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WALLA WALLA CITY COUNCIL Special Meeting Agenda June 14, 2019 - 4:00 p.m.

Mission: We provide municipal services and programs essential to a desirable community in which to live, work and play.

1. CALL TO ORDER

2. ACTIVE AGENDA

A. 2019 Legislative wrap-up discussion. Presentation by Mara Machulsky of Northwest Solution. Mara will review the 2019 Legislative session and Council will discuss City's current and upcoming legislative priorities.

3. ADJOURNMENT

Values: Customer Focus/Service Excellence Stewardship Communication Leadership Integrity ar-3459 2. A. City Council - Special Meeting Meeting Date: 06/14/2019 Submitted For: Nabiel Shawa, City Manager Office, Administration Add'l Contributors:

Information ITEM TITLE: 2019 Legislative wrap-up discussion. Presentation by Mara Machulsky of Northwest Solution. Mara will review the 2019 Legislative session and Council will discuss City's current and upcoming legislative priorities.

Attachments Legis. Report 6.14.2019 City of Walla Walla Legislative Update 6/14/19

Intro The 2019 legislative session ended on time this year on April 28th with the governor and legislative leaders celebrating significant victories related to climate change and conservation, education, healthcare, jobs and safe communities.

May has been a time of rest and travel for most of the legislative family, punctuated by a handful of bill signings, in-district meetings and events. Especially media events as legislators wrap up session and report back to their constituents the successes of the season.

All three budgets have been signed by the governor and the final bill signing ceremony has taken place.

• The 2019 Final - Summary of Legislation Passed by the Washington State Legislature is available in electronic form here.

• All of the budget documents can be found on the LEAP (Legislative Evaluation & Accountability Program) website here.

The $52 billion operating budget agreement that Senate and House leaders passed and has been signed by the governor. The operating budget, which includes over $800 million in new tax revenue, leaves a projected $2.8 billion in total reserves at the end of the biennium. The bulk of new spending goes to K-12 education, primarily to cover the ongoing costs to meet the state’s obligations to fully fund public schools.

Legislators approved more than $800 million in increased taxes over two years, though only a little more than half of that will go toward supporting the operating budget. The remaining $376 million will come from increasing taxes on big tech companies and some service businesses, which will pay for higher education and workforce programs. The new 2019-21 operating budget will spend about 17 percent more than the state’s previous two-year budget.

This year we entered the session with probably the best budget situation we have seen in this century. Lawmakers began with a budget that was scheduled to grow from $44 billion for the current biennium up to, roughly, $50 billion with maintenance-level growth. Particularly, most of that growth is related to the investments made, namely the law passed in 2017 to fully fund K-12 public education. Since the economy is strong, all that growth was covered with existing revenue, plus — if you looked at the four-year balance — we had, at that time, a $500 million ending fund balance.

Governor Jay Inslee has been touring the state signing bills in subject specific locations as well, and conducting in-district subject matter visits. For example, he toured the Port of Skagit last week to learn about the port’s investment in creating a countywide broadband internet network.

Governor Inslee’s presidential campaign has surpassed 65,000 individual donors from across the country, all but guaranteeing him a spot in the first Democratic debate in late June. The first debate round will take place in Miami on June 26 and 27, with up to 20 candidates randomly divided into two groups, half appearing each night. A second debate is scheduled for July. Inslee is running for the White House even while leaving open the option of running for a third term as governor next year.

June Robinson of Everett, Monica Stonier of Vancouver, and Laurie Jinkins of Tacoma still lead the race for the next Speaker of the House to replace Frank Chopp of Seattle. Gael Tarleton of Ballard has recently thrown her hat into the ringEach of these candidates are compelling in their own way, and would bring a new style of leadership to the House.

Senator Palumbo resigned from the Senate to accept a job with Amazon as their statewide director of public policy. The new job most likely will require him to register as a lobbyist in Olympia. In more than two-thirds of states, legislators would be banned from moving immediately to a private-sector job in which they lobby their former legislative colleagues. Washington, however, is an outlier in this regard. Representative Derek Stanford is being considered to assume the Senate seat vacated by Palumbo.

A second state lawmaker has also drawn scrutiny for work he is undertaking outside the Legislature — but, unlike Palumbo, he remains in office. State Senator Doug Ericksen, R-Ferndale, recently registered with the U.S. Department of Justice as a foreign agent for the kingdom of . Ericksen is joined in that work by , a former state House member whose term ended in January.

The Senate seat in the 40th LD formerly held by Kevin Ranker will have a special election this summer. Currently appointed Senator will run to be officially elected for the four-year term, but opposition is expected.

REET There was major discussion on the REET structure this session. Ultimately the legislature chose to reform the way REET is collected and distributed in Washington State. We were not able to get the City of Walla Walla’s legislative change requested through HB 1679 and SB 5676 to advance in the legislative process.

The REET reform bill, Senate Bill 5998 raises $243.5 million over two years, while creating a small tax cut for some home sellers. The bill changes the state portion of the real-estate excise tax, usually paid by people selling homes, from a flat 1.28% to a graduated rate. • It lowers the state rate to 1.1% for housing sales under $500,000. The current 1.28% would remain for homes sold between $500,000 and $1.5 million. • Houses selling between $1.5 million and $3 million would be subject to a 2.75% rate, and houses going for more than $3 million would have a 3% rate. • Agricultural and timber lands that are sold would keep the current 1.28% rate.

Revenue Distributions under SB 5998: Beginning January 1, 2020, and ending June 30, 2023, revenue distributions must be as follows: • 1.7 percent must be deposited in the Public Works Assistance Account; • 1.4 percent must be deposited in the City-County Assistance Account; • 79.4 percent must be deposited in the general fund; and the remaining amount must be deposited in the Education Legacy Trust Account.

Highway 12 A push by Governor Inslee to open culverts for salmon passage won’t block the latest phase of the project creating four lanes on U.S. Highway 12.Earlier this month, Inslee ordered the Washington State Department of Transportation to increase culvert repairs around the state to improve fish passage and salmon recovery. To fund the improvements, the governor directed the department to add an additional $175 million to the $100 million that legislators provided this year in the 2019-2021 transportation budget.

According to the Seattle Times, the agency has said the money would come from projects that spent less than what they were allotted in the 2017-19 budget. The financial shift, however, will not hold up Phase 7 of the Highway 12 widening project that will widen the highway to four lanes from Nine Mile Hill west of Touchet to Frenchtown. The project is still scheduled to go to bid later this year with construction to start next year.

Legislative Outreach Strategy- Interim 2019

1) Communicating the City of Walla Walla’s established legislative priorities and issues directly to members of the Washington State Legislature (and staff), the Governor's Office, and Washington Departments or Agencies, and identify any areas of potential concern or opportunity for achieving the City’s identified objectives.

2) Arranging meetings with legislators, policy makers, and other stakeholders regarding legislation and legislative matters of interest to the City of Walla Walla.

3) Pre-working issues/bills with partners and interest groups, as authorized by the City of Walla Walla

Mara Machulsky Northwest Solutions (360) 742-0515