.”

Walsh said he came up with the list by consulting with his constituents rather than educational professionals: “I think the people of Washington are who we should listen to, not self-appointed experts.”

According to the ACLU of Washington’s Youth Policy Counsel, Kendrick Washington, the bill is “censorship, plain and simple,” as it prohibits teachers from discussing “issues of the most profound national importance, such as the impact of systemic racism in our society.” Washington said the bill would force all state public schools to continue teaching  “bland, average” U.S. history, , and make it difficult for schools to add diverse historical perspectives to their curricula. Although individual teachers could choose to add other reading material, such as the 1619 Project, to the list, teachers would be barred from “giving deference to any one perspective” on the additional reading material.

2. Longtime state Senator Reuven Carlyle (D-36, Seattle) announced Monday that he would not run for re-election this November when his term expires. While many of his colleagues in Olympia are looking back at Carlyle’s legacy as an environmental champion and as a stickler for tax fairness and budget transparency, we’re wondering who’ll take his place.

The district’s two  state representatives, Noel Frame and Liz Berry, are both poised for the position. Although Frame has seniority, serving in the House since 2016, she already plays a vital role for the Democrats as the House Finance Committee Chair and may not want to give up the role. Last year, Frame pushed the capital-gains tax through the legislature, something state Democrats had been trying to do for a decade. Berry, who was first elected in 2020, is vice chair of  the House Labor Committee.

Both Frame and Berry congratulated Carlyle on social media. On her Facebook page, Frame said she and Berry are “asking for a little bit of time to evaluate what move makes the most sense for advancing our shared values and moving forward a progressive policy agenda” in the legislature.

The process for replacing Carlyle, who may have been worried about an intra-party primary challenge similar to the one that gave moderate state Sen. Mark Mullet (D-5, East King County, Issaquah)  a scare, is not an anointment; as always, voters will make the final decision through the primary and general-election process this year.

—Leo Brine

 

Democratic Party, Elections, labor, Transit, Transportation

Sound Transit CEO Rogoff Out Next Year, Labor Council Wades Into Sawant Fray, 43rd Democrats Divided on Dow

1. Learn to trust the Fizz: Sound Transit CEO Peter Rogoff will leave the agency next spring. On Thursday, Sound Transit board members voted to approve the terms of Rogoff’s departure and queuing up a national search for his replacement.

The announcement came two weeks after the board removed what had seemed to be a standard one-year renewal of Rogoff’s contract from their regular agenda, after a nearly two-hour executive session in which board members discussed his performance as director of the agency. Board members also retreated to a lengthy executive session during Thursday’s meeting before emerging with the news that Rogoff “did not foresee continuing in his role,” in the words of board chair Kent Keel.

As PubliCola reported in early September, board members have spent the last month discussing whether to renew Rogoff’s contract, raising questions about Rogoff’s leadership style as well as large cost increases—largely for property acquisition—that forced the board to adopt a “realignment” plan for the voter-approved Sound Transit 3 package earlier this year. Mayor Jenny Durkan King County Council member Claudia Balducci, and King County Executive Dow Constantine are among the board members who brought up concerns publicly and internally.

According to a report by an independent consultant, Triunity, the cost increases were worsened by the fact that various divisions of the agency didn’t communicate with each other, thanks to a “siloed” organizational structure and a culture of keeping bad news under wraps. Another issue: Sound Transit, under Rogoff’s leadership, has been slow to make decisions that could reduce costs, such as choosing a single preferred alignment for light rail expansion instead of continuing to study many different options.

Durkan, one of two board members to vote against retaining Rogoff after allegations that he acted inappropriately around female staff, did not join in the round of praise for Rogoff that followed the board vote Thursday. After a round of effusive praise for Rogoff (Auburn Mayor Nancy Backus: “We should be very grateful as a board and a region for his expertise and skills”), Balducci’s comments focused mostly on Rogoff’s early years at the agency, calling him a steady hand when the agency was struggling to get its bearings

“We were trying… to build this incredibly ambitious and future-looking transit plan, to finally meet the promise of what we have needed and wanted in this region for over 50 years,” Balducci said. “Peter stepped in in the middle of that and quickly got his bearings and helped to bring us home.”

Rogoff will receive severance worth one year’s salary, plus unused vacation time and other benefits outlined in his contract. Speaking after the vote, Rogoff said he has found the job “simultaneously exhilarating and exhausting,” sometimes leaning more toward the latter. “I will continue to be the loudest cheerleader for Sound Transit’s staff and all of their accomplishments even after I step to the sidelines next year,” he said.

