WashACE Blog

Congratulations are due all around on workers' compensation reform

House Bill 2123, the workers' compensation compromise bill, which passed the Legislature yesterday, and is on its way to Governor's desk, is the result of extreme heavy lifting by the business community, the Governor, and reform-minded legislators. Congratulations are due all around. See this morning's Seattle Times and the News Tribune for the most recent update.

AWB reports in its Fast Facts yesterday that

 House Bill 2123 is expected to prevent double-digit rate increases next year for most employers, in part by allowing for voluntary structural settlements. Organized labor denounced the plan, even though everyone from Gov. Chris Gregoire to House Speaker Frank Chopp – who had been firmly in labor’s corner – called it fair for everyone. 

While it doesn't do everything that we wanted, some success trumps no success...or as Erik Smith writes at the WashingtonState Wire and Richard Davis takes one step further, we're baby-stepping into a full workers' compensation solution. 

Here is a round-up of other reports on the legislature's recent workers' comp compromise:

Lawmakers race special session deadline in Olympia (Puget Sound Business Journal) 

AWB Statement on Workers’ Compensation Agreement (Association of Washington Business) 

Senate, House and governor announce agreement on workers’ comp (The Hopper, Senate Democrats Blog)

Statement from Speaker of the House Frank Chopp on the workers’ compensation reform (HDC Advance, Chopp Statement)

Gov. Gregoire’s statement on workers’ compensation agreement (Governor's Press Release)

Workers’ comp deal: “We have now produced what I consider to be a good system” (Capitol Record, TVW)

Lawmakers reach likely deal on workers' comp (Seattle Times)

WA leaders reach key deal on workers' comp changes (more from Seattle Times) 

Gregoire, legislative leaders reach deal on worker's comp (Political Buzz, The News Tribune)

 

 

Speaker Chopp, Let our legislators go home: Allow the House to vote on workers' comp

Make no mistake, the main thing holding the Legislature in Olympia is Speaker Frank Chopp who, in lock-step with organized labor, is setting the stage for double-digit increases in workers' comp rates. The increases will primarily hit small, locally based businesses in Washington, and the current stand-off in Olympia threatens to require a second 30-day special session.  Here are some of our regulars on the current status of work compensation reform and a budget for the upcoming 2011-13 biennium: 

House should allow vote on crucial reform, Everett Herald, and House should allow vote on workers’ comp reform, The News Tribune, Richard Davis

Something’s About to Give on Worker’s Comp – But What?, Washington State Wire, Erik Smith 

TVW takes a revealing look at Oregon's workers' comp success story, Olympia Business Watch Blog

State preps for July shutdown as budget talks stall, Associated Press, Mike Baker 

Organized labor is out-voted in the House on workers' comp reform...

...but, says Seattle Times Kate Riley, you wouldn't know it because Speaker Chopp won't let the issue come to a vote. In her editorial opinion today, Riley says Speaker Chopp needs to begin representing "all working families" (emphasis in the original) by supporting workers' compensation reforms that spur job creation and economic recovery, not just organized labor interests. She concludes, 

Citizens need lawmakers to step up and make difficult bipartisan decisions that put the state in better stead for a recovery.

Continue your calls and letters to House Speaker Chopp and urge him to bring ESH 5566 to the floor for a vote.

Keep our best teachers? It's a "no-brainer."

Partnership for Learning and Stand for Children have sponsored a radio ad in support of HB 1443 that is running on radio stations across the state starting today, Wednesday, April 20. Listen to the ad here and read the text below. Also, read an op-ed in Publicola by Washington Roundtable President Steve Mullin.

Most important, call your legislators and tell them to stand for children. Urge a yes vote for HB 1443. 

Here's the text of the radio ad:

Our schools face some difficult choices: budget cuts and teacher layoffs.

 What do you think matters most when deciding which teachers to lay off?

Seniority or excellence?

It's a no-brainer, right?

Wrong.

When it comes to layoffs and teachers, excellence should trump seniority. But in Washington schools today, pink slips go to teachers with the fewest years in the classroom-regardless of their performance.

And guess what? Students suffer.

