The somewhat slow pace by which legislators hit the ground last Monday has been replaced by at least a jog as the one week timeline for the first special session of 2010 nears.
Over the last few days the major pieces needed for the Legislature to adjourn and go home have emerged in the process. With that said, doubts remain whether the emergence of key revenue and budget bills in the last couple of days is enough to reach adjournment by Monday, the one week deadline many legislators set out to meet when the special session was convened.
The Senate passed their proposed 2010 supplemental operating budget on the first day of the special session. Since then proposals on the $30.6 billion operating budget have been exchanged between the House and Senate in search of a compromise. For the moment, however, the bill (ESSB 6444) awaits further consideration on the House floor.
Yesterday, the House passed their proposed 2010 supplemental capital budget. Not much negotiation has taken place with regard to the capital budget. Leaders on the capital buget continue to wait for decisions on revenue and operating dollars to determine how much money is available for capital. The bill (ESHB 2836) awaits further consideration in the Senate Ways & Means Committee.
Also yesterday, the Senate passed, 25-18, a revenue generating bill (SESSB 6143) which is half of a two bill revenue package that would raise $809 million through June 30, 2011. The bill is the same as the revenue bill passed by the Senate in the regular session except for two changes. The first is a reduction in a sales tax increase from a three-tenths proposed increased to two-tenths. In addition, under the revised version, realtors, research and development businesses, and nonprofit and public hospitals would not be affected by the surcharge.
Other than these changes, the bill remains the same as the original bill. The revised bill : (1) closes dozens of tax loopholes, (2) extends the sales tax to bottled water for three years, and (3) increases the occupation tax on service businesses by one-quarter of 1 percent for three years each. Finally, the bill doubles the small business tax credit permanently for service businesses and funds the implementation of the Working Families Tax Rebate. Low-income families would start receiving checks in 2012.
The Senate’s two-bill revenue package also includes Senate Bill 6874 to increase state cigarette taxes by $1 per pack. SB 6874 still needs to be approved by the full Senate.
Today, the House passed a revised version of SESSB 6143 with a vote of 53-42.
The revised bill passed by the House is a plan that was offerd by Governor Gregorie as a compromise between the differing House and Senate proposals. The plan would generate nearly $800 million in new revenue without a sales tax increase. Instead the plan, which includes elements from the Senate and the House proposals, is a temporary business-and-occupations tax surcharge of 0.25 percent on some service businesses. Finally, the plan would close tax loopholes, extend the sales tax to bottled water, and overhaul the way taxes are charged to out-of-state businesses. The Senate and House continue to remain divided on the implementation of a sales tax, with the Senate favoring a sales taxes increase and the House opposing an increase.
Like the Senate, the House’s proposal consists of a two-bill revenue package. House Bill 2493 , like SB 6874, raises state cigarette taxes by $1 per pack and increases taxes on other tobacco products. Yesterday, the House passed HB 2493 witha vote of 54-42. The bill now awaits further consideration on the Senate floor.