by John Stafford
“The Legislature has just wrapped up an historic and truly extraordinary session. It has been the most innovative, having produced unprecedented and legacy making advances as all-encompassing as any session in the last 25 years.”— Governor Jay Inslee, April 25, 2021
The Washington State Legislature has just completed its 2021 session — a 105-day event charged with passing three state budgets (operating, transportation and capital) and hundreds of policy bills, conducted exclusively online. From a liberal perspective, this has been an exciting and momentous session, with major legislative achievements in a wide range of areas.
I’ll evaluate the 2021 Legislative Session in 14 different areas: state budgets, tax reform, pandemic response, economic relief, housing and homelessness, K–12 education, health care, racial justice, criminal justice, gun control, labor, climate change, growth management act, and other, and give the session an overall grade.
The State Budgets
The Operating Budget (ESSB 5092)
The operating budget is the primary state budget, and it covers the daily operating expenses of state government. For the last biennium (2019–2021), the operating budget was roughly $52 billion. Four major budget proposals were introduced during this legislative session: Governor Inslee’s $57.6 billion budget, the $55 billion House Republican Budget, the $58 billion House Democratic Budget, and the $59.2 billion Senate Democratic Budget. All of the Democratic budgets contained new taxation; the Republican Budget did not. The final operating budget was $59.2 billion — a significant increase from the last biennium and at the high end of the four proposed budgets. The budget includes a range of important spending measures on key priorities, including $340 million in additional funding for the state’s Immigrant Relief Fund, making it the second largest fund in the country (behind New York), and substantial resources for addiction recovery.
The Capital Budget (SHB 1080)
The capital budget is used to finance K–12 school construction, general government facilities, broadband, and a variety of other needs. Again, different proposals are submitted toward the beginning of the session and then negotiated. The final capital budget was $6.2 billion, which is the largest in state history, and it includes critical funding in a number of areas.
The Transportation Budget (SSB 5165)
The transportation budget has not yet been finalized. There were several major transportation budget proposals under consideration: Democratic Sen. Rebecca Saldana’s $14.3 billion, 12-year plan, Democratic Sen. Steve Hobbs’ $18–19 billion, 16-year proposal, Republican Sen. Curtis King’s $10 billion, 8-year plan, and Democratic Rep. Jake Fey’s $26 billion, 16-year package. There are major philosophical differences in the approach taken by each of these proposals based on the extent to which they focus on traditional transportation (e.g., new roads, widening of existing roads, etc.) versus climate change-sensitive transportation (e.g., transit, bike lanes, pedestrian lanes, etc.). Major projects that are candidates for transportation funding in these proposals include the I-5 Columbia River Bridge Replacement Project between Washington and Oregon, a new Highway 2 Trestle in Everett, investment in the SR 167 and SR 509 Puget Sound Gateway, I-405 enhancements, repair of the West Seattle Bridge, Sound Transit, and fish culvert improvements to support salmon runs.
A number of environmental groups did not believe that any of the transportation budget proposals were sufficiently progressive to warrant passage (although the Fey proposal was deemed to be the closest). In the end, no consensus was achieved and no comprehensive transportation budget was passed. However, a smaller stop-gap budget ($11.8 billion) was passed, which Hobbs has described as, “Just enough to keep the lights on.” This will serve as an interim budget, while negotiations proceed to pass a final transportation budget. The passage of a final transportation budget with a $0.05 per gallon (or greater) gas tax increase is a precondition for the passage of two major climate change bills.
I give top marks to both the operating budget and the capital budget — they are high-quality, progressive, and do an excellent job of meeting the demands of our times. The transportation budget, however, is a weak, interim, place-holding measure, warranting a low grade, with the final grade uncertain until a final budget is passed.
Tax Reform: A
Capital Gains Tax (ESSB 5096)
The Washington State Legislature passed significant new progressive taxation in the form of a capital gains tax. The tax, sponsored by Democratic Sen. June Robinson, calls for a tax of 7% on capital gains in excess of $250,000, with exemptions for a number of asset classes (e.g., retirement accounts, real estate, etc.). This is one of the most exciting events of this session, as it is a major step toward restructuring the state’s tax code. This bill was strenuously opposed by Republicans. The conservative Freedom Foundation has already filed a lawsuit challenging its legality.
Working Families Tax Credit (ESHB 1297)
This bill provides tax rebates to lower-income individuals and families (it is similar in design to the federal Earned Income Tax Credit). This program was created by lawmakers in 2008, but has not been funded until this year. Unlike the capital gains tax, this bill passed with bipartisan support.
