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Legislative Report – 2015

WASHington

Washington 2015 Legislative Profile

Governor: Jay Inslee (D) – up for election in 2016

Legislative Majorities:

• Senate 26-23 Majority Coalition Caucus (25 Republicans, One Democrat) to 23 Democrats
• 51-47 Democrat Majority

Senate Majority Leader – Senator Mark Schoesler

Senate Republican Leader – Senator Sharon Nelson

Speaker of the House – Representative Frank Chopp

House Majority Leader – Representative Pat Sullivan

House Republican Leader – Representative Dan Kristiansen

Washington 2015 Session Overview

Washington’s 2014 election cycle tightened up the vote count in the House between Democrats and Republicans, but kept the Democrats in control by two votes. In the Senate, the Majority Coalition maintained its control, even as it had a Democrat member retire. During the 2014 elections, the Republicans picked up an additional Republican vote in the Senate. Because of the party split – House Democrats in charge of the House, and the Majority Coalition Caucus in charge of the Senate – it was difficult for the House and Senate to resolve their issues philosophically or politically.

While this split was advantageous in some ways, especially in preventing negative legislation from passing into law, it made it extremely difficult to pass either an operating budget or a transportation package. In the end, the session adjourned July 10, the longest session in Washington history, finishing after 176 days.

Retail Grocery

HB 1355 – Increasing the minimum hourly wage to twelve dollars over four years

NWGA Position: No position taken

Status: Died in Senate.

Summary: This legislation would have established a statewide minimum wage of $12 over 4 years, reaching $12 an hour minimum by 2019. The bill did not include a local preemption.

SB 6029 – Establishing a living wage

NWGA Position: No position taken

Status: Died in Senate Commerce and Labor Committee.

Summary: This bill would increases employee wages based on the consumer price index, with annual increases required higher than the current minimum wage increase calculations. In exchange, employers would receive a reduction in their B&O taxes annually. The bill includes preemption language for all local governments on wage and hour issues, including sick leave and minimum wage.

SB 6087 – An act relating to increasing the minimum hourly wage

NWGA Position: NWGA took no official position, but supported the concepts offered in the bill.

Status: Died in the Senate Commerce and Labor Committee.

Summary: The legislation would require employers that don’t provide health insurance to increase the minimum wage they pay to workers to $13 an hour by 2020. After 2020, wages would continue to increase as adjusted for inflation. The bill would also allow employers to take a credit against the minimum wage increases for providing sick leave to their employees. The bill also included a local preemption on all wage and hour laws.

Impact to Industry: These three bills would all have increased the minimum wage in Washington state for all employees, even those covered under a CBA. Each bill had a different method, with the House bill offering a straight increase with no credits for other benefits, and no local preemption. The Senate bills offered differing approaches, both offering credits to employers either with a reduction in the B&O tax (SB 6029) or by offering credits for other benefits offered (SB 6087.)

NWGA will be working during the interim to determine whether legislation could be developed to increase the minimum wage but provide credits for the benefits offered by our members, and also include a preemption on wage and hour issues for local municipalities.

HB 1356 – Establishing minimum standards for sick and safe leave from employment

NWGA Position: Concerns

Status: Passed the House 51-46. Died in Senate Commerce and Labor Committee.

Summary: This legislation proposed to take the Seattle sick leave model and implement it statewide by 90 days after the bill was signed by the Governor. The bill would have created a tiered sick leave model, with large employers (250 or more) offering sick leave to an employee at a 1 hour for every 30 hours worked. Employees would be allowed to carry over 72 hours from year to year, and use up to 72 hours per year.

Impact to Industry: This bill would have taken the Seattle sick leave ordinance statewide, and required first day sick leave for all employees in Washington State, regardless of the current CBA contract.

HB 1701 – Ban the Box

NWGA Position: NWGA initially opposed the bill, but was neutral on the amended version.

Status: Died on House Floor.

