Sen. Ed Murray said he was led to believe the two sides fighting over a plan to streamline collection of state and local business and occupation taxes were coming together.
That's why Murray, chairman of the Senate Ways & Means Committee, scheduled a last-minute hearing Tuesday on a substitute version of Senate Bill 6176, the governor's proposal to make the state the central collection point for B&O taxes.
But the sign-up sheets in the committee hearing room suggested otherwise, Murray, D-Seattle, said at the start of the hearing.
And the testimony from representatives of several cities confirmed it.
"I don't think we are anywhere near a good relationship," Seattle City Councilember Richard Conlin said when Murray pressed him about the nature of the negotiations.
Testimony from Randy Lewis, the Westport city administrator, further confirmed that the cities are more interested in stopping the legislation than they are in making it easier for small businesses to pay their B&O taxes -- regardless of what they may be telling lawmakers in private conversations.
"This bill takes away local control of our tax system," Lewis said -- incorrectly.
For Washington employers, paying taxes can seem like playing a game with 50 different sets of rules, AWB President Don Brunell writes in his weekly column.
It's anything but simple.
Gov. Chris Gregoire is trying to make it a little less complicated. The governor wants to make the state the single collector of all local and state business and occupation taxes, similar to how the state currently handles state and local sales taxes.
Some cities are pushing back against the governor's proposal saying they will lose money as a result, but Brunell notes that Gregoire is rejecting their claims.
"These horror stories of how they're losing money? No They're not," Gregoire said.
"If we ever need a reform that helps business," Gregoire said, "this is it."
Sen. David Frockt and Rep. Larry Springer said Thursday that lawmakers are making progress toward balancing the state budget, despite charges from critics that they've been distracted by other issues such as abortion and same-sex marriage.
Most of the work is occurring behind closed doors at this stage of the 60-day session. But the legislators told AWB's weekly Lobby Lunch meeting that budget writers in both the House and Senate are hard at work.
"Not to be flip, but we actually work on a lot of things," said Springer, D-Kirkland. "We're all segmented. I think it's a misplaced concern to worry about that. Whether we are making significant progress on the budget sort of depends on who you ask, but I can tell you it's not for lack of trying."
Producing the budget will be especially hard this year because all the cutting in previous years leaves lawmakers with no easy choices, Springer said. Even so, the House is committed to producing a balanced budget that does not anticipate any new revenue, he said.
In other words, they won't make cuts with the expectation that programs will be restored later through a voter-approved sales tax hike, as Gov. Chris Gregoire has proposed, or some other plan that emerges from the Legislature.
"You have to assume that a revenue package will not pass," Springer said.
The fallout from Tuesday's State of the Union address continues. Tom Dononhue, president of the U.S. Chamber of Commerce, told the Fox Business channel it was a political speech "full of taxes and taxes, regulations and regulations, stimulus and stimulus. It doesn't address the two fundamental questions at hand and that is how do we drive growth into the United States to the extent that, number two, it creates jobs?"
"I heard a lot about how we were going to regulate things, how we were going to constrain things, how we were going to tax issues. But I didn't hear anybody say 'and here's what we're going to do to move forward, to liberate the free enterprise system in this country to put people back to work.' It was all about what government was going to do and what the president was going to do with the arm of government to see what he could do to put people back to work. But that's not gonna help," Donohue concluded.
Jay Timmons, president of the National Association of Manufacturers, responded: "The President deserves credit for highlighting manufacturing on a national stage, but presidential leadership requires more than speeches. President Obama had a chance to set a bold manufacturing agenda in motion, and he missed it."
"On regulations, for example, the President touted his Administration’s efforts to rein in some regulatory excesses and costs—$10 billion in savings over the next five years. But, Boiler MACT, Utility MACT, Cement MACT and the Cross-State Air Pollution Rule, to name just a few of this Administration’s rules, would impose costs that dwarf the savings highlighted by the President.
"And on labor, the President never mentioned the aggressive actions that the National Labor Relations Board took in the past year. If President Obama wants manufacturing to lead the economy, federal agencies cannot swoop in and tell manufacturers where they can do business."
Timmons concluded: "It’s 20 percent more expensive to manufacture in the United States than it is among our major trading partners — even after excluding the cost of labor. The best way to create an environment to increase manufacturing employment in America is to lower the cost of doing business through pro-growth tax rates, sensible legal policy, reasonable regulations and affordable and secure energy supplies."
The Association of Washington Business is Washington's state chamber of commerce and manufacturing and technology association as recognized by the U.S. Chamber of Commerce and National Association of Manufacturers, respectively.
Representatives from businesses large and small spoke out Tuesday against a proposal that would make Washington just the second state in the country to require employers to provide workers with paid sick leave.
For small employers with narrow profit margins, Senate Bill 6229 would add signficantly to the cost of doing business, forcing some to eliminate other worker benefits -- such as health insurance -- to make up the difference.
For large businesses, even those that already provide workers with paid sick leave, the bill would be an administrative burden and could conflict with existing labor contracts.
For example, Boeing's recent landmark agreement with the Machinist's union does not include an include a waiver for the proposed state law, meaning the contract and the state law would be at odds, Carolyn Ladd, a Boeing attorney, told members of the Senate Labor, Commerce & Consumer Protection Committee.
Proponents of the bill said it's needed to make sure that sick people don't report for work at restaurants and elsewhere, spreading disease.
But business owners said there are already ways to accommodate sick workers and protect public health without adding an expensive state mandate.
Snow and ice did not deter the governor -- or rather, the governor's fiscal and policy leaders -- from kicking off AWB's 2012 Lobby Lunch series last week.
