May 20, 2019
Fast Facts
Bringing Business Up to Speed
Top Stories

Budget analysis shows 18% state tax and spending increases 'unlikely to be sustainable'

For the third straight budget cycle, Washington lawmakers have increased spending by double-digits -- but this year's increase is the largest yet, and the biggest in at least a quarter century.

That's one of the facts laid out in the latest Washington Research Council (WRC) policy brief, released last week.

Lawmakers approved a two-year budget that will spend $53.85 billion. That 18.3% increase includes 13% just to maintain the current level of services. On top of that, the Legislature added $2.37 billion in new policy spending. The money went to employee compensation (including paying for collective bargaining agreements and K-12 health benefits), public schools and higher education.

In 2015-17, the Legislature increased spending by 13.6%. In the 2017-19 budget cycle that is just ending, spending went up by 16.9%.

Higher spending while the economy is good could mean painful cuts down the road, the WRC notes.

"A series of large spending increases, combined with the likelihood of an economic downturn sometime in the future, make this budget unlikely to be sustainable," they conclude.

The governor has not yet signed the budget. There are calls for Gov. Inslee to veto a last-minute tax on global banking firms, but the governor has not commented on whether that new tax will earn his signature.

« Back to Main
Housing Forum
Moving Backward

Gov. Inslee is wrong to flip-flop on liquefied natural-gas facility in Tacoma

By The Seatte Times Editorial Board

Gov. Jay Inslee is doing an outstanding job staying on message in his presidential campaign, making climate change his signature issue and a focus of the primaries.

But Inslee went too far last week when he pulled support for a project in Tacoma that will cut emissions and create jobs.

Early in his governorship, Inslee championed the Tacoma liquefied natural-gas (LNG) facility. That pragmatic, nuanced approach provided certainty for local companies to commit more than $500 million to a project that will substantially reduce emissions from ships sailing between Puget Sound and Alaska.

That stance no longer jibes with the current mantra of his far-left environmental base, which now advocates for halting additional fossil-fuel consumption. It also had put Inslee in conflict with one of the state's wealthiest tribes, the Puyallup Tribe of Indians, which opposed the project.

Moving goal posts late in the game may discourage companies from innovating and investing in cleaner ways of doing business, at least in Washington....

Read the full editorial in The Seattle Times
A New Challenge for Border Towns

Lawmakers changed the sales tax exemption. Will Oregon residents still want to shop Tri-Cities?

By The Tri-City Herald Editorial Board

Of all the new, last-minute tax measures approved by the Legislature two weeks ago, one in particular likely will cause headaches for Mid-Columbia retailers in coming months.

Oregon residents will no longer get a sales tax exemption right away at a Tri-Cities checkout counter.

Thanks to ESSB 5997, out-of-state shoppers will have to pay the sales tax upfront, save their receipts and file for a one-time, yearly reimbursement from the state of Washington.

They will qualify only if the amount they are requesting exceeds $25.

Clay Hill, government affairs director for the Association of Washington Business, said approval of ESSB 5997 was "especially disheartening" because there was a unified voice of opposition by business and retail organizations.

Democratic lawmakers are betting they will raise $53 million for a two-year budget from out-of-state shoppers who don't turn in their paperwork or who don't meet the $25 minimum threshold.

But it is the border communities that will pay the biggest price for the tax grab, and it isn't right to put the burden primarily on the edges of the state.

Read the full editorial in The Tri-City Herald
Upcoming Events