Two things happened Sept. 21 that could make Gov. Jay Inslee more amenable to supporting broad-based tax relief for inflation-battered Washingtonians during next year’s legislative session.

On that day, the Washington Federation of State Employees announced a tentative agreement with the state — the result of secret negotiations between the two — that the union called “the largest compensation package in our union’s history.”

The tentative agreement includes a $1,000 incentive payment for getting a COVID-19 booster shot and a 4 percent raise for employees on July 1, 2023, followed by a 3 percent raise on July 1, 2024.

The Office of Financial Management estimates that cost information for the tentative agreement will be posted to its website on Oct. 3.
Later that day, the Economic and Revenue Forecast Council released figures showing revenue projections for Washington’s current two-year budget period increased by $43 million more than projected in the last quarterly update. The 
September revenue forecast essentially showed the state is about $1.5 billion above expectations for the 2021-23 budget since the February revenue forecast.

The Center Square reached out to the Governor’s Office to ask if Inslee would consider supporting broad-based tax relief — such as a cut in the sales or property tax when legislators meet next year — given state coffers are full and that in clandestine negotiations he has already agreed to a compensation increase for state government employees.

“The collective bargaining process has been consistent across administrations,” Jaime Smith, Inslee’s communications director, told The Center Square via email.

The Legislature used to decide compensation packages for state employees as part of public budget hearings.

Then-Gov. Gary Locke signed legislation (House Bill 1268) into law that gave state employee union executives the power to negotiate directly with the governor behind closed doors for salary and benefit increases. He signed it in 2002. The law went into full effect two years later.

Before that change, collective bargaining for state employees was limited to non-economic issues such as work conditions. Salary and benefit levels were determined through the normal budget process in the Legislature.

Lawmakers will have the opportunity to approve or reject the entire agreement between the WSFE and Inslee. But to reject it would court the possibility of a government strike.

During an appearance last week on TVW’s “Inside Olympia,” Sen. Andy Billig, D-Spokane, said broad-based tax relief was on the table for next year’s legislative session.

“We want to ... provide relief, but do it in a smart way so that we’re being good stewards of the public’s money and making sure we’re getting the best possible bang for that investment,” the Senate majority leader said.

The governor's spokeswoman boosted one bit of targeted tax relief signed in 2021.

“The Legislature did approve the Working Families Tax Rebate that will put hundreds of dollars back into the pockets of hundreds of thousands of families in this upcoming tax season, and is an on-going program,” Smith said.

The Working Families Tax Credit, a targeted tax relief program, goes into effect next year. It will distribute $300 to $1,200 to those who qualify.

Smith didn’t completely shut the door on the idea of Inslee supporting broad-based tax relief next year.

“We will work with legislators this session to determine how to continue supporting families and communities during these economically challenging times,” she said.