Rep. Drew MacEwen has introduced House Bill 2068, which would provide business and occupation (B&O) tax relief for most of the 360,000 businesses in the state that pay the tax. Under the bill, all businesses would be exempt from B&O tax liability on their first $200,000 of taxable income.

“This three-page bill would provide meaningful tax relief to hundreds of thousands of business owners across Washington state,” said MacEwen, R-Union. “Under my plan, these employers would have more money available to grow their businesses and hire new employees.”

According to an estimate from the nonpartisan Office of Program Research, all businesses with gross receipts less than $3,050,000 would see a tax cut.

“The goal of this legislation is to spur economic growth and get all of Washington working again,” said MacEwen. “Many folks in communities across the state are still struggling in the aftermath of the great recession. Jobs were lost that never came back. I believe this bill could be the catalyst for the economic revitalization these communities so desperately need.”

Under House Bill 2068, current B&O tax rates would be adjusted to make the bill revenue neutral, meaning it would not impact the state’s operating budget. The bill awaits a hearing in the House Finance Committee. If signed into law, it would take effect Jan. 1, 2018.

The 2017 legislative session began Jan. 9 and is scheduled to adjourn April 23.

PHOTO CAPTION: Rep. Drew MacEwen, R-Union, discusses his B&O tax reform bill with NFIB/Washington Small Business “Day at the Capitol” attendees on Feb. 9, 2017.

The three lawmakers who represent the southwest Sound’s 35th Legislative District say the 2016 legislative session may have been a bit messy, but the outcome was a big thumbs up for fiscal responsibility.

It took 20 days of overtime for lawmakers to reach agreement on a budget, but in the end their deal avoided the gimmicks and the spending patterns that got the state in serious trouble during the economic slowdown of seven years ago, the lawmakers said. “Our majority coalition in the Senate managed to hold the line, and we passed a budget that won’t force a tax increase next year,” said state Sen. Tim Sheldon, D-Potlatch. “The fact we had to fight makes you wonder whether people learned anything from the recession.”

The final gavels fell Tuesday night in the House and Senate to end the Legislature’s session after 80 days, long past the Legislature’s scheduled adjournment on March 10.

Wins for the 35th District include:

• $206,000 for a Mason County veterans’ shelter. The money will renovate existing properties to provide transitional housing for veterans in cooperation with Mason County’s specialty veterans’ court. Organizations providing assistance include Mason County Veterans Mentoring, Catholic Community Services, Mental Health Professionals, LLC, and Northwest Resources. Another $100,000 for the project will be provided by Mason County.
• $1 million for minor works repairs at the West Sound Technical Skills Center in Bremerton. The center provides career training for students between 16 and 20 years old from eight school districts in the west Puget Sound area.
• $300,000 to help maintain the USS Turner Joy, the historic warship that is a major Bremerton tourist attraction.

Lawmakers this year were charged with making minor adjustments to the two-year budgets they approved last year for state operations, capital spending and transportation. Chief disagreement between the House and Senate was whether lawmakers should add big new spending. Majority Democrats in the House favored a half-billion dollars in spending increases that would have required a tax increase next year to sustain, or else would have forced big cuts in the Legislature’s plans to spend more on K-12 education.

All three 35th District lawmakers were opposed to that idea.

“Supplemental budgets should be focused on addressing emergencies, increased entitlement caseloads and fixing errors in the biennial budget – not enacting new policy that increases spending,” said Rep. Drew MacEwen, R-Union. “The budget we passed addressed important issues and supports projects in the 35th District. We also made modest but important investments in mental health and K-12 education – without raising taxes. We passed a balanced and sustainable budget that meets the needs of students, families and our most vulnerable.”

Rep. Dan Griffey, R-Allyn, said the final result is what counts. “Though it took a little bit of overtime to reach an agreement, the budgets we passed kept to the spirit of a true supplemental budget year. There were some important projects in our communities that didn’t receive funding in this supplemental year, but we’re looking forward to coming back in 2017 to get those projects prioritized. That said, we put dollars toward wildfire recovery, which was critical after the devastating wildfire season Washington had in 2015, and we provided funds to keep charter schools open, to address the teacher shortage and to improve our mental health system.”

Sheldon said the spending proposal from the House Democratic Caucus repeated one of the biggest errors of the last 10 years.

“This is how we got into big trouble just before the recession, when the Legislature launched billions of dollars in new spending that could not be sustained without a tax increase,” Sheldon said. “Why on earth anyone would want to relive that nightmare is beyond me.”

The final supplemental operating budget approved by the Legislature keeps new spending to a minimum, and puts its emphasis on urgent state needs. It complies with the state’s four-year balanced-budget law, passed by chastened lawmakers of both parties in 2012, when the lessons of the recession were fresh. The law prevents lawmakers from enacting spending plans that cannot be sustained in future years.