Summary: The legislation initially contained provisions prohibiting employers from using criminal history to screen employees. However, amendments to the language allowed for an initial prohibition on asking about previous convictions, but did allow employers to deny employment after the individual had cleared the initial application period. Additionally, the private right of action, initially included in the bill, was removed.

Impact to Industry: As preliminarily drafted, this legislation would have prohibited employers from asking about convictions at the time of application, unless those crimes involved financial crimes. NWGA and others worked with the proponents of the legislation to amend the bill to allow for usual and customary screenings after the initial application of the individual. In essence, the individual could apply for a job, but after the initial application, if the individual was found to have criminal convictions not suited to the grocery work place, they could be denied employment without repercussion. NWGA advocated for language to be included to screen for Level II and III sex offenders on the initial application; that language was not included. The bill as amended did not significantly impact the grocery industry, and NWGA moved to neutral. If the same bill is proposed during the 2016 session, NWGA will likely remain neutral on the bill.

SB 5513 – Creating the workers’ recovery act by amending provisions governing structured settlements by lowering age barriers and clarifying legislative intent

NWGA Position: Support

Status: Passed the Senate 28-21. Died in the House Labor Committee.

 

Summary: The legislation would have removed the age floor for use of the final settlement agreements (currently set for age 50 by 2016.)

Impact to Industry: NWGA has worked with the business community to lower the arbitrary age restriction of age 50 from the final settlement agreement program. The program is not being utilized because of this age restriction, and employers are forced to continue with other antiquated processes, like side-bar agreements, to try and resolve claims.

SB 5510 – Simplifying and adding certainty to the calculation of workers’ compensation benefits

NWGA Position: Support

Status: Signed by Governor.

Effective Date: The study is scheduled to begin August 1, 2015, with reports provided to the Legislature by February 1, 2016 and September 1, 2016.

Summary: As initially drafted, the bill would have required a complete overhaul to the wage calculation system. Wages would have been calculated to a flat rate, plus health insurance (under the Cockle decision.) A work group must be convened by the Washington Department of Labor and Industries by August of 2016; a report is due to the Legislature in September of 2016.

Impact to Industry: As initially drafted, a change in the wage calculation for employers would have saved NWGA members money in just the time and effort of trying to calculate a wage at time of injury for workers. A study, while not ideal, will force both employers and workers to the table with Labor and Industries to determine if a new, streamlined method of calculation wages is necessary and can be developed.

HB 1078 – Enhancing the protection of consumer financial information

NWGA Position: Opposed as introduced; neutral on final passage

Status: Signed by the Governor.

Effective date: July 24, 2015

Summary: Notification must be provided to consumers when a data breach of encrypted data occurs, except if the breach is not reasonably likely to subject consumers to a risk of harm. Notification requirements are established – notice must be in plain language, include contact information, and a phone number. If over 500 individuals are involved in the breach, notification must also be provided to the Washington State Attorney General’s office.

Impact to Industry: This bill came from the Washington State Attorney General’s office. The AG was growing increasingly concerned with the number of data breach incidents occurring and wanted to pass legislation to make notification requirements more stringent than current law. NWGA worked with the staff of the Attorney General’s office to significantly modify the bill. Notification is now only required if the breach of encrypted data could reasonably cause consumers harm. The private right of action was removed, and individuals cannot sue companies under the Consumer Protection Act as was initially proposed.

Budget and Taxes

SB 5077 – Operating Budget

NWGA Final Position: Support, with concerns

Status: Signed into law.

Effective date: July 24, 2015

Summary: The greatest differences between the House and the Senate could be seen in the development of the operating budget. The House supported a comprehensive tax package, which at times included a capital gains tax, funding provided by a cap and trade tax, a sales tax on bottled water, and the closure of several tax exemptions. The Senate relied on two funding sources to balance the budget – an increase in the sales of recreational marijuana, and increased revenues to the state as businesses recovered. This increase created more B&O tax revenue, and increased sales tax revenue.

