Lawsuit filed by banking groups calls more attention to Legislature’s use of title-only bills

Last week’s lawsuit filed by two banking associations has again highlighted the mischief caused by lawmakers’ use of title only bills as placeholders for last minute legislation. (We wrote about the process and policy problems associated with the 11-hour tax hike on banks in Monday’s newsletter.)

The Columbian editorial board takes aim at title-only bills, calling them an end-run around transparency.

Questions about the legality of House Bill 2167, adopted this year, likely are headed to court, following a lawsuit filed by the Washington Banking Association and the American Bankers Association. That bill essentially will double the Business & Occupation tax to 3 percent for banks with an annual net income of at least $1 billon. It was passed in the waning days of the session as the Democratic-led Legislature adopted a slew of new taxes to pay for the largest budget in state history.

The banking associations argue that HB 2167 violates both the state constitution and the U.S. Constitution’s Commerce Clause by creating “an unconstitutional differential tax rate for in-state and out-of-state institutions.”

We will leave questions of constitutionality to the courts. But the lawsuit should bring attention to the absurd use of “title-only” bills by the Legislature.

Washington Policy Center analyst Jason Mercier, a long-time critic of title-only bills, considers the attorney general’s motion to dismiss the associations’ suit.

The Attorney General’s office yesterday filed a motion to dismiss the Title Only bill lawsuit against the legislature. The lawsuit represents the first legal challenge to the legislature’s use of Title Only bills to circumvent the state constitution. The stealth tax increase imposed by HB 2167 is the epitome of what Washington’s constitution tries to avoid—brand new bills in the waning hours of session rammed through without adequate public input. Reading the Attorney General’s brief defending lawmakers use of Title Only bills immediately reminded me of Judge Dredd shouting: “I never broke the Law! I am the law!”

According to the Attorney General, the courts have no right to second guess what the legislature does when adopting laws under separations of power.

Here’s the AG’s brief.

Mercier also rounds up a host of editorials criticizing the practice, including those in the Tri-City Herald, Everett Herald, and Walla Walla Union-Bulletin.

Process and transparency matter. Mercier writes that the first court hearing on the lawsuit will be January 9, 2020. Should be both interesting and consequential.