In yesterday’s newsletter we discussed the time it’s taking to understand the full impact of the fiscal actions taken at the close of the legislative session. The Washington Research Council has been unpacking the numbers, first with an analysis released last week. They’ve now published a second tally, updating the data. Unsurprisingly the toll is rising.
As updated, the major revenue increase bills passed in 2019 increase total revenues (to NGFO, WEIA, and other accounts) by at least $1.019 billion in 2019–21 and $2.801 billion in 2021–23. Of that, $998.3 million in 2019–21 and $1.470 billion in 2021–23 go to the NGFO + WEIA. Other legislation reduces total revenues by at least $138.0 million in 2019–21 and $80.1 million in 2021–23.
See the post for the more detail. And stay tuned. WRC analyst Emily Makings writes that the numbers are still not final.
As the Seattle Times editorial board writes, last minute tax tactics frustrates efforts to understand the effects of the legislation. The editorial focuses on the tax increase on major banks.
In the final hours before the end of the 2019 legislative session, Democrats in Olympia rammed through a tax increase on big banks. They used a parliamentary gimmick called a “title-only bill” to bypass the state constitution and cut the public out of the process…
This game gets around Article 2, Section 36 of the Washington State Constitution, which says that any bill must be introduced at least 10 days before the end of the session. A two-thirds vote can override that requirement.
Democrats didn’t have two-thirds support for their new bank tax, so they used title-only bill HB 2167, which emerged fully baked from behind closed doors. It targets out-of-state banks and would nearly double the business and occupation tax on those with at least $1 billion in profits worldwide. That would generate about $130 million for the state in the next biennium.
Democrats even blindsided their own banking experts. Sen. Mark Mullet, D-Issaquah, chairs the Senate Banking Committee. “I can 100% guarantee to every person in this body that not at one point has this committee looked at this issue that was presented on Friday — out of the blue, from nowhere — in any way, shape or form,” Mullet said before the vote.
As the editorial points out, Mullet contends the tax is probably unconstitutional, “but he couldn’t get a formal legal analysis in time because the state attorney general’s office was closed for the weekend.”