The battle between the House and Senate proved very contentious, with lawmakers unable to reach a final agreement until the final days before the June 30 deadline. The Governor did not sign the bill until 11:40 p.m. June 30, minutes before a full government shut down.

The final agreement included no new taxes on the grocery industry, or our supply partners. The agreement did decrease the dividends provided to retailers for the sales of Lottery tickets from 6% to 5%; it is unclear whether this reduction must be done across the board, or if it can be taken more significantly from tickets issued from machines and less from tickets issued by customer service (where labor costs are more intensive.) The retail community is working with the Lottery Commission to determine details.

HB 1695 – Concerning youth substance use prevention associated with tobacco and drug delivery e-cigarettes and vapor products

NWGA Position: Opposed

Status: Died in House Chamber

Summary: The legislation would regulate the e-cigarette industry, including both cigalites and liquid, refillable systems. The bill included a 95% ad valorem tax on the product at retail, a prohibition on flavored products including menthol, and prohibitions on internet orders and sales. The bill gave authority to the Washington Liquor and Cannabis Board (WA LCB) to develop labeling requirements and control over ingredients in the products.

HB 2194 – Creating a funding stream and program for cancer research, prevention and care

NWGA Position: Opposed

Status: Died in House Chamber

Summary: The bill creates a 10% excise tax on all tobacco products except “little cigars” at the point of distribution into Washington State. A $.025 per cigarette tax was also created. The floor stock tax currently applied to cigarettes would be applied to all tobacco products.

SB 5808 – Concerning cancer research

NWGA Position: Opposed

Status: Died in Senate Chamber

Summary: The legislation increased tobacco taxes on cigarettes an additional $0.025 per cigarette. It also created a 10% additional excise tax on all tobacco products to be placed into a new cancer research fund.

Impact to Industry: All of these bills would have substantially increased the cost of tobacco and nicotine products in stores. The taxes on tobacco products would have pushed the price of cigarettes to the highest in the nation, ahead of New York. The vapor regulation bill (HB 1645) would have nearly doubled the cost of e-cigarettes, which are sold by some of our members. Additionally, there would have been Washington-specific labels developed for these products, and a Washington-regulated ingredients list, both of which could be changed by rule at the Board. With no federal standards on these products, these changes would have made these products cost-prohibitive in Washington State, and shift sales to other states and to the internet. (Even with the internet prohibition, there would be no way to enforce the law without a national standard.)

It is the intent of the prevention community to increase the cost of these products to provide additional funding for cancer research, and to also make these products extremely expensive for consumers. Washington State currently leads the nation in black market importation of tobacco products at a loss of $350 million in tax revenue for the last few years. Additionally, native tribes are able to sell these products without many of the taxes imposed by retailers. These bills would have significantly impacted Washington retailers, and put our stores at a competitive disadvantage to the tribes and other retail outlets. It was the recommendation of NWGA that the WA Liquor and Cannabis Board be given additional resources to go after black market importation of these products, and use that revenue to fund cancer research programs.

Initiative Process

SB 5375 – Requiring disclosure by entities that compensate for petition signatures

NWGA Position: Support

Status: Died in Senate Government Operations and State Security Committee.

Summary: The bill is modeled after Oregon’s registration law. The bill required the employers of signature gatherers to provide baseline contact information to the Secretary of State’s office for their signature gatherers. Additionally, signature gathering companies operating in Washington State would be required to provide contact information, which measures they were working for, a valid business license, and an attestation that the business was operating legally in Washington. Signature gatherers would be required to take on-line training course which would be developed by the Secretary of State’s office.

Impact to Industry: Retailers have struggled with how to honor the rights of individuals to gather signatures for ballot measures in public spaces but still ensure the rights and safety of customers and business owners. Retailers have documented incidents of signature gatherers harassing customers and staff, and have made repeated calls to law enforcement on individuals creating problems at stores. At the Legislative hearing, grocers from NWGA and other retail industries testified in support of the bill. However, the Chair of the committee expressed her outright opposition to the legislation, and the bill did not move forward.

