1. By: Mark Gjurasic & Chester Baldwin

2. US Unemployment 5.0% 5.0% March, 2016 State Unemployment 5.8% 5.8% March, 2016 Unemployment Rate

3. Unemployment (March 2016) - Seattle rate 4.9%- Grays Harbor 9.2% - King County 4.9% - Thurston County 6.1% - Pierce County 6.4% - Lewis County 8.5% - Snohomish County 5.2%- Mason County 8.2% - Spokane County 6.7%- Benton County 6.8% - Chelan County 7.2%- Franklin County 8.9% 2015 Economic Conditions

4. “$38.2 billion budget (2015), adds only $1.91 million additional spending” ~ Legislative Staff COMPROMISE:House Democrats wanted:$467 million Senate Republicans wanted $49 million  $1.91 million additional spending  House Democrats want to eliminate “four year budget requirements” – going back to a two year cycle 2016 Session Budget Update Spending Rep. Hans Dunshee (D-44), Chair of the House Appropriations Committee Sen. Andy Hill (R-9), Chair of the Senate Ways & Means

5.  Mental Health Treatment & Care/Staffing  Low Income Healthcare  Homelessness Student Funding  Wildfire (2015) Costs  Charter School Funding  K-12 Funding: Classroom Para educator Major Area Spending

6.  No General Tax Increases  “Sweeping” Dedicated Funds: $29.4 million to the General Fund. 4 Year Budget Plan:$68 million in FY 2018 $97 million in FY 2019  Keeps “Rainy Day Fund” – only covers “wildfire damage”  About $46 million in taxes that National Companies have not paid on Royalties – Waiving some of the penalties if taxes paid. Balancing the Supplemental Budget 2016

7. HB 2224  Revenues would apply to education and essential public services by modifying and improving the fairness of Washington's excise tax system by enacting an excise tax on capital gains, narrowing or eliminating tax preferences, reinstating a previously expired business and occupation surtax while increasing the small business tax credit, and implementing marketplace fairness in Washington.  Sponsors: Representatives Carlyle, Hunter, S. Hunt, Kagi and Walkinshaw. Proposed “Tax Targets” – House Democrats Rep. Kristine Lytton (D-40) Chair of House Finance Committee Rep. Frank Chopp (D-43) Speaker

8. HB 2224 *  Imposes a 5 percent tax on capital gains.  Reinstates the 0.3 percent business and occupation (B&O) surtax on service businesses.  Increases the small business credit for service businesses.  Eliminates the preferential B&O tax rate of 0.275 percent for travel agents and tour operators.  Eliminates the preferential B&O tax rate of 0.138 percent for resellers of prescription drugs.  Repeals the sales and use tax exemption for bottled water.  Changes the nonresident sales and use tax exemption for tangible personal property into a remittance program.  Narrows the use tax exemption for extracted fuel.  Eliminates the preferential B&O tax rate of 0.484 percent for royalty income.  Authorizes additional methods of establishing nexus for purposes of business and occupation and sales taxes.  Limits the availability of a real estate foreclosure exemption. * Also, sales tax on services is always an option. Proposed “Tax Targets” – House Democrats Rep. Frank Chopp (D-43) Speaker

9.  Department of Corrections DOC Secretary Dan Pacholke resigns due to illegal release of 2,300 prisoners which resulted in 2 citizen deaths. Independent investigations are taking place.  Department of Transportation Director “Denied Confirmation” due to mismanagement of projects (Bertha stuck, floating bridge pontoon doesn’t float, ferry's that don’t float strategy, converting freeway lanes to new $10 toll lanes)  Override Governor’s Veto on 27 bills (2/3 vote in each chamber) of 37 bills – 10 NOT voted (last time 1998)  Taskforce Created for K-12 Funding: Results due 2017 & funding implementation by 2018 (per State Supreme Court) 2016 Major Session Issues

10.  Governor Inslee signed Supplemental Operating Budget (2ESHB 2376) on Monday, April 18 along with an array of budget related bills. In additional to signing the supplemental budget, Governor Inslee used his veto authority to issue approximately 20 vetoes.  According to OFM Director David Schumacher the vetoes amount to an imbalance of around $200 million through 2019. Supplemental Operating Budget

11. Protects projects passed in 2015, $16 billion over 15 years, with Gas Tax Funding (Bi-partisan bill) 1. Increased $507 million 2. Full funding to continue computer modernization project for DOL 3. Full funding for Enhanced driver’s licenses & ID’s because of workload demand 4. Nothing that allows care dealers to implement vehicle licensing services 5. Funds maintenance & congestion relief 2016 Supplemental Transportation Budget Sen. Curtis King (R-14), Chair of the Senate Transportation Committee

