Template revised September 22, 2016.

COMMISSION

AGENDA MEMORANDUM

Item No.

BRIEFING ITEM

Date of Meeting

May 28, 2019

DATE: May 21, 2019

TO: Steve Metruck, Executive Director

FROM: Eric ffitch, Manager, State Government Relations

Nate Caminos, Director, Government Relations

SUBJECT: 2019 State Legislative Session Review

EXECUTIVE SUMMARY

The purpose of this briefing is to provide the Port of Seattle Commission, Executive Director,

and Executive Leadership Team with a final report on the 2019 State Legislative Session, with

specific attention given to the Port’s 2019 State Legislative Agenda.

On Sunday, April 28

, the House and Senate both adopted conference reports (consensus

amended bills) on the Operating Budget, Capital Budget, and Transportation Budget, and

adjourned “sine die” (i.e. without designating a future date). This marks the end of the 2019

state legislative session, concluding in 105 days for the first time in a budget year since 2009.

Overall, it was a productive session for the Port of Seattle’s priority issues, save for the

Legislature’s failure to enact a low-carbon fuel standard. Several Port of Seattle priorities were

debated in the final days of session, including passage in the final week of legislation to reform

the Model Toxics Control Act program, legislation to authorize tolling and accelerate the

construction of the Puget Sound Gateway program and, hours before adjourning on Sunday,

April 28

, the adoption of Initiative 1000.

The final budget compromise funded the Maritime Innovation Center with a full $5 million,

included $1.75m for the fishing pier at Pier 86, and funded other priorities for the Port of

Seattle, such as core plus education.

The memo below attempts to provide a comprehensive review of the final status of all

legislative issues on which Port staff and commissioners engaged this legislative session.

MORE WORK TO BE DONE:

Clean Fuels Standard: As the end of session approached, rumors began to swirl in the state

capitol about a final effort to enact a Clean Fuels Programs statewide. Advocates who had spent

all session supporting HB 1110 met with staff from the Governor’s office and Senate leadership

to discuss the prospect of a small transportation package, funded by a gas tax and other

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revenue-raising proposals, that could be paired with a low-carbon fuel standard and passed

through the Senate.

Early on Friday morning, April 26

, a draft proposal was released that sought to amend the

Senate Transportation budget with a compromise proposal that included a small gas tax to fund

transportation, a low-carbon fuel standard, and some of the compromise language that Sen.

Hobbs had sought in the Transportation Committee’s consideration of HB 1110 (i.e. his

“alternate compliance” pathway).

With little time to review and considerable concern from environmental groups, the Port did

not engage directly in the debate on this amendment. In its committee hearing, the proposed

amendment was opposed by groups on both sides of the low-carbon fuel standard issue and

did not move forward. With the Legislature’s adjournment on Sunday, April 28

, the effort to

enact a low carbon fuel standard will have to be taken up next session.

Maritime High School: Despite its inclusion in the House-passed operating budget proposal, and

apparently lack of controversy or opposition, the final operating budget deal did not include

$100,000 for a maritime high school study at the Office of Superintendent of Public Instruction.

That funding was put forward by Rep. Gael Tarleton and included in the initial House operating

budget proposal, but not the Senate version. Staff is seeking clarity on why the funding was

removed in a final deal and will work to advance this effort in the 2020 session.

SUCCESS FOR PORT PRIORITIES:

Workforce development: Governor Inslee signed HB 1568 into law on Wednesday, April 24,

2019. This bill confirms that funding and leading on workforce development programming is

within the authority of port districts, as part of their economic development authority. It has

been a priority bill for the Port of Seattle since 2016, and this year the Port was joined by the

Ports of Port Angeles, Moses Lake, Vancouver, and Everett in seeking its passage. Other

partners included the maritime unions, the Association of Washington Business, and more.

Initiative 1000 (I-200 repeal effort): For the third consecutive session, Commissioner Bowman

traveled to Olympia to share the Port of Seattle’s perspective on the challenges of reaching our

minority contracting goals with Initiative 200 in effect. The testimony took place at a joint

meeting of the Senate State Government, Tribal Relations, and Elections Committee and the

House Civil Rights and Judiciary Committee. That hearing was kicked off by a panel of Governors

Gregoire, Locke, and Evans, all speaking in support of Initiative 1000.

Initiative 1000, which amends Initiative 200 to allow public entities to grant preference on the

basis of race, gender, or national origin, passed the House and Senate on the final day of

session. It will take effect on July 28, 2019.

