WSLC 2004 Legislative Report

TABLE OF CONTENTS

Apprenticeship ignored amid training rhetoric
Home-care workers win historic contract
President's column -- Union members: America needs your activism, not cynicism
State workers' health care protected by House Dems
Offshore outsourcing takes center stage
Workers' compensation attacks unrelenting
Minimum wage freeze rejected again
Charter schools passes, but public vote looms
Health care: How your taxes subsidize Wal-Mart

(This is an abbreviated version of the 2004 WSLC Legislative Report. Order the printed version to see all the stories from 2004.)

Despite tight budget, lawmakers gamble
on more tax breaks lacking accountability

One of the big differences between Congress and the Washington State Legislature is that state lawmakers must live within their means and balance their budgets. The record deficits generated by the party of fiscal responsibility in Washington D.C. demonstrate that Congress is under no such restriction.

But in this Washington, state legislators have embraced a new way to spend, spend, spend just like their counterparts in D.C. By renewing and adding more business tax breaks, legislators are spending billions in future revenue, exacerbating an already unfair patchwork tax system that plays favorites between industries, and adding salt to the wounds of strangled public services and the public employees who provide them.

This year legislators had an opportunity to undo some of the damage from the painful biennial budget approved last year using Governor Gary Locke’s well-marketed Priorities of Government approach. (Schools, state employees, teachers and the working poor discovered they were not priorities.) No one expected dramatic changes with 2004’s supplemental “adjustment” budget, but many assumed that the slightly improved revenue projections would allow legislators to mitigate the cuts. But instead of focusing on damage control, the 2004 session will be remembered as a year business tax breaks proved to be the Priority of Government.

The first bill passed by both houses and signed by Gov. Locke was renewal of the research-and-development tax breaks for high-tech companies including Microsoft, Amgen, Phillips and other multi-billion-dollar firms. That quickly removed $53 million from the budget negotiating table and added $175 million to the next biennium’s projected $1 billion shortfall.

Later in the session, even as bad news was being delivered that only minor mitigation in health care cuts for poor children would occur and other important services would remain unfunded, the tax-break beat went on. Additional breaks were approved in either the House or Senate, often on bipartisan votes, for everything from physical fitness centers to temporary staffing agencies.

The Washington State Labor Council is not opposed to all tax exemptions. In fact, it supports those that demonstrably create or maintain good family-wage jobs. This year’s tax relief for aluminum smelters, which will help stave off closure of the Intalco plant in Ferndale, is an example of targeted tax relief with specific, enforceable reporting and requirements on job retention.

Some welcome progress has been made on the issue of tax break accountability and disclosure, something the WSLC has advocated for more than a decade. For the first time ever, Washington taxpayers will actually be allowed to find out which firms take advantage of the R&D tax break, for example. But the baby steps taken on R&D and other tax break accountability are insufficient to justify their considerable expense amidst a continuing budget crisis. Legislators continue to gamble on business lobbyists’ promises of job creation, rather than insisting those promises be kept—or even assessed.

Bills were introduced to require regular reporting of all tax breaks and assessment of their effectiveness. Decried as job-killing paperwork, they were rejected. Meanwhile, legislators have no problem creating mountains of paperwork for state workers to justify their existence, in the name of government efficiency.

This irresponsible spending of our tax dollars must stop. As is the case with the federal budget deficits of Bush & Co., the price ultimately will be paid by future generations in the form of additional cuts on state services and tax increases.

As white-collar professional workers, like the manufacturing workers before them, watch their jobs move offshore, the issue of outsourcing has become a hot political topic. In the debate over what, if anything, government should do about it, there is one thing everybody seems to agree upon. We need to improve and expand job training to ensure Americans have the skills needed for the jobs we have.

Apprenticeship programs are an ideal solution. Unlike many training and retraining programs, they require no government funding because they are financed by the existing workforce and the employers that benefit from them. Apprentices earn while they learn. Plus, the vast majority of apprenticeships offer in-demand skills in the building and construction trades, jobs that may be economically cyclical but cannot be outsourced offshore.

That’s why it was so disappointing this year that the Republican-controlled State Senate blocked and killed an effort to promote apprenticeship in Washington.

