Special Session for School Funding Begins in Washington State

By Andrew Ujifusa — April 29, 2015 3 min read
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Ever since last year, when the Washington state Supreme Court found the state in contempt for not increasing K-12 spending enough to satisfy a 2012 court ruling, Evergreen State lawmakers have been under the gun to act. But after the state’s regular legislative session failed to produce an accord on an education budget, Gov. Jay Inslee called a special session, starting on April 29, in order for lawmakers to agree on a spending plan for public schools.

Remember, the state’s highest court has said that if lawmakers don’t reach what it deems to be a satisfactory budget, the justices might impose penalties on the state.

So what’s under discussion? Several ideas from several sources. But keep in mind one crucial fact: Washington currently does not levy personal income or capital gains taxes. That has made boosting state revenue and earmarking it for K-12 a particularly knotty problem.

  • Democrats in control of the House of Representatives want to impose a new capital gains tax of 5 percent that they say would increase state spending on K-12 by 21 percent for the state’s 2015-17 budget cycle. The first-year spending increase on schools would be about $400 million. The plan would earmark a portion of the budget increase specifically to reduce K-3 class sizes, a key provision in the 2012 McCleary v. Washington ruling, in which the court found the state’s K-12 funding inadequate and unconstitutional.
  • A separate bill from Sen. Kevin Ranker, a Democrat, which garnered Democratic support in the House, would impose a capital gains tax of 7 percent. However, his plan would exempt the first $250,000 of investment income for individuals, and the first $500,000 of such income for joint filers, from his tax.
  • Both Ranker’s bill and House Democrats’ blueprint share elements of what Inslee, a Democrat, proposed last December in his budget plan for 2015-17. The governor has offered up a plan to tax investment income at 7 percent, like Ranker’s bill. But like House Democrats’ plan, Inslee’s would exempt the first $25,000 of investment income for individuals (and the first $50,000 of such income for joint filers) from the tax.
  • Meanwhile, state Treasurer Jim McIntire (D) in what he told the Associated Press should be a conversation starter, thinks the state should institute a new personal income tax of 5 percent, while eliminating the state’s property tax and cutting business taxes.
  • Senate Republicans, meanwhile, who control their chamber, think the idea of significant tax increases are off the mark. Instead, they point to the $3 billion in revenue growth they say is on the way during the 2015-17 budget cycle. Republicans want $1.3 billion of the extra revenue earmarked for education. Like the Democrats who have McCleary in mind, the Republicans want money specifically for K-3 class-size reductions, to the tune of $350 million, particularly in low-income communities, and $741 million for maintenance, supplies, and other operating costs, as well as expanded all-day kindergarten.
  • And in a plan released earlier this month, state Superintendent Randy Dorn says that, in part, the state must fix how local property tax levies create an inequitable school funding environment in the state.

One important note: There’s an emphasis on certain forms of teacher compensation in the House Democrats’ plan that’s lacking in Senate Republicans’ proposal.

Democratic Rep. Ross Hunter, the lead budget writer in the House, released a chart showing where Democrats’ plans differ from Republicans':

UPDATE: Although the bill isn’t listed on the Senate Republicans’ website or on the chart from Hunter, GOP members of the Senate have introduced legislation, Senate Bill 6109, that alters the structure for funding education in the state and creates new a teacher salary schedule.

Photo: Washington Gov. Jay Inslee talks to the media on Earth Day, April 22, 2015, outside the state capitol in Olympia, Wash. Rachel La Corte/AP

A version of this news article first appeared in the State EdWatch blog.