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Puget Sound Gateway tolling: SB 5825 was passed by the House and Senate in the dying days

of legislative session. One of the Port’s priority bills, to authorize tolling and accelerate

construction of the Puget Sound Gateway program, SB 5825 took over from the House proposal

as the vehicle for passage this session. It was the subject of an intense lobbying effort the final

week of session, to secure the 60 percent of votes it needed to pass (because it authorizes

bonds, it requires more than a simple majority vote for passage). Since the development and

finalization of the 2015 Connecting Washington Transportation Package, the Port has been a

primary advocate for the construction of the Puget Sound Gateway Program, connecting SR 167

and SR 509 to Interstate 5, and speeding freight movement throughout the region.

SB 5825 was signed into law on May 21, 2019.

Model Toxics Control Act: In the early morning hours of Sunday, April 28

, the House voted to

concur in the Senate amendments to SSB 5993, a bill to reform the Model Toxics Control Act.

Port staff testified in support of SB 5993 in its first hearing at the Senate Ways and Means

Committee on Wednesday, March 27

. That bill sought to increase the funding available for

remedial action grants, changed the Hazardous Substance Tax from a value-based calculation to

a volumetric calculation, and brought transparency to MTCA that had been lacking.

The bill also established a specific account for the operating expenses at Dept. of Ecology which

had long counted on borrowing MTCA funds and makes that transfer official and codified. The

original proposal also set up some specific funds for stormwater, to prevent the annual fight

between stormwater and Remedial Action Grants. And, the bill established an “inflator”

mechanism so the volumetric taxation rate will keep pace with inflation. While the final

proposal was moderated a bit through compromise as it moved through the committee

process, the structural reforms remained in the final version, and the Port maintained its

support for the measure.

The Port was glad to join the Washington Public Ports Association, the Association of

Washington Cities, the Washington State Association of Counties, the Washington

Environmental Council, the Nature Conservancy, and others in advocating for this bill.

State commercial aviation coordinating commission: Legislation brought forward by Senator

Karen Keiser and Representative Tina Orwall, to convene a statewide commercial aviation

coordinating commission charged with recommending a site for a future primary commercial

service airport, went to a “conference committee” with the House in the final week of session.

On Thursday, April 25

, the Conference Committee (three House members; three Senate

members) came to agreement, and the final bill included the following changes from its initial

version:

- Remove the Governor/his designee and the Freight Mobility Investment Board from the

coordinating commission; added WSDOT Aviation and a freight forwarder

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- Adds in, as non-voting members of the commission: a representative from the

Department of Defense; four legislators, two from the Senate and two from the House;

a statewide environmental organization; an organization concerned with water/land use

policy

- Removed staff from the 4

and 9

district Congressional offices

- Requires a sixty percent vote of the committee to recommend a future site

- Requires the research on a site done in this process to include: the feasibility of

constructing a commercial aviation facility in that location and its potential

environmental, community, and economic impacts

- Delays the timeline for the study submission to Jan. 1, 2022 (Governor’s compromised

had offered 2023; 2022 was the compromise date)

- Prevents the commission from recommending: (a) upgrades at a King County airport or

(b) any military facility where commercial aviation would conflict with military

operations

The Port of Seattle continued to express support for this effort, while not advocating for any

amendments, as directed by the Commission. The Senate and House both adopted the

conference committee report unanimously, and SSB 5370 was signed into law by Governor

Inslee on Monday, May 13, 2019.

Rep. Fey’s “Green Transportation Package”: On Sunday, April 28

, the last day of session, the

Senate accepted the House amendments and passed Rep. Fey’s bill to bring some common

sense reforms and new policies to the state’s efforts around transportation electrification.

Some of the policies contained in that proposal are as follows:

- New incentives for electric vehicles purchases, including a pilot program to promote

electric vehicle use by low-income residents;

- Incentives for alternative fuels, including a Business & Occupation Tax exemption that’s

extended to 2029 and expanded to include alternative fuel infrastructure projects;

- Green Transportation capital grants to help transit agencies to electrify their vehicle

fleets, upgrade their electrical transmission and distribution systems or construct

charging and fueling stations;

- Reforms to aid the development of electric car-sharing services and businesses;

- Enhances efforts to get cars off the road through increased carpooling, vanpooling,

telecommuting, walking, biking or taking mass transit

Port of Seattle staff signed in “PRO” on HB 2042 as it made its way through the legislative

process.

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The bill was signed by Governor Inslee on Tuesday, May 7

, as part of a suite of other energy

bills signed in a public ceremony at a park in South Seattle.

