With special session a certainty after the end of the 2015 regular session, Gov. Jay Inslee called on budget negotiators to compromise on revenue proposals to come to an agreement on the state’s 2015-17 biennial operating budget.
Dammeier’s plan would increase the statewide levy for schools, and would replace local levy money being used for salaries and compensation with state money. Local school levy amounts would be reduced dollar for dollar. The concept is often called a “levy swap.”
Dammeier says the change would be revenue neutral statewide. However, critics, including Inslee and Sen. Kevin Ranker, D-Orcas Island, say that Dammeier’s proposal would raise taxes in counties with high property values — such as King County — by up to $500.
Both Inslee and Ranker have capital gains tax proposals to increase state revenue. Ranker unveiled his proposal earlier this month for a 7 percent capital gains tax that would apply to gains higher than $250,000 for single taxpayer (or $500,000 per couple) and would not apply to primary homes.
Inslee called Ranker’s plan more equitable.
“I have a hard time seeing why Republicans want to increase taxes on 50 percent of the people when we could solve this problem by taxing less than 1 percent of the people — and the less than 1 percent of the people are doing pretty well in our new economy that we have,” Inslee said.
Earlier this week at a press conference with other Republican leaders, Sen. John Braun, R-Centralia, addressed that criticism of Dammeier’s plan by saying reform of the school levy system will be an ongoing process.
“Sen. Dammeier’s done a great job looking at this at different levels — at the state level, at the school district level, at the teacher level — what does it do for teachers and at the taxpayer level,” he said. “In a state where you do tax reform, it takes that kind of careful analysis to get it done right. And poking at draft one or the original run of the numbers doesn’t help the process.”
However, Inslee said Thursday criticized the notion that people with high-value homes always make a lot of money.
“If we are going to ask people to contribute more for the schools, it’s not fair to put the burden on working people who are struggling to make their house payments,” Inslee said.
Lawmakers in both parties this month said the state needs to focus on levy reform as a way to address the state Supreme Court’s requirements to increase the reliance of basic school funding on the state in the McCleary decision. But Inslee told reporters on Thursday he believed that aim could be reached through raising revenue by other means.
Click through to watch Inslee’s press conference: