Plan Washington

To unlock our state’s potential, programs and policy must address the needs of underserved rural communities. The interdependence of urban and rural economies is measurable and significant. The state must identify ways to strengthen rural communities so job creation occurs organically.

Many rural Washington communities are experiencing demographic transformation as economies based on natural resources face greater regulatory challenges and slimmer margins. As opportunities shrink in these traditional industries, the younger generations move away from rural areas to find job opportunities in urban centers. Having the right education and training available helps people learn 21st century skills and stay in place. Vocational learning opportunities should start early in the K-12 system.

Community and technical colleges (CTCs) are critical resources for bringing more earning power into rural economies. They are broadly distributed across the state and accessible to underserved communities. Many participants are low-income and first generation college students. Twenty eight percent are parents, 43 percent work full or part-time while attending classes, and 42 percent are people of color. Recently CTCs have moved into an economic development role that includes contract training, small business development, and entrepreneurship programs. 

Recommendations

1. Seize the Mass Timber Opportunity. Create incentives for builders to use advanced wood products made in Washington. The state’s timber industry has been in decline for over 20 years. A sustainable wood product revolution will create economic opportunity for Washington’s struggling rural communities while providing environmental benefit through carbon sequestration. Take action to facilitate in-state production and use of cross-laminated timber.
2. Broaden Tax Incentives for Distressed Regions. Washington currently offers tax abatements for manufacturing and research expenses in qualifying regions. Expanding the incentives to include the service sector will further encourage job growth in high unemployment areas. By widening the sales tax “set aside” for rural areas, county governments can engage private investment opportunities.
3. More Entrepreneurial Support. Legislators should consider an administratively simpler B&O tax, such as a Single Business Tax, with accommodations for startups and small businesses that create jobs. Fund export assistance vouchers which help small and medium-sized businesses enter foreign markets. Encourage participation in the state’s Startup 365 program, Score Business Mentors, Fund Local, Make It In Washington, and U.S. Department of Energy Small Business Vouchers.
4. Make Asset Maps Readily Available. Many communities have created asset maps of which residents are unaware. Encouraging local communities to distribute these effectively will empower local entrepreneurs.
5. Clear Barriers to Statewide 5G Internet. Washington needs to upgrade its telecommunications infrastructure so that rural areas will become viable places to live and work with stronger internet connections. This requires counties, cities, and the state to minimize permitting delays and regulatory hurdles.

ACHIEVE LOW CARBON PROSPERITY

Current policy is leading Washington toward a cleaner grid, led by the elimination of in-state coal electricity and the announced shut down of coal-fired electricity delivered from out-of-state Colstrip Units 1 and 2. Through 2030, the state can meet all of its new electricity needs with conservation and efficiency investments. In the same way utilities help drive energy efficiency improvements like LED light bulbs, they can play a similar role in electrifying transportation and converting industrial processes to cleaner fuels.

Reducing emissions can align with improving profits and reducing cost of living. The critical question for the economy is the amount of carbon reduction that is technologically feasible, and the cost effectiveness of making those investments.

Some emerging technology solutions will generate carbon reductions that result in net savings to the economy. However, realizing this potential requires overcoming persistent barriers to market efficiency. Less understood is the availability and cost effectiveness of carbon reduction investments at the state level. For example, given Washington’s unique energy profile the advantages of electrification are more pronounced than in other states.

