Governor’s budget eyes new sources of revenue

With opposition to Washington Gov. Jay Inslee's proposed 2015-17 biennial budget coming from both sides of the aisle, the state's top executive says it's up to the Legislature to provide a better alternative.

Gov. Jay Inslee discussed the revenue portion of his proposed budget with the Reporter on Thursday.

With opposition to Washington Gov. Jay Inslee’s proposed 2015-17 biennial budget coming from both sides of the aisle, the state’s top executive says it’s up to the Legislature to provide a better alternative.

Inslee revealed his budget this week in separate portions, ending with his revenue strategy on Thursday. Staff members from Reporter newspapers met later that day in Bellevue to discuss the budget with the governor.

Inslee’s budget would fund a number of major state transportation projects over the next 12 years, including completing the State Route 520 floating bridge and Interstate 405 projects between Renton and Bellevue.

About $4.8 billion of that money would come from a cap-and-trade plan on carbon emissions that affects 130 of the state’s biggest polluters. That, the governor said, would advance the state’s clean air obligations without raising the gas tax. He added this has been a proven method in the United States and other parts of the world.

“This is not a rocket ship to the moon where we have to invent a new science,” the governor said. “This is a well-known, well-accepted, successful policy, so I don’t think there’s any reason we shouldn’t be able to learn from the experience of other states.”

The governor said he’s open to other ideas, adding his budget has encouraged Republican lawmakers to reconsider raising the gas tax for the 2015-17 biennium.

“It’s interesting; I’ve heard some critiques of this (emissions plan) where, all of a sudden, some of my Republican colleagues are falling in love with the gas tax,” Inslee said, “and I’m wondering where they’ve been the past two years.”

Inslee said his budget also includes a “mark of good faith” to Republican lawmakers by diverting up to $650 million in sales tax on transportation projects from the general fund into more transportation projects. Neither he nor his fellow Democrats think it is responsible, given the state’s education funding obligations, Inslee said.

About 40 percent of the projected revenue from a carbon emissions cap-and-trade would be dedicated to education funding through the general fund, Inslee said. Another $800 million a year in education funding would come from the governor’s proposed capital gains tax on the sale of stocks and bonds and other assets. The plan would not include a tax on retirement funds or home sales.

Inslee said another $400 million in spending cuts and cost savings will satisfy requirements of the McCleary decision — a court order requiring the state in increase funding for K-12 education — a year early. His budget supports all-day kindergarten statewide and would add more than 6,300 children in the state’s preschool program for low-income children.

The governor said he’s heavily committed to education funding, and his support is not based on orders from the state Supreme Court.

“We’re not doing this just to make nine people in black robes happy,” he said.

The governor’s budget does not fully fund Initiative 1351 by $2 billion in the next biennium. Initiative 1351 requires reducing class sizes for public schools by hiring more teachers, administrators and school district staff, but Inslee’s budget only funds grades K-3.

The Washington Education Association, which sponsored the initiative, is criticizing the governor’s budget proposal, but Inslee said his plan is a good-faith effort to begin funding I-1351.

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