2. The King County Labor Council, which represents around 150 unions in King County, tweeted on Thursday urging Seattle City Councilmember Kshama Sawant to stop “meddling” and “interfering” in the internal business of the Pacific Northwest Carpenters Union, which is currently on strike over a contract that a majority of members rejected over issues including pay, contract length, and parking reimbursements. “Ask how you can support instead of being a nuisance,” the Labor Council said.

Sawant began inserting herself into the debate earlier this month, when she issued statements and held a rally urging union members to vote “no” on the contract. Union leaders, including the head of the anti-Sawant Building Trades Union as well as the Carpenters’ Union itself, have repeatedly asked Sawant to stay out of their negotiations. “[N]o politician should be meddling in a private sector union contract negotiation,” Washington State Building Trades vice president Chris McClaine said. “It only helps those who want to destroy worker unions and take money out of workers’ paychecks.”

This week, Sawant issued a flurry of statements supporting the strike, touting her own promise to contribute $10,000 (up from an initial pledge of $2,000) to the carpenters’ strike fund, and showcasing a letter of support from several dozen carpenters’ union members for “stepp[ing] forward in solidarity” with the strike. The $10,000 pledge will come from the Sawant Solidarity Fund, which supports various political efforts and campaigns.

Sawant also said this week that she will introduce legislation to “require construction contractors to fully pay for workers’ parking costs, strengthen enforcement and penalties for wage theft, and restore [the] right to strike” at sites with a project labor agreement (PLA)—a bargained agreement between the union and contractors that prohibits workers from walking off the job. PLA sites in Seattle include the NHL hockey arena, the downtown convention center, and Sound Transit’s ongoing light rail construction.

It’s unclear when Sawant plans to introduce the legislation or what mechanism it would contain for requiring specific parking reimbursements, which are currently included in union contracts, not dictated by legislation.

3. The 43rd Legislative District Democrats failed to reach an endorsement for King County Executive at their endorsement meeting Tuesday night, a victory of sorts for incumbent Dow Constantine after a series of landslide votes for lefty candidates in other races. Constantine received a little over 43 percent of the vote to his challenger, state Sen. Joe Nguyen’s, 54 percent.

That may not seem like a blowout, but compared to the district’s sweeping support for other progressive candidates—city attorney candidate Nicole Thomas Kennedy, City Council candidate Nikkita Oliver, and mayoral candidate Lorena González all received first-round votes of at least 75 percent—Nguyen’s 54 percent showing looked limp.

“We cannot wait for the status quo to solve the problems that have been impacting us for decades and they especially won’t be solved by those who helped create them,” Nguyen said before the vote. Constantine responded to this by highlighting the county’s work responding to the COVID pandemic, including the imposition of a countywide vaccine mandate for indoor and large outdoor events. “This is the kind of difficult work that real leaders do. I’ve never been much for bluster,” Constantine said.

Democratic Party, homelessness, human services, Mayor Durkan, Morning Fizz, Parks, Police

Another Sweep in Ballard, JustCARE Disputes Mayor’s Cost Claims, and Former County Dems Leader Resigns

1. On Friday, the city will remove any tents that remain at Gilman Playfield in Ballard, part of a wider strategy of removing encampments that are near schools, playgrounds and sports fields. The Gilman sweep comes after similar encampment removals at Rainier Playfield and Miller Park on Capitol Hill, which the mayor’s office said were necessary to make the parks “safe and accessible” to students and children playing sports.

Mayoral spokeswoman Rachel Schulkin said the Seattle Police Department responded 61 times in the past six months to “calls including disturbances, domestic violence, and other suspicious or potentially dangerous activity at the playground,” and that the fire department had responded to another 11 calls. Additionally, “Youth sports team coaches, parents, and neighbors have been reaching out to the City over the past few months with various safety concerns and to express their frustrations over not being able to use the field for youth sports,” Schulkin said.

On the day a jury found Derek Chauvin guilty of murdering George Floyd, the account retweeted a post from the Kent Police Department that read, “If you’re celebrating 420 today, DON’T DRIVE. Pop a squat on your 70s basement couch, play some Boston in the background, binge watch Fast Times and eat Doritos.” When a reader called the tweet “tone deaf,” the Kent account responded, “Just want to encourage people to be safe if they’re celebrating today 😊.”

