Legislature adopts 1,100-page budget and adjourns 2021 session
Washington lawmakers on Sunday afternoon gave final approval to a 1,100-page, two-year budget that spends roughly $59 billion, plus billions more in federal stimulus money.
Its passage was one of the Legislature’s final acts before lawmakers closed out a 105-day legislative session that was conducted for the most part remotely, via video conference, due to public health concerns.
The plan, first unveiled publicly Saturday, looks much like the plans majority Democrats proposed earlier in the 2021 legislative session, before budget writers negotiated a final deal. It funds a wide span of priorities — from reopening schools to fighting and preventing wildfires to helping the state address a court decision that struck down the state’s simple drug possession law.
Its writers say it aims to bolster the state’s recovery from COVID-19 with a focus on equity.
“This is a momentous budget for a time that calls for action,” said Rep. Timm Ormsby, lead budget writer in the House, in a prepared statement. “Families and neighbors who have felt held back and forgotten are lifted up with these investments. This budget honors the sacrifices the people in this state have made and reinforces our values of helping those who need it the most.”
The plan passed along party lines. Sen. Lynda Wilson, lead Senate Republican budget writer, said Saturday the inclusion of a new tax on capital gains alone would have been enough to make it partisan. She and other Republicans also lamented the closed nature of budget negotiations.
The Legislature passed a new 7 percent tax on capital gains in excess of $250,000 on Sunday that now awaits Gov. Jay Inslee’s signature. That’s expected to bring in about $415 million per year starting in 2023.
Republicans have argued that there is no need for new taxes, given unexpectedly rosy revenue projections and the federal stimulus money.
“The fact that this relies on new taxes is a choice,” Rep. Drew Stokesbary, R-Auburn, lead budget writer in the House, said. “It’s not a necessity.”
The budget also funds the state’s long-unfunded tax credit for working families for the first time, with $261 million. Passing a bill that expanded that tax credit and guaranteed its funding was a bipartisan success for lawmakers this session.
When coupled with the new tax, Democrats consider the budget progress toward rebalancing a state tax code that favors the most wealthy.
“I know that this budget will change people’s lives,” Sen. June Robinson, lead sponsor of the capital gains tax bill, said Saturday.
Sen. Christine Rolfes, lead budget writer in the Senate, called the two-year spending plan “probably one of the most complicated budgets” she’s been part of crafting — not just because negotiations and its development happened “completely online,” but because of unpredictable, though positive, revenue projections and the arrival of federal funding as the budget took shape.
Big items it funds with federal COVID-19 relief money include $1.7 billion for school reopening, learning loss, and other education-related efforts; $1.1 billion for public health efforts such as vaccine distribution and contact tracing; $658 million for rent assistance; $528 million for child care; and $500 million for unemployment insurance benefit relief.
Another $340 million in federal money is set aside for people impacted by COVID-19 who haven’t been able take advantage of other benefits because of their citizenship status.
It also holds back about a billion in federal stimulus money in reserves, according to legislators.
In a controversial move, the plan takes $1.8 billion out of the state’s “rainy day fund” and deposits that into the state’s general fund. It usually takes a super-majority vote of the Legislature to tap rainy day money, but takes just a simple majority in some emergencies and economic downturns.
It also creates a new “Washington Rescue Plan Transition Account” that can be used to respond to COVID-19, but also functions as an unrestricted savings account that takes just a simple majority to tap. Republican lawmakers have decried the creation of that account as a workaround.
“We raid the rainy day fund and put it in another fund to get around the super-majority vote in the future — that didn’t need to happen and shouldn’t have happened,” Senate Minority Leader John Braun of Centralia said.
Other major spending items that use state funds include $800 million to reduce unfunded liability of the Teachers Retirement System Plan 1 fund and about $300 million to implement the Fair Start Act, which aims to expand access to child care and early learning.
There’s $130 million for forest health and wildfire response, and roughly $100 million to eliminate state employee furlough days that were included in collective bargaining agreements for the next two years. And there’s money to make Juneteenth a state holiday, create an office to investigate incidents when police use excessive force, and help address the state Supreme Court decision that struck down the state’s simple drug possession law.
Sen. Rolfes shared a fact on the Senate floor after the vote: Writing the budget without paper, online, saved 747 reams of paper.
Lawmakers officially adjourned for the session just before 6:15 p.m. Sunday.
“With this budget, we will continue to lead the nation,” said Rolfes in floor debate. “You’ve heard it said before that a budget is a moral document, it shows our collective values, and provides a blueprint for our shared future together.
“Today, we show that this legislature can work effectively for the people, even in the midst of an emergency.”
This story was originally published April 25, 2021 at 6:31 PM.
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