12. 6. Transportation Relief: Incident response teams on I-5 I-405: New Auxiliary lanes and hard running shoulders at chokepoints Elimination of tolls on nights, weekends & holidays JBLM & I-5 New lanes 7. State Patrol Officers get 5% raises 2016 Supplemental Transportation Budget Rep. Judy Clibborn (D-41), Chair of the House Transportation Committee

13. Senate Majority Coalition Caucus 2549  Senate Republicans 25 of 49 2349  Senate Democrats 23 of 49  Sen. Tim Sheldon (D) = 26 Members  November Election – Races Up for Re-Election Republicans 14 Democrats 12 2016 Election: November 8, 2016 Primary: Tuesday, August 2, 2016 Sen. Mark Schoesler (R-9), Majority Leader Sen. Sharon Nelson (D-34), Democratic Leader

14. 5098  House Democrats 50 of 98 4898  House Republicans 48 of 98 “All House Members are up in November 2016. We need 2 to 3 Seats” ~ Republican Leaders 2016 Election: November 8, 2016 Primary: Tuesday, August 2, 2016 Rep. Frank Chopp (D-43), Speaker Rep. Dan Kristiansen (R-39), Minority Leader

15. HB 1054/SB 5222 – Collection Agency Credit Card Transaction Fees  Representatives Stanford, Gregerson, Senators Angel, Benton, Hobbs  A collection agency may collect a transaction fee for processing a credit card payment of up to 2.5% of the payment amount was, provided a no-cost payment option is available to the debtor.  The option must be disclosed to the debtor at the same time and in the same manner as the credit card information is taken. 2016 WCA Introduces Transaction Fee – “Pass Thru Bill” Sen. Jan Angel (R-26) Sen. Mark Mullet (D-5)

16. HB 1054/SB 5222 – Collection Agency Credit Card Transaction Fees  We thank Sen. Mark Mullet for drafting an amendment to establish the 2.5% that was going to be an amendment on the Senate Floor and supporting our legislation.  DEAD 2016 2016 WCA Introduces Transaction Fee – “Pass Thru Bill Rep. Derek Stanford (D-1) Ray Henning

17. HB 2673 – Judgment Lien Recording Cost  Representatives Sawyer, Shea  WCA introduced legislation that provides that any fee for recording a judgment as a lien on the nonexempt value of a homestead property is a recoverable cost by the judgment creditor.  Representative Sawyer, Prime Sponsor, worked to promote the bill to the Committee Chairman and House Democrats.  DEAD 2016 WCA Introduces Recording Fee “Pass Thru” Rep. David Sawyer (D-29) Kevin Underwood

18. HB 2674/SB 6448 – Dispute Resolution Fees  Representatives Jinkins, Rodne, Kilduff, Reykdal, Fey & Senators Rolfes, Darneille, Haseagawa  A county legislative authority may impose a surcharge of up to $20 on each civil filing fee in superior court for the purpose of funding DRCs. The maximum amount of a DRC surcharge that may be imposed in district or small claims courts is raised as follows:  In district court, the maximum surcharge on civil filing fee is raised from $10 to $20.  In small claims court, the maximum on each filing fee is raised from $15 to $20.  These flat fee levels may be adjusted annually up to the state's fiscal growth factor. "Fiscal growth factor" means the average growth in state personal income for the prior 10 fiscal years.  DEAD 2016 2016 WCA Opposes Kevin Underwood Rep. Laurie Jinkins (D-27)

19.  Original Bill changes interest rate from 12% to O%, for known restitution Legal Financial Obligations (LFO). Senate Law & Justice Committee amends to 4%.  Original Fiscal Note: Only +/- $1.37 million per year  New Fiscal Note: $7 million per year in LOSS to State $1.75 Million to State General Fund $1.75 Million to Judicial Information System (JIS) $3.5 Million to Counties $7.5 Million TOTAL LOSS Per Year 2016 WCA Opposes – HB 1390 Rep. Roger Goodman (D-45)

20.  Supported By: 1. Representative Goodman, prime sponsor; 2. American Civil Liberties Union; 3. State Poverty Action Network; 4. Voices for Justice; 5. Superior Court Judges Association; 6. Post Prison Education Program; 7. Children's Alliance; 8. Columbia Legal Services; 9. National Alliance on Mental Illness; 10. Northwest Justice Project; 11. Washington Defender Association and Washington Association of Criminal Defense Lawyers; 12. Seattle and King County NAACP and Blackout Washington. 2016 WCA Opposes – HB 1390 Kelsi Hamilton Ray Henning

