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The 2024 legislative session got off to a fast start in January with lawmakers introducing hundreds of bills covering virtually every topic you could imagine, from weighty public policy issues to proposals for a state rock (Tenino sandstone) and a state clam (Pacific razor).
Unfortunately, too many of the proposals we’ve seen coming out of Olympia this year would, if approved, make it harder, more complex and more expensive to start or operate a business in Washington.
One of the first ideas to generate headlines was a package of bills aimed at regulating gift cards, of all things. The bills would require businesses to transfer the money on unused gift cards to the state Department of Revenue, cash out balances below $50 and report consumer data to the state, among other requirements.
Gift cards have no expiration date in Washington and are popular with consumers, so it’s not clear what problem lawmakers are trying to solve. It is clear, however, that the proposals would create a variety of new problems for employers who would be tasked with a huge new administrative burden.
It would be costly for store owners in other ways too, since they would be required to honor gift cards even if the funds have been turned over to the state. And there are fraud and security issues. Requiring businesses to provide cash on hand for unspent balances below $50 would essentially force businesses to serve as ATMs, attracting criminals and fraud.
The 2024 legislative session has also seen renewed efforts to increase real estate and property taxes, both of which would drive up the cost of housing and exacerbate the state’s housing crisis.
Backers of a bill that would impose a real estate transfer tax on sales of over $3.025 million say it targets wealthy individuals, but most transactions in that price range are either commercial and industrial properties — the places where people work — or multifamily residential properties, which typically provide the most affordable housing options in a community.
Another proposal seeks to impose rent control, which not only fails to address the root cause of the housing affordability crisis — an inadequate supply of housing — but could also deter housing investment. And there’s a renewed push to create a split roll property tax structure, which would increase property taxes for business and commercial property owners — another tax on Main Street. Lawmakers made progress on addressing Washington’s housing crisis last year. Here’s hoping they don’t go backward this year.
On employment law, there’s a proposal that would allow striking workers to receive unemployment benefits. This is not what unemployment insurance was intended to do. The UI fund, which is 100% paid for by employers, was created to provide benefits for people who lose their job through no fault of their own and who are looking for work. People who are choosing not to work, for whatever reason, don’t meet those criteria.
Those are just a few examples of the bills we’ve seen this year that would either make it more expensive or more complicated (or both) to run a business in Washington. No doubt each of the ideas is well-intentioned. Taken individually, each of the ideas may not seem particularly expensive or cumbersome.
But there is a cumulative effect on employers that legislators often fail to appreciate. Year after year, there are proposals for new regulations and higher taxes, even when the money is not really needed. Washington’s state budget has grown tremendously over the last decade. In fact, it’s more than doubled.
Thankfully, the state is not facing a shortfall in the operating budget. Simply put, legislators shouldn’t raise taxes when they don’t need to, and they should carefully consider the cumulative effect of regulation before they put new hurdles in front of employers.
Kris Johnson is president of the Association of Washington Business, the state’s chamber of commerce and manufacturers association.