Governor calls for increased school funding, capital budget and new taxes in State of the State; GOP insists on Hirst fix

Gov. Jay Inslee yesterday delivered his 2018 State of the State address. (video, speech begins at about 32 minutes; view also the Republican response). In it he called on lawmakers to adopt a capital budget, fully fund the court-ordered increase in teacher salaries to satisfy the McCleary mandate, and take action on carbon pricing. There was more – it was a State of the State address, after all, and therefore came with a list of priorities – but those were some of the marquee items.

The Associated Press reports,

Gov. Jay Inslee made a forceful push Tuesday for a carbon tax in his annual state of the state address and urged lawmakers to quickly implement court-ordered increases in education funding…The Democratic governor has previously said he wants to use state reserves to help pay for education improvements ordered by the state Supreme Court. He would backfill that reserve withdrawal with about $1 billion in carbon tax revenues.

On education funding, the governor said,

Legislators can take pride that they passed a plan that will fully comply with the McCleary decision…

But the Supreme Court has made it clear that the plan needs to start one year earlier, and fortunately, we have the reserves to do that.

As we’ve written before, tapping the rainy day fund requires a supermajority vote. At this point, it’s far from clear that a supermajority of the Legislature agrees with either the governor’s sense of urgency – the plan will be fully funded, just one year later – or that accelerating the funding constitutes a proper use of the fund.

And with respect to the capital budget, the link to Hirst water rights legislation – unmentioned in the state of the state – remains challenging. As the AP reports,

Inslee told the Legislature that passage of the $4 billion budget was a crucial first order of business this session.

Lawmakers adjourned last year without passing the budget because of a dispute over how to address a court ruling related to water rights and well permits…

After the speech, Republicans expressed anger that Inslee didn’t mention the water bill in his speech and said that the two measures will continue to be linked together.

The Lens reports on Monday’s committee hearing on a Hirst bill.

The AP describes the governor’s carbon tax plan.

Under bills introduced in the House and Senate, a proposed tax of $20 per metric ton of carbon emissions would start on July 1, 2019 and increase annually by 3.5 percent over inflation.

The tax would raise about $1.5 billion over the first two years and an estimated $3.3 billion over the next four years. Half of the money from the tax — which would be paid by power plants and fuel importers but would ultimately affect consumers — would go into efforts to reduce greenhouse gas emissions, such as programs to expand opportunities for renewable energy at both homes and utilities, and research of clean energy technology. An additional 35 percent would go into flood management and storm water infrastructure, and would also be used to reduce risks of wildfires.

The AP indicates that the proposed legislation faces an uncertain future.

Democratic House Majority Leader Pat Sullivan said that while nothing is off the table, there are a diversity of opinions surrounding the tax within his caucus.

“It’s a challenge,” he said…

Republican leaders from the House and Senate criticized the costs that consumers could face under such a plan.

The Seattle Times reports on the plan in some depth, noting

But as in recent years, Inslee’s plan faces steep hurdles in Olympia.

The story provides useful perspective and history on one of the governor’s top priorities and how it’s viewed inside – and outside – legislative chambers.

My Northwest has seven takeaways from the speech.

And so begins Day 3 of the 60-day regular session.