21.  PRO: Representative Goodman, Prime Sponsor; Michael Shoemaker, Civil Survivor; Shankar Narayan, ACLU; Michael Fisher, “I Did the Time;” (“organization”) Tahoti, “Black Out Washington;” (“organization”) Ardell Shaw, “Black Prisoners Care;” (“organization”) Tarra Simmons, citizen; Kelly Thompson, “Voices for Justice;” (“organization”) Dr. Alexis Harris, University of Washington Testifying for HB 1390 in 2016 Senate Law & Justice Committee Rep. Roger Goodman (D-45) Josie Cummings

22.  CON: Kevin Underwood and Kelsi Hamilton, Washington Collectors Association; Ruth Gordon, Rebecca Johnson, Tawni Sharp, and Staci Myklebust, Washington Association of County Clerks WCA was the MOST viable group to OPPOSE HB 1390. Testifying Against HB 1390 in 2016 Senate Law & Justice Committee Kevin Underwood Kelsi Hamilton

23.  Provides that a court may not impose costs on a defendant who is indigent at the time of sentencing. Establishes provisions governing payment plans and priority of payment of LFOs.  Addresses actions a court may take in sanction proceedings for failure to pay LFOs where the offender's failure to pay is not willful. Provides that the DNA Database fee is not mandatory if the state has already collected the offender's DNA as a result of a prior conviction. See Supplemental Budget analysis for information on HB 2376.  DEAD 2016 More on HB 1390 (LFO/Interest Rate) Kevin Underwood Ray Henning

24. Concerning collection agency practices  Senators Nelson, Hasegawa  It requires debt collectors to send out proof of the debt with the initial notice  Redefines communications to include attempted communications. This means instead of talking to the consumer three times in a week a debt collector can only make the consumer phone ring three times in a week.  It requires debt buyers to affirmatively investigate the chain of title and requires the debt buyer to include the assignment with the initial notice.  DEAD 2016 Bills WCA Opposed – SB 6649 Kevin Underwood Sen. Sharon Nelson (D-34)

25. Concerning service of legal actions to collect a debt by a collection agency  Senator Nelson  Would forbid serving a consumer with a collections legal summons unless the suit has been filed and that the filing has enough proof to allow the consumer to answer the suit.  Prohibits a licensee or an employee of a licensee from serving the debtor with a summons and complaint unless the pleadings have been filed with the court and the summons and complaint contain a file number and sufficient information to allow the debtor to file an answer with the court.  DEAD 2016 Bills WCA Opposed – SB 6628 Ray Henning

26. HB 2376 - 2016 State Supplemental Operating Budget Update  There is no reference to HB 1390 (LFO, interest rates). We do know that the fiscal impact to implement HB 1390 would be about $7 million dollars. There is no reference to the $7.5 million dollars in this Supplement Operating Budget.  There are references of a total of $982,000 that has been appropriated as it relates to grants given to the County Clerk Legal Financial Obligation Grants to help collect LFO funding.  EFFECTIVE DATE: 4/18/2016. LFO Grants for Collection of LFO’s Governor Jay Inslee

27.  The actual language in the budget and the breakdown per county clerk is below: LFO Grants for Collection of LFO’s

31. EHB 2659/SSB 6360 – Consolidation of Traffic-based Fees  The original bill called for specific mandates and topics to be considered, as well as, a “Taskforce” Organization with funding of $1.7 million. WCA was not included.  Under the revised bill, a work group of stakeholders is convened by the Office of the Attorney General (AGO) to receive input and provide feedback on a plan and the program for the efficient statewide consolidation of an individual's traffic-based financial obligations imposed by courts of limited jurisdiction into a unified and affordable payment plan. The following people must be invited to participate on the work group: 2016 WCA Opposes Original Bill – SB 6360 Rep. Laurie Jinkins (D-27)

32. 1. Administrator for the courts; 2. Director of the Department of Licensing; 3. District or municipal court judge; 4. Washington Association of Prosecuting Attorneys; 5. Public defender, jointly appointed by the Washington Defender Association and the Washington Association of Criminal Defense Lawyers; 6. District or municipal court administrator or manager; 7. Representative of a civil legal aid organization; 2016 WCA Opposes Original Bill – SB 6360 Kelsi Hamilton Chester Baldwin WCA Lobbyist

33. 8. The Chief of the Washington State Patrol; 9. Association of Police Chiefs and Sheriffs; 10. Director of the Washington Traffic Safety Commission; 11. Representative of a statewide association of city governments; 12. Representative of a statewide association of counties; and 13. Representative from a statewide association of collection professionals. 2016 WCA Opposes Original Bill – SB 6360 Rep. Laurie Jinkins (D-27)

