Eastern Adams County's Only Independent Voice Since 1887
Eastern Adams County's Only Independent Voice Since 1887
OLYMPIA – Bankers are suing the state Legislature for enacting unlawful taxes under a “title only” bill.
On Nov. 5, the Washington Bankers Association, represented by former State Attorney General Rob McKenna, filed suit over House Bill 2167, a title-only tax increase passed in the waning hours of the 2019 legislative session.
House Bill 2167 was introduced April 10 and only included one sentence: “The legislature intends to enact legislation concerning tax revenue.”
Without following regular procedures, on April 26, a substitute bill taxing “specified financial institutions” was introduced and passed on the House floor by Democrats.
Rep. Alex Ybarra, R-Quincy, who represents Lincoln County as part of the 13th Legislative District, opposed the tax.
The next day, the substitute bill was approved by the Senate Ways and Means Committee on a party-line vote. And on the final day of the session, April 28, Democrats pushed the tax through the Senate and delivered it to Gov. Jay Inslee, who signed it into law May 21.
Legislative District No. 9 Sen. Mark Schoesler, R-Ritzville, was among those opposing the bill in the Senate.
In an advisory vote on the tax Nov. 5, 55% of voters said the Legislature should repeal the tax.
According to the lawsuit, “Plaintiffs seek a declaratory judgment that SHB 2167 is unlawful and invalid because (1) the Act was enacted in violation of Article II, Section 36 of the Constitution of the State of Washington, and (2) the Act’s imposition of a 1.2% surtax on gross income of specified financial institutions, all of whom are out-of-state entities, discriminates against interstate commerce in violation of the Commerce Clause of the United States Constitution.”
The lawsuit is the first of its kind to challenge the Legislature’s use of title-only bills to circumvent the regular bill process and input from taxpayers.
Under Article 2, Section 36 of the state Constitution, “no bill shall be considered in either house unless the time of its introduction shall have been at least ten days before the final adjournment of the legislature...”
Article 2 does allow a last-minute bill with a two-thirds majority vote in both the House and Senate.
The association did get an opportunity to testify on bill April 26 without any time to study the bill or prepare adequate background information.
“We found out about it (tax bill) about 3 ½ hours ago,” association spokesman Trent House said during his testimony that day. “That’s very difficult to process, even with the best staff. It’s hard to get information back on a bill of this nature that raises this kind of money in that period of time... We don’t know exactly what this bill does or who it applies to. It’s very difficult to even understand how to testify on this bill not knowing that information.”
Roger Harnack is co-owner and publisher of Free Press Publishing. An award-winning journalist, photographer, editor and publisher who grew up in Eastern Washington, he's one of only two Washington state journalists ever to receive the international Golden Quill for editorial/commentary writing. Roger is committed to preserving local media, and along with it, a local voice for Eastern Washington.
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