Washington Mortgage Bankers Association 3/15/2016
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1 Washington Mortgage Bankers Association 3/15/2016
2 2016 Session 60-Day Short Session began on 1/11/16 Cutoffs during process to keep things moving Politics very difficult: House Controlled by the Democrats by a 50 to 48 margin. Senate Controlled by the Majority Coalition Caucus, which was made up of 1 Democrat and 25 Republicans vs. 23 Democrats. Upcoming 2016 Elections means pressure to finish & a lot of political maneuvering: majorities up for grabs in both bodies
3 February Revenue Forecast went down, somewhat complicating the budget process In February, forecast reduced by about $500M due to slower growth The sets the amount of $$ the Legislature can spend for operations in the state Total operating budget for = $38B Reduced resources changed the discussions around the supplemental budgets for the session
4 Quick timeline for budget negotiations House Released their operating budget on 2/22 Passed entire House on 2/25 on party lines Senate Released their operating budget on 2/24 Passed entire Senate on 2/26 on party lines Timeframe of 2 weeks does not leave much time to come to agreement
5 Outcome of budget discussions led to a special session The House & Senate took very different approaches to the Supplemental budget in their original proposals, time ran out with no resolution. Both bodies had provisions that were very unlikely to be supported in the opposite body
6 The House s budget assumed $119 M new revenue by: Adding real estate excise tax on foreclosure sales - $34.4M Limiting sales tax exemption for non residents to refund - $ 21.9 M Repeal the sales tax on bottled water - $ 23.2 M Repeal differential B&O rate on wholesale prescription drugs - $ 17.6 M Repeal differential B&O rate on International Investment Management Services $16.6 M Repeal differential B&O rate on travel agents and tour operators - $6.1 M This package passed out of the House Finance Committee on 2/29, but never received a vote by the entire body
7 Special Session began on 3/10 The Governor called the Legislature back for a special session immediately following Sine Die The Governor also immediately vetoed 27 bills because an agreement had not been met on the budget Did sign DFI-request legislation extending the mortgage lending fraud account (SB 6282) into law (1 of 10 signed) Veto actions were unprecedented
8 Special Session Now negotiations have moved behind closed doors Legislators have gone home, leaving budget discussions to key negotiators Timeframe remains uncertain: could be a matter of days, or up to 30 days A lot of pressure remains to finish
9 2016 Elections Election Factors Presidential year = high turnout; Governor Gov Inslee v. Bill Bryant (R), Randy Dorn? Many other statewide races, incl. Treasurer Senate: ½ up for reelection Current split: 26 MCCs v. 23 Ds House: All up for reelection Current split: 50Ds v. 48Rs The Legislature is expected to change considerably, with many members retiring or moving to other offices Means majorities are up for grabs
10 Next year expected to be very long again Because of the remaining issues to be addressed dealing with McCleary, expect another very long year The remaining problem is estimated to cost roughly $4B Dealing with very controversial issues, such as local levy amounts and teacher compensation Plus the addition of many new legislators
11 Questions?
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