In 2000, Gov. Locke lauded apprenticeship as a job training model and issued an executive order phasing in the current requirement that at least 15% of total labor hours on major public works projects be performed by apprentices. At the time, opponents predicted the order would raise costs or exclude contractors from certain parts of the state from bidding. None of that happened. In fact, the requirement is waived if not enough apprentices are available or in other extraordinary circumstances. As long as contractors show a good-faith effort to comply, they are in compliance.

So this year, Rep. Steve Conway (D-Tacoma), House Commerce and Labor Committee Chairman, sponsored HB 2439 codifying and making permanent Locke’s apprenticeship executive order. Rep. Cathy McMorris (R-Kettle Falls) offered a misguided amendment to allow mere “trainees” to satisfy the requirement instead of participants in a real state-certified apprenticeship program, but she failed (see House Vote #2). Then the House voted 54-44 (see House Vote #3) to approve HB 2439.

But in the State Senate, where Republicans hold a 25-24 majority, the bill was blocked and killed in committee by Sen. Jim Honeyford (R-Sunnyside). The chairman of the Senate Commerce and Trade (but not Labor) Committee refused to allow a vote.

Apprenticeship is a win-win program with proven results, not a partisan issue. Honeyford’s colleague Sen. Pam Roach (R-Auburn) sponsored the Senate version of Conway’s bill, but she too was denied a vote by Honeyford. Maybe next year this important Senate committee will have a new chair and we can all move past the obstinate anti-labor mentality that now permeates the panel.

The good news on apprenticeship is that HB 3045, known as the Hats ‘n’ Boots bill, passed and was signed by the governor. Sponsored by Rep. Velma Veloria (D-Seattle), this orders the Department of Natural Resources to swap some common-trust timber lands with the South Seattle Community College so the school can expand its facility there into a world-class apprenticeship and manufacturing training center. The land is where the Georgetown-area hat-’n’-boots structure was, until it was moved recently. The bill passed both houses with only one dissenting vote: Rep. Richard DeBolt (R-Centralia). And no, we don’t know why.

Perhaps the best news from the 2004 session was that the state home-care workers finally got their historic first contract approved.

In 2003, Republican leaders in the Senate blocked funding of the contract for some 26,000 independent provider home-care workers represented by Service Employees International Union Local 775. Between sessions, the union returned to the bargaining table to renegotiate a scaled-back contract that addressed concerns raised by lawmakers who opposed the contract. House Democrats who approved the 2003 version again embraced the proposal and Speaker Frank Chopp announced at the start of the 2004 session that this was one of his biggest priorities. SEIU 775 also reached out to new Republican Senate leaders -- Majority Leader Bill Finkbeiner and Ways and Means Chairman Joe Zarelli -- to seek their support.

It worked. The House approved funding early in the session (see House Vote #1) and the Senate unanimously approved the contract (see Senate Vote #11). The contract provides a 50-cent raise, workers’ compensation coverage for the first time, and health care benefits to those working at least half time. The budget also funds a “parity” increase of 50 cents for all agency home-care workers.

We’ve got a president who ran for office four years ago saying he would be a “uniter not a divider,” and yet not since Richard Nixon has a president’s policies and scandals so polarized the nation.

We’ve got one-party control of our federal government -- and our Supreme Court, many would say. That party seems either hopelessly out of touch or actively hostile to the interests and concerns of working Americans.

We’ve got a Washington state government that has invited corporate leaders to determine the people’s Priorities of Government. As a result, our public schools, our crumbling infrastructure and our human services for the least fortunate among us are underfunded, even as lawmakers continue granting more unaccountable tax giveaways to business interests.

We’ve got misguided citizen activists tapping into voter anger and frustration over taxes, and further disenfranchising citizens by convincing them their government is the enemy.

But we in organized labor have something else. We have a long, proud history of rising to the occasion and fighting for what’s right. We have faced powerful interests before, we have persevered and we have prevailed.

If there’s one lesson our mothers and fathers who built the labor movement have taught us, it is that we can’t allow ourselves to be disenfranchised. We can’t let our spirits be broken. We can’t withdraw into the hopeless cocoon of cynicism.

After all, the easiest advice anyone can give a person dissatisfied with their job, their wages or their working conditions is to quit. If our predecessors had all taken that advice, we'd still be working 12-hour days, six days a week. The American standard of living -- its very middle class -- was won by workers who REFUSED to quit their jobs.

