State House Democrats announce supplemental budget proposal. Split package includes ending tax breaks and teacher pay increases.

February 28, 2014

House Democrats in Olympia released a 2014 supplemental budget proposal Wednesday that would restore cost-of-living (COLA) increases for teachers and would spend additional money on school programs, while ending some tax exemptions, including imposing a state sales tax on bottled water.  The bottled water tax would narrow the state’s general sales tax exemption on food items.

The $200 million-plus proposal was introduced in two parts. One bill would alter the $33.6 billion two-year operating budget and add $60 million for books, technology, and supplies for primary schools, as well as  $18 million for increased community mental-health funding.

A separate bill would spend $51 million to provide public school employee raises in the form of COLA increases.  The bill also includes $16.5 million for early learning programs.   The COLA raise would be on top of pay increases approved each year by local school districts.

The additional spending would be paid for, in part, by ending $100 million in current tax exemptions, by extending state taxation to bottled water, out-of-state residents, and  the resale of prescription drugs. The spending would also come from new dollars available from projected general revenue increases and reductions in case loads for various state services.

Senate Democrats released a supplemental budget Tuesday, which proposes ending the same tax breaks, providing $101 million for education related programs, and spending $51 million on school employee COLA’s. The education and non-education components combine for a total of $174 million in additional spending.

The Senate Majority Coalition Caucus released a bi-partisan supplemental budget on Monday totaling $96 million without ending current tax exemptions.  

Rep. Ross Hunter (D-Medina), chair of the House Appropriations Committee, called the House proposal “a modest budget,” but said the school employee COLA and early learning program expenditures, which were not listed in the underlying budget plan, would be part of the package the House expects to pass next week.

Sen. Andy Hill (R-Redmond), chair of the Senate Ways and Means Committee, agreed the House and Senate are “not that far off” on the underlying supplemental budget, but said that settling on tax exemptions and cost-of-living raises may be difficult with only a couple of weeks left in the session.

House Democrats on Wednesday also released a construction budget that proposes to spend $700 million on new classrooms for kindergarten through third grade. The new spending would come from committing $50 million in annual state lottery revenues to pay for the plan. It is not clear at this time how this plan would fare in the Senate if it passes the House.