Editorial: Lawmakers, back away from capital budget cliff

By The Herald Editorial Board

Once again, to the brink at the state Capitol.

This time the consequence of not forging a last-minute agreement among Democrats in the House, Republicans in the Senate and the governor’s office isn’t a government shutdown; still, it’s a consequential loss of $4 billion in spending throughout the state that is intended to help build and repair schools, colleges and community centers; provide grants for housing projects; fund parks and trails and restore habitat; clean up toxic waste sites; replace and repair water and sewer infrastructure and more.

Usually, the state’s capital budget is a relatively noncontroversial vote for lawmakers. The projects it funds are spread throughout the state, and lawmakers like to point to what’s been provided in their individual districts.

At least since 1985, the Legislature has never failed to pass a capital budget during budget years. This year, the capital budget may go unspent.

With the third special session scheduled to end Thursday, Republicans in the Senate are withholding a vote on the capital budget until they see passage by the House and the governor’s signature on legislation that would override a 2016 decision by the state Supreme Court — the Hirst decision — regarding water rights for individual property owners.

On a 6-3 vote, the court changed the rules for drilling wells for private property, shifting the responsibility for determining if there was adequate availability for existing water rights holders — including municipalities, farmers and tribes — from the state Department of Ecology to individual counties under the Growth Management Act. The result, Republicans say, has been a shutdown of development and land sales in the state’s rural areas because of the increased difficulty and cost in getting permits for wells.

The Senate, since the start of the year, has passed bills four times that would override the court decision and return the authority on wells to the state Ecology Department, but Democratic lawmakers in the House have balked over concerns for those holding existing water rights and adequate stream flows for salmon.

Republicans are adamant that unless they use the capital budget as leverage, a resolution to the Hirst decision won’t happen. Democrats — in particular Gov. Jay Inslee, who spoke with The Herald Editorial Board on Thursday — say it’s not acceptable to hold the capital budget hostage, especially because it’s key to providing the classroom space that will be necessary to take advantage of the increased spending for K-12 education that lawmakers approved just days ago.

Gov. Jay Inslee talks about budgets, other issues from Everett Herald on Vimeo.

Among the school and college construction projects set for Snohomish County are $9.3 million in state funding for an elementary school in the Lake Stevens School District, $14.6 million for three schools in the Edmonds School District, a $37.8 million science, engineering and technology building at Edmonds Community College and $3.8 million for repairs and upgrades at Everett Community College.

To resolve the standoff, Inslee has proposed lifting the court decision for an 18-month period while negotiations continue. But Republicans, including House Minority Leader Dan Kristiansen, R-Snohomish, say that period wouldn’t provide enough certainty for property owners, lenders and others. Already, Kristiansen said, property sales and land values have been adversely effected, and the tax burden shifted to existing property owners.

The standoff has been further complicated by Gov. Inslee’s veto of a Business and Occupation tax break for the state’s manufacturing businesses, giving them the break previously negotiated for Boeing.

In their own meeting with the editorial board, Kristiansen and Rep. Norma Smith, R-Clinton, said the veto of manufacturers’ B&O reduction was a major blow to businesses in Snohomish County and could discourage the location of new businesses here, even as Arlington and Marysville begin marketing their joint manufacturing center.

But Republicans had their own part in their spat with Inslee. Republicans had suggested the B&O tax break in mid-June during budget negotiations, and twice, Inslee said, he said he wouldn’t support it. With many seeing an increase in their property tax bills because of the Republicans’ “levy swap” to resolve the school funding issue, Inslee said, it wasn’t fair to give industry a tax break at the same time. Inslee said he vetoed the tax break when Republicans, at the last minute, restored the B&O tax break to the budget and passed it with a state shutdown looming and no time for further talks.

With just days remaining in a third — we hope, final — special session, this standoff has not been among the Legislature’s or governor’s finest hours. And it’s in contrast to a number of examples this year where lawmakers and the governor have worked effectively and cooperatively for the benefit of state residents. The best example of this being passage of a paid family leave law that is arguably the strongest among the handful of states that provide it and could become a model for similar legislation in Congress.

Lawmakers, back away from the brink. Find a way forward on Hirst that allows property owners to reasonably and affordably determine if they have access to water while protecting existing water rights and the environment. And pass the capital budget.

Then, please, go home.