The Washington State Labor Council’s Labor Neighbor program is your opportunity to take back your government the old-fashioned way -- by talking to your neighbors and co-workers about what’s important.

What better example could we possibly set for our children? Activities like Labor Neighbor
teach them that politics isn’t just
about the blabbering, arguing
know-it-alls on CNN and Fox News.
It’s about you and me.

This grassroots, volunteer-based effort involves union members walking their neighborhoods, handing out written materials and discussing the candidates and the issues with fellow union members around the district. These household walks begin months before the election and culminate in a massive, but focused get-out-the-vote effort on Election Day.

The response from the volunteers who have participated in Labor Neighbor and from the members they contacted is consistently positive. If you’ve participated like I have, you know what I’m talking about. In an era of negative political TV ads, mail pieces and recorded phone calls, people are impressed that somebody cares enough about the issues -- and about them -- to actually knock on their door. It puts a human face on the issues. It’s a fun way to spend a weekend afternoon with a friend or co-worker.

And what better example could we possibly set for our children? Activities like Labor Neighbor teach them that politics isn’t just about the blabbering, arguing know-it-alls on CNN and Fox News. It’s about you and me.

Our government is what we make of it, not something to complain about from the comfort of our couches and our idle cynicism.

Labor’s strength is, and always has been, in its members. The same energy and commitment that rank-and-file members bring to union organizing campaigns and community volunteerism, they also bring to political activism. Be a part of that proud tradition and help put the grassroots back in YOUR neighborhood’s politics.

Fill out our online Labor Neighbor Volunteer Form; call 1-800-542-0904 to have a volunteer form mailed or faxed to you; e-mail WSLC State Field Director Raechelle Turner at rturner@wslc.org; or call her at (206) 441-2647. Help us meet our goal of having 10,000 union members volunteer in 2004!

As expected in this supplemental budget year, both the House and Senate approved “no-new-taxes” budgets. But with a slightly improved revenue forecast and some unexpected cost savings, lawmakers were in a position to mitigate some of the damage done in 2003 with the biennial budget. House Democrats approved a budget far superior to both the Republican Senate and Gov. Gary Locke’s proposals.

State employees have had their wages frozen for three years now and their health benefits cut. They have shouldered a disproportionate share of the burden for solving our state’s budget problem caused by a national recession.

Recognizing this, House Democrats approved by a 51-45 vote (see House Vote #8) a budget that lowered state workers’ monthly premiums by $14 to $65 a month. Senate Republicans passed a budget that would raise their average premiums by $28 up to $107 a month. The governor’s proposal pegged average monthly premiums at $100.

During debate on the Senate budget, an amendment was offered by Sen. Karen Fraser (D-Olympia) to allocate an additional $39 million toward state employee and teacher health benefits, reducing the workers’ premiums. The vote on the amendment was 26-23 in favor (see Senate Vote #9), but a 60% majority was required so it failed.

Ultimately, the budget agreement worked out between the two houses and signed by the governor, kept the health costs the same as last year, at just under $79 a month. The Washington Federation of State Employees, AFSCME Council 28 considered this a victory.

House Speaker Frank Chopp (D-Seattle), Appropriations Chair Helen Sommers (D-Seattle) and Vice Chair Bill Fromhold (D-Vancouver) all deserve to be acknowledged for their leadership on the state employees’ health care.

Maintaining affordable health benefits will continue to be a priority as state employees negotiate their historic first master contract.

A number of bills were introduced regarding offshore outsourcing this year. The issue of U.S. jobs moving overseas has gotten lots of media attention now that it involves not just manufacturing jobs, but also professional and technical jobs. The Bush administration fanned the flames by declaring outsourcing to be “good.”

The Washington Alliance of Technology Workers/CWA estimates the state has lost some 10,000 technology jobs since 2001. Boeing, AT&T Wireless and many other local employers, including our own state government, are shipping thousands of information technology jobs overseas.

The WSLC joined WashTech in supporting the following bills, none of which were voted upon:

Although House Democratic leaders were unwilling to vote on these bills, they were alarmed after hearing passionate testimony about the extent of the problem and amended their budget to fund a comprehensive study of state agencies’ outsourcing.