SB 5920 – Changing the timeline for filing initiative measures

NWGA Position: Oppose

Status: Died Senate Rules.

Summary: Changes the filing period for an initiative from 10 months to 20 months. The time period to allow for the collection of signatures is extended from six months to 16 months.

Impact to Industry: This legislation would have doubled the window of time for the filing of an initiative, and almost tripled the amount of time to gather signatures for qualifying. Without legislation to address the issues around specific signature gatherers at retail stores, this bill would have further exacerbated issues already present at store sites.

Pharmacy

SB 5441 – Addressing patient medication coordination

NWGA Position: Neutral

Status: Signed by the Governor.

Effective date: July 24, 2015

Summary: The bill establishes a medication synchronization program with pharmacies and insurance companies. For individuals with a high number of prescriptions, medications would be synchronized to one day each month to coordinate the dispensing of all of their medications. Ideally, this process would involve a face-to-face meeting with the pharmacist to coordinate all of the prescriptions. Insurance companies would be required to cover the costs for the medications on a short fill or to fill a prescription for longer than 30 days if either circumstance is needed to coordinate the prescriptions to one dispensing date.

Impact to Industry: Pharmacies will be able to dispense prescriptions in a methodology to synchronize a patient’s medications. This will allow a pharmacy to dispense a drug for more or less than 30 days, and have that prescription be covered by an insurance provider. Patients will have the co-pays covered, but at a discounted rate (either at 50% or based on 15-day increments.) Pharmacies will be paid for the prescriptions, and the initial dispensing fee. Insurance carriers, however, will likely not provide an additional fee to cover further costs.

SB 5557 – Addressing services provided by pharmacists

NWGA Position: Support

Status: Signed by the Governor.

Effective date: Immediately for pharmacists currently working in credentialed health care facilities (like community clinics); the law is effective for all other pharmacists beginning January 1, 2017.

Summary: Under this new law, services provided by pharmacists can be billed to insurance carriers, similar to other providers. This will include services provided at retail pharmacy sites to cover cholesterol screenings, bone density scans, and immunizations beyond just the cost of the shot. Pharmacies will be able to recoup the costs of providing these services to customers at store sites, as long as the pharmacist and pharmacy are in the covered provider networks.

Impact to Industry: While not a huge cost savings to retail pharmacies initially, retailers will have the ability to recoup costs for their pharmacists providing services to customers on a daily basis. Specifically, pharmacies will be able to bill carriers for the costs of screenings and immunizations beyond just the cost of the medications themselves, but for the time to provide those services.

SB 5857 – Addressing registration and regulation of pharmacy benefit managers (PBM)

NWGA Position: Support

Status: Died in House Chamber.

Summary: The legislation would require PBMs to register with the Office of the Insurance Commissioner (OIC). The OIC would have the authority to mediate disputes between a pharmacy and a PBM over specific disagreements on reimbursement issues.

Impact to Industry: Over the last several years, PBMs have worked between pharmacies and insurance carriers in determining how much a pharmacy will be reimbursed for the cost of a medication. Typically, the PBM reimburses at a significantly lower rate than the cost of the drug to the pharmacy, which has already been dispensed to the patient. As a result, pharmacies are not having their costs covered.

This bill would have provided an opportunity for the Office of the Insurance Commissioner to act as a third party in the mediation of a dispute between a pharmacy and a PBM for the reimbursement of costs of a prescription. There is no requirement that the OIC rule in favor of one party or another, just that there is a forum for both sides to present. The law would require review of costs based on the regional wholesalers used by pharmacies; PBMs could not use examples of prices from another part of the country.

The PBMs actively opposed this legislation. Additionally, they involved the labor unions, convincing them that by allowing a mediation service between pharmacies and PBMs, costs for the unions’ Taft trusts would increase. The pharmacy community disputed that finding, but we were unable to move the bill forward before the end of session. There will be continued work on this issue during the interim to determine whether there would be increase cost to trusts and Tafts. The state insurance providers – the Uniform Medical Plan and Medicaid – both identified their costs as zero.

