Friday Legislative Report - March 19, 2021

BACKGROUND

This week in the 2021 Legislative Session saw a confluence of several significant events which will inform the key budget writing process- the release of the Washington State Economic and Revenue Forecast, the release of the Transportation Revenue Forecast, and the passage of the federal COVID-19 relief stimulus bill, the American Rescue Plan Act. 

Firstly, the Washington State Economic and Revenue Forecast was positively beaming sunshine compared to previous iterations during the height of the pandemic shutdown- revenues are up, and projections are that they will continue to grow. You can read a detailed write-up we did of the March 17’s forecast on our blog. This rebound seems to be leaving out some Washingtonians, however, a story told through the unemployment data and a trend we will be watching. 

Concerningly, the transportation budget continues to be hammered by the lingering effects of reduced travel, and revenues are significantly down. As ports, we understand the real value of transportation infrastructure investments, and the decline means there isn’t much money there to fund these vital projects. We’ve invited Senator Steve Hobbs and Senator King to come talk more about their plans to fund transportation- register here for our March 24th meeting at 10am. 

Finally, the state and many local governments will receive an influx of federal dollars aimed at stimulating the economy and reducing the impacts of the pandemic. We invited the attorneys of Van Ness Feldman to give a talk earlier this week detailing what these dollars mean for Washington and more specifically port districts- you can watch a recording of that meeting here. 

This complex situation will offer budget writers challenges and some resources as they strive to complete their work in the approximately one month remaining in this regular legislative session. 

MODEL TOXICS CLEAN-UP ACT (MTCA)

As noted above, the state revenue forecast was released on Wednesday and included significant additional revenue.  Federal funding from the American Rescue Plan Act provides additional resources to budget writers. These factors combined support cautious optimism for Remedial Action Grant appropriations. 

Despite the encouraging signs, now is not the time to relax.  Please continue to stay in contact with legislators as budgets are released next week. 

TRANSPORTATION

Transportation conversations shifted this week in anticipation of the release of the 2021-23 biennium transportation budgets early next week. Released this past Wednesday, the Transportation Revenue Forecast stood in stark contrast to the sunnier general revenue forecast. The transportation forecast shows $101.5M in revenue reductions from the November forecast. Taken together, revenues for the current biennial are reduced $356M from the start of the biennium.   

The impacts of COVID-19 are expected to persist; the transportation revenue forecast is decreased an additional $220M for the 2021-23 biennium. All of these decreases suggest the budgets introduced next week will be stark. No additional spending means many of the programs we support, like the Transportation Improvement Board and the Freight Mobility Strategic Investment Board, will see future budget cuts. Both House and Senate budget proposals will be heard in their respective transportation committees next Tuesday. WPPA will provide analysis of the budget proposals as soon as they are released. 

BROADBAND

SB 5383, a bill that creates limited authority for public entities to provide telecommunications services to end users (aka, retail authority), this week received mixed testimony in public hearing in the House Committee on Community & Economic Development and is scheduled for executive session on March 23. HB 1336, a bill supporting an unrestricted version of retail authority for ports and public utility districts was heard in the Senate Environment, Energy & Technology Committee last week and is scheduled for executive action on March 24. Both bills are likely to receive further scrutiny and amendment before advancing. A comparison of these bills can be found here. 

Two bills that are not identical, but both designed to facilitating the installation of broadband along state highway rights-o-way continue to move in this session. The House version, HB1457, received public hearing in the Senate Transportation Committee this week. The Senate version, SB5439, has already received a public hearing in the House Transportation Committee. A comparison of these bills can be found here. 

TAX INCREMENT FINANCING (TIF)

It was a busy week for the tax increment financing (TIF) bill (ESHB 1189), which was scheduled for a final vote out of committee on Thursday.  Behind the scenes, groups were discussing how to address the Ports of Tacoma and Seattle’s ongoing concerns about the potential for large TIF areas to be formed by other agencies in their districts.  Senator Mullet, the Chair of the Committee on Business, Financial Services & Trade proposed an amendment that would limit the size of the TIF area from a max of $75M in the underlying land value of each TIF area that was in the current bill to a combined total of $200M in total assessed value (land and structures) in TIF areas for each sponsoring agency, with an overall maximum of two projects each.  In other words, a TIF area could be one area not to exceed $200M in total assessed value, or two areas of lesser value not to exceed $200M. The bill passed unanimously from committee with this and other changes.  The bill moves to the Rules Committee for further consideration.    