Rep. Sandra Romero (D-Olympia) later sponsored HCR 4419 creating a task force to study the impact of public and private sector outsourcing. Rep. Skip Priest’s (R-Federal Way) amendment to make it a business-dominated task force failed (House Vote #10), and the House approved HCR 4419 64-31 (House Vote #11.) Unfortunately, the GOP-controlled Senate refused to allow a vote on it.

Since the multi-year attack by the business community on unemployment benefits and the rights of jobless workers succeeded last year, business lobbyists have set their sights on injured workers.

Despite evidence that Washington’s workers compensation system is one of the most efficient, cost-effective systems in the country, the employer community is determined to drive down benefits, remove systemic protections and eliminate the Washington Industrial Safety and Health Administration’s ability to function. Employer groups are whipping up anger among employers struggling in this weak economy while deliberately ignoring the 1998 Performance Audit and Oregon’s national survey that demonstrate our model system is not broken.

Though many of the bills implementing these attacks passed the Senate in 2004, they were killed by the Chair of the House Commerce and Labor Committee, Rep. Steve Conway (D-Tacoma). But there is no question these attacks will continue.

Emboldened by the huge financial resources they have been allowed to amass through the Retrospective Rating program, employer groups are funding think tanks and using “studies” to justify their attacks. The Building Industry Association of Washington, which pumped more than $4 million into its political coffers last year thanks to the Retro program, says it may fund an initiative to pursue its workers' compensation agenda, which includes across-the-board benefit cuts.

Here are some of the employer attacks and the 2004 legislation intended to implement them:

As of Jan. 1, 2004, Washington's minimum wage is $7.16 an hour. That’s the highest in the nation, ahead of Alaska's $7.15, Oregon's $7.05 and California's $6.75. Agriculture, restaurant and retail lobbyists, and some legislators, say that kills jobs.

Last year, they introduced 13 bills to weaken our state minimum wage law. All died quickly except one, which managed to pass the GOP-controlled Senate on a 25-24 vote. That bill was again the focus in 2004.

“Hopefully, having the highest minimum wage in the nation will draw more workers.”

— Kirk Mayer of Washington Growers Clearing House Association in Wenatchee, in a April article about fears of a harvest-season labor shortage.

Sponsored by Sen. Mike Hewitt (R-Walla Walla), SB 5697 would end voter-mandated inflationary adjustments except in years the state unemployment rate is below the national average. The premise implies the minimum wage is to blame for high state unemployment rates. This despite clear evidence that job losses in the high-wage manufacturing sector, not in minimum wage-paying retail, restaurant and agriculture sectors (where job growth is occurring), are responsible for high jobless rates.

The truth is that even in good economic times Washington’s jobless rate fairly consistently remains above the national rate. There are many reasons for this, one of which is that Washington is a desirable place to live (when you’re looking for a job) and stay (after you have lost one). Other reasons cited by state economists include the seasonal nature of labor-intensive agricultural work and high unemployment in traditionally timber-dependent rural areas. That’s why Washington’s rate has been lower than the national rate in only three of the past 33 years.

Had SB 5697 been in place since 1992 our minimum wage would have increased just 4%, from $4.25 to $4.42, in 12 years.

The sponsors of SB 5697 know that. But they also know passing an outright freeze in the minimum wage would be politically unpopular, so they came up with a bill that implicitly blames the minimum wage for high unemployment, and freezes it anyway.

SB 5697 again passed the Senate, this time on a 27-22 vote (see Senate Vote #3). Three Senators who voted against it last year, switched and voted “yes:” Sens. Luke Esser (R-Bellevue), Mary Margaret Haugen (D-Camano Is.) and Pam Roach (R-Auburn). Sen. Marilyn Rasmussen (D-Eatonville) switched from a “yes” to a “no” vote.

SB 5697 quickly died (again) in the House labor committee chaired by Rep. Steve Conway (D-Tacoma).

Minimum wage critics have been saying the same thing ever since 1937, when Washington state set a national precedent by instituting the first minimum wage. (We were, and still are, #1!) Their dire predictions of job losses, inflation and economic damage never come true. They certainly haven’t in Washington since voters, by a rare 2-to-1 margin, approved Initiative 688 to index our minimum wage.

