Washington legislators wrapped up their short 60-day 2022 session on time on March 10. Two years into the COVID-19 pandemic, they passed a number of mostly small but important policy improvements that will help many of the people hit hardest by the pandemic’s health and economic impacts. Using state tax revenues that have come in faster than forecasted and remaining federal COVID relief dollars, legislators passed a supplemental budget on party line votes that increases funding for important priorities, including behavioral health, housing, and a host of other programs. They largely stood up to the pressure for across-the-board tax cuts, rejecting an austerity approach that would have caused lasting harm to individuals and communities. While the Legislature did reduce some business taxes, they ultimately allowed other measures to die like the proposed Labor Day sales tax holiday and property tax cuts for homeowners.
Washington legislators made many good decisions this session. Still, the measures passed will not reverse the 40-year trend of growing income inequality or end entrenched racial and gender inequities – underlying problems made worse by the pandemic. They also did little to eliminate the long-term structural deficit in our state tax code that has gradually ratcheted down investments in public programs that promote equitable opportunity and healthy communities.
Here’s a wrap up of the bills we were following:
A Just Tax Structure for Ample Investment
Many Washington workers, families, and small businesses struggle to pay for food and rent, while the wealthiest individuals and corporations make record profits. Tax reform is one tool to add fairness to our regressive tax system, provide funds to help families and small businesses get through these hard times, and jump start a recovery that provides opportunity and healthy communities for all.
- Supplemental budget: The supplemental budget passed the Legislature on party line votes. It uses state tax revenues that have come in faster than originally forecasted and remaining federal COVID relief dollars to increase funding for important priorities, including behavioral health, housing, and a host of other programs. K-12 education received increases for school nurses, counselors, and other important supports for students – but still saw a $90 million reduction in total funding. The budget also transfers $2 billion in general tax revenues usually used for the operating budget into the transportation budget, thereby avoiding an increase in the gas tax. Democrats who control both chambers of the Legislature largely avoided the pressure for across-the-board tax cuts, reducing taxes for many small businesses, data centers, and the film industry, but ultimately rejecting a proposed Labor Day sales tax holiday. More detail on what is and is not in the supplemental budget is included below.
- Implementation fix for the Working Families Tax Credit (HB 1888): The Working Families Tax Credit is designed to help offset the high rate of taxes paid by Washington’s lowest income residents. This bill passed the Legislature with bipartisan support. It eliminates the benefits cliff in the WFTC that resulted from a late-stage amendment in a bill passed last year. The supplemental budget also includes $10 million in funding to support community-based outreach in anticipation of the Working Families Tax Credit being rolled out to hundreds of thousands of Washingtonians in 2023. This funding will help ensure an equitable launch of this historic program.
Two measures that would have required Washington’s wealthiest residents to pay more of their fair share did not move this year:
- Wealth Tax (HB 1406, SB 5426): A new 1% property tax on financial intangible property of the ultra-wealthy, such as stocks and bonds, would raise billions of dollars to reinvest in healthy, resilient communities. It did not move out of committee. For more information on the Wealth Tax, click here.
- Estate Tax reform (HB 1465): Closing loopholes and enhancing progressivity in Washington’s estate tax would help address inequities in intergenerational wealth and close the racial wealth gap. It did not move out of committee.
Amply Funded Child Care
Child care and early learning are critical to child development, family wellbeing, and business prosperity. Yet even before the pandemic, child care was in crisis. Our state’s economic recovery depends on significant new public investments to ensure that child care is affordable and available to all working parents and their kids, with well compensated teachers and caregivers.
- Washington’s 2022 supplemental budget includes a number of line item increases for child care and early learning that will help kids, families, and providers. However, public investments in child care remain far below the level necessary to assure access and affordability for families, and living wages and sustainability for the child care workforce and providers. Important increased investments include:
- $125.7 million from state and federal funds to increase the subsidy rate the state pays for kids from low-income families and other increased supports for centers and family child care providers.
- $14.6 million to expand ECEAP, the state’s early learning program for children from low-income families.
- $1.3 million to waive background check fees and convene a background check workgroup to help ease difficulties in hiring new staff.
Access to Health Care
Health care is a human right. But high costs and insurance based on employment, age, and immigration status block access to health care for hundreds of thousands of Washingtonians. COVID has exacerbated disparities. We must make health care more accessible in the short-term, as we also push towards larger health care system transformation that provides quality care for all and reins in cost.
- Immigrant health care coverage: Our state’s supplemental operating budget includes $12 million to implement two new programs to enable health care access for immigrants by January 1, 2024. Funds are included to create an Apple Health lookalike program for low-income immigrants earning 138% or less of the federal poverty level, as well as funding for agencies to pursue a federal waiver which would allow immigrants of all incomes to purchase plans on our state marketplace, with subsidies for those earning 139-250% FPL.
- Prescription drug affordability board (SB 5532): This bill, passed with bipartisan support, creates a PDAB that will help drive down pharmaceutical costs, hold drug companies accountable, and rein in overall health spending. Starting on June 30, 2023, the PDAB will have the authority to conduct an annual affordability review of 24 drugs per year as well as to establish upper payment limits on up to 12 drugs if they have led or will lead to excess patient costs. The final budget includes nearly $1.5m for agencies to implement the bill.
