AWB to State Leaders: Keep Washington Competitive
Thirteen of the state's top elected officials met with employers and business leaders Tuesday to engage in meaningful conversations about what it takes to keep Washington's economy strong.
Key takeaways include new attention to Washington's affordable child care crisis; a lack of workforce housing; and a record-breaking state budget that has lawmakers breathing easier but is raising concern among employers about whether the growth is sustainable.
Employers also discussed rural jobs, transportation and employment law among other topics at AWB’s 35th-annual Legislative Day and Hill Climb. And AWB's Grassroots Alliance brought new energy and voices to the event from local chamber of commerce leaders.
"We get more benefit from AWB than we do any other organization," said Jennifer Liggett, executive director of the Covington Chamber of Commerce, one of 90 members of the alliance that’s strengthening the ties between local chambers and AWB.Turnout was strong, with 202 participants representing communities from Clarkston to Maple Valley.
Tuesday's event covered many topics, but the overall message was clear: Washington employers are actively engaged in a dialogue with state leaders to keep our state's economy competitive.
A Strong State Budget
The Legislature passed a $52 billion, two-year budget in 2019. This is the second year of the state budget cycle, which means this year's discussion should, in theory, only handle supplemental spending to last year's plan.
Overall, state leaders seemed relieved that there are both strong revenues and no major school funding lawsuits to solve in the current legislative session, which has taken a significant amount of energy in OIympia over the last two years.
The state's top budget writers met with employers for a panel discussion and lunch to kick off the day.
State Sen. Christine Rolfes, D-Bainbridge Island, chairs the Senate Ways and Means Committee and referenced Gov. Jay Inslee's budget proposal in her remarks to employers.
"The budget that they gave us was very supplemental," Rolfes said. "…In the past we've had big debates between the chambers and the governor's office about resources and taxes, and this year…this budget doesn't rely on tax increases. And so that makes it truly a supplemental conversation that we're having with them. That's not to say there won't be tax policy change, but it came to us in a way that was easier for the Senate to digest."
State Sen. John Braun, R-Centralia, is the committee's ranking member."It's probably the easiest supplemental budget we've had in this century," Braun said.
He noted that the state has received an additional $1 billion in projected revenue collections since lawmakers adjourned last April.
"Broadly our budget is in very good shape," he said.
Employers also heard from the chair and ranking member of the House Appropriations Committee.
"I think it is our fervent wish that we have a supplemental year," said Rep. Timm Ormsby, D-Spokane, who chairs the committee. "But that does not stop aspirational members from pursing aspirational concepts that cost money."
Ranking member and Rep. Drew Stokesbary, R-Auburn, discussed his proposal to allow local governments to pass a sales tax to deal with homelessness. Several speakers raised the issue of homelessness Tuesday and acknowledged it's a statewide problem.
"Big things around here don't get done without people compromising," Stokesbary said of his proposal.
State Sen. Steve Hobbs, D-Lake Stevens, updated employers on his Forward Washington transportation proposal. The measure is a combination of a carbon fee, gas tax and other fees, paired with major investments for the state's transportation needs.
"And it’s a good alternative," Hobbs said. "It's an alternative -- that I have worked with business on, I've worked with Republicans on, as well as the environmentalists in my own caucus -- to the low-carbon fuel standard, which I think quite frankly increases the cost of gasoline, with no benefit to the state."The House of Representatives ended up passing House Bill 1110 the following day, moving the low-carbon fuel standard debate to the Senate. AWB is opposed to the measure, noting it will raise the cost of fuel significantly while providing little in the way of carbon emission reduction.
Hobbs said his Forward Washington proposal includes $1 billion for preservation projects, $500 million for maintenance, $500 million for stormwater projects and other significant investments, including road culverts for fish.
"I don't want any carbon charge, but…the fact of the matter is, something's going to happen," Hobbs said. "We need to take destiny in our own hands and pass something that the whole state can benefit from."