But as long as there are lobbyists in Olympia, there will be attacks on the minimum wage. See you next year.

After eight years of failure in legislative sessions and two voter rejections of ballot initiatives, legislation authorizing charter schools in Washington state was approved this session. E2SHB 2295 authorizes up to 45 new charter schools over the next six years.

Organized labor has opposed charter schools for years because it diverts public resources and attention from what should be our goal of successful public schools for all of our children.

The WSLC also opposes charter schools because it is unfair to school employees. Under E2SHB 2295, the bargaining units for both classified and certificated staff in these new charter schools must be “stand-alone” units and not part of the unit representing the rest of the school district’s employees. This is a classic method of reducing the bargaining leverage of workers, by limiting their right to be part of a larger bargaining unit. Smaller groups simply have less bargaining power.

The new charter schools will be exempt from virtually all state statutes and rules that apply to other public schools. In addition, the bill allows the conversion of existing public schools into a charter schools; classified and certificated employees in conversion schools will maintain their existing bargaining unit affiliation with the school district.

Sponsored by Rep. Dave Quall (D-Bellingham), the bill missed legislative deadlines for action but was resurrected through extraordinary procedural means. The final version passed both houses on March 10, the second-to-last day of the session. The House approved it 51-46 (see House Vote #12) and the Senate 27-22 (see Senate Vote #10).

Now the Washington Education Association (not affiliated with the WSLC), is collecting signatures for a referendum to repeal the new charter schools legislation. If they collect the necessary 98,000 signatures it will be on this fall’s ballot.

In this important election year, one subject tops poll after poll as Americans' biggest domestic concern: health care. Several years of double-digit health premium increases have cut into profits so companies are forcing workers to sacrifice wage increases and pay more out-of-pocket. Health care is becoming less affordable and less attainable.

Health care inflation is a major drag on our economy. Employers are passing on costs, resulting in labor unrest among grocery workers, state workers and even the nurses that provide health care, to name a few. What's causing this inflation? Skyrocketing drug prices and technology costs, and the socialized costs of the uninsured are driving up rates. Last year, lawmakers took a first step on addressing drug prices, but little or nothing has been done about the uninsured. Their ranks have risen to more than 750,000 in this state. The uninsured get health care, but it happens in emergency rooms and community clinics, often for problems that could have been avoided if they had access to preventative care. The facilities forced to provide that care are not compensated so they pass on the costs to the people who can pay.

HB 2785, the Health Care for Washington's Workers bill sponsored by Rep. Eileen Cody, was based on two simple principles. If you work, you should get health care. And it's not right that taxpayers and employers that do provide health care subsidize large corporations that don't. Right now, we are paying for health care through the Basic Health Plan for more than 400 Washington workers employed at Wal-Mart, one of the most profitable companies in the world—even as that company "competes" the responsible employers right out of business. Wal-Mart is the poster child for this abuse of the system, but other big corporations are doing the same thing.

HB 2785 required big businesses that don’t offer affordable health care to pay a fee-per-employee to help fund the BHP. It also provided small businesses with premium assistance and other ways to help them afford employee health benefits. The bill received a hearing with strong testimony in support, but was not voted upon. It will be back next year.

There are many more stories included in the print version of the WSLC's 2004 Legislative Report on issues like transportation and other building trades issues, the primary election system, medical monitoring of farm workers who use pesticides, genetic job discrimination, and much, much more. Union members may request a free copy.

Mar. 8 -- GOP's right wing takes flight (gay rights, primary election, budget, outsourcing)
Feb. 27 -- House Democrats come through (proposed budgets, apprenticeship, farm workers)
Feb. 23 -- Mad kowtow (workers' comp, outsourcing, employee references, home care)
Feb. 13 -- Outsourcing: Let's vote on it! (EFCA, workers' comp, charter schools)
Feb. 6 -- The politics of workers' comp (R&D and TIFs, genetic testing, living wage ordinances)
Jan. 27 -- We pay for Wal-Mart greed -- always (health care, workers' comp, R&D tax breaks)
Jan. 22 -- We're No. 1, which doesn't "suck" (min. wage, R&D tax breaks, apprenticeship)
Jan. 16 -- R&D needs Reporting & Disclosure (plus workers' comp, health care, and home care)