WSLC Legislative Update -- January 28, 2005

"The Washington state tax structure is enormously regressive.
For anyone to argue that it makes sense for the poor to pay a higher proportion of their income in taxes than the rich is utter nonsense."

2005 WSLC LEGISLATIVE CONFERENCE

The Washington State Labor Council’s 2005 Legislative Conference is Thursday, February 24 at the Red Lion Olympia Hotel. All union members are invited to attend and get updates on the status of legislation affecting working families. Registration starts at 7:30 a.m. and the conference begins at 8:30 a.m.

Gov. Christine Gregoire is scheduled to speak at 9 a.m., followed by a number of legislative leaders. The conference concludes with lunch, at which time attendees are urged to meet with their legislators to discuss the issues most important to them.

As usual, from 6:30 to 8:30 p.m. Wednesday night before the conference, there will be a reception offering an excellent opportunity for informal conversation with legislators and other public officials. Avoid the reception lines by visiting the early registration table in the lobby at 2 p.m.

The registration fee is $30 and includes materials, lunch Friday and admission to the reception Thursday night. Download a registration form or call (206) 281-8901 for more information.

So said Bill Gates, Sr., before the House Finance Committee this week. After summarizing the findings of the Washington Tax Structure Committee he chaired, Gates added some personal comments characterizing the state's tax system as "unconscionable." He favors a personal and corporate income tax. Gates reminded state legislators that companies like Amgen and Microsoft owe their good fortunes to significant public tax dollar investment in education, roads, and research and development.

In contrast, lobbyists from the business associations argued against such public investments. While rightly pointing out the unfairness of the current B&O gross-receipts tax, these lobbyists continued to whine and exaggerate about our state's "business climate" in their testimony. They argue for a no-new-revenue budget, while making erroneous statements about the cost of workers’ compensation and unemployment insurance. And of course, never once did they mention how the state’s structural budget gap could be narrowed by suspending some of their tax preferences or agreeing to real disclosure and accountability measures.

"Washington now ranks 46th nationally in K-12 spending, 48th in customized training dollars, we have over a half million people who have no health insurance, and a transportation infrastructure that is woefully under-funded," Bender testified. "Washington state is facing a structural budget gap. We are simply not generating enough revenue to fund our state’s growing human service needs, our economic and physical infrastructure, or to adequately compensate our dedicated and hardworking state employees."

Greg Devereux, Executive Director of the Washington Federation of State Employees, posed the question: "Is it better to give a business a targeted tax break or is it better spend an extra $100 million on mental health, transportation, or job training?" He suggested that the legislature currently has no way to evaluate this question; no way to determine what gives the best rate of return to the state's taxpayers.

Kudos to Finance Committee Chair Rep. Jim McIntire (D-Seattle), who called this first of four hearings designed to build bipartisan support for changes to our broken tax system. The committee's next hearing—on Tuesday, Feb. 1 at 10 a.m.—will look at the issue of what are appropriate tax and spending limits.

Previously, the House Finance Committee heard three bills supported by the Washington State Labor Council:

HB 1069 would create a citizens' commission to study, review and make critical recommendations on our state’s 535 tax preferences—a number that has doubled over the past 20 years. It was approved Wednesday by the Finance Committee on a 5-3 party-line vote.

"It could scare businesses off," said Rep. Ed Orcutt (R-Kalama), who joined GOP colleagues Reps. John Ahern (R-Spokane) and Dan Roach (R-Bonney Lake) on the committee in voting "no." Even Rep. Orcutt's hometown newspaper, the uber-conservative (Vancouver) Columbian, editorialized that the bill is "the right thing to do" and called the objections of Republicans "thin." When Rep. Orcutt isn't opposing scrutiny of tax breaks, he's proposing new ones. Amidst a projected $1.8 billion shortfall, he has proposed a break for the construction of tsunami-resistant structures.

HB 1069 suggests a 10-year review cycle, which labor feels is too long a time period for such an important issue. The WSLC urges a floor amendment to reduce the review time to four years. Speaker Frank Chopp (D-Seattle) has put HB 1069 on his list of "fast track" bills he hopes to advance to the Senate very quickly, perhaps as soon as next week.

HB 1094, sponsored by Rep. Sharon Tomiko Santos (D-Seattle), adopts best practices regarding public disclosure and accountability for tax preferences. It would require businesses that receive tax incentives to fill out a survey identifying themselves and including information about their business activities, detailing employment, wages and employer-provided health and retirement benefits. The surveys would then be disclosed to the public upon request. HB 1094 has been heard by the committee, but has yet to be voted upon.

HB 1096, also sponsored by Rep. Santos, would require the governor to submit a tax expenditure/preference report along with the governor’s biennial budget. The point is that tax preferences are expenditures, too. When the state defers revenue from businesses or individuals it is making a value judgment, and at the same time, creating a cost because there is less revenue for education, health care, etc. HB 1094 has been heard, but not yet voted upon.

How often have we all heard legislators, policymakers and pundits ask, "Yes, but where does organized labor stand on this issue?" (Don't answer that.)

The 2005 Washington State Labor Council Position Papers answer that question on many specific legislative issues, offering background information, labor’s position and recent legislative histories.

On issues ranging from the minimum wage to workers’ compensation, from workplace safety to unemployment insurance, the WSLC and other labor organizations are all too often the only voice representing working people in Olympia. That is unfortunate, given the number of high-paid corporate lobbyists roaming the halls who often fight to remove or roll back workplace standards and rights. But it is a banner the WSLC and other labor organizations carry with pride.

Find out where we stand and why by downloading the WSLC 2005 Position Papers at www.wslc.org/legis or by calling 206-281-8901 or 360-943-0608 to have them mailed to you.

HB 1028 and SB 5097, the companion bills to promote apprenticeship utilization in Washington state, are on the move. HB 1028 advanced Monday from committee and could get a House floor vote any time; and SB 5097 passed from its committee on Thursday. Please call the toll-free Legislative Hotline at 1-800-562-6000 and leave a message urging your legislators to support these bills.

MONDAY, Jan. 31 -- At 10 a.m., the Senate Labor and Commerce Committee hears SB 5069 creating a family leave insurance program; at 1:30 p.m. House Labor and Commerce will hear HB 1173, the companion bill on family leave, and HB 1439 requiring the hours of work for individual homecare providers to be subject to collective bargaining.

TUESDAY, Feb. 1 -- At 10 a.m., House Finance will have a discussion of spending, tax limits and tax reform.

THURSDAY, Feb. 3 -- At 8 a.m., Senate Labor and Commerce hears SB 5240 giving the Department of L&I the authority to levy administrative penalties for wage-and-hour violations; and SB 5466, a Farm Bureau-supported change in the definition of wages for purposes of workers' comp (which would lower time-loss benefits for some injured workers). At 1:30 p.m., House Labor and Commerce hears HB 1264 prohibiting non-competition agreements in the broadcasting industry.

FRIDAY, Feb. 4 -- At 1:30 p.m., House Health Care hears a number of bills related to improving patient and employee safety in the health care industry.