Liquor

HB 1807- Assisting small businesses licensed to sell spirits in Washington State

NWGA Position: Initially opposed; final position was neutral

Status: Signed by the Governor

Effective date: July 24, 2015

Summary: As initially drafted, the bill would have allowed retailers that sell below $300,000 worth of spirits per month to sell up to $50,000 at a 7% fee rate, and apply the 17% to the rest of their sales. Retailers that sold more than $300,000 of spirits would be required to apply the 17% to all sales. The bill also allows for a streamlined process for centrally warehousing product for multiple retailers, and a reduction in penalties for former contract and state run stores that are having difficulties paying their license fees. The bill was substantially modified before final passage, and the language relating to the 17% fee was removed.

Impact to Industry: After negotiations with NWGA and other retailers with the proponents of the bill, that 17% language was removed. NWGA did not have a position on the other portions of the bill, and the warehousing language actually improves central warehousing for some retailers that purchase as part of a cooperative agreement.

HB 1965- Implementing a temporary additional fee on licenses and permits issued by the Washington state liquor control board

NWGA Position: Neutral

Status: Signed by the Governor.

Effective date: July 24, 2015

Summary: The bill provides the WA Liquor and Cannabis Board the ability to apply an additional 6.2% fee on current license fees from June 30, 2015 to June 30, 2017. This additional fee does not apply to the 5-10% distributor fee or 17% retail fee on spirits. The fee is to be used to update internal computer systems, automate the licensure system, and make other, detailed improvements. The WA LCB cannot actually receive the funds until June 2016 after they have developed their modernization plan with stakeholders. A report is due to the Legislature, the Office of Financial Management, and others at that time.

Impact to Industry: The fee increase will affect licenses issued by the WA Liquor and Cannabis Board to retailers. This will increase costs. However, because of the passage of prior legislation requiring license streamlining during 2014, and the directive in this legislation to work with stakeholders on the development of the systems, NWGA believes we can work with the WA LCB to modernize their computer system and streamline the licensure process. There are a multitude of endorsements and licenses required for any one grocery store, and the entire licensure process must be examined. This bill gives us the opportunity to work with the WA LCB to design a new computer system to accommodate those license changes.

HB 1343/SB 5301- Concerning spirits retailers when selling for resale

NWGA Position: Support

Status: Died in Chambers.

Summary: The bills remove the 17% retail fee from wholesale transactions between a retailer and an entity buying the product at wholesale.

Impact to Industry: During the rule making process in 2012, the Washington Liquor Control Board incorrectly applied the 17% retail fee to wholesale transactions between a retailer and an on-premise licensee. NWGA opposed this language in the rules, but they were finalized and approved by the WA Liquor Control Board. Over the last few years, NWGA has worked with a large a large coalition including the Washington Restaurant Association and the Washington Food Industry Association to eliminate the application of the 17% fee on wholesale transactions with on-premise retailers. This legislation would have eliminated the 17% fee for retailers, and prevented deliveries until July 1, 2017. Retailers and restaurants were opposed by the big distributors, and some spirits manufacturers also openly opposed the legislation. While there is support to move the bill in the Senate, the House continues to resist bringing this issue to the floor for a vote. As a result, the 17% fee remains on retailer sales to on-premise licensees, but is not applied to former contract and state run stores.

SB 5280- Concerning the sale of beer and cider by grocery stores licensees

NWGA Position: Support

Status: Signed by the Governor

Effective date: July 24, 2015

Summary: The bill allows grocery stores with more than $15,000 in liquor inventory to install a growler station for beer and cider. Employees staffing those stations must be MAST trained (Mandatory Alcohol Server Training). EBT cards cannot be used by individuals to buy growlers.

