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UPDATE – No budget deal in sight; Inslee’s team waiting to Monday for decision on sending layoff notices to thousands of workers

Post by Brad Shannon / The Olympian on June 23, 2013 at 3:33 pm | No Comments »
June 24, 2013 8:45 am
Sen. Joe Fain
Sen. Joe Fain
Rep. Ross Hunter
Rep. Ross Hunter

UPDATE: Gov. Jay Inslee’s budget office won’t make its final decision on sending out temporary layoff notices to thousands of state government workers until morning – giving lawmakers a bit more time to forge a late-night or early morning budget agreement.

“A decision likely wouldn’t come until tomorrow,” spokesman Ralph Thomas of the Office of Financial Management said early Sunday evening. “We’re still waiting to see if they get a deal tonight.’’

ORIGINAL POST: Budget negotiators for the Republican-steered Senate and Democrat-controlled House were trading offers and deliberating behind closed doors in Olympia Sunday afternoon in search of a budget deal that can avert a government shutdown on July 1. But major issues remained on funding K-12 schools, tuition and state worker health care – among others – which suggested any budget deal could be many hours, if not days away.

Without a budget deal at least close at hand, state budget director David Schumacher has said layoff notices would go out to thousands of state employees on Monday.

The warn-letters would tell of temporary layoffs effective July 1 in the event government must shut down, which 34 agencies must do completely and 24 more must do partially if no budget is passed by June 30, while 25 including the state treasurer’s office remain open.

The state web page explaining options to employees is here. Our story last week on closures is here.

As lawmakers negotiated terms of a roughly $33.6 billion two-year operating budget, the Office of Financial Management had not yet made a final decision mid-afternoon Sunday on whether to tell agencies to send out the letters, according to spokesman Ralph Thomas.

As they have for several days, budget negotiators and members of the House and Senate leadership teams reported talks were continuing and that progress was being made.

“The budget positions are on top of each other and we are almost done with the final sticking points – so much so that we are starting to move some of those bills that are necessary to implement the budget out of either chamber today,” Senate Republican Floor Leader Joe Fain said shortly after the Senate brought back its members at 1 p.m. “So you are seeing strong progress headed toward a budget completion at any time.’’

Fain and his counterparts in the House were reluctant to say if they could get an agreement tonight, which would appear to be needed to avoid layoff notices going out Monday morning.

“We’re moving offers back and forth and I think we’re down to some very difficult issues that remain to be decided,” House Appropriations chair Ross Hunter, D-Medina, said. “We do not yet have a deal.’’ Asked about the prospects of agreement by Monday, Hunter repeated his statement: “We do not have a deal.”

House Majority Leader Pat Sullivan, D-Covington, said a deal could come quickly but he also acknowledged it was “possible” the House and Senate could still find themselves at loggerheads in another week – forcing the shutdown – if things did not change.

The House has been insisting on fewer cuts to social programs that help the disabled and needy. It also has sought to close tax breaks to raise extra money, and Rep. Reuven Carlyle of Seattle has been pushing to include a telecom-tax bill – which could raise a net $85 million in new revenue and avoid $1.1 billion in future lost revenue by eliminating a home-phone tax exemption.

Carlyle says all affected parties in the telecom industry have agreed to eliminating the tax exemption and treating all telecom firms – except satellite-based services – the same and that the agreement passed the House on 74 votes before hitting a no-tax wall in the Senate.

But Sullivan said the focus was on where to put existing dollars – for K-12 schools, for higher education and for such things as public-employee benefits.

Sullivan said the House remains skeptical of a Senate plan to move some part time state and K-12 employees onto the health exchange created by Obamacare, where the low-paid workers might qualify for federal health subsidies.

Senate Majority Leader Rodney Tom has contended there is plenty of revenue to put $1 billion of new money into K-12 public schools in response to the Supreme Court’s finding the state was failing to fund basic education adequately. The House has insisted current revenues allow just over $700 million in new investment – without harming other programs or making unwise fund shifts such as raiding school construction accounts and borrowing money to repay that raided account.

Despite the lack of obvious movement, the House did pass four policy bills needed to implement the budget on Sunday afternoon, and the Senate was prepared to do the same with a few budget-related bills on its calendar.

The House bills dealt with Medicaid funds the state hopes to capture for certain disabled and needy adults, nursing home reimbursements, authority for the new Washington Health Benefits Exchange to assess a fee on health insurance policies sold through the exchange, and extending fees on legal recordings to 2017 to pay for judicial-system improvements.

Stay tuned.

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