Historic Funding For Education - Big Wins for Small Business and Real Estate

kids running out of a school smiling

RE Magazine — Summer 2017

Heading into the 2017 Legislative Session there were two knowns. First, in order to comply with the Supreme Court McCleary Decision, the State would have to figure out a way to add to the historic increases in education funding that were a part of the last two budgets. Second, in order to do that, Legislators were going to look everywhere—particularly, at the taxes small businesses pay and real estate was at the top of the list. The goal of our Legislative Steering Committee was to ensure great funding for our schools was done in a way that ensured the continued success for small businesses. After more than 170 days in session and a third special session, the Legislature produced a final budget that is a win for education and for small businesses in our state.

Education Funding

The final budget provides historic new funding for education for the third budget cycle in a row.

In fact, the Washington Legislature has now doubled the amount of K-12 funding that it provides since 2012. This budget puts $1.8 Billion more into public schools in from 2018-2020 and overall $7.3 billion more between 2018 and 2022. The average teacher salary will increase by $10,000, districts in high cost areas will get extra money to help their teachers pay a higher cost of living. This budget doubles the amount for gifted programs and provides big increases for special needs education. Once this budget is in place Washington will have gone from 36th in per pupil spending in the country to somewhere around 11th. This budget is a big win for schools in our communities.


Many new and increased forms of revenue were considered in the six months that legislators worked to put this deal together.

Among them included big increases in the B&O, doubling Real Estate Excise Tax (REET) on high value properties, a new capital gains tax, carbon tax, and many other options. Ultimately the Legislature settled on a fairly complex idea that has been labeled as a “Levy Swap.” Essentially, the state property tax will increase by 88 cents per thousand, with a decrease in the local property taxes that are paid on local levies. Because of the way this works, 73% of homeowners will see no change or a tax decrease. Homeowners in high property value areas (mostly central Puget Sound) will see some property tax increase. The average homeowner in Seattle will see a $400 increase in their property tax. Additionally, online sellers will be required to collect sales tax and remit it to the State of Washington on all purchases made by Washington residents, sales tax will also be added to bottled water and a few other tax exemptions will be closed. Washington REALTORS® supported, or was neutral, on all of these pieces—some came from the House budget, some originated in the Senate budget. While no one likes higher property taxes, Washington is a very low property tax state. Property tax is stable funding and is broad based (there is an exemption for low income seniors in this budget as well). Based on those factors, and the fact that we support increased education funding, we consider this budget a win for education and a win for small businesses in our state.

“When I rolled out my budget proposal in December, I said that I would judge the success of this session on two things: whether we fully fund education and do so without cutting services that protect the health and safety of vulnerable Washingtonians and families. This budget does both. This is a historic budget that I believe fully funds our schools for the first time in decades and will meet our constitutional obligations.”
Governor Jay Inslee



About the Author

Nathan Gorton

Nathan Gorton has worked as the Government Affairs Director at Washington REALTORS® for seven years. He came to Washington REALTORS® from the Snohomish County-Camano Association of REALTORS® where he worked for seven years as the Local Government Affairs Director and then as Association Executive. Prior to his work in Snohomish, Nathan worked on and managed several political campaigns ranging from city ballot issues to Congressional races. Nathan served as the 2015 Chair for the National Association of REALTORS® Government Affairs Directors. Nathan is a proud graduate of the University of Washington. He lives in Olympia with his wife and adorable daughter.



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