On Thursday afternoon, the House and Senate budget chairs announced that they had come to an agreement on the operating budget, but details were not released to the public until Saturday afternoon. The budget was passed by the Legislature yesterday (just a day later), the final day of the legislative session.

As passed by the Legislature, the budget bill appropriates $52.419 billion from funds subject to the outlook (an increase of $7.758 billion, or 17.4 percent, over 2017–19). Additionally, the Legislature passed E2SHB 2158, which increases appropriations for higher education and career connected learning by $393.6 million. These appropriations are from a new dedicated fund, the workforce education investment account (WEIA), and they are funded by a new business and occupation (B&O) tax surcharge on certain businesses. Together, appropriations from funds subject to the outlook (NGFO) and the WEIA total $52.813 billion (an increase of $8.151 billion, or 18.3 percent, over 2017–19).

The outlook based on the budget conference report balances over four years, but I don’t think the revenue figures in the outlook are final (the outlook is on page 38 at the link). For example, the Legislature passed E2SHB 1873, which taxes vapor products as tobacco products, but the bill does not appear to be included in the outlook.

Additionally, the Legislature passed ESHB 2163, which appropriates $58.4 million from the budget stabilization account (BSA) in 2017–19 to make hold harmless payments to school districts. The outlook does not account for this, so the BSA balance will be lower than indicated.

Some of the major revenue increases include:

• ESSB 5998: The real estate excise tax (REET) rate will be graduated so that it is 1.1 percent on the portion of the selling price that is less than or equal to $500,000; 1.28 percent on the portion that is more than $500,000 but less than or equal to $1.5 million; 2.75 percent on the portion that is more than $1.5 million but less than or equal to $3.0 million; and 3.0 percent on the portion that is more than $3.0 million. (The rate on sales of undeveloped land, timberland, agricultural land, and water or mineral rights will remain 1.28 percent.) This is expected to increase NGFO revenues by $243.5 million in 2019–21 and $366.1 million in 2021–23.
• SHB 2167: Financial institutions with annual net income of at least $1 billion will have to pay an additional tax of 1.2 percent of gross income, on top of the 1.5 percent B&O tax rate they already pay. This is expected to increase NGFO revenues by $133.2 million in 2019–21 and $205.6 million in 2021–23.
• E2SHB 2158: As noted above, this B&O tax surcharge does not affect NGFO revenues. A preliminary fiscal note estimates the bill would increase revenues for the new dedicated account by $380.0 million in 2019–21 and $565.7 million in 2021–23. (Here’s a Senate staff summary of the effects by industry group.) Note, though, that these preliminary fiscal estimates were paired with appropriations from the WEIA of $374.7 million—about $19 million less than what was ultimately appropriated.

Stay tuned for more budget details. In the meantime, Austin Jenkins at NW News Network and Melissa Santos at Crosscut have good overviews of what happened over the weekend.