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The Impact – Judgment Day for Policy Bills, Session Update

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February 17, 2021

We’re one-third of the way through the session. A $2.2 billion COVID relief package has already cleared both the House and Senate. The next two weeks will be very telling for which proposals have enough momentum to become law.

February 15th was the last day for policy bills to make it out of their original committee. Policy bill cutoff impacts any bills that aren’t NTIB, necessary to implement the budget. If a House or Senate bill costs the state money or raises money for the state, it is likely to wind up on the list of NTIB bills. The deadline for those bills to pass their initial fiscal or transportation committees is February 22nd.

Among the bills getting the most attention this week is SB 5096, the capital gains tax sponsored by Democratic Senator June Robinson. An amended version passed out of the Senate Ways and Means Committee this week. There were more than twenty amendments proposed by Sen. Lynda Wilson, (R-Vancouver) including efforts to remove the emergency clause and allow a referendum vote on the bill, but the only amendment adopted came from Robinson herself. The sponsor’s amendment* lowered the proposed capital gains tax rate from 9% to 7%, excluded all real estate sales and transactions, and made various other changes to what remains a very contentious proposal in Olympia. Democratic legislators have proposed different versions of capital gains tax bills this year and in multiple successive years. The Senate has been a particularly challenging climate for capital gains tax proposals in the past.

We spoke with Olympia reporters Laurel Demkovich of The Spokesman-Review and Joseph O’Sullivan of The Seattle Times to hear their perspective on the session so far.

On the capital gains tax proposal:

““It will probably have to make its way through the courts. Some say that this is an unconstitutional income tax, but I think generally it probably has more support than it has in previous years, but I think that there’s going to be some of those in the middle, those moderate democrats, who might not necessarily support something so broad,” said Demokovich.

“There’s some reluctance to use it to balance the budget because it’s almost surely going to draw a lawsuit that would almost surely go to the state supreme court,” said O’Sullivan.

”If you have to pass a tax like this and then wait to see if the state supreme court is going to rule it’s constitutionally valid, you can’t necessarily depend on that for the budget that you just wrote,” said O’Sullivan. “Do you have to then raise one tax just apply to the budget, if you feel that needs to happen, and then pass the capital gains tax on top of that?“

We also covered bills related to expanding state oversight of police, regulating personal data privacy rights and the impact a strictly long distance legislative session has on which bills advance.

“Maybe it does. In the case of the cosmetologists, when they showed up they killed a bill pretty quickly. On the other hand you have a lot of groups, I mean gun rights supporters show up in mass every year, supporters of gun restrictions show up every year, but we don’t often see too many real big surprises,” said O’Sullivan.

“Not having supporters in the building probably affects testimony in some ways, but I also think this has allowed people in Spokane and on the east side of the state, a lot more people to get involved,” said Demkovich.

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