NEWS: Fain helps craft sustainable budget and pass key reforms

During an all-night session of negotiating and voting that finally concluded after dawn Wednesday, Washington lawmakers addressed state government’s financial concerns and made significant investments in the future with a series of breakthrough reform measures and by approving supplemental operating and capital budgets.

The budget and reform package, brokered in part by a bipartisan state Senate coalition that included Sen. Joe Fain of Auburn, has been among Fain’s priorities since the Legislature convened in January.

“Taxpayers and those who rely on state services all come out ahead when the state’s budgets are sustainable over the long term. To get there we need to change how the budgets are built. The reform bills we passed show our commitment to that,” said Fain. “It took plenty of hard work and a willingness to compromise on both sides, but it was worth it.”

One of the most controversial proposals concerned the procurement of health benefits for public school employees. Fain was skeptical of earlier proposals, but worked to improve the final version to ensure it took meaningful steps to address inequities in the current system.

That bill, Fain explained, allows individual school districts to retain local collective-bargaining rights when purchasing health care plans; however, improvements must be made in those plans to make individual and family coverage premiums more equitable, with the goal of making family coverage affordable.

The state teachers’ union, which administers 60% of the state’s health care plans for public school employees, fiercely opposed the original legislation. However, individual teachers and classified staff who pay for family coverage have heralded the reform as a step forward in lowering costs and improving coverage.  Rep. Pat Sullivan of Covington joined Fain in supporting the new law.

Another reform bill centered on fiscal sustainability requires budgets to balance over four years and is the first of its kind in the nation. The new policy forces lawmakers to consider the long-term consequences of short-term and often short-sighted spending decisions, reducing the chances of continual budget deficits.

“The Legislature has a history of passing expensive bills with no way of paying for them,” Fain continued. “The balanced budget reform not only requires state government to think long-term about its spending decisions, but will also prevent legislators from trying to sneak through large spending proposals without identifying a way to pay for it.”

Another sustainability bill reforms the state pension system by changing the early-retirement option for future employees, who will still be able to retire early, but with a much smaller taxpayer subsidy.  The change is expected to save the state roughly $1.3 billion over the next 25 years and shore up much of the unfunded liability in the oldest of the state’s three pension programs.  Current state employees are not impacted by the change.

A final piece of the reform agenda includes a constitutional limit on the level of debt that the state can incur. While the state’s capital budget that pays for building and construction projects is separate from its operating budget that pays for schools, corrections and human services, the debt payments to cover the capital budget’s bonds are paid out of the operating budget. By lessening the amount of debt, the state can free up money in the operating budget to strengthen its reserves and avoid costly deficits.

The fiscal reform agenda experienced new life when Fain joined a bipartisan coalition of senators in early March and took control of the Senate’s budget deliberations. While this uncommon move was controversial at the time, it paved the way for a final plan that was approved with near-unanimous and bipartisan support.