The encampment was quiet on Wednesday morning, as outreach workers went from tent to tent to discuss options with the people living in the park. None of the tents were on the playground or the nearby playfield; the biggest concentration was in a shaded area near the restrooms and on the sidewalk outside the playfield fence.

According to an outreach worker on site, most of the residents would be offered rooms at the Executive Pacific Hotel downtown; if the majority of the dozens of people living in the park accept placements, the hotel would be essentially full, although some people who moved into the hotel have reportedly left without receiving permanent housing placements.

Encampment removals slowed down dramatically during the first year of the COVID-19 pandemic but have been ramping back up this spring, including the removal of tents and encampment residents from University Playfield near I-5 last weekend.

Also Wednesday, the JustCARE program moved a number of people living in Pioneer Square near the historic First Avenue pergola to its own hotel-based shelters, the Navigation Center, and the Executive Pacific Hotel, most likely making a planned sweep of that encampment unnecessary; the city is reportedly planning additional encampment removals in Pioneer Square and the International District in the coming weeks.

2. Mayor Jenny Durkan has repeatedly claimed that JustCARE costs more than $100,000 a person, a claim that has so frustrated the organizations supporting the program that they produced a flyer outlining what they say the program costs “at scale”: Just under $50,000 a client, half of which is the cost of hotel rooms themselves.

Durkan’s office has shown little interest in expanding JustCARE, which is a joint project of the Public Defender Association, Asian Counseling and Referral Service, REACH, and other groups, arguing that there are cheaper options that do the same thing.

A spokeswoman for the mayor’s office provided a chart outlining the budget for King County’s extension of JustCARE, which comes in at an average of $104,000 a month per room. The mayor’s office says that they have always calculated and compared costs on a “per room” basis than a “per person” basis, a claim the PDA disputes. The PDA says that its cost estimate of around $49,000 per client is based on a longer-term model that would bring the program to “scale,” renting “more than twice as many rooms in the same hotels, and [serving] more than twice as many participants,” according to PDA director Lisa Daugaard.

In February, the city rejected a proposal that would have effectively expanded JustCARE by moving clients into the Executive Pacific Hotel downtown, insisting that they could not spend a penny more than $17,000 per client plus the cost of the rooms themselves.

Ultimately, the city signed two contracts for hotel-based shelters, with the Low-Income Housing Institute and Chief Seattle Club, that came in significantly above the $17,000 cap.

Mayoral spokeswoman Kamaria Hightower told PubliCola, “We absolutely agree that a provider contract should be a longer-term commitment both for clients and efficiency and understand the county is seeking that approach. That’s why we created our hotel programs that are a year long and include rapid rehousing resources (and some [permanent supportive housing] resources).

3. Bailey Stober, the former director of the King County Democrats who lost his job after an investigation found him guilty of sexual harassment and workplace misconduct, is leaving his latest job as communications manager for Kent Mayor Dana Ralph under circumstances that remain unclear. Ralph would not provide details about why Stober is leaving, but confirmed that he has “resigned his position effective June 1.”

Contacted by email, Stober said, “When I took the job, I came to Kent from Texas and told the Mayor I would give her 18 months to two years and then my plan was to return to Texas. I took a great job offer in Texas and as I enter my 18/19th month with the city I’ve finished the projects I wanted to finish and am happily going back to Texas.”

Stober is the anonymous voice behind the city of Kent’s Twitter account, which gained thousands of followers for its puerile tweets mocking other cities and making jokes about “nuggs.” (Here are some lyrics the account  posted at 9:00 on a Friday night.)

On the day a jury found Derek Chauvin guilty of murdering George Floyd, the city of Kent account retweeted a post from the Kent Police Department that read, “If you’re celebrating 420 today, DON’T DRIVE. Pop a squat on your 70s basement couch, play some Boston in the background, binge watch Fast Times and eat Doritos. Be chill and stay off the roads.” When a reader called the tweet “tone deaf,” the Kent account responded, “Just want to encourage people to be safe if they’re celebrating today 😊.” Unlike many other local jurisdictions, the city did not acknowledge the Chauvin verdict on its Twitter account.

Earlier this year, Ralph stood by Stober when he got kicked out of a local bar after allegedly inciting a massive brawl and calling both Ralph and the chief of police and threatening to have the bar’s liquor license revoked.

