OLYMPIA — Deciding who should pay a state agency’s $6.1 million settlement of a sex discrimination case has embroiled the House and Senate in an unusual conversation on whether someone other than taxpayers should foot the bill.
Attorney General Bob Ferguson negotiated the deal in September on behalf of the state Board of Pilotage Commissioners, ending a multi-year legal fight launched by a woman denied a license to become Washington’s first-ever female marine pilot.
The commission, which has three staff members, is on the hook for paying off the settlement over the next six years. But it cannot afford the annual $1 million cost — which was the size of the board’s entire budget in 2015 — and the Senate and House sharply disagreed on whether to pursue an unprecedented step of making those regulated by the agency help pay.
The Republican-led Senate passed a bill requiring nearly half the cost be borne by pilots licensed by the commission and shippers who hire them to steer their vessels safely through Puget Sound. The rest of the money would come from the commission coffers and state transportation budget. All payments would be spread over six years.
The Democrat-controlled House countered by allotting $2 million in its proposed transportation budget, thus alleviating the commission, pilots and shippers of the financial burden. Democrats figured to repeat the process in future budgets. The dollars would come out of the state’s account for multi-modal projects.
On Tuesday, a compromise surfaced to require pilots pay $10,000 and shippers a tariff surcharge in each of the next two years. A study would be done to see the best means of handling the final four years of costs.
Legislation authorizing the compromise failed to get a vote in the House Transportation Committee when Republicans refused to support it. GOP members objected to forcing pilots and vessel owners from paying anything because they are not named as responsible parties in the lawsuit. Taking that path would set a bad precedent, they said.
“The bill’s dead,” said Rep. Judy Clibborn, D-Mercer Island, chairwoman of the House Transportation Committee. “That leaves us with our original House position.”
Although Democratic lawmakers control the majority on the panel and could have passed the compromise language, Clibborn didn’t see a reason to do so since it wasn’t an approach her caucus had ever backed.
“I don’t want my people voting on something that is a Republican effort and has no votes from Republicans here,” she said.
Sen. Curtis King, R-Yakima, chairman of the Senate Transportation Committee and the bill’s prime sponsor, was caught off guard by what happened.
“I’m disappointed,” he said. “I’m going to have to work on it.”
King originally introduced Senate Bill 5819 in response to the September 2016 settlement of the gender discrimination case involving one of the state’s oldest and smallest agencies.
Back in 1888, even before statehood, the territory of Washington required owners of vessels traveling through Puget Sound to hire specially trained pilots. At that time, the territorial governor appointed a three-person commission to license the pilots.
In 1935, the Legislature formally established the seven-member Board of Pilotage Commissioners and etched into law its responsibility for licensing and regulating all pilots serving Washington waters in Puget Sound and Grays Harbor. Commissioners, who get paid $50 a meeting, are tasked with recruiting potential pilots and putting them through a rigorous selection process involving more than a year of training plus exams.
This agency is unique in that it operates without state tax dollars. It relies on $6,500 in license fees paid by each pilot and other ancillary fees. Tariffs paid by the vessel owners — which totaled nearly $32.8 million in 2015 — are split evenly among the pilots.
In its 129 years of existence, this commission has never licensed a woman to be a pilot. Capt. Katharine Sweeney came closest but the commission denied her a license in 2011. She sued and a jury in 2014 agreed she had been discriminated against because of her gender.
The Attorney General’s Office undertook negotiations resulting in the settlement. While the commission is part of the state’s self-insurance coverage, the insurer would have only paid any amount above $10 million, according to state officials.
Sweeney, a Seattle resident and master mariner, is chief executive officer of Compliance Maritime, a company she started in 2010. She provides safety management and vessel security audits, according to the firm’s website.
Reached Tuesday by phone, she said she was not aware of the legislative discussions.
“I think the people that are responsible should pay,” she said. “The shippers should not have to pay for the discrimination that occurred at the hands of the commission and Puget Sound Pilots.”
King said he felt it only fair to spread the financial burden because representatives of pilots and vessel owners hold four of the seven commission seats and thus were involved in the licensing decision. He, and the other 24 senators who backed his bill, wanted to send a message of a need to change the culture.
“The taxpayers didn’t create this problem,” King said Tuesday. “I felt a lot of responsibility fell on the pilots that were involved with the examinations. We spread the load. That’s all we were trying to accomplish.”
Not surprisingly, members of the Puget Sound Pilots association opposed the Senate approach because it makes them pay to settle a lawsuit from which they had been dismissed.
A spokesman for the Pacific Merchant Shipping Association told lawmakers in hearings in the House and Senate earlier this year that they were willing to help but did not want tariffs hiked too high or it could deter shippers from calling on ports in Puget Sound and Grays Harbor.
Even Clibborn acknowledged earlier this month there may be some blame to spread around, just not the financial responsibility.
“I thought it was cloudy about who was really at fault for this gender bias,” she said. “It was difficult to say that this little board that got stuck with this was the only one.”