Washington Landlord Association

Third Special Session Legislative Update: State Operating Budget Passes

07 Jul 2017 12:43 PM | KATRINA CHRISTOFFERSEN (Administrator)

Dear WLA Members:

We are currently in the third special session, which started on Wednesday, June 21, 2017.  Although the state operating budget has passed, still the state Capital Budget is being negotiated.  These are:

1.      Two-year Operating Budget:

  • Funding for education K-12 as it relates to the McCleary Court Case will be funded by an increase in the state portion of your property tax from $1.88 per thousand dollars of assessed value to $2.70 per thousand dollars of assessed value.   There will also be a levy tax threshold starting in 2019 not to exceed $1.50 per $1,000 of assessed valuation, or $2,500 per pupil, whichever is lower.
  • It’s estimated that the total amount in four years will bring in $7.3 billion dollars to fund education.  New revenues from a variety of different sources to include Market Place Fairness, repeal of sales tax extension on bottled water, self-produced fuel exemption, and streamline sales tax payments.
  • We anticipate that the State Supreme Court will rule that $7.3 billion dollars is not enough revenue and does not fulfill the Supreme Court mandates to “fully fund basic education.”  We anticipate new taxes or increase in existing taxes that will target real-estate in the 2018 session to fund public education. 

2.      Successfully Opposed the Following New Revenue Options to Fund Basic Education:

  • New State Capital Gains Tax (6%)
  • Raising Real-Estate Excise Tax (REET) from the current 1.28% to 2.5% at time of sale of real-estate
  • Sales Tax on Services
  • Increasing a State B&O Tax on residential and commercial services from 1.5% to at least 2%  

3.      Two Year State Capital Budget:
  • The Capital Budget is currently being negotiated.  One of the biggest areas of contention is to resin the “Hirst Decision” that was awarded in October 2016 to Washington State Supreme Court level.  Basically, if you are going to drill for water on your private property, a building permit cannot be issued unless the owner of the property proves that there is no impact to the groundwater table or streams that may impact fish and wild life habitat.  The burden is on the property owner to provide a study/report to the county that they reside in proving no impact.
  • We are told that such a study could cost anywhere from $20,000 to $40,000.  Key negotiators on this issue include Sen. Judy Warnick (R), Sen. Jim Honeyford (R), Rep. Derek Stanford (D), Rep. Larry Springer (D) and others.

Respectfully Submitted,

Mark Gjurasic



(360) 481-6000 

Chester Baldwin



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