Freeing our future: Artwork supporting a capital gains tax
Freeing our future: Artwork supporting a capital gains tax (Artwork on the grounds of the Washington State Capitol Campus, photographed by Balance Our Tax Code)

His­to­ry has been just made in the Wash­ing­ton State Legislature!

More than six years after Gov­er­nor Jay Inslee first put the idea on the table for law­mak­ers’ con­sid­er­a­tion, the Wash­ing­ton State Sen­ate has joined the State House in giv­ing final approval to a bill (ESSB 5096) that would at last levy a cap­i­tal gains tax on the wealthy to bal­ance Wash­ing­ton’s tax code and raise sore­ly need­ed fund­ing to sup­port our fam­i­lies’ child­care needs.

Levy­ing a cap­i­tal gains tax on the wealthy has long been one of the North­west Pro­gres­sive Insti­tute’s top leg­isla­tive pri­or­i­ties. NPI research has con­sis­tent­ly found robust pub­lic sup­port for levy­ing a cap­i­tal gains tax on the wealthy.

A total of 59% of like­ly Wash­ing­ton vot­ers sur­veyed expressed sup­port when we asked about levy­ing a cap­i­tal gains tax to fund edu­ca­tion last May, with just 32% express­ing oppo­si­tion — few­er than the per­cent­age express­ing strong sup­port (42%). 9% said they were not sure. (For more details, read this post.)

“I’m glad to see the Leg­is­la­ture pass Sen­ate Bill 5096,” tweet­ed Gov­er­nor Jay Inslee, adding: “This bill will help us address our upside down tax sys­tem and has been one of my pri­or­i­ties for years. It’s a good day in Wash­ing­ton State.”

The water­shed vote came on the final day of the 2021 leg­isla­tive session.

Twen­ty-five Demo­c­ra­t­ic sen­a­tors agreed to adopt the final ver­sion of the bill nego­ti­at­ed in a con­fer­ence com­mit­tee with the House late last week, while three Demo­c­ra­t­ic sen­a­tors joined all twen­ty-one Repub­li­cans in vot­ing nay.

The roll call was as follows:

ESSB 5096
Cap­i­tal gains tax
Sen­ate vote on Final Pas­sage as Rec­om­mend­ed by Con­fer­ence Committee

Yeas: 25; Nays: 24

Vot­ing Yea: Sen­a­tor Bil­lig, Car­lyle, Cleve­land, Con­way, Darneille, Das, Dhin­gra, Frockt, Hasegawa, Hunt, Keis­er, Kud­er­er, Liias, Lovelett, Nguyen, Nobles, Ped­er­sen, Ran­dall, Robin­son, Rolfes, Sal­daña, Salomon, Stan­ford, Well­man, Wil­son (Claire)

Vot­ing Nay: Sen­a­tor Braun, Brown, Dozi­er, Erick­sen, For­tu­na­to, Gildon, Hawkins, Hobbs, Holy, Hon­ey­ford, King, McCune, Mul­let, Muz­za­ll, Pad­den, Rivers, Schoesler, Shel­don, Short, Van De Wege, Wag­oner, War­nick, Wil­son (Jeff), Wil­son (Lyn­da)

The Demo­c­ra­t­ic sen­a­tors who vot­ed nay were Kevin Van De Wege of the 24th Dis­trict, Mark Mul­let of the 5th Dis­trict, and Steve Hobbs of the 44th District.

Van De Wege was pre­vi­ous­ly a sup­port­er of the bill when it orig­i­nal­ly came up.

He trad­ed places with Annette Cleve­land, of the 49th Dis­trict, who was in the no camp on the last go-around, but became an aye vot­er for this last and most essen­tial vote, the final step in get­ting SB 5096 out of the Legislature.

Inslee first pro­posed levy­ing a state cap­i­tal gains tax on the wealthy in Decem­ber of 2014, ahead of the 2015 long ses­sion. At the time, Repub­li­cans con­trolled the Sen­ate, and they pre­dictably refused to give the idea any consideration.

Democ­rats regained a work­ing major­i­ty in the Sen­ate near­ly three years lat­er fol­low­ing Man­ka Dhin­gra’s vic­to­ry in the 45th Leg­isla­tive Dis­trict, and then expand­ed their majori­ties in both cham­bers in the 2018 midterms.