These two measures are highly consequential and thus deserve a high grade. They provide funding for critical needs, and they begin to address one of the biggest problems in the state: the regressive nature of our tax code. Washington has the most regressive tax system in the country, with its lowest 20% of earners paying nearly six times the rate in state and local taxes as a percentage of income (17.8%) as its top 1% income earners (3.0%). This is because Washington is one of just seven states without an income tax or a capital gains tax, and thus relies heavily on the sales tax. Several capital gains proposals have been introduced in Olympia in recent years, but none have passed. This year’s bill will raise over $400 million per year, and represents a major structural breakthrough for the state. The bill was passed with a clause stating that it was, “necessary for the support of the state government and its public institutions,” which means that it cannot be challenged by citizen referendum (although it can be challenged by citizen initiative).
Pandemic Response: A-
The legislature passed a number of important bills to address the health risks associated with the pandemic:
- ESHB 1368: Channels federal funds to initiatives to address COVID-19
- 2SHB 1148: Provides protections for patients in acute care facilities
- E2SSB 5237: Expands affordable child care and early learning programs
- ESSB 5115: Establishes emergency labor standards that reflect the added health risks associated with the pandemic
- E2SHB 1073: Expands the state’s Paid Family and Medical Leave program for workers whose hours were cut due to COVID-19
Several bills did not pass, including HB 1486 that would have extended unemployment insurance benefits to individuals who voluntarily quit their employment in order to care for a child or vulnerable adult due to the pandemic. Nevertheless, the legislature’s response to the pandemic has been strong.
Economic Relief from the Recession: A-
The legislature has also crafted bills to address the economic hardship emerging from the pandemic-driven recession for both individuals and businesses. These include:
- ESHB 1368: Provides economic relief to citizens, and directs the deployment of federal stimulus money
- SHB 1151: Provides public support, including food relief, for individuals in need
- 2SSB 5214: Increases access to the state’s welfare program (Temporary Assistance for Needy Families, or TANF)
- ESSB 5061: Provides economic relief for businesses
- ESSB 5478: Minimizes unemployment rate increases for businesses that would otherwise take effect due to the pandemic
These and other bills will help jumpstart the economic recovery. In the aftermath of the Great Recession (2007–2009), the state implemented an austerity approach: cutting benefits in an attempt to balance the state’s budget. This approach had devastating impacts on lower-income individuals and families and served to prolong the recession. Thankfully, the State has adopted the opposite strategy to deal with the pandemic-driven recession: spending on relief. This, coupled with federal aid from the Biden administration, should significantly accelerate the economic recovery.
The legislature has also done a good job of addressing the affordable housing shortage and providing funding to address homelessness. The capital budget contains $175 million for the Housing Trust Fund. In addition, several key bills were passed, including:
- E2SSB 5160: Extends the eviction moratorium for tenants and provides both tenant and landlord protections during the pandemic
- ESHB 1236: Protects tenants by limiting the reasons for eviction (referred to as “Just Cause Eviction”)
- E2SHB 1277: Increases the Real Estate Document Recording Fee in order to support affordable housing
K–12 Education: A-
The state made significant progress in supporting the reopening of schools in light of the many challenges presented by the pandemic, as well as the rise in racist incidents in our schools. There is funding for additional counselors and nurses in lower-income school districts. In addition, the following bills have passed:
- SHB 1225: Increases support for school-based health care facilities
- SSB 5030: Provides additional funding for mental health care in schools
- EHB 1342: Eliminates the school lunch co-pay requirement for students in need
- SHB 1221: Provides a means of graduating for students who are at risk of not graduating due to the pandemic
- ESSB 5044: Requires anti-racism and cultural competency training in K–12 schools
- SHB 1356: Bans the use of Native American mascots in schools
Health Care: A-
A number of important changes dealing with affordability, equity, and service provisions were made in the field of health care. These will provide near-term improvements to our health care system. In addition, an important bill to establish a commission to study the long-term viability of a single-payer health care system in Washington state also passed, making health care yet another area where there has been strong progress in the 2021 Legislative Session.
