Rachel La Corte , Associated Press

TACOMA, Wash. (AP) — As a court deadline looms, Democratic Gov. Jay Inslee on Tuesday proposed that the state spend $2.7 billion over the next two years to fully fund the state’s basic education obligations and to increase salaries for teachers.

While releasing his K-12 education funding proposal at an event at Lincoln High School in Tacoma, Inslee announced he is seeking more than $4 billion in new revenue, with a majority of it — about $3.9 billion — dedicated to education-related costs. The proposal also increases spending on health benefits for school instructional and administrative staff, teacher mentoring and paraeducator training.

“For the first time in over three decades, K-12 spending will top 50 percent of state spending,” he said. “This is big, this is bold. This is the right thing to do.”

Inslee is set to release his full two-year budget proposal in Olympia on Wednesday.

The new revenue he seeks includes:

—An increase in the business and occupation tax on services provided by accountants, attorneys, real estate agents and others from 1.5 percent to 2.5 percent, which would raise $2.3 billion in the 2017-2019 budget. An increase in the tax filing threshold means that thousands of small businesses will get tax breaks under the plan.

—A carbon tax that would charge the state’s emitters $25 per metric ton starting in 2018, raising $2 billion, of which $1 billion would go toward the education plan, with the remainder going to clean energy and transportation projects.

—A 7.9 percent capital gains tax on earnings from the sale of stocks, bonds and other assets above $25,000 for individuals and $50,000 for those who file jointly. The levy would begin in the second year of the biennium and would raise about $821 million in fiscal year 2019. Retirement accounts, homes, farms and forestry would be exempt.


The governor’s budget is just the first of three to be released in the coming months. After the next legislative session begins Jan. 9, the Senate and House will also release proposals in hopes of negotiating a compromise during the 105-day session.


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