Thursday, May 26, 2011

Legislative Wrapup Report: For a Few Dollars More

With less than two hours to spare, the 2011 legislature adjourned Wednesday, May 25, ending the special session with the House and Senate gaveling the day to a close together with a mixture of relief and celebration.

The final days were marked by exceptionally long hours and closed door sessions, and once a budget agreement was delivered Monday, the pace picked up. It was time to go home.

The 2011-13 operating budget, E2SHB 1087, includes $4.5 billion in reductions and $459 million in transfers, to close a $4.9 billion budget shortfall. It also leaves more than $700 million in reserves.

In many cases, the budget represents a continuation of funding decisions started in the 2009-11 biennial budget, last December’s budget bill (HB 3225) and the early action supplemental budget in February (ESHB 1086).

Read the Full Update

Wednesday, May 25, 2011

Go ahead, make my day

The Senate recently passed the 2011-13 operating budget (ESHB 1087), the 2011-13 capital budget bond bill (HB 2020) and the construction cash only bill (ESHB 1497), and the bill that would task a blue ribbon commission with reviewing the state's debt limit and putting a lower working rate in place (starting in 2015).

Other bills that have passed in the last two hours are ESHB 1410, which would delay the requirement to pass the science assessment to graduate until the class of 2015, and ESB 5919, the policy bill that puts in place many of the education funding cuts including a new formula for the Transitional Bilingual program that will phase in 2012-13.

A handful of other bills have made their way across both chambers, and it appears that they are ready to sine die. The big doors are opening and all looks well.

Congratulations legislators - you did it!

Rolling in the deep

With eight hours left to go on Day 30 of the special session, the wheels are turning slowly.

The House came in at 9 a.m., went into caucus, and has emerged to pass the capital budget, the bond bill and the blue ribbon commission on right-sizing the state's debt limit. A couple of other bills have passed as well, but big ticket items like state agency consolidation remain.

The Senate has also been rather pokey, with the operating budget, capital budget, bond bill, ALE funding, and education reforms still on the calendar. After a three-hour "recess" over lunch to go back to the table on the operating budget for a unexpected glitch, they are on the floor.

As long as the Senate passes the capital budget, the school construction assistance program is golden. In addition, the capital budget includes $20 million for energy efficiency grants, $5 million for emergency repairs, and funding for three skills centers plus $1 million for Aviation High School.

More later ... it's time for science, finally.

Tuesday, May 24, 2011

House begins floor action on budget

The House is beginning work on the 2011-13 operating budget. Speaker Frank
Chopp, D-Seattle, is running the floor action.

Capital budget deal announced

The agreement includes a smaller capital budget and some limits to the debt capacity.

The capital budget will include a $1.1 billion bond budget ... HB 2020. Senator Derek Kilmer, D-Gig Harbor, said that every school district that has passed a bond measure will get the school construction assistance they have been counting on, plus some funding for skills centers is included.

On the constitutional amendment, the compromise is to put something into statute this year on a working debt limit but not to seek an amendment at this time.

Reporting on the agreement, Senator Linda Evans Parlette, R-Wenatchee, indicated that they have agreed on reducing the debt limit over time and will create a blue ribbbon commission to assist with the thinking on what the right level of debt should be. The commission will include legislators, the state treasurer, OFM, and others with expertise on bonds and financing.

SB 5181 will create the commission, and will put in place a working debt limit smaller than the 9% currently in the constitution. The working debt limit is currently 8.75, and bonding capacity has been based on a three-year average; the language they are working on is to reduce this over time, with a goal of reducing the debt service in the operating budget to about 5.5 percent.

A constitutional amendment has been put aside for now, although it might be something the blue ribbon commission may recommend.

The cash projects in the capital budget will show up in a striking amendment for SHB 1497. This is a new approach, according to ranking committee member Judy Warnick, R-Moses Lake, where the bond bill (HB 2020) and the cash bill (HB 1497) will be more transparent on what the state is buying.

No bills or summary details yet; probably tomorrow. Negotiators worked until 5 a.m., and gave the Governor and the governor's office credit for helping them reach agreement.

The press conference will be available on TVW later today.

Legislative Update: Compromise operating budget announced

House and Senate leaders and budget negotiators gathered this morning to announce a bi-partisan budget that makes $4.6 billion in reductions, including some painful cuts to K-12 education.

While not ideal, early agreement had been reached on suspending citizen initiatives on class size (I-728) and COLAs (I-732), which would save the state at least $1.2 billion right off the bat. K-4 class size enhancements were also on the chopping block, which cut about $170 million.

Districts had also expected a June apportionment shift, but the hit is less than originally projected—$128 million shifted from June 30 to July 1.

The compromise budget also includes $33.5 million for K-3 class size reduction in high poverty schools.

Local effort assistance (LEA) was protected in both the House and Senate budget proposals, and remains preserved in the compromise plan.

One of the largest cuts to K-12 is a 1.9 percent salary reduction for certificated and classified staff and 3 percent for administrative staff. An exemption is included for those who make less than $30,000. The cut represents $179 million that will be pushed down to local districts to deal with.

Read the full update.

Monday, May 23, 2011

Legislative Update: Come together

Senate and House leaders and budget writers will hold a press conference Tuesday, May 24 at 10 a.m. to announce the agreed-upon 2011-13 operating budget.