- E2SHB 1152: Strengthens Public Health Care Districts and creates a Public Health Advisory Board
- E2SHB 5377: Increases the affordability of health care plans in the individual health care market
- SSB 5068: Provides one year of postpartum insurance coverage via Apple Health
- E2SHB 1477: Established new 988 telephone hotline for responses to behavioral health and suicide risk emergencies
- SSB 5228: Pursues equity training in health care industry
- E2SSB 5052: Pursues health care equity by establishing regional equity zones
- 2SSB 5313: Precludes discrimination based on gender identity in the provision of health care services
- SSB 5185: Improves capacity for informed consent for health care decisions (and does not require parental consent for abortion decisions by minors)
- E2SSB 5399: Establishes a commission to study the possibility of universal, single-payer health care in Washington state
Racial Justice: A-
The massive protests this past summer in response to the killing of George Floyd have led to demands for legislative changes in the nature of policing in our society. In response, legislators introduced a large number of compelling proposals dealing with police reform. The following is a partial list:
- ESHB 1054: Bans the use of certain police procedures (e.g., chokeholds, no-knock warrants), bans the use of military equipment by police departments, requires permission for tear gas usage in most circumstances, etc.
- E2SHB 1310: Establishes standards for use-of-force by police officers
- SSB 5066: Establishes standards for police officers to report on use-of-force incidents involving other officers
- E2SSB 5259: Requires statewide reporting on police use-of-force incidents
- SB 5051: Provides additional bases upon which police officers can be certified/decertified
- ESHB 1267: Establishes independent Office of Investigations to investigate incidents of police use of deadly force
The legislative response to this challenge has been impressive. The only concern that I will raise is whether there is enough being done to address the deeper, more foundational problems of racial equity in our society.
Criminal Justice: A
This is another area where there has been significant, structural progress in the 2021 Legislative Session. Major bills include:
- ESHB 1078: Provides voting rights to ex-felons
- EHB 1090: Bans the presence of private, for-profit detention centers in the state
- ESB 5476: Temporary two-year legislation calls for charges for low-level drug possession charges to be reinstated (during the session, the Washington State Supreme Court issued its Blake decision, removing drug sentences for many of these charge) but reduced to misdemeanor infractions
- ESB 5164: Removes second degree robbery as a factor for determining “three-strikes” eligibility
Gun Control: B
There was a major legislative victory and a major legislative defeat in the realm of gun control:
- ESSB 5038: Prevents the open carry of weapons (including knives) at public demonstrations and at the Capitol
- SSB 5078: A significant bill to regulate high-capacity gun magazines did not pass
Two important labor measures passed:
- ESSB 5284: Precludes paying a sub-minimum wage to individuals with disabilities
- SB 5172: Ensures the fair payment of overtime wages for farmworkers
Climate Change: B+
The Climate Commitment Act (E2SSB 5126)
Washington has tried to pass a carbon tax several times in the past decade, to no avail. In this session, a major carbon pricing bill was passed. This huge piece of legislation calls for the 100 top emitters in the state (accounting for about 75% of the state’s emissions) to have their carbon emissions capped via tradable allowances which are auctioned to them. The emission allowances will be steadily decreased over time. This will reduce the state’s emissions and raise nearly $500 million per year for the state.
This is one of two major carbon pricing proposals introduced in the legislature this year. The other proposed using a “green bond” approach, where carbon emissions are taxed, and then bonds are sold that promise these future carbon tax revenues to investors in return for an upfront lump sum payment. This enables a large influx of upfront funding for climate change projects. But this bill did not pass. Many environmentalists (myself included) preferred the green bond measure. However, I still support the Climate Commitment Act, and hope that it will generate momentum to institute a national carbon pricing scheme.
The Clean Fuels Act (E3SHB 1091)
This requires transportation fuels to have a lower carbon content. In the prior two years, this bill has passed the House but not the Senate. This bill allows Washington to join Oregon and California as states with a clean fuel standard.
The Healthy Environment for All (HEAL) Act (E2SSB 5141)
This important legislation acknowledges that lower-income communities and communities of color will be most impacted by climate change. It calls for protocols to ensure that this reality is acknowledged and incorporated into climate change laws. It establishes an Environmental Justice Commission to pursue these objectives. This bill also failed each of the past two sessions, before passing this year.
