Tuesday, July 25, 2017 This Week's Paper

State budget fails to include SR 167 funding

// Legislature guts public works funding pool, maintains social services

The state budget is now law. The two-year deal was passed by lawmakers on June 28 and got a gubernatorial signature on June 29. The signature came just hours before the old budget was set to expire and kick off a government shutdown last weekend.

Anyone thinking the legislative session that included two special sessions would have done more than craft a two-year budget would largely be wrong.

The state’s two-year operating budget weighs in at $33.6 billion and had been bogged down since April, when it was originally set for passage but what bogged down with fights over proposed tax breaks here and proposed tax hikes there to balance the books. It was the latest time lawmakers had passed a budget in two decades.

“There are certainly some good things in the budget but it makes you wonder why it took 153 days to do it,” City of Tacoma Government Relations Manager Randy Lewis said. “There is no reason that I can see that it would take this long to draw up.”

And even the “good things” were less victories than non-defeats. Social services funding, for example, was not cut as deeply as initial proposals suggested. But it did not increase either, even after deep cuts during the last two budgets.

“At least they didn’t make that worse,” Lewis said.

The state, for example did not take all of the money from liquor sales that was intended for local governments, as it did during the last budget. Lawmakers only took half of the money once bound for cities, which means Tacoma gets about $800,000 it had not expected.

The state budget avoids new taxes, by changing the laws on estate taxes and telephone fees to the tune of about $250 million but also includes many unsustainable accounting shifts that push big decisions to the next budget battle.

The state budget, for example, adds funding to public schools around the state, roughly about $1 billion, or a 12 percent bump, as a “down payment” to reach the estimated $3 billion funding gap outlined by the State Supreme Court’s McCleary v. State decision in 2012 that ruled Washington lawmakers were in violation of the state Constitution by failing its “paramount duty to amply fund” basic, public education. Estimates of doing that would have added about $3 billion to the state’s roster of spending. The added funding, albeit less than required, also comes as the Legislature voted down a cost-of-living increase for teachers for the second budget in a row, even after state voters approved an initiative to mandate the raises.

Much of the funding for that educational “down payment” comes from the six-year transfer of the state’s Public Works Trust Fund that provides local governments with low-interest loans for utility and road projects. That means governments will have to pay higher interest rates found on the private market to fund infrastructure projects.

Despite wide-reaching support, funding for the final, billion dollar-plus leg of State Route 167 did not make the budget cut. But lawmakers have pledged to look for “reforms” and “efficiencies” next year to keep that 30-year effort alive as a way to improve freight mobility between the industrial and warehouse centers found in the Puyallup Valley and Port of Tacoma waters.

The package to fund SR 167’s completion included nearly $1 billion through a gas tax increase of 10.5 cents per gallon, and was called by legislators around the state as “the single largest economic development project in the state.” The increased gas tax would have also funded more lanes along Interstate 5 around Joint Base Lewis-McChord, which is a bottleneck around commute times.