5 ways to spend federal aid, 1 reason to pass capital gains

Here’s what’s happening on Day 68 of the 2021 session of the Washington Legislature.

NO CAPTION NECESSARY: Logo for the Cornfield Report by Jerry Cornfield. 20200112

2021 Washington Legislature, Day 68 of 105

Everett Herald political reporter Jerry Cornfield: jcornfield@heraldnet.com | @dospueblos

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OLYMPIA, March 19, 2021 — Good morning. Welcome to Friday.

As policy committees continue to churn, attention is starting to shift to budgets. Senate Democrats are eyeing March 25 for the rollout of their operating budget. House Democrats will follow close behind with their version and are penciling in Saturday, April 3, for possible floor action.

This week’s revenue forecast made clear money will be in ample supply. That doesn’t mean it will be easy to get to “Yes.”

Democrats must figure out how to deal with the $4.2 billion in federal aid that will arrive with very few strings attached. There’s already jostling within majority caucuses as to how to spend it. Gov. Jay Inslee has his ideas (though he declined to share any at a Thursday news conference) and Republicans do, too.

Senate Democrats accounted for a couple hundred million dollars when they accelerated the timelines for expanding child care and early education programs as part of the Fair Start for Kids Act. And, of course, a portion will go to the COVID-19 health care response.

It does seem there are lots of possibilities for the Legislature and governor to go big with what is left.

For example, there’s interest in steering a portion into preventing wildfires in hopes of saving the state money on firefighting in the future. They could plug a projected $800 million hole in the next two-year transportation budget due to the pandemic. Revenue from gas taxes, toll roads and ferries nose-dived as people stopped driving and traveling.

Or they could put some serious money toward getting broadband into the places it needs to go, a problem illuminated and magnified by the pandemic. Less clear is if they could use it to speed replacement of culverts to comply with a federal court order. That is a $3 billion undertaking.

And aren’t lawmakers looking to replace Western State Hospital? Maybe stand up small treatment centers in communities? This could be a moment to transform the delivery of mental health treatment and behavioral health services.

Plenty of notions are going to garner debate in the coming days. If you hear of other ideas, let me know.

Just do it

Could a Republican talking point against the capital gains tax actually be a decent reason for Democrats to pass it and Inslee to sign it?

Republicans argue that with tax collections rising and a pandemic windfall of federal aid coming, the state doesn’t need the proposed tax to pay for vital services in the next budget. Or the one after that, based on current projections. They’re right.

And, Republicans point out, it isn’t going to produce a quick pay day for the state anyway. The first dollars aren’t supposed to start rolling in until the uber wealthy — about 8,000 of them — file their federal income tax returns in April 2023.

That means there’s lots of time — and it will be needed — to litigate the legality of a capital gains tax. Since Democrats won’t take it off their to-do list until they know it can’t be done, why delay?

Ditch and dine

GOP Sen. Doug Ericksen racked up a chunk of missed votes recently when he traveled to El Salvador to observe elections, reports McClatchy’s Sara Gentzler.

With a virtual session of the Legislature, Ericksen managed to cast a few votes and take part in caucuses while out of the country.

“Obviously if we were not working remotely, I would not have gone,” he told Gentzler.

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