As the budget agreement released yesterday heads toward just-in-time legislative approval, policy analysts, interest groups and journalists are attempting to digest the details. Here’s a quick overview of the coverage and analysis.
For Washington Research Council, Emily Makings provides a good, concise overview.
The new state budget that Washington lawmakers must approve by the end of Friday clocks in at $43.7 billion in spending over the next two years.
That represents a $5.2 billion revenue increase from existing and new taxes, including a hike in the state property tax, according to budget documents.
And it boost spending by 13.5 percent over the state’s present two-year operating budget…
That plan adds $7.3 billion to K-12 education over four years. Of that, $1.8 billion is spent in the 2017-19 budget.
The bulk of the new revenue comes from an increase in the state property-tax levy, which raises $1.6 billion through 2019. As that new levy is put in place, local property-tax levies used for school-worker salaries and other needs will be capped at a lower rate.
All of the budget information available can be found on the LEAP website.
The negotiated contracts with state workers will be funded, as The News Tribune reports.
The compromise budget provides $618 million in the next two years to help pay for the state worker contracts Gov. Jay Inslee’s office negotiated with a group of unions last summer. That money also would provide rate increases for certain non-state employees, such as home child care providers and adult family-home providers.
Under the negotiated contracts, most state employees would get cost-of-living increases of 2 percent this summer, followed by another 2-percent increase in July 2018 and a third 2-percent increase in January 2019. Some workers would receive higher targeted salary increases.
Under the agreement, the state will pour an additional $1.8 billion into public schools in the next two years and another $5.5 billion between 2019 and 2021. Those dollars will go to address the education funding mandate of the court’s McCleary decision.
Many of the new dollars will come from hiking the state’s common school levy to $2.70 per $1,000 of assessed valuation, a whopping 81-cent increase from the current level. The increase, expected to generate an estimated $4.1 billion in the next four years, would go into effect in 2018.
But while everyone can expect to pay more property taxes to the state, many will end up paying less in levies to their local school districts.
As part of the agreement, the maximum amount of maintenance and operation levies will be $1.50 per $1,000 of assessed value of property or $2,500 per pupil, whichever is less. In districts with high property values, it is unlikely they will be able to charge the full $1.50.
With the NW News Network, Austin Jenkins reports,
Republican John Braun chairs the Senate budget committee and first proposed the property tax swap months ago.
“We expect that 73 percent of the state’s taxpayers will see a net property tax reduction.”
…The final deal does include some of the taxes Democrats proposed. For instance it requires out-of-state internet sellers to collect sales tax from Washington customers. And it ends the sales tax break for bottled water.
But it also extends some new tax breaks to businesses that Republicans wanted. And it gives all manufacturing businesses the low Boeing rate on the Business and Occupation tax.
The Associated Press coverage includes some details on teacher compensation.
The outline of the education plan provided Thursday sets a minimum starting salary for teachers at $40,000, with adjustment for inflation and regional differences. Under the plan, the average minimum salary for instructional staff will be $64,000, and adding in regionalization, it will range from $66,194 to $82,081. School districts can pay a salary over the maximum of $90,000 by up to 10 percent for educational staff associates or teachers who teach science, technology, engineering, math or in bilingual or special education programs.
Also under the measure:
—There’s a mandatory 10 percent increase after 5 years of employment.
—Starting in 2020-21, the minimum state allocations for salaries must be adjusted annually for inflation.
—Starting with the 2023 session, and every six years after that, the Legislature must review compensation to make sure they are adequate based on the market and economic differences between school districts.
See also this report in the Spokesman-Review.
While most everyone is disappointed that the negotiations have led to the rush to complete budget work at the possible minute, the National Conference of State Legislature reports that Washington is, in this instance, not unique.
All but four states start their next fiscal year on Saturday, and legislatures in 11 of those states had yet to finalize a budget as of Wednesday, according to the National Association of State Budget Officers.
“It’s not untypical to wait to the end. What’s untypical is the degree of crisis that we’re seeing in terms of not being able to make the budget balance,” said Elizabeth McNichol, senior fellow at the left-leaning Center on Budget and Policy Priorities. She noted this kind of stress in budget negotiations is more common during a downturn.
The report goes on,
Nowhere are the budget pressures greater than in Illinois, which faces a possible debt downgrade to junk status and hasn’t had a budget for two years. The two-year budget stalemate has resulted in a nearly $15 billion backlog in unpaid bills. Gov. Bruce Rauner has told lawmakers he will keep them in session beyond Friday’s deadline if they fail to agree on a balanced budget.
Some states are finding a way forward. Washington state lawmakers Wednesday reached the outline of a deal that would avert a partial government shutdown. The sides had been at odds over education funding.
Elsewhere, states like Pennsylvania and Connecticut are struggling to fill large deficits.
“There’s still a core number [of states] that are dealing with the fact that revenue is just not growing at the same pace as expenditures,” said Marcy Block, lead Fitch Ratings analyst for Connecticut, New Jersey and Delaware.