Faced with a $5.1 billion shortfall between revenues and expenditures/commitments, negotiators have taken nearly all 30 days of the special session to reach an agreement. The end is in sight.

No one believes that K-12 education will be spared some deep cuts, and as budget committees march towards the final day of special session (this Wednesday, May 25 at midnight), we continue to get a peek at what’s in store for public schools.

Read the full update.

Budget update

Just a quick update that it looks like there is agreement on the operating budget but few details. Both caucuses are expected to share details with their members and the budget will be revealed at 10 a.m. Tuesday.

A quick glance at HB 2065, indicates a 15% cut to ALE programs (online, parent partnership and contracted ALE), which is a cut to basic education. Legislators are trying to garner $40M and don't think the savings on eliminating parent partnership stipends will net enough.

Speculation is rampant on K-12 salary reductions, but the rumors are an agreement on 1.9% for teacher pay cut and 3% to classified and administrative employees.

As to bus depreciation and the $95 million tied to the lump sum payment, no word on where this will end up. Some speculation is that will be taken but not at such a large rate.

The House is currently doing the workers compensation reform bill(s), while Senate Ways & Means is getting ready to run a number of bills necessary to implement the budget. The House Ways & Means Committee is supposed to start their meeting at 5 p.m., but it could be delayed based on what happens on workers comp and how much time that takes.

Final sticking points of major issues: the capital budget tied to the constitutional amendment to reduce the debt limit from 9% to 7%, and reorganization of several state agency operations and contracting out provisions. A five-corners meeting just broke up on the constitutional amendment with no agreement. We may end up with a cash-only capital budget, which would result in $330 million for school construction match.

Also in the final countdown is the science assessment bill that would delay the link between graduation and passing the science test to either 2017 or, under an amendment by Rep. Dammeier, roll it back to 2015. We think there is agreement to roll back to 2015 but to drop the requirement that students in the class of 2014 that fail the test have to take a third science credit - a serious unfunded mandate to schools.

More later.

Friday, May 13, 2011

Legislative Update: Friday the 13th

As week three of a session that has nothing special about it ends, lawmakers and insiders are starting to predict that a second 30-day session will be needed to finish up the main business of 2011 – namely, passing a two-year operating budget.

Negotiations and proposals continue to move back and forth between the chambers and the second floor (where the governor’s office is), with a peek at plan elements based on NTIB bills that are starting to see some action.

Measures such as HB 1131 and 2SHB 1132, which suspend citizen-initiatives that support smaller class sizes and teacher COLAs, are a given, and cut about $1.2 billion from the state’s public schools tab. Both bills have passed the House and were heard in Senate Ways & Means this week.

After a bill signing Thursday, Gov. Chris Gregoire said she wouldn’t call a second special session unless legislators were ready to pass a budget. And she said it three times, just for good measure.

The 30 days is up May 25. Starting next week, House Democrats will be short a few members, since travel plans have kicked in for some; recalling them may be an option, but isn’t one some want to contemplate.

Read the full update.

Tuesday, May 10, 2011

Legislative Update: House and Senate take action on bills

Both the House and Senate returned to work Monday, May 9, passing several bills that have been labeled NTIB or “necessary to implement the budget.”

Since Monday, the House passed bills that suspend Initiative 728 (HB 1131); Initiative 732 (2SHB 1132); and SHB 2065, alternative learning experiences.

The first two bills save the state about $1.2 billion. A fiscal note for SHB 2065 hasn’t been drafted yet, but will be less than the $53 million cut in the original house budget proposal.

HB 1131 suspends the citizen initiative that funded smaller class sizes. Some legislators have argued that rather than suspending the initiative another time, lawmakers should just eliminate it. Others are banking on better days ahead when funding could be restored.

With 2SHB 1132, teacher COLAs are suspended for the next two years, and the catch-up requirements are eliminated. In addition, the bill references that national board certified teacher bonuses will be included in the budget, and includes language that puts in place the freeze to the salary step schedule.

Read the full update.

Apportionment payment change offered

One of the bills labeled "necessary to implement the budget" or NTIB is
HB 1354, which moves the June 2011 apportionment payment to July 1st.

Both the House and Senate budget writers planned to move $253 million from the 2011 Fiscal Year into the 2011-13 biennium, thereby reducing the need for $253 million more in cuts before the end of June.

House budget chair Ross Hunter, D-Medina, has an amendment on the House floor to reduce the payment shift from $253 million to $128 million. If adopted, it means that school districts will have more money flowing out to them in June than previously expected and less of a hit to the state's general fund for the next two years.

The additional funds were identified through a tax amnesty program offered earlier this year that has brought in more money than anyone expected. Gov. Chris Gregoire suggested using the windfall to pay down the apportionment shift, and it looks like Hunter plans to carry that through when the bill comes up for a vote on the House floor.

Thursday, May 5, 2011

Much ado about nothing

After nearly two weeks of special session, it would be wonderful to report the road home is clear. Unfortunately, the light isn’t shining too brightly yet.

The House returned April 26, passed a handful of bills that had already been passed and, for the most part, went home. They returned this week for another floor session, and the House Ways & Means Committee held a full day of public hearings and executive session Thursday, May 5.

Most of the Senate also showed up for the start of special session, holding short floor sessions nearly every day last week and this week. The Senate Ways & Means Committee has held a couple of public hearings, and finished business Thursday before noon.

Both the full House and Senate will be back Monday, May 9 for floor action.

Read the full update.