Courts, criminal justice, Democratic Party, Drugs, legislature, Morning Fizz, Taxes, Transit, Uncategorized

Oly Fizz: Wealth Tax Dies, State Could Re-Criminalize Drug Possession, Sound Transit Gets Green Light to Fix Fare Enforcement

1. A proposed 1 percent tax on the wealth of 100 or so very rich Washington state residents is dead for this year. The cause of death: The House Appropriations Committee did not include the wealth tax (HB 1406) on this week’s committee agenda, which means the bill will not move forward. The bill had detractors in both parties and never advanced past the House, where it has languished since early April. The session ends next Sunday, April 25.

The chair of the House Appropriations Committee, Rep. Timm Ormsby (D-3, Spokane) said the committee was prioritizing bills that have gone through the legislative process. The committee is hearing only four Senate bills this week, including the cap-and-trade bill (SB 5126) and a bill addressing the State v. Blake decision, which effectively decriminalized simple drug possession in Washington state (SB 5476).

Tax reform bills arguably had a better chance of passing this year than any time in recent memory, with Democrats firmly in control of both houses and the pandemic exposing the economic gulf between the very wealthy and everyone else.

While legislators did pass some progressive legislation that had been in the works for years, including the working families tax exemption (HB 1297), and the capital gains tax (included in the budget), the wealth tax stalled.

Tax reform advocates say because the wealth tax is the first legislation of its kind in the nation, it will take some time before legislators start pushing the policy forward. “I don’t think that’s necessarily the best thing about the legislative process,” Misha Werschkul, executive director of the Washington State Budget and Policy Center, said. “If there’s a good idea, there’s no reason not to pass it the first year it’s introduced.” However, Werschkul and other advocates said they think the wealth tax has enough momentum to move faster than previous tax bills.

2. The House of Representatives is considering a bill that would re-establish a criminal penalty for drug possession in response to the state supreme court’s landmark ruling in February that effectively decriminalized drug possession.

In that decision, State of Washington v. Blake, the court ruled that Washington’s so-called “strict liability” drug possession laws—which made no distinction between intentional and unintentional drug possession—were incompatible with the due process rights enshrined in both the state and federal constitutions. The court’s decision rendered Washington’s existing drug possession laws toothless, sending lawmakers, prosecutors and attorneys statewide scrambling to adjust to the sudden end of decades of harsh drug policies.

In the legislature, a group of lawmakers saw an opportunity to cement de-criminalization in Washington law by rewriting the state’s drug possession statutes. Sen. Manka Dhingra (D-45, Bellevue) led the charge in the state senate, drafting a bill that would have removed all criminal penalties for possessing a “personal use amount” of an illegal drug—up to one gram of heroin or two grams of methamphetamine, for example. The bill also proposed a system in which law enforcement could pass the names and contact information of drug users to a “care coordinator,” who would then reach out to the drug user to offer treatment and recovery resources.

As the end of the legislative session approached, senate Democrats rushed to adjust the bill to reach an agreement with some of their Republican counterparts. The resulting amendments, Dhingra wrote in a press release last week, no longer reflected a “treatment-first approach” to drug use. Instead, the revised bill would impose a gross misdemeanor charge for drug possession—making no distinction between a “personal use amount” and larger quantities.

While the re-worked bill would require prosecutors to divert people charged with drug possession to addiction treatment for their first and second violations, it would grant prosecutors leeway to decide whether a person is eligible for treatment after their third violation, re-introducing the possibility of fines or jail time.

Dhingra, still listed as the bill’s sponsor, chose not to vote in support of her bill when it passed the senate last week. “I understand the importance of keeping a statewide policy response moving, and this compromise was the only way to do that,” she wrote in the press release. “Too many lives, especially Black and brown lives, will continue to be shattered by a criminal justice approach to what is fundamentally a public health problem.”

The legislation is now one of two bills written in response to the Blake decision before the House Appropriations Committee. The other, sponsored by Rep. Roger Goodman (D-45, Woodinville) and Rep. Tara Simmons (D-23, Bainbridge Island), would make possession of a “personal use amount” of illegal drugs a civil infraction.

3. Governor Jay Inslee signed legislation last week (HB 1301) that authorizes Sound Transit to create an “alternate fare enforcement system,” removing what the agency called the primary legal obstacle preventing it from decriminalizing fare nonpayment on buses and trains. Unlike King County Metro, Sound Transit has resisted calls to end its punitive approach to fare enforcement, arguing that a more lenient policy would lead to revenue loss as people realize they can get away with riding for free.