Our leaders in Olympia are listening. We say "thank you" to senators from both parties who voted to keep our most effective teachers in the classroom. And we urge House members to vote yes on HB 1443.

Because excellence in our classrooms should matter more than seniority.

Visit GreatTeachersWA.org to learn more and contact your legislators.

 

Analysts compare house and senate budget proposals

The Washington Research Council posted its comparison of the house and senate budget proposals, concluding that the senate version

makes many of the same reductions as the House-passed bill, but it cuts $326.7 million more. The need for deeper cuts is a consequence of not assuming that $300 million would be raised by privatiz- ing the distribution of liquor.

 On the education front, the Partnership For Learning evaluates each of the budget proposals and provides a budget breakdown chart comparing the governor, house and senate's budgets on PFL priorities.

Similarly, the Workforce Training and Education Coordinating Board compares the three budgets for treatment of their key K-12, community college, and workforce education issues. 

 Finally, on the workers' compensation reform front, the procedural move last week to bring SSB 5566 to the house floor for a vote failed, but the bill has been deemed NTIB -- or necessary to implement the budget -- so there is still the possibility of it being part of the final budget solution. 

Continue your calls and letters to your legislators. Tell them to pass a sustainable budget within existing revenues that includes important voluntary settlements for injured workers.

Bi-Partisan Senate budget proposal unveiled

 Senate leaders from both parties released their budget yesterday. It's all still under review, but early reports appear optimistic. The real debate now begins. Here are several stories to get you started:

Senate budget cuts teacher pay, raises tuition (The Olympian)

Senate Rolls Out Bipartisan Budget With a More Conservative Tone, But Has Same Big Pitfall (Washington Wire)

Senate releases bipartisan budget with $4.8 billion in cuts (The Capitol Record)

State Senate proposes even deeper cuts to education (The Seattle Times)

And for those wanting the real deal, here's the technical detail from:

Senate 2011-13 Operating Budget Proposals (Legislative Evaluation and Accountability Program)

 

Freshman Dems propose tax increases on home buyers

Brad Shannon reports this morning on new taxes proposed by freshman Democrats in the House:

Freshmen Democrats in the House introduced a bill that targets favorable tax treatment for large home lenders and out-of-state shoppers. They say it would raise $170 million for K-3 programs in public schools....

...HB 2078 specifically targets first-mortgage interest earnings of banks that exceed $100 million a year and would end tax breaks for out-of-state shoppers. It would raise more than $80 million a year from each tax.

Missing in this representation of the mortgage interest earnings exemption, in particular, is that if the tax exemptions mortgage lenders now enjoy in Washington were eliminated, banks would pass the tax on through to home buyers.

Result: Home purchases become more expensive and Washington's current housing market, which is struggling mightily to recover, takes another hit.

The continuing hew and cry for "closing tax loopholes" is misleading many into believing there is some quick revenue fix for balancing the state budget. But budget challenges in Olympia have been for some time and continue to be due to legislative over-commitment of state taxpayers to unsustainably high spending.  

Richard Davis's blog on the Washington Research Council's tax loopholes paper and  a subsequent Crosscut column explain the role and complexities of tax exemptions in Washington's tax system. 

The News Tribune calls "'Loophole repeal: An imaginary budget solution," saying 

the “loopholes” targeted by the protestors tend to fall into two categories: Expendable but piddly, and potentially lucrative but also justified.

Not everyone in the political environment currently surrounding the budget debate is interested in fully understanding the why's and wherefore's  -- as they say, "you don't want to wreck a good story with the facts!" -- but the information on tax exemptions is available. 

Higher ed funding cuts force rethinking of how we do college

Since higher education is unprotected by constitutional provisions (like basic K-12 education) or by federal program matching (like Medicaid) it is often a prime target for budget writers looking to cut spending. AP reporter Molly Rosbach writes about it here.

Among the changes currently in play for legislative consideration are tuition increases and tuition-setting flexibility at the state's 4-year institutions; accepting more out-of-state students, who pay higher tuitions yet; programs cuts; both cutting and increasing various state aid programs supporting tuition assistance for middle and low-income students; as well as fashioning better systems for moving students more smoothly and more productively through the education system from pre-Kindergarten through college and beyond.