In order for the TIF bill to become law, the bill must move out of Rules Committee to the floor of the Senate for a vote, then back to the House for concurrence on the Senate changes.  If the House votes to concur within the allowable time, the bill would then be sent to the Governor for his review and signature.  Normally, bills passed in 2021 Legislative Session would have an implementation date of July 25, 2021. 

OTHER KEY PRIORITIES

Aviation 

SB 5031 has made its way to the House Capital Budget Committee where it will receive a hearing next Tuesday. The bill would make the Community Aviation Revitalization Loan Program (CARL) permanent. It’s companion, HB 1030, is currently in the Senate Rules Committee. WPPA supports both bills and is currently talking with legislators to identify which bill should be prioritized for passage. HB 1198 received a hearing this week in the Senate Transportation Committee. The bill extends the timeline for the Aviation Coordinating Commission to complete its work. WPPA is also watching HB 1379 which would establish an unpiloted aircraft system coordinator with WSDOT aviation. This bill was also heard in committee on Monday. 

Public Works 

SB 5032 is scheduled for executive session in the House Capital Budget Committee next Tuesday. The bill extends the sunset for ports and other public owners to use alternative public works procurement processes when constructing capital projects. 

Rail Safety and Labor 

WPPA testified with concerns on HB 1418 during Senate Transportation Committee testimony on Monday. The bill is designed to address rail safety recommendations identified during an interim JTC study related to the 2017 Amtrak 501 derailment. The change in scope related to the Utilities & Transportation Commission’s oversight role continues to be unclear. SB 5065 will be heard in the House Committee on Labor & Workplace Standards next Wednesday. The bill continues to extend benefits beyond those afforded by the Paid Family & Medical Leave passed in 2018. WPPA will seek an amendment to the bill exempting rail operators with fewer than 50 employees. The bill has not yet been scheduled for a hearing in the House. 

ESHB 1056 Concerning Public Agency Remote Meetings

WPPA supports ESHB 1056, which allows public agencies to hold remote meetings during a declared state or local emergency. The bill was amended this week in Senate State Government & Elections Committee prior to a vote to keep the bill moving. Chairman Hunt’s amendment clarifies that agencies that held meetings remotely prior to the pandemic may continue to do so, provided they provide an opportunity for the public to listen in to the remote meeting. The bill moves to the Rules Committee for further consideration.

ESSB 5141 Implementing the Recommendations of the Environmental Justice Task Force

The bill was heard in the House Environment and Energy Committee and is scheduled for executive action today.   

E3SHB 1091 Clean Fuel Standard (previously Low Carbon Fuel Standard) 

The bill was passed by the Senate Environment, Energy and Technology Committee on Wednesday along party lines, with the exception of Senator Hobbs who voted no.  The bill has been referred to the Ways and Means Committee but has not yet been scheduled for a hearing.   

WPPA is considering opportunities to improve the bill, and remains neutral on this legislation. 

SSB 5126 – Washington Climate Commitment Act  

The bill was scheduled for executive action in the Ways and Means Committee yesterday but no action was taken.  This reflects ongoing discussions between the chairs of the Environment and the Transportation committees.  As noted in previous Weekly Reports, carbon pricing, a low carbon fuel standard, and the transportation budget are linked.  The bill is exempt from cutoffs because of its budget implications. 

WPPA is considering opportunities to improve the bill.  The association supports carbon pricing policies to the extent revenue is committed to transportation purposes. 

SHB 1193 Dredged Material Disposal 

The bill passed the House unanimously and was heard in the Senate Environment, Energy and Technology Committee on Wednesday.  The Puyallup Tribe raised concerns about this bill in the Senate, and work to address those concerns is ongoing.