Under existing policy (which Sound Transit is not currently enforcing), people who fail to show proof of payment more than once in a year receive a ticket and $124 fine; if they fail to pay the fine, they can face criminal charges.

Advocates for low-income transit riders have long argued that this policy is too punitive and disproportionately impacts low-income people and people of color; in 2019; King County Metro revised its own, similar rules to take fare enforcement out of the courts and give riders multiple alternatives to paying fines. Sound Transit said it would like to consider decriminalizing fare enforcement, but its enabling legislation required the fines.

For the next year, as part of a pilot program aimed at testing out potential long-term changes, Sound Transit isn’t issuing citations and has replaced private security guards with “fare enforcement ambassadors” who work to educate people about how and when to pay their fare and how to access low-income ORCA cards, among other changes.

Democratic Party, legislature, State of Washington, Taxes

State Wealth Tax Proposal Derailed in Olympia
State Rep. Noel Frame
State Rep. Noel Frame

by Leo Brine

With Democrats firmly in control of all three branches of state government, lefty tax reform advocates hoped for bold legislation this year. Indeed, with newly-elected President Joe Biden—and the crushing COVID-19 recession—making old-fashioned liberal tax policy viable for the first time in a generation, progressive taxation is in vogue in the state legislature.

Kinda. While both the House and Senate included the capital gains tax (SB 5096), a longstanding progressive goal, in their operating budget proposals, a proposed wealth tax (HB 1406), the first of its kind in the nation, is not on track to pass this session.

The wealth tax would require any state resident with more than $1 billion in intangible financial assets, such as stocks and bonds, to pay a one percent tax on their worldwide wealth. The Department of Revenue estimates only 100 Washington taxpayers would pay the tax, which would generate $2.5 billion annually.

Rep. Noel Frame (D-36, Seattle), the wealth tax’s prime sponsor and chair of the house finance committee, said if Republicans don’t agree to move the bill, she doesn’t want to waste the committee’s time with political theater on a bill that still has a long way to go. 

House Democrats passed the bill out of the Finance Committee on March 31 and sent it to the Appropriations Committee.

Republicans have made it clear they do not support the tax and some Democrats have shown opposition to the bill –two Democratic representatives voted against the bill in House Finance Committee on March 31. While Democrats may still have the votes to move the bill out of Appropriations committee, they’re not sure they’ve got the time, given that it’s this far behind in the process and the committee has Senate bills to consider.

Rep. Noel Frame (D-36, Seattle), the wealth tax’s prime sponsor and chair of the house finance committee, said if Republicans don’t agree to move the bill, she doesn’t want to waste the committee’s time with political theater on a bill that still has a long way to go.  “We’ve asked a lot of our staff, and I’m not inclined to ask them to do more in service of a bill that I don’t, at this moment in time, with 13 days left, see getting across the finish line this session,” Rep. Frame said.

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Rep. Timm Ormsby (D-3, Spokane), the chair of the House Appropriations Committee, said that at this point, bills “are going to need to be agreed to by both sides in order to make it through the process, so we don’t have a show hearing, as opposed to using our time most efficiently for bills that will pass.”

Misha Werschkul, the executive director of the Washington State Budget and Policy Center, said the legislature likely prioritized the capital gains tax because the bill was “developed over several years to have that strong support to move forward.” Continue reading “State Wealth Tax Proposal Derailed in Olympia” →

Democratic Party, Equity, homelessness, housing, income inequality, legislature, Morning Fizz, Renters, Uncategorized

Olympia Fizz: House Committee Passes Wealth Tax, House and Senate Take Action on Tenant Rights and Funding

1. After nearly two months of inaction, the House Finance committee passed the progressive wealth tax (HB 1406) out of committee Wednesday morning. The bill made it out of committee with no amendments, despite Republican efforts.

The wealth tax is arguably the most progressive piece of tax reform legislation this session; the House is taking the lead, while the Senate took the lead on the capital gains tax.

The wealth tax legislation would require anyone with more than $1 billion in intangible financial assets, such as stocks, bonds, or cash, to pay a one percent tax on their worldwide cumulative wealth. The Department of Revenue estimates the tax will affect 100 Washington state taxpayers and generate $5 billion per biennium.