Impact to Industry: After several years of effort, NWGA was successful in passing legislation to allow retailer grocers that offer EBT services to also sell beer and cider in growlers. NWGA partnered with independent retailers and the beer industry to pass this bill. The legislation does give rule making authority to the WA Liquor and Cannabis Board, and includes their authority to regulate the size of the growlers offered.

Transportation

SB 5987 – Concerning transportation revenue

NWGA Position: Support

Status: Signed by Governor.

Effective date: First gas tax increase goes into effect August 1, 2015. Second increase is July 1, 2016.

Summary: Increase of fuel taxes – these are permanent increases: August 1, 2015 - $0.07 per gallon; July 1, 2016 - $0.049 per gallon. Increases in the gross weight fees – please see complete bill report for SB 5987 at:

http://lawfilesext.leg.wa.gov/biennium/2015-16/Pdf/Bills/Session%20Laws/Senate/5987-S.SL.pdf

Impact to Industry: NWGA supported this transportation package along with business associations throughout Washington. The Legislature has not passed a meaningful transportation package in almost a decade, and this new funding will be focused on highway improvements. Of the $16.1 billion that will be generated, $8.8 billion will go to road projects, and $1.4 billion will go to maintenance needs. Regretfully, there is no funding for the Columbia River Crossing.

Local Government

HB 1517 – Concerning the distribution of liquor revenues to local jurisdictions

NWGA Position: Support

Status: Died in House Appropriations Committee.

Summary: The bill would have gradually returned public safety funding to local governments from the Washington liquor revolving fund that were swept by the Legislature in 2012.

Impact to Industry: This bill has no financial impact to the retail grocery industry, but does have a significant positive impact to local governments. NWGA has long advocated for the return of funding from the liquor revolving fund to local law enforcement to improve law enforcement staffing ratios and response times. This would, in turn, help local grocers, who call law enforcement when shoplifting and other incidents occur in the stores, but do not get a timely response because law enforcement cannot take the call.

HB 1593 – Concerning local transportation options

NWGA Position: Opposed

Status: The bill received a hearing in the House Transportation Committee, but did not move forward.

Summary: The bill authorizes cities to implement a street utility tax, and also allows transportation benefit districts to impose a vehicle fee of up to $50 and a sales and use tax of up to .02% with a vote of the governing board.

Impact to Industry: NWGA opposes street utility taxes, and testified again against this legislation. The bill did receive a hearing, but the Chair of the Committee did not move the bill forward. The issue was not considered in the Senate.

Environment

HB 1174 – Concerning flame retardants

NWGA Position: Oppose

Status: The bill passed back and forth between the House and Senate as the Legislature worked to find agreement, but failed to pass before the end of session. Summary: As originally drafted, the bill would have banned several specific categories of flame retardants. Additionally, the legislation would have authorized the Washington Department of Ecology to further ban other flame retardants by rule, instead of having to work through the legislative process.

Impact to Industry: Flame retardant bans are complicated for retail grocery. Many NWGA members sell furniture, children’s products, and other materials that contain some kind of flame retardant, especially in the internal padding. The environmental community has worked for years in an attempt to ban flame retardants, but, more importantly, to give the Washington Department of Ecology (DOE) the authority to unilaterally ban those products by rule and not by law. NWGA has opposed those efforts. Banning chemicals by rule would make it very challenging for Washington businesses to stay current with various regulations, and would allow the Department of Ecology to ban chemicals within several months, as opposed to an annual legislative session. The legislative process also provides a much broader forum for debate about the safety and efficacy of these products than a state agency hearing.

HB 1472 – Concerning the use of chemical action plans to require safer chemicals in Washington

NWGA Position: Oppose

Status: The bill moved between the House and Senate several times, but lawmakers failed to reach agreement on a final bill before the end of session. Summary: The bill would have created an alternative assessment program for chemicals both in waterways and in household products. The structures for the alternative assessment were fairly regulated, but would have captured items sold in retail grocery stores.

