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Washington State House passes amended transportation revenue bill; Senate concurs

It took until the wee hours of the morning, but the Legislature has finally reached agreement on the revenue component for a new transportation package.

By a vote of fifty-four to forty-four, the House of Representatives voted to send an amended version of Second Engrossed Substitute Senate Bill 5987 (2ESSB 5987) over to the Senate. The major change made by the House was to eliminate the so-called ransom, or tribute, that the Senate wanted Sound Transit to pay to the state treasury in return for getting its new revenue authority, which it can use to place a Sound Transit 3 measure on the ballot next year.

The ransom would have consisted of a sales and use tax levied on construction projects, capped at just over $500 million (which is a lot of money).

The new language instead allows Puget Sound to keep these funds, and requires that the region spend it on education — which to us seems appropriate.

Here is the relevant final language from Section 422 (PDF):

(1) Beginning January 1, 2017, and until the requirements in subsection of this section are met, a regional transit authority must pay to the department of revenue, for deposit into the Puget Sound taxpayer accountability account, a sales and use tax offset fee.

(2) A sales and use tax offset fee is three and twenty-five one-hundredths percent of the total payments made by the regional transit authority to construction contractors on construction contracts that are
(a) for new projects identified in the system plan funded by any proposition approved by voters after January 1, 2015, and
(b) excluded from the definition of retail sale under RCW 82.04.050(10)

Section 423 stipulates how the money must be spent:

1) The Puget Sound taxpayer accountability account is created in the state treasury. Moneys in the account may be spent only after appropriation. Expenditures from the account may only be used for distribution to counties where a portion of the county is within the boundaries of a regional transit authority that includes a county with a population of one million five hundred thousand or more.

Counties may use distributions from the account only for educational services to improve educational outcomes in early learning, K-12, and higher education including, but not limited to, for youths that are low-income, homeless, or in foster care, or other vulnerable populations. Counties receiving distributions under this section must track all expenditures and uses of the funds.

To the greatest extent practicable, the expenditures of the counties must follow the requirements of any transportation subarea equity element used by the regional transit authority.

(2) Beginning September 1, 2017, and by the last day of September, December, March, and June of each year thereafter, the state treasurer shall distribute moneys deposited in the Puget Sound taxpayer accountability account to counties for which a portion of the county is within the boundaries of a regional transit authority that includes a county with a population of one million five hundred thousand.

The treasurer must make the distribution to the counties on the relative basis of that transit authority’s population that lives within the respective counties.

We have State Representative Jessyn Farrell to thank for this amendment, which keeps this pot of money under local control. No doubt King County Executive Dow Constantine and his fellow executives Pat McCarthy and John Lovick from Pierce and Snohomish Counties are pleased with this development.

The roll call on final passage was, as mentioned, fifty-four to forty-four. Ten Republicans crossed over to help most of the Democrats pass the bill. Most Republicans voted nay, and a few Democrats joined them.

Voting Yea: Representatives Appleton, Bergquist, Carlyle, Clibborn, Cody, Farrell, Fey, Goodman, Gregerson, Hudgins, S. Hunt, Hunter, Hurst, Jinkins, Johnson, Kagi, Kirby, Kochmar, Lytton, McBride, Moeller, Morris, Moscoso, Muri, Nealey, Ormsby, Ortiz-Self, Orwall, Peterson, Pettigrew, Pollet, Reykdal, Riccelli, Robinson, Rodne, Ryu, Santos, Sawyer, Sells, Senn, Springer, Stambaugh, Stanford, Stokesbary, Sullivan, Takko, Tarleton, Tharinger, Walkinshaw, Walsh, Wilcox, Wylie, Zeiger, Mr. Speaker [Chopp]

Voting Nay: Representatives Blake, Buys, Caldier, Chandler, Condotta, DeBolt, Dent, Dunshee, Dye, Fitzgibbon, Gregory, Griffey, Haler, Hansen, Hargrove, Harmsworth, Harris, Hawkins, Hayes, Holy, G. Hunt, Kilduff, Klippert, Kretz, Kristiansen, MacEwen, Magendanz, Manweller, McCabe, McCaslin, Orcutt, Parker, Pike, Schmick, Scott, Shea, Short, Smith, Taylor, Van De Wege, Van Werven, Vick, Wilson, Young

Democrats who voted nay were:

  1. Brian Blake
  2. Carol Gregory
  3. Hans Dunshee
  4. Joe Fitzgibbon
  5. Drew Hansen
  6. Christine Klduff
  7. Kevin Van De Wege

Republicans who voted aye were:

  1. Norm Johnson
  2. Linda Kochmar
  3. Dick Muri
  4. Terry Nealey
  5. Jay Rodne
  6. Melanie Stambaugh
  7. Drew Stokesbary
  8. Maureen Walsh
  9. J.T. Wilcox
  10. Hans Zeiger

The House vote on final passage took place well after 1 AM, after a floor debate that featured over a dozen speakers. Republicans such as Ed Orcutt, Jesse Young, and Liz Pike rose to denounce the bill, while Democrats like Jessyn Farrell, Judy Clibborn, and Dean Takko rose in strong support of it.

The bill retains the poison pill provision inserted by Senate Republicans that prevents Governor Jay Inslee from using his executive authority to set tougher pollution standards for vehicles, which caused our friend Joe Fitzgibbon (D-34th District; West Seattle, Vashon Island, Burien) to case a no vote in protest.

After the House sent the amended bill over to the Senate, the Senate decided to concur in the amendments by a vote of thirty-seven to to seven, with five excused.

2ESSB 5987 now goes to Governor Jay Inslee for his signature.

As it contains an emergency clause (Section 426), it will not be subject to a referendum, much to Ed Orcutt’s displeasure. (Orcutt had argued at length for sending the bill to voters, but his amendment to do so was defeated by the House.)

The House and Senate were not able to complete work on the other bills in the transportation package due to a bitter disagreement in the Senate over what to do with Initiative 1351 (last year’s WEA-sponsored initiative requiring smaller class sizes, which the Legislature has chosen not to fully fund).

The disagreement over I-1351 has brought the Senate to a temporary halt, and the House has opted to take a break in the meantime. Lawmakers in the House were sent home around 3:30 AM this morning after it became clear the Senate was stuck.

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