January 7, 2019
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Legislature prepares to return to work on Jan. 14

Next Monday, Jan. 14, lawmakers will kick off their every-other-year budget-writing session. This is a "long" session, scheduled for 105 days (assuming no overtime sessions).

It’s looking like another challenging session for the employer community. Gov. Jay Inslee has proposed a new capital gains tax and a 67-percent increase in the B&O tax on service businesses, part of a call for increased revenue to pay for a slate of new and increased programs. His proposal would increase the budget by 22.3 percent, or just under $10 billion over 2017-19.

Last week, the governor also submitted his legally required "current law" budget, which would operate the state within existing revenues. That budget would increase spending by $6.412 billion over the last biennium, reflecting natural tax collection growth from the growing economy.

The Washington Research Council dives into the numbers on the governor's budget proposals here, and notes that -- while the current law budget is clearly not the governor's ideal -- it does show a way to balance the 2019-21 budget without raising taxes.

With lawmakers returning to the Capitol, "across Washington, business owners and managers brace themselves for what’s coming next," business columnist Bill Virgin writes in The News Tribune. He lists proposed or recently attempted taxes on energy, capital gains, business and occupation tax on services, real estate excise taxes, and more.

"The increase in taxes on what were once broadly known as ‘business services’ – legal, accounting, consulting – will affect not just the firms providing those services but the businesses that pay for them – in other words, just about every business. Do not expect that one to plod along quietly and unnoticed toward passage," Virgin wrote.

AWB's Government Affairs Team will go over all this and more during the Jan. 11 Legislative Session Preview Webinar. Register now and tune in this Friday to get up to speed on all of the issues.

It's also just three weeks until AWB's annual Legislative Day and Hill Climb, which is Jan. 29. This year's event will be held at AWB and the state Capitol, with plenty of time to meet directly with lawmakers. The full agenda and registration information is available here.

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Legislative Day and Hill Climb Preview
Supporting Rural Areas

Let's work together to prioritize rural economic revitalization

By AWB President Kris Johnson

The mission of the Association of Washington Business is to bring people together throughout the state to promote economic prosperity -- from the urban centers to the most rural corners.

We know that parts of Washington have boomed since the end of the recession, but other areas -- particularly the rural communities that exist in each of our state's 39 counties -- have not realized the same economic opportunities.

Our state's overall success depends on not just talking about the many barriers holding back economic growth in rural regions but finding and implementing solutions discussed at the AWB Rural Jobs Summit in the Legislature and at the local level to move every community forward.

Whether urban, rural or somewhere in between, we're all in this together.

Read the full column in the Tri-Cities Area Journal of Business
Taxing Employers

Legislature's return to work presents a challenge for business

By Bill Virgin

Laments from the business community about taxes, regulations and the high cost and frustration of doing business around here are typically met with two responses: "It can't be that bad, look at our booming economy," and "If you don't like it, leave" (the latter usually accompanied by a snide remark about Texas or the South).

To those points: The current success of the tech sector, however loosely that's defined, certainly fueled economic growth in the region. But other sectors are struggling for reasons of their own (retailing) or related to the boom (industrial businesses dealing with high costs). Tech's boom has papered over a lot of ills, and if the sector ever has another moment like the dot-com bust, that facade will be gone...

Eventually businesses reach a point at which the cost/benefit analysis tips from staying to going.

It hasn't happened in great numbers and it won't happen at the same time for all businesses. But those tipping points are out there. In 2019, we'll find out see how enthusiastically the Legislature pushes the region closer to them.

Read the full column in The News Tribune
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