Last week the Divas were back in Chavi’s rural hometown in Oregon. We picked up our niece Quinlyn early from school to take her to lunch and do a little Auntie shopping. As we waited in the front office we noticed how run down this little school seemed to be. The computers were from the early 2000’s, the library books were tattered, and the building was in a state of disrepair. Our niece is an exceptionally smart gal and luckily, she just qualified for the Talented and Gifted program. The only problem is that THERE IS NO STATE FUNDING in her rural district to support this special and gifted child. If the county can’t come up with money to support this program – then its existence is meaningless.
Schools like the one our niece attends exists all over Washington state, and not just in rural communities but in the inner cities as well. Base salary for a teacher in Washington State is $35,700. These are the folks responsible for the education of our future generation and many of them don’t make enough money to purchase a home on their own salary. This year Washington State’s business community, REALTORS® included, will have a choice. We can support Governor Jay Inslee’s plan to fully and properly fund education in WA State or we can choose what we believe is the short-sighted route. We can fight against this plan in order to save ourselves a few hundred dollars a year in new taxes – taxes that will be well spent on the future of our children and our state!
The Governor’s Proposed Public Education Budget
On Tuesday, Governor Jay Inslee announced his budget plan for solving the public education funding crisis in Washington State. The principle of the plan is to diminish the burden of funding education through local levies and put that responsibility back where it belongs – on the state level. The Governor’s proposed plan would result in a base salary increase for teachers from $35,700 to $54,587. Salaries for school administrators would also see solid increases. It would also increase per student dollars that will help to reduce class size and add school support staff like nurses and counselors.
The gist of the plan involves a number of tax increases on the state level – including a B&O tax increase from 1.5% to 2.5% – this is at the crux of the REALTORS® opposition to this plan. The plan will also alleviate the burden of local communities to raise most of this money via county levies (a.ka. Property taxes).
This change will result in 75% of homeowners across the state seeing a DECREASE in their property taxes.
Reducing the tax burden for our clients and the communities we serve as REALTORS® should always be one of the principles on which we stand. The bottom line is we live in a state where working families are already burdened with a regressive tax system. All of us, including REALTORS®, will reap the benefits of a state where teachers make a working wage and can afford to become homeowners and our students get the benefits of a fully funded public education. So why should we not pay our fair share to improve the education system in our own state?
Let’s Do the Math Real Estate Brokers
Currently, our B&O taxes are 1.5%. In the Governor’s proposed plan the new B&O tax would be 2.5%. The average price for a home according to a recent Seattle Times article, is $307,658 in Washington state.
Old B&O Tax = $138
New B&O Tax = $230
Difference = $92 per transaction!
What is the Impact of this B&O Tax Increase on Brokers?
Let’s talk about your average Realtor. Most agents close between 6-7 transactions a year. That equates to $600 spread out over the entire year. Our friend Marguerite is a very good broker in Tacoma. She has a solid business. She makes over the $100,000 a year. Her increase will be about $1,500 a year.
“As a broker with 12 years of industry experience, I am excited our state has a good plan to fully fund education. It is true that some of us will see an higher increase, but fully funded schools are good for business and good for society – so I’m looking forward to paying my fair share.”
– Marguerite Giguere
REALTORS® in more rural communities also see the positives of this plan. Jessica Baker is a successful agent working in the Coldwell Banker Bain office in Longview, WA and she is wholeheartedly behind the plan.
“As a Realtor in Cowlitz County and a parent, I believe in and support Governor Inslee’s two year budget proposal. Our school districts, teachers and mostly students, will be the main benefactors of this proposal. The B&O tax increase is a small sacrifice with a big impact for the State of WA, including higher pay for teachers and smaller class sizes! It’s communities like Cowlitz County that often get the short end of the stick under the current school funding system.”
– Jessica Baker
And as far as Team Diva is concerned – based on our production we could be seeing an increase of $15,000 in our B&O taxes. That sounds like a lot but really, it’s just one more deal we need to close to make up the difference.
“One more teacher making a working wage means one more family able to buy a home in their community. Sounds like a win-win to us.”
– Chavi and Kim of Team Diva
What Does the $92 Per Transaction (on average) Increase Do?
The average of a $92 increase on each transaction will mean that a school teacher who wants to teach in rural areas but cannot afford to do so because of their own student debt, now have the opportunity to make a difference. It means that inner city teachers and administrators will be making a higher wage and will be less likely leave for higher paying jobs as soon as they have the opportunity. It means that the #1 community we serve as REALTORS®, homeowners, will not be burdened by continued property tax increases in order to keep their local schools funded.
Why as REALTORS® would we not want this for our clients?
