NFIB Washington Legislative Update

Unlucky week for small-business owners as three costly bills advance toward the governor’s desk and expected signature

State Director Patrick Connor reports from Olympia on the small-business agenda for the legislative and political week ending April 9

Week 13 has been unlucky for our state’s small-business owners as the state House and Senate approved bills that will make it more difficult and costly to manage your operations.

Chief among the bad bills to pass this week were several of Gov. Jay Inslee’s priorities, including cap and trade, a low carbon fuel standard, and his so-called “worker protection” bill that does little more than increase penalties on employers. These bills will see more legislative activity before they can be sent to the governor for signature, but the likelihood of defeating them has become much less probable.

#OpenSafeOpenNow

Counties are scheduled to be evaluated Monday, April 12, to determine whether they qualify to remain in Phase 3 re-opening, or regress to Phase 2. Any changes in status would take effect Friday, April 16.

Perhaps not surprisingly, Gov. Jay Inslee has once again changed the criteria for determining county status. This time for the better.

In response to concerns many counties might regress to Phase 2, the governor today announced, “In order to move down one phase a county must fail both metrics for case counts and hospitalizations. Under the previous plan, a county only needed to fail one metric to move back one phase.”

This should reduce the number of counties moving back from Phase 3 to Phase 2.

Environment

HB 1091, Low Carbon Fuel Standard (LCFS) – The Senate passed an amended version of the House’s LCFS bill late Thursday night, April 8, by a margin of 27-20. Democrat Sen. Steve Hobbs joined the Republicans and Sen. Tim Sheldon voting against the bill. It will return to the House for a concurrence vote. NFIB opposes the bill.

SB 5126, Cap and Trade – The Senate spent several hours Thursday, April 8, debating nearly 45 amendments offered on this legislation. Democrat Sens. Bob Hasegawa, Liz Lovelett, and Kevin Van De Wege joined all Republicans and Sen. Tim Sheldon voting against the bill, which narrowly passed 25-24. The bill has already been scheduled for public hearing in the House Environment & Energy Committee at 8 a.m. Wednesday, April 14. NFIB encourages members to visit the legislative website to sign-in CON for SB 5126. (Select “Environment & Energy” and “4/14/2021 8:00 a.m.”) NFIB opposes the bill.

Health Care

SB 5399, establishing a Universal Health Care Commission – The House passed a scaled-down version of the bill on Wednesday, April 7. The amendments direct the new commission “… to create immediate and impactful changes in the health care access and delivery system in Washington and to prepare the state for the creation of a health care system that provides coverage and access for all Washington residents through a unified financing system once the necessary federal authority has become available.” In the short term, the commission is basically charged with researching and reporting on methods of moving the state towards a universal health-care financing and delivery system, including seeking federal waivers to facilitate those efforts. The bill will return to the Senate for concurrence. NFIB remains opposed to the bill.

Labor

HB 1076, qui tam bounty hunter lawsuits – One bit of good news is that HB 1076 failed to advance from the Senate Ways & Means Committee last Friday, the deadline for bills to pass fiscal committees. It appears dead for the session, but there’s always a chance the bill could re-emerge as a result of budget negotiations. NFIB opposes the bill.

HB 1097, Gov. Inslee’s “worker protection” act – This bill would:
- add new daily penalties on businesses operating in defiance of an L&I stop-work order
- give workers more time to file complaints alleging retaliation by their employer
- divert funds from the employer-paid portion of workers’ compensation taxes to create a fund for L&I to provide safety grants to selected employers during a state of emergency.

Floor amendments adopted by the Senate would provide employers 30 days, rather than 15, to appeal a citation for retaliation, and require workers’ comp funds expended as grants to be reimbursed by the state general fund. We commend Sen. Karen Keiser, chair of the Senate Labor, Commerce & Tribal Affairs Committee, for introducing the workers’ comp backfill amendment. NFIB is reviewing the bill as amended by the Senate, but continues to object to new daily penalties on employers contesting a closure order issued during a state of emergency where no direct, immediate threat to public or worker safety and health can be proven.

SB 5478, unemployment insurance relief – Another bright spot is today’s unanimous Senate passage of $500 million in targeted unemployment insurance tax relief to employers that have been hardest hit by shutdowns and slowdowns ordered in response to the COVID-19 pandemic. SB 5478 would remove experience-rated charges from the accounts of (1) employers in 15 sectors whose unemployment insurance taxes increased at least two rate classes, and (2) all other employers whose accounts jumped six or more rate classes. The House version, HB 1568, which would have targeted this relief to smaller employers, has not received a hearing in the House Appropriations Committee. NFIB thanks Sen. Keiser for her work on this legislation, which is a priority for small business. NFIB supports the bill.

SB 5046, allowing lump sum settlements for certain workers’ compensation claims – The bill received a unanimous vote in the House, and should be sent to the governor next week for signature. NFIB supports the bill.

SB 5355, wage liens – Despite five Democrats – Reps. Mike Chapman, Davina Duerr, Mari Leavitt, Larry Springer, and Amy Walen – joining all Republicans voting against it, the bill passed the House, 51-46. It should also head to the governor next week for his signature. NFIB opposes the bill.

Tax & Fiscal

Budget leaders have begun negotiations on the final “go home” two-year capital, operating, and transportation spending plans. Revenue bills needed to pay for the proposals will be part of those negotiations.

HB 1332, county property tax deferrals for businesses suffering 25% or greater revenue loss in 2020 – The bill has not yet advanced from the Senate Rules Committee. NFIB supports the bill, and included it in our letter to the Senate.

There was no action this week on either HB 1406, the Billionaires’ Tax, or SB 5096, the capital gains tax. Since they are “necessary to implement the budget,” we expect further consideration of both bills before session ends.

SB 5483, the “Forward Washington” transportation revenue package – The Senate Transportation Committee will hold a public hearing on its tax bill at 10 a.m. Monday, April 12. The bill includes a 9.8¢ per gallon gas tax increase, as well as per trip fees on for-hire transportation (like Uber and Lyft) and third-party food delivery services (such as DoorDash, Grubhub, and Postmates). These would be in addition to cost increases resulting from LCFS and cap-and-trade bills. Combined, these bills are estimated to cause fuel charges to skyrocket between 60¢ and $1 (or more) per gallon. NFIB encourages members to visit the legislative website to sign-in CON for SB 5483. (Select “Transportation” on “4/12/2021 10:00 a.m.”) NFIB opposes the bill.