Washington State Legislature Adjourns After Brief Double-Overtime
April 12, 2012
April 12, 2012
Just as the special session of the Washington State Legislature expired at midnight on Tuesday, Gov. Christine Gregoire called the legislature into a second special session that lasted just a few hours. Early Wednesday morning, the legislature approved a supplemental budget and adjourned its second special session sine die at 7:31 a.m.
Banks located in more than 10 states will no longer be able to deduct business and occupation (B&O) tax from interest earned on loans secured by first mortgages or deeds of trust on residential properties, a move estimated to raise $14.5 million. The Joint Legislative Audit & Review Committee (JLARC) is also directed to review the first mortgage deduction by June 2015 as part of its tax preference review process. The JLARC had reviewed this same preference in 2011 and recommended that the legislature review the preference because it was unclear whether the original public policy objectives were being met given changes in the lending industry and the rise in the secondary mortgage market.
In addition to scaling back the banks’ B&O tax exemption, the final budget also included the sweep of $4 million from the Department of Financial Institutions’ (DFI) financial services regulation fund. The first draft of the supplemental budget called for sweeping just $3 million.
The supplemental budget raises an additional $12 million by changing rules on roll-your-own cigarettes, saves $238 million by temporarily claiming control of local sales taxes before they are redistributed back to jurisdictions at their usual time—roughly a month after they are collected—and leaves $320 million in reserves.
There were no cuts to K-12 or higher education, but health insurance benefits for K-12 employees were changed with a compromise bill that still retains local collective bargaining, though it does change local bargaining around benefits and requires data from providers and school districts.
Lawmakers also approved a $1 billion capital budget package that supporters say will lead to 18,000 construction jobs.
Questions? Contact a member of the Association’s Legislative Affairs team:
Jennifer Wagner, Vice President of Legislative Advocacy
Mark Minickiello, Vice President of Legislative Affairs
Stacy Augustine, Senior Vice President & General Counsel
Posted in Advocacy News.