Transportation electrification: SHB 1512, the Seattle City Light priority bill on which the Port

and the Northwest Seaport Alliance were partners in advocacy, passed the Senate and was

signed into law on April 23, 2019. That policy will allow utilities more authority to engage in

transportation electrification capital investment. As it made its way through the legislative

process, staff from NWSA provided testimony and Port of Seattle staff signed in “PRO” and

raised the issue in meetings with lawmakers before and during session.

Job-order contracting: HB 1295 was recommended to the legislature by the Capital Projects

Advisory Review Board, an entity on which the Port of Seattle’s Bob Maruska enjoys a

leadership role. The bill improves flexibility in contracting for public entities, including through

the authorization of expanded use of “job-order contracting” (JOC). Under JOC, a contractor

agrees to perform an indefinite quantity of public works jobs, defined by individual work

orders, over a fixed period of time. A job order contractor must subcontract 90 percent of the

work under the contract.

HB 1295 was passed by the Senate on April 16

and Governor Inslee signed the bill on Tuesday,

April 30

, 2019.

Human trafficking: This session, the Port joined in Rep. Pellicciotti’s effort to pass two bills

intended to address the effects of human trafficking. HB 1382 helps ensure people in

prostitution who are victims of crimes as a result of their work (i.e. raped, robbed, beaten) can

come forward to report their victimization and receive immunity from being prosecuted for

prostitution because of their report. And under HB 1383, patronizing a prostitute is increased to

a gross misdemeanor upon the second or subsequent conviction under state law or under an

equivalent municipal ordinance.

HB 1382 passed both chambers and was signed by the Governor. But HB 1383 did not advance

before the “cutoff” deadline and will have to be taken up again next session.

100 percent clean electricity: One of the central environmental accomplishments in the state

legislature this session was the passage of ESSB 5116, the “one hundred percent clean

electricity” effort led by Sen. Carlyle and Rep. Tarleton, at the request of Governor Inslee. This

effort requires all utilities to eliminate coal-generated electricity from their supply by 2025 and

calls for one hundred percent renewable sources for electricity by 2045. It has been the focus of

an expansive advocacy effort and a central priority for Governor Inslee and broad swaths of the

Democratic caucuses in the House and Senate all session long. The Port was a consistent

supporter of this effort as it moved through the process.

The Governor signed ESSB 5116 into law on May 7, 2019.

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Electric aviation: Rep. Vandana Slatter (D-48

LD, Clyde Hill, Medina) has been leading a

conversation in the state about the potential use of hybrid or hybrid-electric aircraft for short,

regional flights in Washington. The Port has been participating in an Electric Aviation Work

Group that Rep. Slatter had secured funding to convene in the 2018 supplemental

transportation budget. HB 1397 sought to continue that work group and provide enough

funding for WSDOT to hire a consultant to broaden the research done by the group. The Port

supported this bill, but it did not advance.

Although HB 1397 did not receive a vote in the Senate before the final “cutoff” deadline of the

year, funding for the electric aircraft work group was included in the final transportation

budget.

Final budget outcomes:

Port of Seattle interests in operating budget:

- Sustainable aviation biofuels work group: The final operating budget includes $20,000

for WSU to continue convening the state’s sustainable aviation biofuels work group

through 2020.

- Streamlined sales tax: In the final budget deal, SST mitigation payments continue for an

additional biennium, and are booked to continue through the 4-year budget outlook.

$16.4 million was allocated over the biennium, considered strong funding compared to

what was included in the initial Senate budget offer.

- Air cargo language: The final budget compromise includes $125,000 to the Department

of Commerce in the 2020 and 2021 budget years to fund a partial employee dedicated

to implementing the recommendations of the Joint Transportation Committee’s air

cargo study. House operating budget does not contain equivalent language.

- Airport health study: The budget also includes $125,000 in funding over the next

biennium for Public Health-Seattle/King County “to conduct a study on the population

health impact of the SeaTac airport communities.” Senator Keiser has told stakeholders

that she views this as the next phase of the study currently underway by the University

of Washington, of which the Port is a partial funder.

Port of Seattle interests in capital budget:

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- Maritime Innovation Center: The final capital budget included $5m for the Department

of Commerce to partner with the Port of Seattle to develop the Maritime Innovation

Center.

- Pier 86/North Elliott Bay Public Dock and Marine Transit Terminal: The final capital

budget deal included $1.75m for reconstructing the fishing pier at Pier 86. That is more

than the initial House level ($750,000) and the initial Senate level ($1,000,000), and

Expedia have said that if the Port of Seattle can contribute an additional $1m, they will

provide their entire pledged $3m.