It is important to emphasize that passing these three major bills in a single legislative session is a huge achievement, and immediately establishes Washington state as a national leader on climate change. A number of other climate change bills also passed, including:
- ESB 5026: Calls for cleaner operations at the state’s ports
- E2SHB 1287: Requires the state to prepare for a zero-emission transportation future, including moving to deploy far more electric vehicle charging stations
- E2SHB 1050: Calls for the heavy regulation of fluorocarbons (used in refrigerants)
- 2SHB 1168: Increases funding for wildfire prevention
- ESB 5158: Establishes a Wildfire Prevention Advisory Council
- E2SHB 1216: Improve the state’s urban and rural forestry
There are also areas of disappointment. As noted above, there is no transportation budget of consequence, and this has major implications for climate change. In addition, the following bills either did not pass or were passed in watered-down form:
- SHB 1204/SB 5256: In its original form, this bill called for the ban on the registration of new vehicles with an internal combustion engine starting in 2030. This bill did not proceed, but was reconfigured (and added to another bill) to be just an aspirational goal instead of a mandate.
- 2SHB 1075: This bill would have regulated the emissions of ride sharing services like Uber and Lyft. It did not pass.
- HB 1388: This bill would allow electric automobile manufacturers to sell directly to consumers rather than selling via dealers, which would lower costs and facilitate the expansion of the electric vehicle market. It did not pass.
- HB 1084/SB 5093: This bill called for the de-carbonization of buildings (e.g., by mandating the transition from gas-powered heat and light to electric heat and light). It did not pass.
Finally, two bills that in my view should have been introduced but weren’t are important to note. Last year, Gov. Inslee proposed declaring a state of climate emergency in the state, but this did not become law. A declaration of this nature was just passed in Hawaii. This proposal should certainly be re-introduced in the 2022 session. The second is a proposal calling for mandatory, comprehensive, interdisciplinary climate change education in K–12 schools statewide. There was a small bill to this effect that was introduced in the legislature last year, but it did not progress, and it was not a priority this year. New Jersey is the first state to pass major legislation in this area, and we should be next.
A number of environmental groups are ecstatic about the progress on climate change and environmental legislation during the session. The Washington Environmental Coalition wrote: “Wow. We still can’t believe what you helped make possible: the most significant legislative session for the environment in history.” This was an important session regarding climate change.
While the passage of the three major bills and several of the other smaller but still consequential bills represents tremendous progress, the extent to which we need to reduce carbon emissions to abate calamitous change is enormous. So we should be wary of being overly pleased when there is so much more work to do.
Growth Management Act: C-
The Growth Management Act (GMA) is a framework to manage growth and sprawl within the state. Some analysts refer to it as a sort of statewide zoning framework. The state is required to update its Growth Management Act (GMA) every eight years, and 2021 is an update year. Accordingly, there were a number of bills passed to address the GMA. One such bill was E2SHB 1220, calling for the incorporation of housing and shelter needs into the GMA. Unfortunately, many of the bills that called for climate change concerns to be addressed via the GMA did not pass. This is a critical legislative area because there are connections between the management of growth and other objectives such as density, affordable housing, homelessness and transit, all of which have implications for climate change. The lack of progress in this area was disappointing.
Three other important bills were passed:
- E2SHB 1139: Requires the State to address the problem of lead in drinking water
- ESHB 1372: Calls for a statue of Nisqually tribal member and fishing rights activist Billy Frank Jr. to replace the statue of Marcus Whitman in the U.S. National Statuary Hall
- HB 1016: Recognizes June 19 (“Juneteenth”) as a state-paid holiday
There were three areas where important legislation did not become law, but I believe may pass in the near future:
- E2SSB 5188: Calls for the creation of a state bank
- SHB 1156: Pursues ranked choice voting in Washington state
- SB 5062: Provides data protections and privacy to Washington residents
OVERALL EVALUATION: A-
There has been major legislative progress in a wide range of areas this legislative session. The operating budget and capital budget are outstanding. There are several bills that fundamentally restructure the manner in which the State operates, for the better. Through its efforts, legislators have meaningfully addressed the six concurrent crises that define our times: the pandemic, the recession, homelessness, our regressive tax structure, demands for racial justice, and climate change.
However, it is important to also be cognizant of the disappointments. Although the State made major progress on climate change, there were significant bills that did not pass, and other bills whose time has come but that were not even introduced. In short, this was a highly compelling session, but there are still major changes that need to be made.
Washington is one of 15 states with a Democratic trifecta (Democratic governor, Democratic control of the House, and Democratic control of the Senate). Democratic legislators have demonstrated how effective they can be when they take advantage of their majorities and pursue a bold agenda. We can hope that they will continue with their high-quality, momentous work in subsequent sessions.
John Stafford is a high school history teacher. He is active with the Democratic Party in South Seattle and with several climate change organizations. He recently completed a run for the state Legislature. He writes periodic articles on politics and policy for the South Seattle Emerald.
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