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Thank you for participating in my recent legislative survey. Your feedback helps me identify and focus on the issues that matter to you. If you did not get a chance to fill out the survey, and would like to share your concerns or comments, please call my office. My contact information is listed at the bottom of this update.

In the coming weeks, I’ll highlight the results of the survey in my legislative updates. Because the highest result came back regarding your opposition to a statewide income tax, this week’s update will be focused on that issue.

Just say “no” to statewide income tax

At 85 percent, the majority of those who responded to the survey are opposed to replacing the sales tax with an income tax. This is not at all surprising. Because, the last nine times voters statewide have been asked to adopt an income tax, they said “no.” However, regardless of this clear and consistent directive from the people, income tax supporters are now focusing their efforts on a capital gains income tax.

Once again, we are being told this is the solution to all of Washington’s budget woes. While it makes for interesting conversation in Olympia, I believe we can go further by continuing to rely on Washington state’s current tax structure. This base, along with a bit more spending discipline, will do a much better job at keeping our state budget intact than a capital gains income tax.

In fact, Washington’s reliance on a sales tax, and business and occupation taxes, creates more revenue stability than income based revenues. For example, if the state’s coffers become dependent on a capital gains income tax for revenue, what happens if the revenue stream suddenly drops? Worse yet, what happens if our education and healthcare system are dependent on this type of tax? Capital gains are notoriously unpredictable. Relying on them would play havoc with our state’s budget. According to an article by The Pew Charitable Trusts, a public policy think-tank, the nature of a capital gains revenue stream is a dangerous choice:

“The volatility (in income taxes) coupled with the decline (in income tax revenue growth) is a nasty combination,” said Gabe Patek, S&P analyst who authored the report. “I don’t envy the state fiscal officials when that’s the environment they are working in.”

And yet, the governor’s current budget proposal to fund education, healthcare, and other critical state provided services is dependent on this volatile tax source. The 2017-19 budget proposal calls for a capital gains tax and carbon emission tax to cover a significant portion of the billions of dollars of new taxes the governor is seeking. These proposals have failed to gain traction before. While I understand the need to fund critical service areas, I believe we should do all we can to stay within our existing revenues – without turning to income tax as a source.

Business, labor and economy

In order to pay for state-provided services, we must have a healthy economy. My legislative focus is on helping businesses create new jobs and retain existing ones. Here is a short summary of a few bills I’m helping sponsor this session:

We need smart economic growth strategies for rural areas. House Bill 1422 would establish the Rural Jobs Act. This bill aims to increase economic development and job growth in rural areas. A non-refundable tax credit would be given to those making eligible contributions to rural economic growth. The tax credit would be applicable to business and occupation taxes, insurance premium taxes or retaliatory taxes.

The delay in the start, or extended overall schedule of an Environmental Impact Statement (EIS), can comprise business development. House Bill 1086 would require EIS to be completed within two years. This bill would incentivize agencies undertaking an EIS to finish them as expeditiously as possible.

Have you ever watched a commercial about visiting California, or another state? Ever wonder why you’ve never seen one for Washington? House Bill 1123 would create the Washington Tourism Marketing Authority to manage the planning, developing and financing for a statewide tourism marketing plan. By investing in statewide tourism marketing, we can help promote and draw business dollars to Washington.

We live in the age of the internet. Ports rely on the grid of information networks, voice, data and internet, to communicate. House Bill 1702 would authorize port districts to purchase, construct, or add to, telecommunications facilities.

We need to keep energy related jobs, and the companies working in our communities. House Bill 1497 would provide a sales tax exemption to energy providers who are converting existing coal-fried electric generation facilities into natural gas-fired generation plants or biomass energy facilities.

The ripple effect of the HIRST decision could mean big changes in water rights and land use. House Bill 1101 would revise the growth management act to simplify the population growth criteria for planning required by the act.

Hydropower, generated mainly from hydroelectric dams, is clean, renewable, non-emitting source of energy that provides low-cost electricity. House Bill 1249 would revise the definition of an eligible renewable source, for the purposes of the energy independence act, to include hydroelectricity.

Currently, the governing body of a city or county can enact ordinances regulating the use of land and certain development. House Bill 1085 would make changes to the uniform building code for single family homes.  This bill will allow the governing body of a city or county to eliminate any minimum floor space requirements for single-family detached homes.

How to stay engaged

Interested in learning more about how you can follow what is happening in Olympia? You can actively participate in the legislative process in a variety of ways. Here are some resources:

My door is always open. If you have questions, concerns or comments you would like to share, please feel free to give me a call or send me an email.

Thank you for the honor of serving you in Olympia.


Jim Walsh

State Representative Jim Walsh, 19th Legislative District
428 John L. O'Brien Building | P.O. Box 40600 | Olympia, WA 98504-0600
(360) 786-7806 | Toll-free: (800) 562-6000