Recommendations

1. Leverage Washington’s Natural Advantage in Clean, Affordable Electricity. State law should recognize the ratepayer interest in shifting carbon-intensive activities, such as transportation and industrial activities, to cleaner electric power. Shifting more activity to electric power will increase demand for electricity, but the greater efficiency of electric motors will decrease overall energy use, wasted energy, and carbon pollution. Standards should fairly evaluate fuels and technologies for their carbon reduction benefits, including nuclear and natural gas, with incentives structured accordingly. Utility incentives, such as time-of-use electricity rates, will encourage adoption of electric vehicles and charging infrastructure.
2. Minimally Price Carbon and Invest the Revenue. As a pollution reduction mechanism, a carbon tax is significantly more effective when revenues are reinvested into carbon reduction projects. Investment decisions should be driven by a technology-neutral, market-based system that pays for verified reductions beyond what taxation would produce. Reinvestment should also target helping large commercial industrial energy users transition energy-intensive processes to more efficient, less carbon-intensive alternatives. This approach provides the surest pathway to a resilient and carbon competitive economy.
3. Prevent GHG Emissions and Living Wage Jobs From Leaking Out of Washington. Energy Intensive & Trade Exposed (EITE) industries are vulnerable to higher energy costs and both domestic and international competition. It’s essential to avoid the leakage of GHG emissions along with good-paying jobs to areas with less efficient manufacturing processes and more carbon-intensive electricity. When only in-state EITEs are taxed, their out-of-state competitors have an advantage.
4. Support Low Carbon Procurement. Government and businesses can apply purchasing power throughout supply chains and be proactive in making cost effective energy efficiency and carbon reduction investments.
5. Require a Legislative Greenhouse Gas Note. All legislation likely to have a significant impact on greenhouse gas emissions should be analyzed for its impact (i.e., a GHG equivalent to “fiscal notes”)

GOVERNMENT THAT WORKS

Spending decisions in Washington State should be prioritized using a comprehensive strategic plan that takes our toughest issues head-on. Interplay over the budget is to be expected between the governor and the four legislative caucuses, but the process can be better structured and create more clear connections to our challenges. Past leaders have built consensus by establishing shared governing priorities. The table below describes an approach to budgeting that both political parties can embrace.

Recommendations

1. Add to the Governor’s Senior Staff the Role of Chief Operating Officer. COOs have been added to governor’s offices in Oregon, Tennessee, Arizona and Rhode Island. The state’s COO would be responsible for the achievement of the Governor’s Goals and the efficient and effective operations of the Executive Branch of state government. A governor’s Chief of Staff focuses on the political aspects of the office, but with billions of dollars at stake someone needs to focus on breaking down the silos and making accountability and transparency realities of daily life for our dedicated public leaders.
2. Implement a Comprehensive Approach to Manage Government Performance. While Results Washington is an admirable foundation, the vision its architects had for it was not fulfilled. Agency performance needs to operate under a common management model and logic to enable credible accountability. Legislation should be passed to require a standard set of best-practice management methods be deployed and that state executives be held accountable to report results in terms that are meaningful and visible to Washingtonians. The approach should include much more active central oversight though agency business reviews with a State COO and automated performance scorecards that focus on agency budgets, outcomes, and process effectiveness. Reviews must be open to the legislature.
3. Pass the SMART Act (State Money Accountability, Review or Termination). The bill would require all state expenditures to include a performance measure of the societal impact wherein the Joint Legislative Audit & Review Committee would recommend continuing, modifying, or terminating the program, as is currently done for tax preferences.
4. Better Connect Spending to Outcomes. Create a state version of the federal evidence-based policymaking commission proposed by Senator Patty Murray and Representative Paul Ryan. The implementation of management systems across state agencies will support a culture of continuous improvement leading to better results. A zero-based budget review process allows better prioritization of state expenditures.
5. Launch Open Data and Digital Leadership Initiative. Getting more datasets online supports an economy of businesses and nonprofits, watchdog groups and journalists, and software application developers. Look to leading states like Utah, and encourage the participation of the local computing employer base in bringing the talent and knowledge to transition state agencies to digital service delivery. Adopt a useful measure of Data Openness.
6. Authorize Pay for Success Bonds. Pay-for-success contracts (a.k.a. social impact bonds) leverage private capital to create better public outcomes by compensating private investors if their investments reduce state liabilities or generate revenue. The legislature should authorize a pilot project related to health & social services.
7. Mandate Budget Transparency. Require every state agency, municipality, and special district government to post their budget online.

