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Published: Wednesday, April 3, 2013, 12:09 p.m.

GOP-led coalition focuses on education in budget

The coalition promises to spend as much as Inslee on education, but not add new taxes or close loopholes

OLYMPIA -- The Senate Majority Coalition today unfurled its much-anticipated budget, promising to spend as much on education as the governor without closing loopholes or imposing new taxes.
The plan funnels $1.8 billion more into schooling from early learning to college -- of which $1 billion is viewed as a down payment on complying with a Supreme Court order to beef up funding of basic education programs.
To cover the spending, the coalition will use most of the $2 billion in additional tax revenue the state expects to collect in the next two-year budget cycle.
"We live within our means," said Sen. Andy Hill, R-Redmond, chairman of the Senate Ways and Means Committee and chief architect of the spending plan.
With release of the plan, coalition leaders are taking the opposite approach of Gov. Jay Inslee and setting up an intriguing negotiation on how to best fund public schools, early learning and colleges.
Inslee last week called for putting $1.2 billion more into schools and to pay for it by ending tax breaks and making two "temporary" taxes permanent. House Democrats are yet to release their spending proposal but are expected to include some revenue-raising measures.
Overall, the budget put forth by the coalition, which is made up of 23 Republicans and two Democrats, calls for spending $33.2 billion and setting aside $611 million in reserves.
Nearly half of the total is earmarked for education of students from pre-school to college. Not only does the budget snag most of the incoming revenue, it also redirects existing streams of tax collections into a separate account for public school funding.
Hill said the changes will lay the foundation for more stable funding for education.
For example, about $1 billion in property taxes -- which is about half of what the state collects -- would be sent from the general fund into the Education Legacy Account. Unclaimed lottery prize winnings and a portion of the hazardous substances taxes also would be steered to the account.
And the plan permanently redirects tens of millions of dollars in real estate and public utility taxes away from the Public Works Assistance Fund which provides loans to cities, counties and special districts for large improvement projects.
Aside from education, the coalition budget embraces a full expansion of Medicaid permitted under the new federal health care law. The move, which Inslee and Democrats also endorse, would enable another 255,000 adults to become eligible for health care that the federal government promises pay for in full, saving the state $303 million.
To deal with a projected $1.2 billion hole in the next budget, the coalition relies on a mix of spending cuts, fund transfers, and continuation of a fee imposed on hospital beds set to expire this summer.
There are "not a ton of big moves. More a ton of small moves," Hill explained.
For example, $66 million in savings is assumed through unspecified "administrative efficiencies" achieved through expanded use of lean management championed by Inslee. Some agency budgets will shrink as unfilled positions are axed rather than kept on the books, Hill said.
One large chunk of savings, roughly $128 million, would come from encouraging as many as 19,000 part-time and low-paid state workers to sign up for the health benefit exchange Washington will launch next year under the federal health care law. These are workers in state agencies, higher education institutions and public schools though not certificated teachers.
Another $180 million would be pared from two programs aiding low-income families -- Working Connections Child Care and Temporary Assistance for Needy Families. That's the amount of money expected to be saved from lower-than-expected demand for services, senators said.
It's unclear how quickly the budget will move through the Senate. A hearing on the budget bill is scheduled for 3:30 p.m. today.
And whether there will be many Democrats voting for the plan -- beyond those of the coalition members, Sen. Rodney Tom of Medina and Tim Sheldon of Potlatch, is unknown.
Hill met regularly with Sen. Jim Hargrove, D-Hoquiam, the lead budget writer for Senate Democrats, in crafting the budget. Hargrove praised Hill for doing so.
"We worked together. I consider it a bipartisan process, the most transparent bipartisan process that's ever happened," Hargrove said.
Hargrove said he backs the budget but wouldn't say how many in his caucus members are ready to do the same.
Hill also declined to predict if all 25 members of the coalition are on board.
"We will have the vast majority of our caucus," he said.
Jerry Cornfield: 360-352-8623; jcornfield@heraldnet.com.

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