OLYMPIA — Budget negotiators in the House and Senate reached a handshake agreement on an operating budget Thursday morning, and Gov. Jay Inslee said the pending deal can avert the shutdown of many state services that would have begun Monday.
The Senate was poised to start voting on the $33.5 billion budget as early as Friday morning. Inslee and leaders in the Senate and House all said they intend to wrap up the budget before state workers leave at 5 p.m. for the weekend.
“We will be notifying state employees to report to work Monday, July 1,” Inslee said in a statement that he read at a late-morning press conference. “Government operations will not be interrupted. All government functions will be in operation Monday. Washington will be at work Monday.”
House Appropriations chairman Ross Hunter, D-Medina, said the budget remained a “delicate” agreement, but Speaker Frank Chopp, D-Seattle, said solid support exists to get it enacted.
Written details of the budget deal were not available to the public by late Thursday afternoon, leaving advocacy groups in the dark about how programs are treated in the spending plan even as the Republican-led Senate pushed for a vote as soon as it could take one.
“We have a deal. … We shook hands, and we are now assured we should be able to get a budget to the governor’s desk so he can sign it,” said Sen. Andy Hill, a Redmond Republican and the Senate’s chief budget author. “It’s good to have it done, but I’m very, very happy with the outcome.”
Hill and other top budget writers tried to fill in the blanks in interviews. They said the agreement puts about $1 billion of new money into K-12 schools in response to the state Supreme Court’s finding the state was not amply funding basic education. It also puts new money into higher education in a bid to block tuition increases at colleges.
It reportedly accomplishes those aims while saving a good share of the safety net programs for the poor, disabled and elderly.
Budget writers said the deal also avoids major new tax increases but does add about $240 million to $250 million from closing two inadvertent tax loopholes created by court rulings – one dealing with the estate tax and the other with phone taxes.
Hunter said the budget expands early childhood education programs and subsidized child care for low-income mothers. Lawmakers said that more than $100 million would go to class-size reductions in the kindergarten and first grades – targeting high-poverty rate schools– and a large chunk of money also would go into expanding all-day kindergarten.
Republican Sen. Steve Litzow of Mercer Island said $15.2 billion in the proposed budget is allocated to K-12, which he said is 11 percent more than in the previous budget. He said it adds $160 million for remedial and special help through the Learning Assistance Program and $10 million for improvements to the lowest performing schools.
State employee compensation would be left intact, reflecting earlier budget plans that passed the House and Senate. It includes acceptance of labor contracts for more than two dozen public employee groups, which in the case of general government agency workers means a potential small pay raise in 2014 and the addition of a step increase for some workers.
Most employees in general-government agencies have seen 3 percent reductions in pay and hours over the past two years, and they will see those temporary cuts end as of Monday, the start of the new budget year.
Government workers’ health care does change in one respect, according to Hunter. He said state plans would add a $25 monthly surcharge for smokers and a $50 surcharge for employees’ spouses who have comparable coverage options elsewhere.
A Senate push to require part-time state and K-12 workers to buy their own policies on Affordable Care Act health care exchanges has been dropped, Hunter said. Hill said the goal now is to let that happen on a voluntary basis through what he described as “pilot projects” with willing unions.
Two big hang-ups in negotiations earlier this week had revolved around the Boeing Co.’s demand for additional study of human fish consumption trends and a dispute over how much financial disclosure to require from companies that receive tax breaks.
The fish issue was omitted from the budget entirely, although Rep. Hans Dunshee, D-Snohomish, said a discussion group started by Inslee, industry leaders and others could continue discussing the subject.
Boeing wanted a study done on how much fish Washingtonians eat before the Department of Ecology adopts new rules next summer that ultimately will determine how stringent water quality standards have to be. Those standards could add costs to Boeing’s manufacturing sites, according to Senate leaders who sought the study on the plane maker’s behalf.
Tribes whose members eat more fish have been concerned that Washington’s four-decade-old standards are out of date. People who eat large amounts of fish from polluted waters can be exposed to unsafe levels of toxins.
The tax-break disclosure issues remained under discussion between negotiators in the House and Senate late Thursday but were delinked from the budget. Proponents seek proof that businesses getting tax breaks on a promise of job creation or some other public good are actually producing that public benefit. Without agreement on the tax-break policy, about $10 million to $15 million in new or extended tax breaks were at risk of not being passed.
Even if the Legislature delivers a budget by Friday evening, it isn’t likely to adjourn immediately. Work on a roughly $3.5 billion construction budget may not get a vote until Saturday at the soonest.
What’s more, negotiations on a roughly $10 billion transportation-tax package acceptable to both chambers could push the Legislature’s second special session into July, with fighting over light rail on a Columbia River bridge project causing most of the sparks.
Brad Shannon: 360-753-1688