Joining AWB members for lunch in Olympia last Thursday were Gov. Chris Gregoire's budget director, Marty Brown, and her legislative director, Jim Justin.
Brown, a longtime fixture in Olympia politics, did not mince words about the gravity of the challenge before lawmakers this session. While Brown believes the next revenue forecast will likely not be significantly different, caseload numbers are likely to shuffle the internal workings of putting together the supplemental budget. (State caseload figures are due out Feb. 10; the revenue forecast follows on Feb. 16.)
"This is tough. There is not an easy path to get this stuff done," said Brown. "There's a lot of uncertainty -- not so much in Washington state but...in the world economy. And our economy is not necessarily dependent on those things, but the consumer confidence that occurs with changes in Europe, activities of Congress, really is a key to our recovery."
Businesses are not back to full speed yet, Brown said, and any economic gains made through private sector hires are being offset by cuts in state and local governments.
"I don't see a real turn around, I don't see a real quick decision-making process here," Brown said, "but I also don't think [lawmakers] are going to stay long, either."
Given the legislative landscape, Justin characterized Gregoire's final policy agenda as a "fairly aggressive, broad" list of proposals for a 60-day session, offering thumbnail sketches of the governor's priority legislationn. The package includes 17 bills, though three of the six aerospace bills, Justin noted, were passed during the December 2011 special session.
With continued high unemployment, growing deficits and a sluggish economy, it's easy to think that a solution is out of reach.
But that's not the case, AWB President Don Brunell writes in his weekly column. By choosing to "Buy American," individual consumers can make a real difference.
Buying American is not anti-trade, but rather about consumer choice, Brunell says. He notes the case of Anders Lewendal, a Bozeman, Mont. contractor profiled by ABC News for building a home using only American-made materials.
Lewendal says that using just 5 percent more American products in construction projects would create 220,000 jobs. And yet the cost of his "all American" home was just 1 percent higher than homes built with materials manufactured offshore.
Former Cheers actor John Ratzenberger has become the face of the Buy American movement, and he's sounding the alarm about the shortage of skilled American laborers and craft workers that results from buying products from overseas.
It's not too late to turn things around. The Buy American movement shows that opportunities abound, Brunell writes. Even in the most dire situations.
A bill is coming soon, perhaps as early as Wednesday, that could fix some of the flaws in the energy law approved by voters in Initiative 937.
Sen. Kevin Ranker, D-Orcas Island, chairman of the Senate's Energy, Natural Resources and Marine Wates Committee, made the announcement Tuesday during an energy panel at AWB's annual Legislative Day in Olympia.
But Ranker, who prefaced his comments by restating his support for the underlying goals of the initiative -- developing more renewable energy resources in Washington, and reducing the state's use of non-renewable energy -- cautioned observers not to expect radical changes.
"I have no intention of gutting 937 and turning it on its head," he said.
Rep. Dave Upthegrove, D-Des Moines, likewise stated his support for the initiative, and pleaded with the business community to display patience on the issue. "We won't be able to address everyone's concerns this year," he said.
A main concern of the business community is that, unless something changes, I-937 will lead to big increases in the cost of electricity in Washington. Low-cost power has been one of the state's main competitive advantages for years, but that's in jeopardy because of mandates on the state's utilities to increase the amount of power they use from renewable sources.
Too often, it's what's not working in public schools that grabs the headlines or the spotlight.
Today, though, at AWB's Legislative Day education panel, it was all about what is working -- and why we need to do more of it. The panel was moderated by AWB Education Committee Chair Natalie McNair-Huff of True Blue, Inc. and sponsored by K12 Virtual Academies.
Representatives from Tacoma's Science and Math Institute (SAMI) and the Delta High School in Richland shared with AWB members how they've been successful in moving students of all backgrounds and education levels to success in their unique schools.
SAMI, a partnership between Tacoma Public Schools and Tacoma Metro Parks that began in 2009, capitalizes on one of the state's largest parks (Point Defiance Zoo and Aquarium), as well as partnerships with local universities, to help students focus on science and mathematics through experiential learning. The school is modeled after the district's other successful innovative school, the Tacoma School of the Arts. Students apply during their eighth-grade year to attend SAMI. School days are a little longer, and students are encouraged to apply for internships, participate in seminars and travel regionally or internationally, as part of the school's focus on applied learning.
Jon Ketler, principal of Stewat Middle School, spoke to the progam's power to catpture the attention of students for who school and/or homeowrk is not a priority at home, or for whom traditional K-12 environments have not been successful.
"How do you get those students engaged in their own educational experience? That's the question," said Ketler. "As the adults, we have to help them see those learning opportunities that they may not have."
The Delta High School, a joint partnership of the Richland, Pasco and Kennetwick school districts, was developed around the fields of science, technology, engineering and math (STEM). The school relies heavily on partnerships with area businesses and government entities -- such as Batelle and Pacific Northwest National Labs -- to provide professional guidance, mentors and advisors.
Gov. Chris Gregoire called on the business community Tuesday to help pass her final legislative agenda, which includes an element designed to help small businesses: tax simplification.
Gregoire flatly disputed claims from the state's largest cities that they will lose millions of dollars in revenue if the state takes over collection of business and occupation taxes, comparing her proposal to the sales tax.
The state currently collects sales taxes and apportions money to local governments.
"These horror stories of how they're losing money? No they're not," Gregoire said. "We will give it back," she said, adding "I think it's the right thing to do for the small businesses of the state of Washington."
Gregoire also asked business leaders to support her proposed half-cent sales tax hike and to help persuade lawmakers to pass her education reform agenda, which she called a prerequisite for raising taxes. And she highlighted one way that her administration trying to lessen the regulatory burden imposed on business.