34.  The work group convenes as necessary. The work group provides final feedback and recommendations to the AGO no later than September 15, 2017. A final report from the AGO, detailing its recommendations and the plan, must be submitted to the Supreme Court, the Governor, and the appropriate committees by December 1, 2017.  Governor Signed – Effective Date: 6/9/2016 2016 WCA Opposes Original Bill – SB 6360 Bob Ferguson Attorney General David Grimm

35. HB 1248 – Court Proceedings  This bill is amended form the original version EFFECT: The striking amendment makes the following changes:  Removes the provision that increased the jurisdictional limit for district courts to $100,000 per claimant.  Changes the mandatory arbitration dollar amount that can be established by a superior court to $75,000, rather than tying it to the jurisdictional limit for district courts.  Raises the filing fee for a request for a trial de novo of an arbitration award to $350, rather than $275.  Provides that the act takes effect on January 1, 2017, and applies to all cases filed on or after that date. WCA Monitors Court Proceeding Legislation Chester Baldwin, WCA Lobbyist

36. Sen. Don Benton (R-17) Sen. Bruce Dammeier (R-25) Rep. Hans Zeiger (R-25) 7 Senators Say: “Bye Bye” ? LIKELY REPUBLICAN SEAT KEY RACE

37. Sen. Jim Hargrove (D-24) Sen. Karen Fraser (D-22) 7 Senators: Say “Bye Bye” ? LEANS DEMOCRAT SEAT DEMOCRAT SEAT ?

38. Sen. Mike Hewitt (R-16) Sen. Linda Evans Parlette (R-12) 7 Senators Say: “Bye Bye” ? REPUBLICAN SEAT ?

39. Sen. Rosemary McAuliffe (D-1) 7 Senators Say: “Bye Bye” ? LEANS DEMOCRAT SEAT

40. Sen. Steve Hobbs (D-44) – Running for Lt. Governor Sen. Cyrus Habib (D-48) – Running for Lt. Governor 2016 Senators Seeking other Offices – Will Return to Senate If They Lose ? LEANS DEMOCRAT SEAT ?

41. Sen. Mark Miloscia (R-30) – Running for State Auditor 2016 Senators Seeking other Offices – Will Return to Senate If They Lose ? LEANS DEMOCRAT SEAT

42. #1 TOP SENATE RACE 2016 – Tuesday, November 8 District Victories 2012Sen. Benton Win:78 VotesTOTAL:54,998 2008Sen. Benton Wins:1,315 VotesTOTAL:57,537 2004Sen. Benton Wins:6,370 VotesTOTAL:52,756 17 th District Sen. Don Benton (R-17) Rep. Lynda Wilson (R-17) The 17 th District Represents part of Clark County including part of Battle Ground and Vancouver.

43. 2 nd Senate Priority Race District Victories 2012 – First election Sen. Mullet Wins: 5,982 VotesTOTAL:67,548 2008Sen. Pflug Wins14,327 VotesTOTAL:72,029 2004Sen. Pflug Wins10,402 VotesTOTAL:65,970 Sen. Mark Mullet (D-5) Rep. Chad Magendanz (R-5) 5 th District The 5 th District Represents East King County, including Carnation, North Bend, Snoqualmie, Issaquah, and parts of Renton, Covington, Maple Valley, Black Diamond and unincorporated King County.

44. Senate Law & Justice Senate Financial Institutions & Insurance 2017 – New Senate Majority – New “Faces”??? Chairman Sen. Mike Padden (R-4) Sen. Jan Angel (R-26) Sen. Mark Mullet (D-5), If Elected Sen. Steve Hobbs (D-44), Candidate for Lt. Governor – If not elected Sen. Jamie Pedersen (D-43)

45. Senate Transportation Senate Ways & Means 2017 – New Committee Chairmenship ? Sen. Curtis King (R-14), If Elected Sen. Andy Hill (R-45) Sen. Kevin Ranker (D-40) Sen. Marko Liias (D-21) Senators: Hobb? Cleveland? Other?? Senators: Rolfes? Carlyle? Other?? ?

46. Mark Gjurasic & Chet Baldwin Mark Cell: 360-481-6000 - MGJURASIC@COMCAST.NET Chet Cell: 360-688-4588 – CHET@LOBBYWA.COM Main Office: 360-705-0113 Main Office Address: 1428 4 th Avenue E, Olympia, WA 98506 THANK YOU!