The Greater Seattle Chamber of Commerce continues to advocate  for SB 5915 which grants Washington's 4-year institutions greater tuition-setting authority and the Washington Roundtable recommends that the state: 

...avoid disproportionately large cuts to higher-education funding in the 2011-13 budget, develop a more stable long-term framework for funding higher education and provide institutions with increased tuition-setting authority and operating flexibility, accompanied by clear accountability for results.

Stateline Staff Reporter David Harrison reports on education funding solutions being considered in other states, like three-year degrees in Ohio.

And, community colleges have long provided a less expensive alternative to the first two years of a four-year degree. They typically experience their largest enrollments during recessions when people are out of work and taking the time to get more education or to retrain for a different career. Stateline's Harrison writes on the community college role: 

With unemployment rates still stubbornly high, many laid-off workers now look to community colleges for the training and education they need to find a job. And steep tuition hikes at four-year schools have many high school graduates turning to community colleges as a more affordable alternative. 

 In his report Harrison describes the difficult challenge facing community colleges around the country and links to a helpful interactive map of the 50 states showing each state's community college enrollment and funding compared with the national average over time.

And, because education doesn't begin with college, the College and Work Ready Agenda (CWRA) and the Washington Partnership for Learning both have positive agendas for important solutions necessary in the state's K-12 system, like

1. Performance-based policies for teachers' reductions in force;
2. Alternative pathways to qualify new principals;
3. Mutual consent in teacher hiring policies; and
4. Maintaining our K-12 graduation requirements

...all promote greater efficiency and effectiveness in education spending and should be adopted by the legislature.

The CWRA says:

Whether they choose to attend a four-year college or go directly into the workforce after high school, we want our children to have the tools for success in hand once they have their diploma clasped in the other. The goal of the College & Work Ready Agenda is to ensure all Washington students graduate from high school with a more meaningful diploma that signifies they are ready for their next step in life. 

The Workforce Training and Education Coordinating Board has a side-by-side comparison of the Governor's and House budget proposals, showing how each affects various resources for K-12, workforce, community college, and Higher Education Coordinating Board funding.

We should be able to add the Senate's version soon...stay tuned.

 

 

 

U.S. Chamber: Washington "poor" place for job creation, due to its state labor and employment policies

 A new study from the U.S. Chamber of Commerce, The Impact of State Employment Policies on Job Growth, reviews all 50 states for the effects of 34 key state labor and employment regulations on the unemployment rate and new business formation.

States, like Washington, that received a "poor" rating "have [labor and employment] policies that inhibit job creation in most categories...," according to the study. On the upside we have the greatest "potential to substantially increase job growth by adopting less burdensome policies."

According to the study, 

laws and regulations that inhibit the ability of workers and firms to negotiate and enforce efficient contracts raise the cost of labor, reduce employment and productivity,and slow economic growth.

The factors contributing to Washington's problematic rating include:

• Numerous labor and employment mandates that exceed federal standards
• Daily overtime rate on public construction contracts
• Very high wage ceiling for income subject to unemployment insurance tax
• Very high workers’ compensation benefits
• State minimum wage in excess of federal minimum wage
• Relatively high number of restrictions on employer inquiries into applicant and employee history
• No right-to-work protections

More reason for meaningful workers' compensation reform with passage of ESB 5566.

 

 

 

WRC discusses tax preferences with Robert Mak

The Washington Research Council's Kriss Sjoblom appeared on Up Front with Robert Mak on Sunday to discuss Washington's tax preferences and explain their purpose and complexities.

Here is a link to the program. The tax preferences segment begins 9 minutes in to the 20-minute program, following a discussion with the Pierce County Assessor. 

In response to questions from Mak and assertions from Mak's other guest, Adam Glickman-Flora of SEIU Healthcare 775 NW, Kriss explained the importance of tax certainty to business and the complexity of the tax exemptions in question, and pointed out that there is a system in place for reviewing all of the state's tax preferences on a ten year cycle.

He refuted Glickman-Flora's assertion that business doesn't pay its fair share, saying that business pays more than 50 percent of Washington's taxes, giving it a high ranking compared with other states across the country. The Council on State Taxation compares the 50 states in this report:  Download COST-State Business Tax Study.