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Governor Inslee proposes new teacher pay raises paid for by closing tax breaks

Mike McClanahan profile by Mike McClanahan

New teachers in Washington would garner higher salaries under a proposal introduced Thursday by Democratic Gov. Jay Inslee.

Governor Jay Inslee News Conference
Governor Jay Inslee unveils his 2016 supplemental budget proposal.

In his 2016 supplemental budget proposal, the governor would raise the starting salary for teachers to $40,000. The estimated cost is $80 million dollars next year, and $100 million every year after that.

To pay for the raises, Gov. Inslee wants to close or alter four “outdated” tax breaks.

Refund the state portion of sales tax to nonresidents: Shoppers from states with no sales tax, like Oregon, would have to apply for a state sales tax refund on purchases in Washington. No longer would the discount be applied instantly. Saved over three years = $79.3 million

-Repeal the sales tax break on bottled water: Saved over three years = $82.9 million

-Limit the real estate excise tax exemption (REET) for banks: Connected to foreclosed properties. Saved over three years = $106.7 million

-Repeal the use tax exemption for extracted fuel: Claimed by the state’s oil refineries. Saved over three years = $58.6 million

“Having a classroom teacher to teach algebra right now is more important than some oil industry tax break that ended up getting done 20 or 30 years ago that doesn’t even apply anymore,” Gov. Inslee said during a press conference.

Washington is struggling to find qualified teachers and substitutes, according to a recent survey by the Office of Superintendent of Public Instruction and the Association of Washington School Principals. Of those responding, 45-percent say they could not fill all classroom teacher positions with fully certified teachers who met job qualifications.

Retirements, hiring freezes and economic uncertainties that have discouraged students from choosing a teaching career, and new teacher burnout are cited as reasons why. Research shows half of beginning teachers opt out of the profession in the first five years, many blame low pay and a lack of support. To address that, the governor’s plan allots $5 million for mentors.

The minimum teacher salary would be raised by $4,300 starting next school year. That increase is in addition to the 4.8% cost-of-living adjustment already worked into the current budget. Teachers with more experience, along with administrative and classified staff, would also get a raise of at least one-percent.

This proposal is only one part of the changes Gov. Inslee would like to make to the state’s current two-year $38 billion budget.  

Washington brought in another $245 million in new revenue since the budget passed, but the Governor says costs have gone up. Separate from the teacher salary plan, his proposal includes $700 million in additional spending to pay for increased Medicaid caseloads, urgent mental health care needs, and to cover the costs of fighting last summer’s wildfires. One million acres and hundreds of homes burned in what’s considered the worst fire season in state history, costing Washington nearly $180 million.

For mental health care, Governor Inslee proposes spending an additional $137 million, both in state and federal money. The money would be spent on new programs, hiring more doctors and nurses at state psychiatric hospitals, and community-based housing and recovery services.

“We know we have to do more for mental health in this state. We have urgent short-term needs, but we also need to take a long view on how to build a stronger mental health system,” Gov. Inslee said.

Governor Inslee’s supplemental budget sources that addition $700 million from fund transfers from the state’s Budget Stabilization Account, which would leave close to $1 billion remaining in reserves.

Republicans quickly responded to the Governor’s proposal. Senate Budget Chair Andy Hill sent an email saying it does not balance over four years. “Unfortunately, as has become a yearly tradition, the governor continues to offer plenty of ways to spend taxpayer dollars, but fails to provide a sustainable way to pay for it,” wrote Sen. Hill.

In the House, Republican budget writer Rep. Bruce Chandler wrote, “The 2015-17 biennial budget was signed into law less than six months ago. Significant policy additions – outside of emergency caseload adjustments – are better suited for the deliberation and scrutiny of a 105-day session during budget-writing years.”

Republican Gubernatorial Candidate Bill Bryant
Republican gubernatorial candidate Bill Bryant criticizes Gov. Inslee’s 2016 supplemental budget proposal.

Republican gubernatorial candidate Bill Bryant appeared on the steps of the capitol to say while Washington does need to do more to recruit and retain teachers, it should be done in the existing budget. “This is the governor who said he would not do anything that would take the state in the wrong direction if elected, and that passing new taxes would take the state in the wrong direction, and yet for four out of four years he has continued to propose new taxes,” said Bryant.

When asked about critics who say he’s proposing “new taxes,” the governor argued this is a “modest” and “reasonable” proposal. “Our tax code is infested with the barnacles that are encrusted on our ship of state of these loopholes that corporate lobbyists have come down here year after year, decade after decade, and they have carved out these special little deals for their special little interest, and they never get reviewed. Even though the industry changes hugely and the needs of our state change hugely, they just remain,” said Gov. Inslee. “We have to realize as the needs of our state change and the industries change, this is the best way to finance the education of our children.”

The governor did receive support from House Democratic Majority Leader Representative Pat Sullivan. In a written statement he said, “The governor has given us a good starting point for discussion. While some legislators may have other ideas on how we reach these goals, his priorities are on target.”

The governor’s budget adjustment suggestions will be considered when the 2016 legislature convenes for a 60-day session starting January 11th.

To read the supplemental budget proposal and highlights:

Watch the Governor’s news conference here: