OLYMPIA — The state House is moving ahead with a plan to pull a Wenatchee-area agency from default and seize tax dollars if local jurisdictions fail to repay the dues.
The 56-33 vote on Monday came after lawmakers approved an amendment that would require a public vote on any tax increases in the local jurisdictions.
Republican Rep. Mike Armstrong of Wenatchee said it will be difficult for local officials to secure voter approval of the taxes, and he believes the terms of the rescue plan are too onerous. Democratic Rep. Ross Hunter said the plan makes it clear to bond markets that officials will make good on debts.
State leaders have feared that the default would make it more difficult for local governments in Washington to borrow money.
Local legislators Monday split on the approval of the bill to bail out the Wenatchee-area agency’s $42 million debt default.
“There were good reasons to vote yes and there were good reasons to vote no,” Rep. Ed Orcutt, R-Kalama, said after the House’s vote, which was its first of the special session.
Before the vote, Orcutt successfully amended the bill to require that a voters in the Wenatchee area approve any tax increase that would be used to repay the state loan.
“If there are tax increases, the voters have to approve it, which forces them into the conversation a little bit more,” Orcutt said.
The amendment swayed the opinion of bill co-sponsor Armstrong, who said the change could lead to total bond default. He voted against the bill.
Clark County’s delegation split its vote. Besides Orcutt, those in favor were Reps. Jim Moeller, D-Vancouver; Sharon Wylie, D-Vancouver and Bruce Chandler, R-Granger.
Local opponents were Reps. Paul Harris, R-Vancouver; Tim Probst, D-Vancouver; Ann Rivers, R-La Center and David Taylor, R-Moxee.
“It was a local issue that should have been handled locally and I didn’t want us to really get involved in it,” Harris said, adding that he was concerned about the precedent it could set. Orcutt said he also considered that to be an issue but ultimately found the risk of default to be too high.
“The implications of not doing it were too big a risk for municipalities all over the state, including in our area,” Orcutt said. “That just tipped the scales enough for me to vote for it.”
Orcutt expects to be a member of a task force that is being assembled to work through issues concerning public facilities districts, in order to “prevent anything like this from happening in the future.”
The bill must pass through the Senate next, which Harris expected to be an interesting debate.
“Senate has some angst with this too so it should be interesting to see if it even comes on(to) the Senate floor,” Harris said.
The Associated Press contributed to this story.