SB971 – Raises revenue to fund transportation projects. (Includes a carbon fee.)
Prime Sponsor – Senator Hobbs (D; 44th District; Lake Stevens)
Current status – Referred to the Senate Committee on Transportation. Had a hearing there February 28th. 1st substitute with significant changes passed out of committee March 6th. Referred to Ways and Means; had a hearing, but still in that committee at the end of the 2019 session. Reintroduced and retained in present status in 2020 session.
Next step would be – Action by Ways and Means.
Legislative tracking page for the bill.
(SB5970 authorizes $5 billion in bonds to fund projects, backed by the additional revenue this bill would raise. SB5972 appropriates the new funds.)

Comments –
The changes in the 1st substitute are summarized on pp. 11-12 of the Senate Bill Report. Among other things, it reduces the carbon fee to $10/tonne for utilities, lowers the increase in EV registration fees to $150 from $200, adds $50 to the registration fee for hybrids, and expands the exemptions for energy-intensive and trade-exposed industries in various ways.

Summary –

The bill raises the fuel tax by 6¢/gallon. It adds a freight project fee of 10% of the license fee on vehicles over 10,000 pounds to the current 15% fee and increases the new fee by 3% every two years until 2031. It adds $5 to the $30 passenger car license fee. It raises the vehicle trip permit from $25 to $45. It raises the fee for an international fuel tax agreement license from $10 to $32.50. Starting in 2020, it raises the fee for an enhanced driver’s license from $24 to $54, and the fee for shorter extensions from $4/year to $9/year. It raises the annual registration fee for electric vehicles from $150 to $350. It adds a surcharge of 25¢ to each ferry ride. It puts a carbon pollution fee of $15/metric ton of CO2 (with no inflation adjustments) on the carbon content of electricity and on fossil fuels, other than those used to generate electricity in the state. These increased revenues go to a new Forward Washington transportation account, which is mostly appropriated for highway projects in SB5972. The bill adds two $10 fees to the license fees for vehicles up to 12,000 pounds; they both go to the Forward Washington account until June 30th, 2020; after that one of them goes to the highway patrol, ferries, and various other transportation funds.

The bill raises the sales and use taxes on automobiles, auto parts, and bicycles 1%. It creates a special transportation benefit assessment on the increase in assessed value resulting from new construction – $2/$1,000 in added value for residential property; $1/$1,000 for manufacturing facilities; and $4/$1,000 for other construction. It raises the mobile home registration fee from $75 to $100, and adds an additional fee of $10. It raises the sales and use taxes on car rentals 1%. It charges a 50¢ fee for each ride in a for-hire vehicle like a taxi or Uber. It creates an additional fine for driving in the HOV lane illegally of $175 for the first offense, $250 for the second offense, and $350 for each offense after that. 14.5% of the revenue from car rental taxes, and the increased revenue from these other changes goes to a new Forward Flexible account, which is mostly appropriated for other transportation than highways in SB5972.

Aviation fuel; agricultural fuel; the Transalta coal plant; biogas; log trucks; facilities making renewable energy equipment; copper, nickel, lead, and zinc mining; the fuel used outside the state by trucks and vessels primarily engaged in interstate commerce; and various other obvious things are exempted from the carbon fee. The Department of Commerce is to develop objective numerical standards for the energy intensity and trade exposure which will qualify energy-intensive trade-exposed manufacturing facilities (EITEs) as exempt.

Details:
The bill prohibits any other fees within the state on the carbon in fossil fuels or used in the production of electricity. (I think this section intends to prohibit cities, counties and other jurisdictions from doing this, though the first sentence reads as if it’s to keep the Legislature from passing any other carbon fees.)

It adds “local agencies” to the current poison pill provisions about moving the funding for transit and highway safety into the construction fund if an agency adopts a low carbon fuel standard. Presumably, this is motivated by the Puget Sound Clean Air Agency considering adopting a Regional Clean Fuel Standard for King, Pierce, Kitsap, and Snohomish Counties. (People say it announced it would do this, but their website doesn’t say that yet.)

Commerce is to create a stakeholder work group to study how to efficiently and consistently integrate carbon pricing in electricity markets and recommend ways to improve their carbon transparency and market liquidity to the Legislature. By 2026, the Department of Revenue, Commerce, Ecology are to review the method for protecting EITEs and the merits of alternatives.

It would let utilities deduct any carbon fees they pay for the carbon content of imported electricity from the alternative compliance fees they would pay under SB5116 if they failed to meet the targets for reducing their use of fossil fuels under that bill, so they would not pay twice.