Spokane Journal of Business

Question marks in Olympia

Departure of West, status change for McMorris could affect region’s clout

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Its tough to say what the upcoming legislative session holds for Spokane and the rest of Eastern Washington.

The uncertainty stems from a transition as key regional legislators leave their leadership posts; upcoming federal elections that are likely to divert lawmakers attention; and the fact that there wont be much money up for grabs in a non-budget-writing year, observers say.

Were not quite sure what the complexion of the 2004 session will be, says Don Brunell, president of the Olympia-based Association of Washington Business (AWB). We still dont quite know what the Legislature is going to look like with Sen. West now the mayor of Spokane. Were not sure how many legislators running for congressional seats or governor will remain as legislators.

Jim Wests departure from the Legislature and his powerful Senate majority leader post thereand what that means for the success or failure of Eastern Washingtons agenda in Olympiais perhaps the biggest question mark facing Spokane in the 2004 session. In addition, Rep. Cathy McMorris, of Colville, has relinquished her post as House minority leader to run for Congress.

Sen. Lisa Brown, of Spokane, as Senate minority leader, will be the lone Eastern Washington legislator in a leadership role.

Those shifts certainly change the mix, says Rich Hadley, CEO of the Spokane Regional Chamber of Commerce.

Says Gary Livingston, chancellor and CEO of Community Colleges of Spokane, We have lost leadership influence. I think this side of the state will have to work very, very hard in helping our delegation be successful next year.

Still, Hadley notes, McMorris isnt leaving the Legislature next session, and West will still be in a position to advocate on behalf of Spokane and regional priorities from the mayors office. Im sure hell still receive a pretty open ear from people hes worked with for 20 years.

Business friendly

Hadley, Brunell, and others say they hope the 2004 Legislature carries on work started this year to make Washington more accommodating to the needs of business.

Steps taken by the 2003 Legislature included passing a state budget that didnt require a general tax increase, and approving a package of incentives that persuaded Boeing Co. to build its next-generation 7E7 aircraft in this state.

I think the tenor in the last session was really healthy, Hadley says.

Says Eldonna Gossett, president of the Spokane Valley Chamber of Commerce, I think everybody is expecting this session to continue the work that was started last year.

Gov. Gary Lockes proposed 2004 supplemental budget, which was released last week and calls for about $193 million in new spending and $168 million in construction, is a good start, Brunell says.

I think thats pretty reasonable for a supplemental budget, he says.

Still, theres work to be done, he says, and atop several lists of priorities is reforming the Department of Labor and Industries, which operates the states workers compensation insurance program.

The AWB wants to see two pieces of legislation passed next year to tighten rules regarding how workers compensation benefits are calculated, following two court decisions that had the effect of increasing some benefits.

Those two decisions dramatically increased the amount of money that goes for time-loss payments for workers compensation, and thats a key driver in the cost of workers comp, Brunell says. Thats why we have the type of rate increases weve seen. Workers compensation premiums rose an average of 29 percent this year, and are set to increase an average of 9.8 percent next year.

Gossett says the Valley Chamber will push for internal reforms to L&I to improve claims management, while the Spokane Regional Chamber would like to delay the implementation of planned rate increases already approved by L&I.

Tort reform

Business and medical interests here also would like the 2004 Legislature to address the issue of tort reform, especially concerning medical malpractice insurance.

Thats the No. 1 priority of the Spokane County Medical Society, and the No. 2 priority of the AWB.

We need to pass some type of medical malpractice insurance reform, because a number of rural hospitals no longer have liability insurance. Weve rapidly reached the point of a crisis, Brunell says. He believes, however, theres less than a 50-50 chance that next years Legislature will produce such reforms.

Education also will be a hot topic in the 2004 session.

Locke, in his proposed capital budget, recommended the appropriation of $6.7 million for a new Academic Center building for Washington State University at the Riverpoint campus here, the construction of which is a big priority for WSU-Spokane as well as for the Spokane Regional chamber.

WSU had requested $20 million for the project.

In our way of thinking, it should have been in the capital budget last session, but it didnt get there, Hadley says.

The five-story, 106,000-square-foot Academic Center will house the WSU-Spokane campus library, classrooms, student services, and faculty offices, and is considered by many to be a linchpin for further development of the Riverpoint Higher Education Campus campus here.

The governors proposed supplemental capital budget, however, did include $8.1 million to complete renovation of Eastern Washington Universitys Senior Hall, a more than 80-year-old building that houses EWUs school of social work.

EWU received $6 million for that project in the 2003-2005 budget approved last spring, enough to complete the first phase of work, says EWU lobbyist Jeff Gombosky, a former legislator himself. The school preferred not to split up the work into two phases, however, and asked the state for the further appropriation, he says.

Renovating the building in one phase will save the state about $400,000, Gombosky says, because theres a time cost associated with splitting a project in two phasesyou finish phase one and basically have to shut down all construction before phase two can begin.

Community Colleges of Spokane (CCS) would like to see the 2004 Legislature boost spending on college enrollments, Livingston says.

Currently, CCS serves 900 students for whom it receives no state funding, he says.

We dont get any state assistance, we only get tuition from those students, which doesnt fully cover the cost of providing education to them, he says.

Statewide, such so-called overenrollment totals about 17,000 students at the various state institutions, and that number is expected to rise to about 33,000 students by 2010, Livingston says.

In response to those overenrollments, WSU and the University of Washington have threatened to cap enrollment, saying they cant educate students for whom the state wont provide funding.

At CCS, however, Our mission is to be accessible and affordable by statute, so we cant just arbitrarily cap enrollment, Livingston says.

Locke asked for funding for as many as 5,200 additional full-time students in his supplemental budget.

On the federal level, the Spokane Regional chamber has raised money from its members to enable it to hire a lobbyist to promote its interests in Washington D.C., Hadley says.

The chamber believes having such a representative will help quarterback our issues in the nations capital, he says. Those issues include lobbying to keep Fairchild Air Force Base off of the list of military bases slated for closure, securing more funding for a multiyear study of the Rathdrum Prairie-Spokane Valley Aquifer and a medical-research center here, and boosting Medicare reimbursement rates for doctors and hospitals.

Part of adding a contract lobbyist at the federal level is sort of recognizing that we have had success at the state level by being well represented and we need to have additional success on the federal level on these top priorities to compete, Hadley says.

Although there are other items on the wish lists of Spokane organizations, such as funding for civic projects like the refurbishment of the Fox Theater, the reality is that the 2004 Legislature is a short session (60 days) and lawmakers attention could very well be elsewhere, observers say.

Says AWBs Brunell, In an election year and a 60-day session, when a gubernatorial election and U.S. Senate offices are up, theres a lot of attention being focused on the elections. Were just hoping they will get some of the reforms done that need to happen.

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