Impact to Industry: NWGA spent a significant time working on this legation, both during the 2014 interim, and during the 2015 session. This bill was highly political, as the Governor tied the passage of this legislation to a water quality rule required by the U.S. Environmental Protection Agency (EPA) on storm water requirements. Many Washington businesses, including those with warehouse facilities like grocers, need this rule to be passed and submitted to the EPA for approval. If the rule is not submitted to the EPA, the federal government will step in and issue their own requirements. The Governor, determined to pass a chemical regulatory bill, refused to sign the water quality rule and submit it to the EPA without passage of HB 1472.

Over the six month session, industries including NWGA worked with the Governor’s office to see if a reasonable compromise could be reached. One of the most critical components for retail was a bright line to determine who was responsible for providing information to the WA DOE if a chemical was identified as being part of an alternative assessment – would it be the retailer, the distributor, the importer? Whoever was determined to be responsible would also be responsible for the costs associated with that alternative assessment. For a smaller retailer, it would be nearly impossible for that retailer to determine what was in a product or to push a company abroad to provide that information.

NWGA worked to provide clarification in the definitions of which companies/distributors would be affected, what data needed to be provided, the costs associated with an alternative assessment, and other key components of the bill. While NWGA did not support the legislation, it was important to work with lawmakers and the various agencies in case the bill did pass.

In the end, lawmakers themselves scuttled the bill. In the last hours of one of the special sessions, a couple of lawmakers attempted to expand the scope of the legislation broadly and include the original language from HB 1174 (flame retardants) into HB 1472, the water quality bill. Certain lawmakers wanted to hang an amendment to the bill to give the Department of Ecology the authority to ban flame retardants by rule – a “deal killer” for the business community and some lawmakers. As a result of this last-minute effort and other actions by lawmakers the bill failed.

It is unclear how the Governor intends to proceed on the water quality rule. Businesses have contact the Governor and asked him to submit the rule to the EPA even though HB 1472 didn’t pass. The bill failed because of lawmakers, not because of business. However, it is unclear whether the Governor will allow the rule to move forward, or allow the EPA to step in with its own rules instead.

HB 1314 – Implementing a carbon pollution market program to reduce greenhouse gas emissions

NWGA Position: Oppose

Status: The bill received hearings in both the House Environment Committee and the House Appropriations Committee, but did not pass the House Appropriations Committee before the end of session.

Summary: The bill would have established a cap and trade program similar to what has been implemented in California.

Impact to Industry: Governor Inslee has made environmental efforts a critical part of his first term in office. He continually pushes for both a low carbon fuel standard and a cap and trade policy both during and outside the legislative session. This proposal would have established a cap and trade proposal on 130 Washington businesses, which he refers to as the “dirty 130.” These businesses, predominantly utility companies and large, single-site businesses, would have their emission level capped and be required to find additional companies to sell to them an allowance to emit at a higher level. Over the next decade, the caps would continue to decrease, requiring these businesses to adapt or buy more emission allowances on the open market. Additionally, the program would expand to include low emitters as well.

If this proposal does not pass in 2016, it is highly possible some kind of cap and trade proposal will be on the 2016 ballot. There are already initiatives filed with the Secretary of State to begin the process, and signature gatherers are out there on one or two of the proposals already.

The Governor has also announced his intention to have the Washington Department of Ecology develop the cap and trade program by rule, without legislation. He believes the agency has the authority to implement the program under existing laws, although it is unclear whether the authority exists to require businesses to pay fees and taxes as part of the program.

View Oregon 2015

View IDaho 2015

Download Full Report Below:

NWGA Lobby Team:

Amanda Dalton
Legislative Director & Oregon Lobbyist
Amanda@daltonadvocacy.com

Shawn Miller
Oregon Lobbyist
Shawn@MillerPublicAffairs.com

Holly Chisa
Washington Lobbyist
hollychisa@hpcadvocacy.com

Melinda Merrill
Idaho Lobbyist
Melindas.Merrill@gmail.com

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