Democrats reach accord on supplemental budget

OLYMPIA -- House and Senate Democrats reached a compromise supplemental operating budget plan this week that increases spending by $306 million, adds $86 million in new fees and leaves $835 million in reserves.

The supplement to the state's current two-year, $33 billion budget will be debated and likely passed Thursday as one of the final agenda items for the 2008 session, which is scheduled to adjourn the same day.

"This is a great budget for kids, for education, for health care. We've done some progressive things, we're moving forward on all-day kindergarten and we are saving $835 million," said House Majority Leader Lynn Kessler, D-Hoquiam.

The compromise plan also provides $6.1 million in new tax exemptions primarily by expanding the so-called Boeing tax break to the entire aerospace industry.

One of the biggest differences between the House and Senate budgets had been the cost of living increases for teachers. The House had called for a 1 percent "catch-up" increase to compensate for suspension of the voter-mandated raises in the 2003- 2005 budget. The Senate budget did not provide the additional raise. The two chambers reconciled by splitting the difference and providing a 0.5 percent increase valued at $17.8 million.

For education, the final budget also provides $17.7 million for assistance to students who are in danger of dropping out. It also keeps last year's expansion of all-day kindergarten on track.

The choices were praised by the Washington Education Association.

"The additional 0.5 percent COLA restoration in the supplemental budget will help improve salaries so public schools can attract and keep the best educators," WEA President Mary Lindquist said in a statement.

The budget provides $70 million for affordable housing, including $50 million for new construction, $10 million for equity assistance to affordable housing nonprofit organizations and $10 million to preserve existing affordable housing.

Victims of last year's flooding in Western Washington were high on the priority list with $12 million for disaster relief and $2 million to help businesses recover, $1.5 million for farmer assistance and $50 million in bonding authority for flood control projects.

The bill provides $5.1 million for substance abuse and mental health treatment and $2.3 million for mental health services.

Spending increases for environmental protection projects came in at $16. 5 million with a $3.5 million appropriation for a year-round rescue tug at Neah Bay to prevent a catastrophic oil spill, should a tanker have problems in heavy weather.

Fred Felleman, Northwest consultant for Friends of the Earth, said permanent federal funding for the tug is needed and is targeted in legislation to be filed by U.S. Sen. Maria Cantwell.

Still, "We're deeply thankful to the state Legislature because we don't know of any season that's a good time to have an oil spill," Felleman said. "Ships don't stop running in the summertime."

The environmental community had asked for roughly $10 million for four agenda items this session, including legislation for urban trees, climate change, locally farmed food school lunch programs; the budget provided $4.1 million but activists said they were pleased with the outcome.

Republicans, who were largely left out of the budgeting negotiations by majority Democrats, said the budget could present problems in the near future.

"There's a lot of things to like in this budget but (Democrats) are still spending more than they are taking in," said Senate Minority Leader Mike Hewitt, R-Walla Walla.

"I'm not hoping for a bad economy, but they need to proceed with caution."

Sen. Joe Zarelli, R-Ridgefield, said the budget will generate a huge deficit.

"This budget spends more than what the governor and the House had proposed. And more important, it brings total spending for the biennium to $33.7 billion against $32 billion of projected revenue," he said.

Kessler was more optimistic about the future.

"When all is said and done, the budget is responsible," she said.

Gov. Chris Gregoire is expected to review the supplemental budget, veto line items if she wants, and sign the budget in the weeks to follow.

BUDGET SUMMARY

BOTTOM LINE: Proposed supplemental Washington state operating budget adds a net of $306 million to the current two-year budget of $33.4 billion.

SALT SOME AWAY: Plan leaves reserve of $835 million, higher than previous legislative plans, but lower than the $900 million Gov. Chris Gregoire had sought.

BIG WINNERS: Education, Medicaid, foster care, family planning, housing, lawsuits against the state, long-term care, environmental and climate change programs, and public safety. Plan preserves 10-year phase-in of free daylong kindergarten. Teachers get a 4.4 percent pay boost in the next school year.

NEXT UP: Both houses planned to pass operating and construction budgets on Thursday.

-- The Associated Press