Kicking up cheers and protests, Washington Gov. Jay Inslee Monday signed into law a carbon-cap program and a bill on clean-fuels standards but vetoed parts of those bills that require a new statewide transportation-funding package for the ambitious climate legislation to take effect.

Inslee’s move — capping a big win on climate legislation while once again testing the bounds of his executive powers — essentially scrapped the “grand bargain” that was struck in the Senate to make sure those two bills passed the Legislature last month.

In a bill-signing ceremony at Shoreline Community College, where he was joined by lawmakers and advocates, Inslee sold the climate bills as a jobs package.

The legislation included “some of the strongest economic development bills we have ever passed in the history of the state of Washington,” he said.

For Inslee, the day marked perhaps the capstone of years of pushing for big-ticket climate-change legislation. On this front, he has stared defeat in the face perhaps too many times to count.

But the governor’s maneuvers Monday raised questions — and potentially, challenges — about whether at least one veto exceeds his executive authority.

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Last year, a Thurston County Superior Court judge invalidated a pair of vetoes Inslee made, ruling that they fell outside the governor’s powers as outlined in the state constitution. The state Supreme Court is expected to hear that case in June.

Meanwhile, the Building Industry Association of Washington is challenging an Inslee veto on another bill. In 2019, Inslee vetoed a subsection of HB 1579 that, among other things, increased civil penalties for violations of the statute that regulates coastal construction from $100 per violation to up to $10,000 per violation. An appellate court decision is pending in that case, according to association spokesperson Janelle Guthrie.

The governor’s Monday vetoes vexed lawmakers across the political spectrum, and even Senate Majority Leader Andy Billig, D-Spokane, and Democratic House Speaker Laurie Jinkins of Tacoma chimed in.

“The governor’s partial veto today of … the clean-fuel standard bill reaches beyond his constitutional powers and we will ask the Washington courts to again rule on the balance of legislative and executive branch powers,” said Jinkins in prepared remarks.

In a statement, Senate Minority Leader John Braun, R-Centralia, blasted the move and compared it to Inslee’s use of emergency powers during the COVID-19 pandemic.

“Maybe he’s emboldened by the sweeping authority he continues to have because majority Democrats refused to address emergency power reform,” said Braun, adding later: “Whatever the reason, his subsection veto today is illegal.”

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In another statement, Sen. Mark Mullet, D-Issaquah, went further, saying, “This sets a chilling precedent and poisons the well for all future negotiations on virtually any tough issue.”

Inslee had previously said he didn’t consider the two issues linked. A statement by his office said, “There never was a grand bargain, as far as the governor’s role in the process is concerned.”

Senate Bill 5126 is intended to drive down pollution to net zero emissions by 2050. Doing that will require, among other things, big reductions in the use of fossil fuels by industry and a near phaseout of gasoline and diesel for vehicles.

At the ceremony, Sen. Reuven Carlyle, D-Seattle, and sponsor of that bill, highlighted the labor and environmental-justice equity standards contained in the bill that he called “high quality.”

“That’s not a typo, it’s not a department down the hall, it’s something real and it’s something authentic, built into the very DNA of that legislation,” he said.

Also signed Monday was House Bill 1091, which sets out to gradually require cleaner fuels in trucks, cars, trains, boats and aircraft that generate more than 44% of Washington’s total carbon emissions.

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They both contained provisions that tied the legislation’s taking effect to a transportation-funding package.

While Inslee vetoed those provisions in both bills, it’s the subsection of the clean-fuels bill that could result in a legal challenge.

Transportation negotiations

In an interview after the bill signing, Inslee said lawmakers have everything they need to strike a deal on a transportation package and that he hopes to call a special legislative session around September.

Sen. Steve Hobbs, D-Lake Stevens, and a key player in putting together a transportation package, said Inslee’s veto makes that harder to achieve.

“We want to work with him but when he does this, it kind of breaks the trust,” said Hobbs, who chairs the Senate Transportation Committee.

Hobbs said he will briefly pause efforts to get the Legislature to tackle the transportation-funding package to assess the governor’s vetoes.

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During the last session, Hobbs championed Forward Washington, a $17.6 billion, 16-year plan that includes a new Highway 2 westbound trestle; Washington state’s share of an I-5 Columbia River bridge into Oregon; widenings at Highways 3, 12, and 18; and fish-culvert widenings.

The money also would also be used for things such as new ferries, walk-bike corridors, electric car subsidies and transit grants.

Some of that would rely on the $5.2 billion forecast to be raised by the cap-and-invest program through the auctioning of pollution allowances to major industrial polluters. Legislators also have drawn up a menu of 33 tax and fee increases, including a 9.8-cents-per-gallon hike on the state gas tax.

 Hobbs said Monday that issues needing resolution include what revenue sources “are we comfortable with,” and how the money would be spent.

Another veto

The transportation vetoes caught the most attention, but another veto created a stir at the end of the signing ceremony.

The governor vetoed a part of the carbon-cap bill that required improved consultation with tribes about climate investments made under the act. He said the bill required tribal consent for some climate projects involving their interest, which differs from the current approach, and does “not properly recognize the mutual, sovereign relationships between tribal governments and the state.”

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But as he sat down to sign the bills, Paul Chiyokten Wagner, founder of the advocacy group Protectors of the Salish Sea, stood up to denounce Inslee for that veto.

“We were stabbed in the back by this man!” yelled Wagner, later yelling “Shame!” several times before being escorted outdoors by law enforcement.

A statement by the Suquamish Tribe also registered disappointment: “The tribal consultation provisions and acknowledgment of treaty rights should have been preserved in this legislation.

“These were reasonable measures that would have assured meaningful tribal consultation is conducted on climate projects that might adversely impact sacred places, habitat critical to hunting, fishing, and shellfish harvesting, as well as other treaty-protected resources,” the tribe’s statement continued.

In his interview after the bill signings, the governor said “we want to continue to work on our consulting discussion with the tribes.

“There is a better way to do it, I will be convening discussions” with the tribes, said Inslee, adding later: “It just needs a little more work.”

Seattle Times staff reporters Mike Lindblom and Lynda Mapes contributed to this story.