Better Schools = Better Communities = Better Home Prices
Our team consistently fields questions about schools in various areas. Seattle, like many big cities, has some great schools and some struggling schools, many in historically low-income neighborhoods or in rural areas. Kids like our niece.
Our friend and Diva Dweller, Mia, is a Certified Speech-Language Pathologist. She works in the Seattle School district with kids who have severe communication issues and her program is seriously underfunded.
“I don’t need a raise. I do need the district to have enough money to hire another Speech-Language Pathologist so I don’t have the equivalent of 45 kids to see in 3 days, and that’s just at one school. Children deserve better, but especially those with a significant communication impairment who were already dealt an unlucky card in life. I invite anyone who doesn’t support this plan to come with me to visit the students in the medically fragile classroom at Lowell. I’ll introduce you to children who are in wheelchairs and use switches to communicate. Then you can tell them in person why they are not worth paying a few hundred dollars more a year in taxes.”
– Mia Richkind
Providing more support for professionals like Mia, means they have a better chance of making real change in the lives of their students.
Improving our education system creates stable communities. Better schools mean more stable neighborhoods. Improved neighborhoods translates to more people buying homes and stronger home prices. Increased homeownership and stronger prices results in REAL ESTATE PROFESSIONALS making more money. Do the math my real estate friends!
The Local REALTORS® Association Slams the Governor’s Plan
This week the Seattle King County REALTORS® came out with their press release GROSSLY exaggerating the impact of funding education is going to have to real estate professionals. Washington State REALTORS® sets the agenda for local REALTORS® boards. Here is their policy piece where the WA REALTORS® are congratulating themselves on defeating any increase on B&O taxes in the 2015/2016 budget. Earlier this week we called and spoke to David Crowell who is in charge of Government Affairs at our local Seattle King County Association of REALTORS® . We asked directly why the decision was made to oppose school funding. David’s response “WA state REALTORS® set the agenda and they are ALWAYS opposed to ANY increase in B&O taxes. We are just following their lead”.
We As Real Estate Professionals Have a Serious Choice to Make.
In November, right after the election, we were lucky enough to meet Nathan Gibbs-Bowling at the Genuine Hustle conference in Tacoma. Nate was selected as Teacher of the Year in Washington State in 2016. We asked Nate to comment about the REALTORS® opposition to School funding.
“The number one determining factor of the health of a society is the quality of education of the populace. The real estate and job markets in Washington State are among the hottest in the nation. If we’re going to continue to create the jobs that are driving the economic growth we’re experiencing, we have to fully fund education. Opposition to the B&O by REALTORS® is classic short term — in the now thinking — that compromise our long term future.”
– Nate Gibbs-Bowling
Are we going to take the high road and fight to protect our clients, our children, and our state by supporting Governor Jay Inslee’s plan to fully fund education in our state. Or are we going to go with the knee-jerk reaction to oppose any and all B&O taxes our REALTORS® leadership is taking? The choice is yours. But we URGE you to get the facts, talk to folks on both sides of the aisle, and make an informed decision. Do not just sit back and let someone else speak for you. We MUST fight for better education in our state.
I challenge the Washington State Association of REALTORS® to come up with a better plan to FULLY FUND education if they are opposed to the Governor’s plan. (We hear they have a plan but there is nothing formal on the website. Seems you can only get this info by going to their meetings. This is prohibitive for many busy REALTORS® or those who have family constraints.). We want to know of a plan that does not leave some schools in the dust or put that burden back on the shoulders of homeowners. When we see that plan – we can talk. Until then we as members of Washington REALTORS® and those like us are are throwing our support behind Governor Jay Inslee’s plan. We MUST fight for better education in our state.
What Can You Do Now?
Remember our adorable and super smart niece Quinlyn? There are lots of Quinlyns out there in Washington state. Don’t let $92/ transaction keep her from becoming a brilliant member of our community.
Step 1: Diva Dwellers, parents, and concerned citizens, please contact your Representatives and let them know you support Governor Jay Inslee’s plan to fully support fund education.
Step 2: Fellow REALTORS® join us in contacting the Washington State Association of REALTORS® at 1-800-562-6024 and ask why they are not making their plan to fund public education public to their members via the website?
Step 3: Fellow REALTORS® join us in contacting your local REALTORS® association and ask them why they are going along with state leadership and not thinking about the impact that this decision is going to have on your local schools and homeowners/clients?
Step 4: Fellow REALTORS® join the Divas and our other concerned real estate professionals at WA State REALTOR® lobby day on January 17th and 18th and let your Representatives that you disagree with our larger organization and believe in fully funding education in our state.
Step 5: Fellow REALTORS® join the Divas in joining your local board and making sure you voices are heard on issues like these across the state. Our kids, clients, and homeowners deserve an alternative voice.
I am a REALTOR® and I vote!