OLYMPIA - The Legislature passed a supplemental operating budget for 2005-07 last week that included removing the $5 day-use fee at the state parks that should take effect April 9. Gov. Chris Gregoire must sign the budget, though, before it's official.

The Legislature also provided "back-fill" funds to replace parking fee revenues. The Washington State Parks and Recreation Commission is meeting this week and will discuss the issue. In the meantime, the parking fee remains in effect.

This year's $1.6 billion in unbudgeted revenue provided lawmakers a rare opportunity to address current needs and save for future ones, according to Senate Ways & Means Chairwoman Margarita Prentice, D-Renton.

"It's only a supplemental year, but everybody's a winner in this budget," Prentice said. "Our children, our seniors, our families, our communities, our economy and our environment. But by far the biggest winner is the taxpayer."

The budget invests an additional $95 million in K-12 and early learning education, including $28.5 million to help students struggling with the WASL to receive their high school diploma, and $15 million to "catch up" K-12 employees' to the COLAs missed when I-732 was not funded in 2003.

It invests an additional $38 million dollars in higher education opportunities, including nearly 500 new enrollments ($7.5 million), new work force education Opportunity Grants ($4.1 million) and life sciences research ($4.3 million).

The budget adds $107 million in health care, including $46 million for mental health treatment; $18 million for Medicare, Part D prescription drug co-pays; $10 million for nursing homes; an additional 6,500 enrollments to the Basic Health Plan, bringing total enrollments to 106,500 ($11.2 million); and an additional 10,000 enrollments to the Immigrants Children's Health Program, bringing total enrollment to 14,000 ($10.7 million).

It also provides around $56 million in tax cuts, including cuts for the timber industry ($4.6 million), the aerospace industry ($2.9 million), the motion picture industry ($3.5 million), and eliminates the day-use fees at state parks ($3.1 million). The agriculture industry is the recipient of multiple tax cuts, including cuts for diesel fuel used on farms ($4.4 million), new seed conditioning facilities ($1 million) and cuts for replacement parts for farm equipment ($5.8 million).

Republican leaders were less than happy with the legislative session, describing it as creating $468 million in new spending, which was more than what Gregoire and the Democratic majorities in both chambers initially proposed.

"Christine Gregoire and the Democrats' budget is another step in the wrong direction for Washington state," said Washington State Republican Party Chairman Diane Tebelius. "Just because our state has a $1.6 billion surplus, does not mean we have to spend it. The complete lack of fiscal responsibility is incredible."

According to Tebelius, state spending increased by 12.4 percent during the 2005 legislative session, while this year's supplemental budget will push that number to 17.4 percent.

Prentice, the Ways and Means chairwoman, praised the budget's savings plan, which sets $825 million into three secure pots of money to protect our economy and state services, including:

$350 million in a new Pension Funding Stabilization Account - approximately

$50 million of which is expended this biennium;

$274 million into the Student Achievement Fund; and

$200 million into the Health Service Account - approximately $60 million of which is expended in this biennium.

It leaves an ending fund balance of $215 million, for $935 million in total savings.

The savings plan, Senate Bill 6896, required a vote from lawmakers earlier in the week to amend I-601, the state's spending limit. A legal technicality to I-601 counts savings as an appropriation. Therefore, the $825 million reserve fund is applied toward the spending limit. The Legislature voted to raise the limit to accommodate the reserves, and changed the law to prevent similar savings strategies in the future from being penalized.

Sen. Mark Doumit, D-Cathlamet, Ways & Means vice chair for the operating budget said exempting the reserves from the 601 spending limit is highly justified.

"This is an unprecedented savings plan," said Doumit. "The drafters of 601 never imagined the budget problems that our state faced after Sept. 11th. And because they never had to learn that lesson, they also never imagined this type of forward-thinking budgeting strategy. But this is very much in-line with 601's goals of protecting state services and protecting our economy."

The state is in the relatively rare position of having greater-than-projected revenues in state coffers, according to Doumit. But he warned against the inevitable downturn.

"We've had about a $5 billion downturn, and now have one year where we have an upturn," Doumit said. "We need to save for the future. Now's the time."

Democrats accepted a Republican amendment to require of any tax increase proposal in the next biennium a two-thirds vote to pass - a testament to their faith in the supplemental budget and savings plan, Doumit said.

The Legislature also passed a supplemental capital budget that builds new prison capacity at the Coyote Ridge Corrections Center in Connell to accommodate tougher sex offender sentencing approved earlier this session ($59 million), and new water reservoirs on the Columbia River Basin as part of a landmark water management plan also approved earlier in the year ($10 million).

The approved capital budget increases total spending by $278 million. Of that, $144 million is new bond spending, including $30 million of state construction bonds authorized in 2005, $30 million in Gardner-Evans bonds, and an additional $84 million in new bond authority as provided for in a separate piece of legislation, House Bill 3316.

Numerous other higher education, public safety, economic development and environmental protection projects were funded in the plan, including:

Six community college construction projects ($9.7 million);

Remodeling space at the University of Washington for a nanotechnology lab ($4.5 million);

Improvements to the juvenile rehabilitation facilities at Echo Glen and Green Hill ($7 million);

Second phase of the State Patrol crime lab in Vancouver ($2.9 million);

Additional funds to the Washington Housing Trust Fund ($21 million);

Funds to jump start the state's biofuel and alternative energy industries ($23 million);

Toxic cleanup efforts around the state ($57 million); and

Hood Canal and Puget Sound cleanup efforts ($14 million).

"The capital budget invests in our economy and our joy in living in a beautiful state like Washington," said Sen. Karen Fraser, D-Thurston County, Ways & Means vice chair for the capital budget. "There's something here for everybody."

The operating budget, Senate Bill 6386, and the capital budget, Senate Bill 6384, now go to Gov. Chris Gregoire.

The 2006 legislative session was scheduled to adjourn on March 9, but adjourned March 8 - one day early, for the first time in 20 years.

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