Op-Ed: Business successes and disappointments of the 2011 legislative session
Special to the Chambers of Commerce
The 103-day regular session and the 30-day special session of the 2011 Legislature are now history, having come to completion May 25. How did businesses fare during the session? Not as well as I had hoped, but we made some progress to help employers.
Budget and taxes
The session mostly centered around creating a balanced state budget for the next two years. Although revenues are up by nearly $4 billion, continuing the rate of spending set in previous budget years would have pushed the state into a $5 billion deficit. Remember, in Olympia, a decrease of an increase in spending is called a “cut.” At $32.4 billion, the 2011-13 operating budget spends $1.8 billion more than the previous budget cycle. While no general tax increases were approved, the budget does include 84 new or increased fees totaling $316 million.
Just a day after the governor signed the budget, the June revenue forecast was released, showing the state has only $163 million in its ending checking account to make it through the next two years. I'm very concerned that such a small amount remains and that the Legislature did little to reform its spending habits.
Unemployment insurance and workers' compensation reforms
One reason our state's unemployment rate has remained high (more than 9 percent) is because of the enormous cost of doing business in Washington. Last year, unemployment insurance taxes for Washington's employers increased an average of 42 percent. Since 2001, workers' compensation rates have increased nine times, including 12 percent in January. When employers pay more to the state, they have less resources to hire and retain jobs.
House Republicans' primary theme is “Let's get Washington working again!” To ease the burden on employers, we passed Senate Bill 5135, which provides a much-needed reduction of unemployment insurance rates this year, and House Bill 1091, which ensures a more stable and long-term fix by recalculating unemployment insurance tax rates.
We also adopted significant reforms to the state-operated workers' compensation system to guard against insolvency and double-digit premium increases. House Bill 2123 allows for voluntary claim resolution structured settlements for injured workers. The measure also includes a stay-at-work wage subsidy program for employers.
Another problem holding employers back is the myriad of existing and new rules and regulations that create a great deal of uncertainty for Washington businesses. The Legislature had ample opportunity to ease regulations, but it wasn't a priority of majority Democrats – even though Gov. Gregoire took the lead in December by directing state agencies to suspend all “non-critical” rulemaking through December 2011. I co-sponsored House Bill 1156, which would have extended that moratorium to July 1, 2014, or until the state revenue forecast shows increases for three consecutive quarters. Unfortunately, the measure never received a hearing.
Instead, the majority party pushed for additional regulations, such as Senate Bill 5068, which enacts stringent requirements for businesses to correct safety violations, even though they are under appeal.
We did give employers additional breathing room through House Bill 1150, This measure, which I co-sponsored, allows companies out of compliance with a state agency rule or regulation seven calendar days (up from two days) to make corrections without a financial or civil penalty. Still, I believe we need to do more to help our employers.
The key to economic prosperity in Washington is getting government out of the way so businesses can do what they do best: create wealth. When businesses prosper, employers hire, workers spend money for a better quality of life, and the revenue collected from that spending creates a better state budget outlook.
I encourage you to join me in these goals. For more information, visit my Web site at houserepublicans.wa.gov/Kristiansen where you can e-mail me with your comments, suggestions and questions. Together, we can get Washington working again!
EDITOR'S NOTE: Rep. Dan Kristiansen, R-Snohomish, serves as chairman of the Washington House Republican Caucus and represents the 39th Legislative District. He can be contacted at (360) 786-7967 or e-mail him through his Web site at: houserepublicans.wa.gov/Kristiansen. His office address is: P.O. Box 40600, Olympia, WA 98504-0600.
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