After a five-hour debate, the Democratic majority in the state Senate narrowly passed a cap-and-trade bill (SB 5126) last Thursday night on a 25-24 vote. The bill taxes large companies that emit large amounts of carbon dioxide and other greenhouse gases by requiring them to buy permits from the state to compensate for every ton of carbon dioxide they produce.
The proceeds from the permits would go into a new Climate Investment Account that would fund things like greenhouse gas mitigation, clean transportation and transportation alternatives, and clean energy programs.
Republican senators prolonged the debate with 45 amendments; they passed three of them.
Later in the night, and with much more ease, Democratic senators passed the House’s clean fuels bill (HB 1091). Governor Jay Inslee had requested both bills.
Three Democrats voted no: Bob Hasegawa (D-11, Seattle); Liz Lovelett (D-40, Anacortes); and Kevin Van De Wege (D-24, Sequim). Every Republican voted against the bill.
None of the three amendments Republicans passed alter the underlying framework of the bill. One directs the Department of Ecology to create a website showing which companies are participating in cap-and-trade program; another requires the department to notify the legislature when a company is no longer part of the program—a political move by Republicans to demonstrate that cap and trade doesn’t work.
Republican senators spent most of the five-hour floor debate giving speeches about how much the bill, in their view, would ultimately cost working-class Washingtonians.
Republicans such as Senator Doug Ericksen (R-42, Bellingham), said the bill—which he referred to exclusively as “cap-and-tax”—would force companies to raise the prices on their goods, specifically on gas, and pass the cost on to consumers. Judy Warnick, another Republican senator (R-13, Moses Lake), said she was taking a stand for mom-and-pop farms and ranchers who would also need to lower the emissions in their production process under the bill.
Moderate Democratic Senator Mark Mullet (D-5, Issaquah) added an amendment that gives industries that are vulnerable to foreign competition, like steel and oil refineries, more time to reduce the amount of carbon emissions in their production process. The amendment also gives the companies free emissions permits while they make their adjustments. But the companies will have to lower their emissions at pro-rated, faster rates once the adjustment period ends.
Some Democratic senators, like freshman Senator T’wina Nobles (D-28, Tacoma) had issues with the bill, arguing that it does not lower emissions fast enough or low enough and is unclear on how it will invest in and assist communities who have been negatively impacted by air pollution because of their proximity to highways. Continue reading “Cap and Trade Moves Forward Over Republican and Some Democratic Opposition”→
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”→
1. City council member Lorena Gonzalez reportedly hopes to introduce legislation in the next few weeks that would require businesses to provide paid family leave to their employees—a significant expansion of a new law, adopted on Monday after a months-long delay, guaranteeing 12 weeks of paid parental leave to city employees. (Employees who need time off to care for other family members can receive up to four weeks off).
Expanding family leave to private employees—as Gonzalez talked about doing when she ran for office in 2015—would likely be far more controversial, especially among small businesses and those that primarily employ service workers, than the city-employee-only law. But the real opposition may come from Olympia, where state legislators are considering a fairly toothless family leave bill that includes a preemption clause that prevents any city from adopting a family leave policy more generous than what the state requires.
The Republican-backed bill, sponsored by 47th District Sen. Joe Fain, would provide up to eight weeks of family leave, increasing up to a maximum of 12 weeks by 2023. Employees who took the time off would be paid just half of their regular wages (rising to a maximum of 67 percent in 2023), and the program would be funded entirely by employees’ own contributions, making it more of a self-insurance policy than an actual benefit. It also requires employees to work for 26 consecutive weeks for a single employer before they receive benefits—a requirement that Economic Opportunity Institute policy director Marilyn Watkins says doesn’t acknowledge the current economic reality, where many people work multiple jobs or switch employers frequently. “It just leaves a lot of people out who are going to end up paying the premium but are never going to meet the qualification to get leave,” Watkins says. “Why should we put things in there that we know are going to be problems—that we know are going to cause inequities?”
According to the bill, “Cities, towns, and counties or other municipalities may enact only those laws and ordinances relating to paid family leave that are specifically authorized by state law and are consistent with this chapter. Local laws and ordinances in existence on the effective date of this section that are inconsistent with this chapter are preempted and repealed.” That means that if the bill passes, any city law providing more leave (and it wouldn’t be hard) will be repealed.
Preemption bills like this aren’t uncommon; they pop up pretty much any time Seattle passes or discusses progressive policies, such as rules allowing safe-injection sites, encampment sweeps policies that Republicans view as soft on homelessness, or a $15 minimum wage. What could be different this year is that Fain’s bill has bipartisan support; in addition to the usual Republican suspects like Michael Baumgartner (R-6) and Mark Miloscia (R-30), the bill is sponsored by Democrats like Steve Hobbs (D-44) and Guy Palumbo (D-1). A competing bill, sponsored by Sen. Karen Keiser (D-33), would provide more extensive benefits and does not include a preemption clause.
Fain said at a hearing last month that he hopes advocates recognize that “nobody ever went hungry on half a loaf”—meaning, some progress toward true paid family leave is better than none. But advocates may decide they want a full loaf after all, and take the family leave issue directly to voters if legislators offer them only crumbs.
2. Miller Park Neighbors memberJonathan Swift, who emceed a Wednesday-night prep session for an upcoming city-sponsored meeting about proposed upzones in Northeast Capitol Hill—said he was interested in a balanced discussion. Then he characterized the two sides in the zoning debate as those who liked neighborhood character and those who didn’t. (A flyer distributed with anti-upzone talking points drove the point home, claiming that the city’s proposal, part of the Housing Affordability and Livability Agenda (HALA), would “destroy the character of the neighborhood” and asserting that “family-sized housing is most appropriate.” )
Anti-HALA architect Greg Hill followed the soft-spoken Swit, telling the crowd of about 100 people that HALA was dominated by an unnamed “right-wing” group and insinuating that HALA, which calls for expanding the city’s urban villages and allowing more multifamily housing along transit corridors, is a sinister, profit-driven developer plot that will decimate Seattle’s environment by reducing the city’s tree canopy. In reality, building housing near transit is the definition of green urbanism, reducing reliance on cars, maximizing energy efficiency, and reducing water usage.
One of the few African-American people in the room—as HALA pointed out, single-family zoning tends to exclude people of color from “character”-filled neighborhoods like Northeast Capitol Hill—was Spencer Williams, a staffer for urbanist city council member Rob Johnson. Johnson has openly criticized Seattle’s brand of reactionary utopianism, which stars NPR-style liberals who denounce Trump for wanting to build a wall to keep newcomers out while defending zoning codes that have the same effect.
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