- MTCA grants: With the passage of SB 5993, the final Capital Budget included stronger

than expected funding for remedial action grants under MTCA. While the Port did not

receive the roughly $3m for the Lower Duwamish that was originally proposed by the

Senate Capital Budget chair, there was some funding included for Duwamish cleanup

work being done by our partners at Seattle Public Utilities.

Port of Seattle interests in transportation budget:

- SR 518 study extension: A small but important priority for this session, Port staff have

been working with the House and Senate Transportation chairs and their staff to extend

the due date for a study of congestion issues on the SR 518 corridor. Extension language

is now in both the House and Senate operating budget.

- Ballard-Interbay Regional Transportation Project: The final transportation budget

included a proviso authored by Rep. Tarleton/Sen. Carlyle to fund a report at WSDOT on

strategies to “improve mobility for people and freight” in the Ballard-Interbay corridor.

Port staff participated in meetings convened by Reps. Tarleton and Frame, Sen. Carlyle,

and CM Sally Bagshaw over the course of 2018 on this topic, and there was some

expectation that Rep. Tarleton would seek funding for a study as described above.

Issues that did not advance:

Data privacy and facial recognition: This session, both chambers debated bills that sought to

put in place new consumer data privacy protections. These included efforts to regulate the use

of facial recognition technology, which would have had implications on airport operations. Staff

communicated with Sen. Carlyle early in the process about the use of this technology at the

airport, and Delta Air Lines also met with many members to express concerns as the process

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went forward. In the end, SB 5376 did not garner consensus and no legislation on data privacy

or facial recognition moved forward this session.

Aircraft noise abatement: Rep. Pellicciotti’s proposed legislation, HB 1847, to expand the

boundaries within which the Port has statutory authority to conduct noise abatement

programming was not considered for a vote in the Senate prior to the final “opposite chamber

cutoff” of the year, and it died. Because this was the first year of a “legislative biennium,” it will

remain an active legislative proposal when the 2020 legislative session convenes next year.

Port automation prohibition: For a brief few days in Olympia, early in session, it looked as

though port districts and labor unions may have cause for substantial disagreement. SB 5905

was introduced by Senator Saldaña on February 13

, and would’ve prohibited port districts

from using public funds to purchase equipment that could lead to automation of operations.

That bill instantly attracted the attention and opposition of port districts, and the sponsor

agreed to remove it from its public hearing and not bring it up again this session. It will remain

an active proposal in 2020.

Transportation Network Companies: In spite of a series of lengthy and substantive meetings

over the interim, Uber, Lyft, and their various regulators and local government stakeholders

(i.e. City of Seattle, Port of Seattle, King County, City of Tacoma, City of Everett, Washington

State Association of Cities, Sheriffs and Police Chiefs, etc.) could not reach agreement on

legislation to establish a statewide regulatory regime. That was the goal of the summer

stakeholder meetings convened by King County, but the conversation tended to reach deadlock

when issues of data sharing and background checks came to the table. No consensus bill was

introduced in Olympia, then, but the TNCs did introduce the bill they’ve sought in each of the

last three sessions. It was opposed by those government groups mentioned above, and others,

and did not move forward this session.

Greenhouse Gases and the State Environmental Policy Act: The Port of Seattle signed in

“other” at a House Environment and Energy Committee hearing on HB 1549, a bill that directed

the Department of Ecology to initiate a rulemaking to clarify how greenhouse gas emissions are

calculated under the State Environmental Policy Act. The proposal was the subject of advocacy

from the Washington Public Ports Association but was opposed by the Department of Ecology

and the Washington Environmental Council. Staff followed up our “other” sign-in with a brief

email statement to the Committee expressing general support for the intent of the bill but

affirming that the Commission did not yet have an official position on the measure. That bill

died but was expected to become a budget proviso establishing a stakeholder process for the

interim, intended to give Ecology direction to begin a rulemaking process in this area. The final

budget compromise DID NOT include a budget proviso funding this stakeholder process, so it

remains on hold.

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Template revised September 22, 2016.

License plate readers: Legislation was introduced and considered that would restrict the use of

Automated License Plate Reading Systems (ALPRS) and could have had implications on some

Port of Seattle efforts, specifically at the airport. Staff discussed concerns briefly with the

member sponsoring the legislation. It did not move beyond its initial public hearing but will

remain an active proposal in the 2020 legislative session.

ATTACHMENTS TO THIS BRIEFING

(1) Presentation slides

PREVIOUS COMMISSION ACTIONS OR BRIEFINGS

December 11, 2018 – The Commission approved the 2019 State Legislative Agenda

November 27, 2018 – The Commission was briefed on the 2019 State Legislative Agenda

May 8, 2018 – The Commission was briefed on the final outcomes of the 2017 Legislative

Session