Legislative session recap: Billions in construction spending; no new taxes
The 2018 Legislative session ended right on time last week – the first time since 2014 that a special session wasn’t required.
The session was “pretty good” on construction issues, said AGC Chief Lobbyist Jerry VanderWood. Billions in new construction spending, no new taxes and workforce-development improvements are among the positives. However, some labor-backed bills passed, some of which AGC was able to improve before passage. Meanwhile, the stage is being set for a ballot fight over carbon taxes. Below is a recap:
Capital budget: Two-year budgets are nearly always passed in odd-numbered years and supplemental budgets (tweaks) in even-numbered years. But in 2017, the Legislature failed for the first time to pass a biannual capital budget as a dispute over water legislation led to an impasse. In January, the Legislature finally passed the 2017-2019 capital budget with new appropriations of $4.195 billion, including $1.033 billion for public-school construction. Of the total, $2.77 billion is financed with state general-obligation bonds.
Then in March, the Legislature passed the capital budget supplemental, adding $414.8 million to the 2017-2019 capital budget.
Supplemental transportation budget: Thanks in part to higher than expected fuel-tax collections, the Legislature passed an $826 million supplemental transportation budget, adding to the $8.5 billion two-year budget passed last year.
Taxes (other than carbon)
Despite a lot of conversation within the Legislature and the Governor’s mansion about B&O, capital-gains and carbon taxes, no new taxes were approved. In fact, the supplemental operating budget passed by the Legislature provides a one-time, $391 million reduction in the state property tax to $0.30 per $1,000 of assessed value in 2019. This was controversial because many felt the move carelessly diminishes the state’s rainy-day fund.
The Governor made a high priority out of passing a carbon tax, and various versions gained a fair amount of attention in the Legislature, but no carbon-tax bill reached the House or Senate floor for a vote.
AGC was particularly concerned about the leading carbon-tax bill since it also included community-workforce agreement (aka, project labor agreement) language with regard to projects that would be funded with the revenue.
It’s important to note that proponents of the carbon tax have filed an initiative and will seek to gain enough signatures to get it on the November ballot. This version, too, has the community-workforce alliance language.
Prevailing wage: A bill (3SHB 1673) passed the Legislature that requires training in public works and prevailing wage to be a responsible bidder on public works. However, AGC secured an amendment so that it exempts bidders who have completed three or more public works projects and have had a Washington business license for at least three years.
A second bill (SSB 5493) says prevailing wage must be established by adopting the hourly wage, usual benefits, and overtime pay established in collective-bargaining agreements for those trades and occupations that have collective-bargaining agreements. For trades and occupations with more than one collective-bargaining agreement, the higher rate controls. For those trades that do not have collective-bargaining agreements, the prevailing rate of wage must be established by wage and hour surveys. If surveys are not feasible, the industrial statistician may use other appropriate methods.
Apprenticeship: Bill EHB 1849 requires public-works contracts to contain apprenticeship-utilization goals by cost value and, except for WSDOT contracts, monetary penalties and incentives for not meeting the goals; requires contracts to include specifications that a contractor or subcontractor may not be required to exceed the apprenticeship-utilization requirements; requires awarding agencies to monitor and report compliance by contractor and subcontractor to the Supervisor of Apprenticeship for verification.
Various bills passed with the intent of improving career opportunities in industries such as construction that are facing a workforce shortage. SSB 6133 directs OSPI to develop expanded career and technical-education (CTE) curriculum frameworks that would enable students who earn credits from CTE courses to apply those credits toward graduation requirements in a broader array of academic subject areas. E2SHB 1600 establishes the Work-Integrated Learning Initiative to promote work-integrated learning experiences.
Early in the session the Legislature passed the AGC-backed bill to address the Hirst case which affected water availability to support development. Click here for a summary of the bill, ESSB 6091.
For questions about these issues contact AGC Chief Lobbyist Jerry VanderWood, 360.352.5000.