The 2007 regular session of the Washington State Legislature begins on January 8th, lasts 105 days, and is scheduled to conclude on April 22, 2007. Sessions that occur in odd numbered years are reserved for writing the State’s, two year, biennial budget. Recent revenue forecasts have projected a $1.9 billion surplus for the ’07 – ’09 biennium. In some respects this is very good news - a surplus of this amount certainly makes the prospect of “general” tax increases unlikely. The not-so-good news is that over half of the surplus is already committed to address unfunded pension liabilities for State retirees, rising health care costs, cost of living increases for state employees, and increasing math and science performance in K – 12 education. The Governor will try to pass legislation establishing a “rainy day” fund to save money to use during the next economic downturn, but will meet resistance from liberal democrats who want to spend the money on new and expanded State programs. This type of spending will surely result in tax increases in future years.

As you may have guessed, the election results from November 7th will have a significant impact on budget and policy decisions in Olympia. The democrats were able to significantly increase their majorities in both chambers of the legislature. The House has moved from 55-43 to 61-37. The Senate has moved from 26-23 to 32-17. These large democrat majorities, coupled with a governor from the same party, will generate enormous pressure on the system to reward their traditional constituencies such as the labor, trial lawyer and environmental communities on both budget and policy matters.

For UCAW, some of our priority issues may well be put on hold for lack of legislative support and, to some degree, we will be put in a defensive posture. As you know, both our efforts in addressing Mike M. Johnson and Bid Rejection have been vehemently opposed by public owners. Our biggest hurtle has been to overcome democrat opposition and, while we have made significant progress, the overwhelming size of the democrat majority may put us out of business for the time being. On the defensive front, there are already proposals to expand local governments’ use of alternative procurement methods, increase bid limits, define “responsible bidder” for bidding public work and increase contractor registration requirements for residential construction. In addition, the Washington Defense Trial Lawyers Association reports that plaintiffs’ lawyers may attempt to reverse the recent Scoccolo decision and eliminate the statute of repose for construction job-site liability. These are all issues that will occupy much of our time and resources.

On the brighter side, the revenue surplus may well protect us from general fund raids on the Public Works Trust Fund. However, we will have to work hard to make sure its resources are not used for non-loan infrastructure programs. Finally, we are very optimistic that we will able to pass legislation dealing with the recent increase in thefts of recyclable metal materials from construction job-sites. A draft bill is prepared and already has support from numerous members of both political parties.

We will be providing you regular updates during the session on the web-site. As always, if you have any questions, please do not hesitate to contact me or Mike Myette directly.