New transportation technologies can get us moving safer, faster, greener, and cheaper with ACES technology: vehicles that are Automated, Connected, Electric and Shared. Automated vehicles improve traffic flow and facilitate ride sharing. Uber is now testing driverless car service in Pittsburgh, which will eventually make ridesharing even more affordable. Connected vehicles communicate with other vehicles and infrastructure to reduce accidents and congestion. Electric vehicles plug into our clean low cost power grid, decreasing pollution and fuel costs. Shared vehicles mean more people in fewer cars.

ACES technologies are arriving rapidly. They have the potential to transform how we move around the region, but only if we integrate them into our planning. Washington is poised to take the lead with our high-tech companies, major universities and forward-thinking, motivated, and tech-friendly population.

ST3 will establish massive transit expansions across the Central Puget Sound, but for transit to be most effective in decreasing congestion, local governments and private industry must work together to overcome “the first mile/last mile challenge.” ACES vehicles will provide key solutions to connect transit hubs with individual origins/destinations.

1. Expand and Transform Park-and-Rides. Current park-and-ride lots are a resounding success—most are full by 7 am. The region needs five to ten times the number of current lots to serve as centers for the flexible vanpools, carpools, and other transportation options. Picking up commuters at a central place saves the time and expense of going from house to house. Build new facilities to utilize the rapidly emerging “self-valeting” function.
2. Update the Commute Trip Reduction Act. CTR provides incentives for companies with over 100 employees to use carpools, vanpools, and transit. As a result, Washington has one of the largest vanpool programs in the country. But the state could have four times the current number by setting up flexible vanpools in addition to the current fixed fleet.
3. Electrify Transportation. Expand the use of electric vehicles that draw power from one of the least carbon-intensive grids in the county. Expand and replicate King County Metro’s all-electric vanpools. Compared to a standard Metro bus that gets 45 miles per gallon per passenger, a Metro all-electric Nissan Leaf gets the equivalent of 500 miles per gallon per passenger. Larger all-electric and hybrid-electric vans will get the equivalent of 1,000 miles per gallon per passenger. Employers can provide inexpensive supplemental charging during the 8-hour workday with a standard household socket.

Faced with project risk and constrained revenue, many states in the U.S. and provinces of Canada have found workable solutions through public-private partnerships. However, the Transportation Innovations Partnerships Act of 2005 has effectively discouraged new financing models within the state. The Act requires a complicated approval process involving six state agencies and restricts the use of private capital for even smaller, non-tolled highway projects. Public-private partnerships must expand beyond the traditional construct to include cooperatives, co-developments, and operations to ensure continual mobility.

Recommendations

1. Expand Public-Private Financing. Share risk and expedite improvements by modifying the Transportation Innovations Partnerships Act to enable public-private partnership models for non-tolled highway projects such as park-and-ride lots (mobility hubs), ferry terminals, and partnerships for utilities and rail.
2. Leverage Private Partnerships. Example: Set aside a third of current park-and-ride spaces where commuters who need a guaranteed place to park would pay a small fee with the fee revenue used to help finance more mobility hubs.
3. Support Maritime. A state-level commitment to the maritime industry on the scale afforded aerospace would boost the long term competitiveness of the port system. Support the priorities of Washington Maritime Federation to advance the needs of the industry.
4. Direct Unanticipated Revenue to Local Roads. The old split of 66% for state highways and 34% for all local transportation projects, including transit, was established in 1991. State leaders are advocating a new policy that recognizes the growing needs of local governments. New state transportation revenue forecasts show $2.5 billion more available to the state over the next 10 years than when Connecting Washington was enacted, providing an opportunity to change policy while supporting state projects that are already counting on future funds.
5. Revive the Mosquito Fleet. Puget Sound ferries date back over 100 years, beginning with a ragtag collection of private services known as the Mosquito Fleet. Private operators should gauge the feasibility of building a broad network of small high speed passenger ferries. The state can facilitate successful partnerships between local governments and private operators, both of whom have demonstrated ongoing interest in expanding passenger-only ferry routes.