WK 6: 2021 Legislative Update

Each week, Trent House AFA's Government Relation's Director, gives you insight into Olympia, providing an update on the week's proceedings.


Join Trent every Friday during session for a discussion of activities in the Legislature via Zoom. Register at https://www.afa-wa.com/events/2021-legislative-review-w-trent-house


Week of February 16-20


Monday February 15 was the last day for bills to pass out of a policy committee in the House of Origin. Some notable bills that did not leave committee include HB 1212 (Gregerson, D-33), the “Right to Repair” bill; HB 1345 (Pollet, D-46) a bill banning flavored vape and menthol tobacco products; SB 5037 (Braun, R-20) requiring in-person learning in certain circumstances; and HB 1029 (Walsh, R-19) limiting the governor’s emergency powers. The remaining bills must pass out of their fiscal committees by close of business on Monday, February 22 unless they are deemed “necessary to implement the budget.” No bill concept is really, truly dead, however, until Sine Die as bills that do not pass cutoffs sometimes find their way into the budget as provisos or amended onto other legislation.


Capital Gains


The governor-request capital gains bill, SB 5096 (Robinson, D-38) was voted out of the Senate Ways & Means committee on the evening of Tuesday, February 16. The substitute lowers the tax rate from 9% to 7%, increases threshold exclusion to $250,000, exempts all sales or exchanges of real estate, replaces sole proprietor deduction with a family-owned small business deduction, adds exemption for the value of goodwill received when a car dealership is sold, and deposits the first $350 million in revenues collected each year into the education legacy trust accounts and deposits the remainder into a new taxpayer relief account. Moderate Democrats Senators Mullet and Van De Wege voted against and without recommendation respectively.


Low Carbon Fuel Standard


On Friday, February 19, the House Transportation committee passed HB 1091 (Fitzgibbon, D-34), the low carbon fuel standard. The bill requires fuel companies reduce the carbon in their product by 10% by 2028, and by 20% by 2035 and creates a marketplace that incentivizes the production of alternative fuels through a credit system whereby carbon producers can buy credits from those clean fuel producers. California passed a clean fuels bill in 2007, British Columbia in 2008, and Oregon passed one in 2015. The Washington State House has passed a clean fuel standard each year for the past two sessions, but neither made it through the Senate.


Pathways to Recovery Act


On Monday, February 15, HB 1499 (Davis, D-32) slid in under the cutoff and was voted out Monday night in the House Public Safety Committee. The bill, known as the “Pathways to Recovery Act” would legalize “personal use amounts” of substances such as heroin and cocaine while also expanding the state’s intervention, treatment, and recovery services. Decriminalization would not prevent employers from establishing or enforcing rules against drug use. If passed, Washington would become the second state in the nation to legalize personal use of drugs. The legislation comes after a record-breaking two-week spike in drug overdose deaths in King County in January. The bill is supported by the recovery community and prosecutors but is opposed by law enforcement. It has been referred to Appropriations.


Data Privacy


Senator Carlyle’s Data Privacy bill passed out of Ways & Means on Monday, February 15. SB 5062 (Carlyle, D-36) would provide Washington state residents with rights to determine what type of data is being collected by companies and the ability to review, correct, or delete that data. Among other elements, it requires companies let people opt out of the processing of their information. The legislation would apply to entities conducting business in Washington that control or process the data of at least 100,000 people. The regulations would also apply to businesses getting 25% or more of their gross revenue from the sale of personal data, and that process or control information on 25,000 or more customers. Violations of the law would be enforced by the state Attorney General’s Office under Washington’s Consumer Protection Act. The concept is not new. In fact, 2021 is Carlyle’s third year running this type of bill.


Behavioral Crisis Response


HB 1477 (Orwall, D-33) received executive action in the House Finance committee on Tuesday, February 16. Using a new tax on phone lines, the measure will help build infrastructure for enhanced and expanded crisis services beginning in July 2022, when federal law will require all phone service providers to direct 988 calls to the existing National Suicide Prevention Lifeline. The federal legislation allows states to place a fee on phone lines to fund the call centers. The proposed tax amount for each phone line in Washington is 30 cents per line per month beginning October 1, 2021 and increases to 75 cents per line per month beginning July 1, 2024. Proponents say implementation of the new 988 National Crisis Line and related crisis services will reduce reliance on emergency room services, as well as the use of law enforcement. Over the past decade, deaths by suicide have increased by 36% in Washington, making it the leading cause of death for Washingtonians ages 10-24. The bill was then heard Friday, February 19 in Appropriations.


Preferential B&O for Hospitality Industry


HB 1299 (Vick, R-18) was also heard in House Finance on Tuesday, February 16. The bill provides a preferential B&O rate of 0.3423% to businesses engaged in lodging, prepared foods, alcohol, take-out and delivery, and bowling alleys. The rate would be applicable July 1, 2021-June 30, 2025. Proponents hope the preferential rate will help businesses bounce back from COVID-19 limitations that have severely hurt the hospitality industry. The bill is estimated to impact 25,000 taxpayers and will cause a state revenue loss of $21.1 million in fiscal year 2022, and $24.2 million in 2023. The bill has not yet been scheduled for executive action.


Wage Parity for Workers with Disabilities


On Thursday, February 18, the Senate passed SB 5284 (Randall, D-26) 42-7. The bill ends the practice of allowing employers to pay people with disabilities a subminimum wage. Currently, the Department of Labor and Industries allows employers to go through a process to describe how the disability negatively impacts earnings and propose a wage. There is no set floor for how low the wages can be, as long as employers get approval from the U.S. Department of Labor to pay less than the federal minimum wage of $7.25 per hour. The practice dates back to 1959, before passage of the Americans with Disabilities Act. The City of Seattle eliminated subminimum wage for workers with disabilities in 2018, and in 2020 Washington state agencies did the same. The legislation is supported by disability advocates and is opposed by some who fear jobs for people with disabilities will disappear if employers must pay a minimum wage. The bill now goes to the House.


Monday, February 22 – Fiscal Committee Cutoff

Tuesday, March 9 – House of Origin Cutoff

Friday, March 26 – Policy Committee Cutoff (opposite House)

Friday, April 2 – Fiscal Committee Cutoff (opposite House)

Sunday, April 11 – Opposite House Cutoff

Sunday, April 25 – Sine Die



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