With one day left to pass it, Democrats release $64 billion budget proposal

OLYMPIA – With just Thursday and Friday left in the legislative session, Democrats on Wednesday released their final budget proposal, spending $64.1 billion on new investments in K-12 schools, programs designed to reduce poverty and homelessness, behavioral health and money to help the state recover from the COVID-19 pandemic.

On off-years, such as this one, legislators are tasked with adjusting the two-year budget passed the year prior. This year, lawmakers had an unprecedented amount of money to use to adjust the next year’s spending.

Last year, lawmakers passed a $59 billion budget and came back this year with more than $5 billion in additional revenue, plus $1.2 billion in federal COVID-19 relief funds not yet spent.

“This is such an unusual supplemental budget,” said Sen. June Robinson, D-Everett. “We were blessed with both state revenue and federal resources that we were able to invest in our communities, in our people.”

The budget leaves $800 million in reserves for the next two years plus an additional $2.75 billion left in an account set aside to help Washington recover from the COVID-19 pandemic, or a similar emergency.

The final plan does not propose any broad tax breaks. A proposed three-day sales tax holiday over Labor Day weekend did not make it into the final budget. Budget writers said there were too many technical challenges.

Rep. Nicole Macri, D-Seattle, said retailers felt a short-term holiday like that would be too “burdensome,” and it would take more time to implement that program.

There are tax breaks for small businesses. Beginning Jan. 1, 2023, small businesses that make less than $125,000 a year do not have to pay a business and operations tax in Washington.

Republicans criticized the budget proposal for not having more large-scale tax breaks.

“I just think that our middle-income families are being hit the hardest and I don’t see help for them, and we really had an opportunity to do that,” Sen. Lynda Wilson. R-Vancouver, said in a conference committee meeting on the budget.

Rep. Timm Ormsby, D-Spokane, said much of the additional money the state had this year was one-time funds that Democrats decided should be dedicated to transportation and capital budgets.

The budget transfers $2 billion in one-time funds plus more than $50 million a year to a 16-year transportation package, which funds new transit, road projects and maintenance across the state. It also transfers $650 million in one-time funds to the capital budget, which provides for construction and infrastructure projects statewide.

Ormsby said those are one-time expenditures that will benefit every corner of the state in both transportation and capital investments.

Republicans also criticized Democrats for failing to include them in budget negotiations or share the final proposal with them until the day they were set to vote on it.

Rep. Drew Stokesbary, R-Auburn, said there were some good things in the proposal, but he was disappointed that Republicans did not have a bigger role, especially as they represent 40% of the state population.

“It does them a real disservice,” he said.

What’s funded

The budget includes a significant amount of funding for K-12 education, including money to adjust for inflation for salaries, materials, supplies and operating costs, as well as funding for additional nurses, counselors and school support staff. It also includes $150 million for a state student loan program, which would offer loans to students with 1% interest rates.

It also includes funding to improve the number of nurses and health care workers in the state. That includes funding for building health care simulation labs, creating a bachelor of science in nursing program at Eastern Washington University, creating additional nursing slots and repaying student loans for those who choose to become nurse educators.

The budget also includes funding for refugee assistance for those coming to Washington from Afghanistan and Ukraine.

There is also $375,000 to study the four lower Snake River dams “as part of a comprehensive salmon recovery strategy,” according to a budget highlights document. That was included in Gov. Jay Inslee’s proposed budget last December.

The budget uses the remaining $1.2 billion in federal coronavirus relief funds allocated to the state last year. That money mostly goes to one-time COVID-19 expenses, such as utility assistance for renters, business assistance, vaccines, data collection, relief for behavioral health providers and enrollment stabilization for public schools that lost a number of students during the pandemic.

More than $350 million is included to increase rates for vendors providing services to people with developmental disabilities or long-term care needs.

More than $230 million will fund wage increases for state employees as per their collective bargaining agreements last year.

The 60-day legislative session is scheduled to end Thursday.