These elec­tions yield­ed more sub­stan­tive con­ver­sa­tions about levy­ing a cap­i­tal gains tax, but still no action. The 2018, 2019, and 2020 ses­sions all adjourned Sine Die with no vote on a cap­i­tal gains tax bill in either cham­ber, large­ly owing to the fact that not enough Sen­ate Democ­rats were on board with the idea.

Then came last year’s pres­i­den­tial elec­tion. Though Democ­rats saw no net change in seats in either cham­ber, the com­po­si­tion of each cau­cus changed.

Cru­cial­ly, in the Sen­ate, the 28th Dis­trict ceased to be rep­re­sent­ed by anti-tran­sit Repub­li­can Steve O’Ban and instead became rep­re­sent­ed by Demo­c­ra­t­ic Sen­a­tor T’wina Nobles. Nobles, who host­ed NPI’s 2020 FallFest last autumn, pro­vid­ed a cru­cial vote for ESSB 5096 ear­li­er this ses­sion and did so again today, enabling the bill to secure the con­sti­tu­tion­al major­i­ty need­ed for passage.

Sen­a­tor Nobles’ work and pres­ence in Olympia is a tes­ta­ment to the dif­fer­ence that one per­son can make in our sys­tem of rep­re­sen­ta­tive government.

Sen­a­tor Nobles is a coura­geous and exem­plary law­mak­er. We can­not thank her enough for her out­stand­ing rep­re­sen­ta­tion of the 28th Dis­trict in her inau­gur­al ses­sion. What an impres­sive start to her career in pub­lic service!

Among the sev­en­ty-sev­en Democ­rats who vot­ed for this bill, there are four in addi­tion to Sen­a­tor Nobles who deserve spe­cial recognition:

  • State Rep­re­sen­ta­tive Noel Frame, the Chair of the House Finance Committee;
  • Sen­a­tor June Robin­son, the prime spon­sor of ESSB 5096 and a vice chair of the Sen­ate Ways & Means Committee,
  • Sen­a­tor Chris­tine Rolfes, the Chair of Ways & Means,
  • and Rep­re­sen­ta­tive Tana Senn, the prime spon­sor of the com­pan­ion bill in the State House Representatives.

These incred­i­ble women worked tire­less­ly through­out the ses­sion to ensure this vic­to­ry could become a real­i­ty. Their lead­er­ship and stead­fast­ness was piv­otal. We would­n’t be here today with­out their efforts. We hope Cas­ca­dia Advo­cate read­ers will join us in thank­ing them for the time and tal­ent they brought to this cause.

Our work is not done, of course. There is sure to be a legal chal­lenge, although the work of defend­ing SB 5096 in court will fall pri­mar­i­ly to Attor­ney Gen­er­al Bob Fer­gu­son’s office, who we have no doubt will assem­ble an out­stand­ing team to give this leg­is­la­tion the best pos­si­ble defense it could pos­si­bly have.

There may also be a chal­lenge from the oppo­si­tion in the form of an ini­tia­tive to the peo­ple for 2021 or (more like­ly) an ini­tia­tive to the leg­is­la­ture for 2022.

Through our Per­ma­nent Defense project, NPI has near­ly two decades of expe­ri­ence com­bat­ing right wing bal­lot mea­sures. We will glad­ly con­tribute all of that expe­ri­ence to the coali­tion that forms to defeat any bal­lot mea­sure that attempts to over­turn this vital­ly impor­tant, fis­cal­ly respon­si­ble legislation.

Today, though, is a day of celebration.

Today, the leg­isla­tive process worked, and yield­ed a bill that will final­ly require the wealthy in our state to pay a bit more in mem­ber­ship dues to sup­port the essen­tial pub­lic ser­vices that make our com­mu­ni­ties strong and healthy.

Onward to the bill signing!

About the author

Andrew Villeneuve is the founder and executive director of the Northwest Progressive Institute, as well as the founder of NPI's sibling, the Northwest Progressive Foundation. He has worked to advance progressive causes for over two decades as a strategist, speaker, author, and organizer. Andrew is also a cybersecurity expert, a veteran facilitator, a delegate to the Washington State Democratic Central Committee, and a member of the Climate Reality Leadership Corps.

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