- Protecting consumers from balance billing (HB 1688): HB 1688 aligns state and federal law to bring stronger protections for patients against surprise medical billing, a practice that can cause devastating financial hardships and lifelong medical debt. The bill prohibits providers from asking patients to waive their rights and adds new protected services such as emergency behavioral medicine, air ambulances, and post-stabilization care. HB 1688 and its companion had 45 legislative co-sponsors, passed with bipartisan support, and received $442,000 for implementation costs in the final operating budget.
- EOI also supported a number of other policies this session to improve health care access and affordability, rein in costs, and protect health care workers. Wins include the passage of SB 5589, which sets a health care spending goal on primary care through our state’s Health Care Cost Transparency Board, as well as SB 5610, which will help prevent discrimination and undue financial hardship for low-income patients who receive drug vouchers to help cover their pharmaceutical costs.
Bills EOI supported that did not pass include:
- Keep Our Care Act (SB 5688): This measure failed to pass due to strong opposition from large hospital systems. It would have regulated health care consolidations, driving down patient costs, holding large health systems accountable, and maintaining equitable patient access to care.
- Safe and Healthy bill (HB 1868): This bill would have improved working conditions for health care workers.
- Health care contracting (HB 1741): A bill aimed at preventing anti-competitive practices in contracting between hospitals and insurance companies.
Fair and Safe Workplaces
All workers have a right to living wages, safety at work, freedom from discrimination, the right to organize, and time to protect their own health, care for family, and engage in community life.
- Paid Family & Medical Leave improvements (SB 5649): Washington’s Paid Family & Medical Leave program helps workers and families maintain economic security while coping with a serious health crisis or welcoming a new child. SB 5649 passed with strong bipartisan support. It will make PFML more compassionate by allowing parents who would have qualified for family or medical leave for a new child to continue leave for seven days in the event of the child’s death, and make it easier to take medical leave following childbirth. It also establishes a process to assure long-term financial stability for the program by requiring actuarial analysis and establishing a taskforce to make recommendations to the 2023 legislature. The Senate removed provisions from the original bill that would have allowed advance application and included people taking leave to care for other family members to continue leaves following a death in addition to new parents. The state budget includes $350 million for a PFML reserve fund as well as funding to implement SB 6549.
For context on recent news regarding the PFML trust fund, click here.
Legislative support – Partner-led policies
EOI supports additional policy advances led by allied communities and organizations to undo racist structures, promote equitable access to educational opportunity, and build lifelong economic security for all.
Undoing Racist Structures
- Reform Legal Financial Obligations (HB 1412): This bill allows judges to waive or reduce legal financial obligations for those who do not have the ability to pay. Relief from exorbitant and unpayable legal debts will help people successfully re-enter society after release from prison and address racial and class inequities embedded in our policing and incarceration systems. It passed the Legislature with bipartisan support.
- Washington Future Fund(Baby Bonds SB 5752/HB 1861): Baby Bonds would help address centuries of institutional and systemic racism that keeps BIPOC families living in poverty by creating a fund for individuals born into families with limited means that they could use as young adults to invest in areas traditionally linked to building wealth. The bill did not pass, but the supplemental budget includes $450,000 to establish a study committee that will make recommendations to the Legislature by December 1, 2022. The committee will include legislators, members of impacted communities, and advocates.
Lifelong Economic Security
- Diaper Subsidies (SB 5838): This bill provides for increases in TANF grants for families with young children to cover the cost of diapers and other child necessities. It passed the Legislature with large, bipartisan majorities. The budget includes funds to cover grant increases of $100 per month beginning in November 2023.
- Strengthen WA Cares Act (HB 1732 and HB 1733): This pair of bills was among the first to be moved through Washington’s 2022 legislature. They delay implementation of Washington’s landmark long term care program to allow for some policy changes. Both have passed the Legislature and been signed into law by the Governor.
Access and Equity in Higher Education
- Expanding apprenticeship pathways with wraparound supports (SB 5600): This bill creates the framework for significantly expanding apprenticeship programs to industries such as education, early learning, and hospitality, with wraparound grants to help support students. It passed the Legislature with bipartisan support.
- College credit for apprenticeship classwork (SB 5764): This bill makes students enrolled in full-time apprenticeship programs eligible for aid from the Washington College Grant for classwork, which is often completed at local Community and Technical Colleges. It passed the Legislature with bipartisan support.
- Low-interest student loans (HB 1736): The bill establishes the Washington Student Loan Program, offering 1% loans for students pursuing degrees in high demand fields who have family incomes below the state median family income. The supplemental budget includes $150 million in funding.
Empowering Workers and Strengthening Our Economy
- Wage & Salary Information (SB 5761): This bill will help reduce the racial and gender wage gap by requiring employers with 15 or more employees to post information on pay ranges in job announcements. It narrowly passed the Legislature on mostly party line votes.
- Legislative staff collective bargaining (HB 2124): Beginning in 2024, legislative staff will be able to collectively bargain, with agreements to be implemented in mid-2025.
- Strengthening Unemployment Insurance for caregivers (HB 1486): This bill failed after stalling in the House. It would have allowed people to be eligible for unemployment insurance if forced to quit a job because a schedule change made care for a child or vulnerable adult inaccessible.
More To Read
August 16, 2022
We applaud the swift passage of this historic legislation and will continue to advocate for investments in the care economy
March 11, 2022
Washington legislators made good decisions but the measures passed will not reverse the 40-year trend of growing income inequality.
March 7, 2022
The way we talk about and report on the economy and the state budget often masks underlying problems