Employers also met with the chair of the Senate Labor and Commerce Committee, State Sen. Karen Keiser, D-Kent.
Tanya Neilsen, who owns Thrive Community Fitness in Maple Valley, told Keiser about the cumulative impacts of new state laws on employers. She mentioned new minimum wage and paid family leave requirements, and the possibility of new rules around predictive scheduling. There are now fewer employees and the fitness center is open less than when it began, she explained.
"Although those employees are making more, there's fewer employees being employed," she said. "And of those employees, there's fewer entry-level employees."
Hill Climb and Legislative Priorities
After lunch, more than 50 employers and business leaders covered the Capitol Campus one-on-one meetings with state lawmakers to discuss everything from tax and fiscal policy to support for rural communities and much more.
State Leaders Visit AWB Board Meeting
House and Senate legislative leaders, and Gov. Jay Inslee visited the AWB Board meeting Tuesday afternoon.
AWB member Nicole Sohn asked Democratic leaders how to keep the discussion about child care and early learning bipartisan, and if they thought a capital gains tax is the best way to fund early learning.
Senate Majority Leader Andy Billig, D-Spokane, said early learning works on so many levels, from changing the trajectory of a child's life to improving graduation rates and helping employees and employers. Some proposals in the Legislature this year are aimed at raising the state subsidy for working parents to be able to afford child care, as well as invest in more training for educators.
"What we need to do in early learning is probably a billion dollars a year," Billig said. "Now it's the best billon dollars the state could ever spend." Child care has traditionally been a bipartisan issue, he said.
"But we've got to pay for it somehow," he said. "And I think it is hard to find the support, to find the money, in a bipartisan way."
House Speaker Laurie Jinkins, D-Tacoma, noted her background in public health, and that she sees early learning and child care as "primary prevention."
And the issue is impacting many families.
"There's a (child care) shortage for folks who are low income, for folks who are middle income, for folks who are high income," Jinkins said. "Basically, there is a shortage of access to high quality child care across the board in this state."
As far as paying for more services with a capital gains tax, Jinkins said, "There are not a lot of alternatives out there." She also noted that while she has sponsored capital gains tax bills in the past, her new job is Speaker of the House, not to advocate for different bills.
Republican leaders also addressed the board.
House Minority Leader J.T. Wilcox, R-Yelm, mentioned the state's housing shortage in his remarks."Turns out that a state report determined that we're about 250,000 housing units behind where we should be over the last 10 years," Wilcox said. "And it's no surprise to House and Senate Republicans. We've been talking about the roadblocks to home and all kinds of other construction for each one of those last 10 years."
In the House, he added, housing and construction "is the place that has become the most full of ideology."
Wilcox also said the current session is "anti-business."
Senate Republican Leader Mark Schoesler, R-Ritzville, urged the employer community to stick together and present a united front.
Later, Gov. Jay Inslee spoke with Tim Schauer, AWB’s immediate past board chair, and took questions from board members.
Inslee encouraged the business community to get involved in the Career Connect Washington program, which combines classroom learning with practical careers, especially in high-demand industries.
"This thing is going to rise or fall by business leadership," Inslee said. "The state government is not driving this show. We are the enablers of this, we are the coordinators, we are the people who can connect business people to the K through 12 system. But the real driving force is in business leadership."
Inslee said he became convinced of this when he visited Switzerland. There, a highly successful apprenticeship and workforce training system helps young people navigate the transition from school to career. AWB President Kris Johnson joined that trip as well.
"It is business leadership that identifies the need for a particular talent, and drives the curriculum and what we really need," Inslee said.
The Legislative Day and Hill Climb ended with a packed reception in the Capitol Rotunda. Dozens of lawmakers, employers and local chamber of commerce leaders from AWB's Grassroots Alliance enjoyed networking.
"This event was just amazing," Neilsen said at the reception. "What other opportunity do you get to meet with your legislators, go toe to toe with them, sometimes share not popular opinions, but things that they really do need to hear from us in a very constructive manner?"