Finance committee chair Rep. Noel Frame (D-36, Seattle) urged her colleagues to vote yes on the bill so the state could begin rebalancing Washington’s tax system, which, according to the progressive Institute on Taxation and Economic Policy, forces the lowest income Washingtonians to spend 18 percent of their income on taxes while the very wealthiest spend just 3 percent of their income on taxes.

“The Washington state wealth tax would take a giant step forward in trying to right that wrong by asking the wealthiest Washingtonians, including some of the wealthiest people in the world, to pay their fair share,” Rep. Frame said.

Members of the finance committee passed the bill 9-7 with Democratic senators April Berg (D-44, Mill Creek) and Larry Springer (D-45, Kirkland) along with all Republican committee members, voting no. PubliCola has reached out to both Berg and Springer for comment.

Patinkin Research Strategies found that 58 percent of Washingtonians support the tax and just 32 percent are opposed. (The pollster gets a B/C rating from 538.)

According to Frame, the legislature will direct revenue from the wealth tax into a dedicated Tax Justice and Equity fund, rather than into the state’s general fund as the bill originally specified. Legislators will use the Tax Justice and Equity fund to support an anti-displacement property tax exemption (HB 1494) that the finance committee also passed Wednesday.

The finance committee passed the wealth tax in their last regularly scheduled meeting of the session. April 2 will be the last day for finance bills to be read into the record on the house floor, leaving little time for the bill to be deliberated on in the Rules committee, which will take up the bill next. If Rules passes it out, the bill will go to the House floor where progressives hope to send it to the Senate.

2. The Legislature’s latest biennial budget proposals made two traditional foes, tenants and landlords, happy—with some footnotes.

In budgets released this week, legislators from the House and Senate allocated roughly $1 billion to new rental assistance and eviction protection programs. (The House allocates $1 billion, the Senate $850 million). The state will use the money to pay off rent debt accrued by tenants during the statewide eviction moratorium and fund legal counsel in eviction cases.

Continue reading “Olympia Fizz: House Committee Passes Wealth Tax, House and Senate Take Action on Tenant Rights and Funding” →

Democratic Party, legislature, State of Washington, Taxes

Democrats Include Capital Gains Tax In Budget Proposals

by Leo Brine

Senate and House Democrats unveiled their operating budget proposals for the 2021-23 biennium late last week. Both budgets included the capital gains tax (SB 5096), signaling that Democrats expect the House to pass the dramatic bill and Gov. Inslee to sign it.

Senators passed the capital gains tax on March 6. The House Finance committee has held a public hearing for the bill, but has yet to pass it out of committee and send it to the House floor. The lead budget writer, Senator Christine Rolfes (D-23, Bainbridge Island), said Democrats included the tax in the budget because the bill had, for the first time, passed the Senate, and “it’s the Senate’s practice to book [earmark] revenue that we passed.”

Representative Noel Frame (D-36, Seattle) said she’s confident the House will pass the bill which she said is why it is included in the House’s proposal. “We booked it in the budget in years past,” Rep. Frame said, “we built it into the budget this year and we are confident it will continue to move.”

Legislators in the House and Senate expect the 7 percent tax on capital gains of more than $250,000, which takes effect in July 2022, to generate more than $350 million a year beginning in 2023. Rolfes said the revenue generated from the tax in the senate’s proposal would eventually help fund the Taxpayer Fairness account, which provides funding for the working families tax exemption for low-income Washingtonians (HB 1297).

Continue reading “Democrats Include Capital Gains Tax In Budget Proposals” →

Democratic Party, legislature, Taxes

Democratic State Senate Sends Capital Gains Tax to House
State Sen. June Robinson (D-38, Everett)

by Leo Brine

For the first time in Washington state history, state legislators had a floor vote on a long-proposed capital gains tax. Even more novel: They passed it.

As expected, on Saturday, March 6, the Senate Democrats, led by Sen. June Robinson (D-38, Everett) pushed SB 5096 through the senate. The bill passed 25 to 24 with most of the Democratic majority, including all of Seattle’s delegation, voting for it. The entire Republican caucus, along with moderate Democratic Senators Steve Hobbs (D-44, Lake Stevens), Mark Mullet (D-5, Issaquah), Annette Cleveland (D-49, Vancouver) and Tim Sheldon (D-35, Potlatch), voted against the bill. A capital gains tax has been part of Governor Jay Inslee’s biennial budget proposals since 2014 and has appeared in every biennial budget proposal since.

