Democrats eyeing the need for higher taxes

Even with a robust economy, the majority party may seek more revenue to carry out its wish list.

OLYMPIA — Democratic legislative leaders are gearing up for one of the most challenging conversations this session: taxes.

With control of the state House and Senate, their members are bent on using the next state budget to make a dent in curing social ills, correcting economic wrongs and combating climate change.

They desire to transform the state’s mental health system, end homelessness, build housing, expand pre-school education, make college tuition free, boost special education funding, broaden access to health care, provide pay raises for state workers, clear every blocked fish passage and save the Southern Resident orcas.

This is an expensive list, far more expensive than can be afforded with the amount of revenues expected to flow into state coffers.

Democratic leaders of the two chambers aren’t ready to come right out and say they intend to raise taxes. On Tuesday, they did provide reporters with a chart showing why they think there may be no other choice.

It shows that revenues are expected to reach $50 billion for the two-year budget that begins July 1 but the cost of continuing current state programs as is, plus the tab for McCleary school funding commitments, add up to $51.1 billion.

Theoretically, the gap can be covered with existing reserves, they said.

Not part of the equation are all those investments — code for new spending — their members want to do. They cost a couple more billion dollars.

As party leaders try to keep a lid on members’ expectations, they seem to be constructing a case for a spend-and tax approach in budgets to be released next month.

“Nobody wants to raise taxes for the sake of raising taxes,” Senate Majority Leader Andy Billig, cq JCD-Spokane, said Tuesday.

Gov. Jay Inslee, also a Democrat, reached the taxes-are-necessary line a couple months ago.

As part of his proposed budget, Inslee called for creation of a new tax on capital gains, an increase in the business tax rate paid by professional services and changing the state’s share of the real estate excise tax from a flat rate to a graduated rate. In all, these would bring in roughly $3.7 billion.

The governor said earlier this week he has not delved deeply on the topic of taxes with lawmakers as he figured they need time to get a better handle on the situation.

“I think legislators are just now coming to grips with the financial challenges we have,” he said.

Thus far, lawmakers haven’t expended much energy on a capital gains tax or hiking the business and occupation tax rate. But they are looking at reworking the state’s share of the real estate excise tax, or REET. The idea is replace the flat rate of 1.28 percent imposed on each sale of property with a four-tier graduated rate.

And right now some Democrats disagree with the governor’s approach.

Inslee suggests setting rates of 0.75 percent on sales of property valued at less than $250,000, 1.28 percent for properties worth between $250,000 and $999,999, 2 percent rate on those valued between $1 million and $5 million, and 2.5 percent on properties valued above $5 million. And he wants the resulting $400 million steered into the state transportation budget to remove barriers to fish passage.

Rep. Noel Frame, D-Seattle, authored House Bill 1921 which would impose the lower rate of 0.75 percent on sales of properties up to $500,000. It would apply the 1.28 percent rate on sales between $500,000 and $1.5 million, 2 percent on those between $1.5 million and $7 million and 3 percent if the selling price is greater than $7 million.

And her bill keeps the money in the operating budget and directs a portion into development of affordable housing. It received a hearing this week.

That doesn’t mean it’s a done deal. It is a signal the conversation on taxes is going to get serious, soon.

Jerry Cornfield: 360-352-8623; jcornfield@herald net.com. Twitter: @dospueblos


In consideration of how we voice our opinions in the modern world, we’ve closed comments on our websites. We value the opinions of our readers and we encourage you to keep the conversation going.

Please feel free to share your story tips by emailing editor@bothell-reporter.com.

To share your opinion for publication, submit a letter through our website https://www.bothell-reporter.com/submit-letter/. Include your name, address and daytime phone number. (We’ll only publish your name and hometown.) We reserve the right to edit letters, but if you keep yours to 300 words or less, we won’t ask you to shorten it.

More in Opinion

Back to the wild — a whole new outdoor recreation world | Guest editorial

When enjoying the great outdoors, continue to socially distance and be aware of how else COVID-19 has changed our world.

KCLS is stepping up its commitment to patrons

KCLS has expanding its online resources so patrons can continue to learn, build skills, stay entertained and remain mentally and physically active amid the pandemic.

The true meaning of community | Guest editorial

LWTech president Dr. Amy Morrison reflects on how the COVID-19 outbreak has brought the community together.

Deserving respect for being human | Windows and Mirrors

Since the COVID-19 outbreak began, Asians and Asian Americans have been targeted. Here’s what’s been happening on the Eastside.

Thank you grocery store clerks

Recognizing the sacrifices of our unsung essential workforce.

Now is the time to be kind to each other | Windows and Mirrors

As the COVID-19 outbreak continues, it is important for us to be there for others in our communities.

To our elected officials: Be bold, be consistent, be honest, be helpful

By Patrick Grubb, Washington Newspaper Publishers Association Governor Jay Inslee has been… Continue reading

Libraries are the place to go according to poll

Library will host short film festival on March 20.

A way to keep us healthy | Letter

A way to keep us healthy A problem has occurred recently that… Continue reading

We need to think before we act | Windows and Mirrors

As coronavirus has led to xenophobia and racism against Asians, we should all stop and think before acting on our biases.

Gov. Inslee is cordially invited to Kirkland, Eastside

We need the governor here to know we’re a priority, not in Olympia or on cable news channels.

The state has too much money and it’s a problem

With revenues rising, budget writers are going to get lots of requests on how to spend it