The bill proposes a 7 percent tax on capital gains—profits from the sale of stocks, bonds and other long-term assets—over $250,000; the Washington State Department of Revenue estimates that fewer than 20,000 people statewide will be subject to the tax. The bill would take effect in 2022 and an amendment adopted Saturday requires the threshold amount to be adjusted for inflation annually.

The tax excludes capital gains from the sale of real estate, farming and ranching livestock, certain agricultural land sales, timber and timberlands and retirement accounts.

After debating 19 amendments, the senate adopted three, including one that irks progressives; the amendment, inserted in the bill by centrist Sen. Steve Hobbs, struck down the emergency clause that would have protected the bill against a voter referendum.

The other two amendments were proposed by bill sponsor Robinson and another by Sen. Marko Liias (D-21, Lynnwood), respectively.

At most 18,000 people or, roughly 0.24 percent of Washingtonians, will have to pay this tax.

Robinson’s amendment directs the first $350 million collected per fiscal year from the tax to go into the state’s Education Legacy Trust account with the following $100 million going into the state’s general fund. Any more collected would go into a “Taxpayer Relief Account,” which will fund tax breaks for low-income Washingtonians.

Democrats are using the revenue from the capital gains tax to fund another bill the Democratic senate recently passed, a child care bill aimed at expanding affordable child care and early childhood development programs in the state. Democrats say the pandemic has illuminated and exacerbated the issue of unaffordable child care.

That’s certainly good scripting from the Democrats, especially if the legislation goes to a referendum. And there’s no question the pandemic has dramatized inequities in child care. But the pandemic has highlighted all kinds of systemic inequities.

Sen. Liias’ amendment stops people from being taxed twice on real estate sales. Washington’s real estate excise tax (REET) taxes the sale of all real property. To prevent the taxes from stacking, the amendment specifies transactions subject to REET would not also be subject to the capital gains tax.

The most significant amendment, however, was Hobbs’ amendment to strip the emergency clause out of the bill. Hobbs, a moderate Democrat who emerged a decade ago as a sometimes GOP ally during the Republicans’ successful efforts to wrest control from the majority Democrats, said there was no need for an emergency clause; the clause would have put the tax into effect immediately.

There was no floor debate over Hobbs’ amendment. Continue reading “Democratic State Senate Sends Capital Gains Tax to House” →

Democratic Party, legislature, State of Washington, Taxes

Democrats’ Capital Gains Tax Passes First Legislative Hurdle

By Shauna Sowersby

Democrats have proposed several bills this session aimed at taxing the richest Washingtonians, and they passed one of them, a capital gains tax, out of the Senate Ways & Means Committee on Feb. 16, meeting an early session deadline. You can never count out fiscal bills in the state legislature, so some of the other bills, including a wealth tax, could factor in later in the session, but the capital gains tax, SB 5096, now has some momentum.

The bill is being sponsored by Sen. June Robinson (D-38, Everett), at the request of the state Office of Financial Management. Robinson is the Vice Chair of the Senate Ways & Means Committee.

The bill would impose a 7 percent tax on profits of more than $250,000 that result from the sale of certain assets, including stocks, bonds and mutual funds. Unlike a similar capital gains tax that was introduced in the House, Robinson’s version would exclude real estate sales. Other types of capital assets including retirement accounts, timber and certain types of agricultural land would be excluded as well. 

Wealthy households in the state currently only pay about 3 percent of their income in taxes, while the poorest pay more than 17 percent.

Scott Merriman, a legislative liaison for OFM, noted that the measure is a way to balance Washington’s tax code, which is one of the most regressive in the country. In addition to having no state income tax, Washington is one of just nine states that does not have a capital gains tax. Because revenue in the state is heavily dependent on property tax and sales tax, wealthy households in the state currently only pay about 3 percent of their income in taxes, while the poorest pay more than 17 percent, according to a 2018 report by the Institute on Taxation and Economic Policy. 

“This bill is a key part of helping to provide the resources to support the proposed expenditures in the budget for your consideration,” Merriman told the committee.

In Robinson’s bill, $350 million of the yearly revenue from the capital gains tax would go towards the state Education Legacy Trust Account, which would help fund education. The rest, an estimated $200 million, would be put into a new account called the Taxpayer Relief Account, whose exact purpose legislators have not determined.  Continue reading “Democrats’ Capital Gains Tax Passes First Legislative Hurdle” →