2026 Legislative Update: Week 1
Welcome to the first week of the 2026 Washington State Legislative Session!
Lawmakers have returned to Olympia for a fast-moving 60-day short session shaped by several powerful forces: a sharpened progressive edge following the 2025 special elections, a deeply challenging budget environment, and the early shadow of the 2026 election cycle. Together, these dynamics create an atmosphere of urgency, narrow timelines, and heightened political stakes. As fiscal pressures intensify and policy priorities collide, legislators will face difficult tradeoffs and high-stakes negotiations that will define the remainder of the biennium and set the tone for the year ahead.
Progressive Democrats scored significant victories in the November special elections, defeating both business-aligned Democrats and a Republican in several high-profile, closely watched races. These outcomes have modestly confirmed the ideological balance within the Democratic caucus and may influence internal dynamics as lawmakers confront a looming fiscal challenge. The most expensive contest – nearly $4 million – played out in the 26th Legislative District, one of Washington’s true swing districts. There, appointed Senator Deb Krishnadasan prevailed over Rep. Michelle Valdez (formerly Caldier) (R-26), a well-known and dedicated campaigner. While Krishnadasan’s win confirms Democrats’ hold on the Senate, Valdez will return to her House seat this session, preserving her role in the Legislature. In the 33rd District, appointed progressive Democrat Edwin Obras narrowly defeated Burien Mayor Kevin Schilling, a business-oriented Democrat, with the race not decided until the third day of ballot counting. And in the 48th District, appointed Senator Vandana Slatter (D-48) defeated moderate Democrat Amy Walen. Walen, like Valdez, will return to her House seat, maintaining continuity in the lower chamber. And finally, appointed Senator Victoria Hunt (D-5) beat former Republican representative Chad Magendanz in the race to fill the seat left by the passing of Senator Bill Ramos (D-5) last session. Taken together, these results suggest growing momentum for the progressive wing of the Democratic Party, perhaps as a reaction to the federal political environment. Democrats lead in Washington’s Senate, House, Governor’s mansion, and all state-wide offices, but whether these wins will embolden Democratic leadership to pass a substantial revenue package to address the state’s budget shortfall remains an open and closely watched question as the session gets underway.
Both the House and Senate received a sobering, firsthand look this week at the depth of the state’s fiscal challenges as committees heard Governor Ferguson’s proposed operating, capital, and transportation budgets. Washington law requires the Governor to submit a balanced budget, measured over a four-year outlook, meaning that projected expenditures may not exceed anticipated revenues across that period.
Against that backdrop, Governor Ferguson’s proposed budget seeks to close a roughly $2.3 billion shortfall by combining spending reductions with major one-time fixes. His plan would tap about $1 billion from the state’s rainy-day fund and redirect hundreds of millions of dollars from Climate Commitment Act revenues – money originally intended for climate and clean-energy programs – to support general budget needs and programs like the Working Families Tax Credit. The proposal also includes nearly $800 million in agency cuts. While Ferguson has framed the plan as a balanced approach to a difficult fiscal situation, critics warn that relying on reserves and diverting climate dollars to cover ongoing expenses is a risky strategy that could undermine long-term investments and leave the state more vulnerable in future budget cycles.
In late fall, Senate Ways & Means Chair June Robinson (D-38) issued a firm warning to her Senate colleagues: she would not entertain any new provisos in this year’s budget. Meanwhile, members of the House have reportedly been asked to identify their top budget priorities to safeguard.
Language for the so-called “millionaires’ tax” for which Governor Ferguson has indicated support has not yet arrived, but already, revenue proposals are part of the biennium’s conversation, including:
● HB 2100 (Scott, D-43) – creates a payroll tax on 5% of salaries above $125,000 for companies that gross more than $5 million, had employee wages more than $7 million in the previous year and have more than 20 employees.
● SB 5796 (Saldaña, D-37) – creates a payroll tax of 5% on salaries of $189,371 or more against the portion of salary above the Social Security wage limit for employers with more than $7 million in payroll expenses.
● HB 2098 (Reed, D-36) – eliminates the $75 million cap on the advanced computing surcharge, increasing the tax on tech companies.
● HB 1921 (Fey-D, 27) – establishes a road usage charge.
● HB 1870 (Zahn, D-41) – allows counties to impose a new property tax
● HB 2116 (Bergquist, D-11) – increases schools’ local levy property tax ability by raising the cap on the max value a home can be taxed for school purposes.
● HB 1840 (Peterson, D-21) – allows counties to impose a local real estate excise tax.
● HB 2027 (Berg, D-44) – imposes a new real estate transfer tax of up to 3% on the sale of certain homes.
● HB 1702 (Wylie, D-49) – allows counties to impose an additional 3% tax on utilities.
● HB 2046 (Berg, D-44) – capital gains.
● HB 1607 (Stonier, D-49) – adds a 10-cent per-beverage container tax.
● SB 5576 (Lovelett, D-40) – imposes a new sales tax on Airbnb, VRBO, and other short-term rentals homes.
● HB 2068 (Reeves, D-30) – increases taxes on cigarettes and vape products, and increases the license fees for retailers who sell cigarettes and vape products.
● HB 1386 (Thai, D-41) – imposes an 11% sales tax on firearms and ammunition.
● HB 2442 (Berg, D-44) – allows counties and cities to impose additional excise taxes on real estate sales (up to 0.25%). Expands existing authority for counties and cities to impose up to a 0.5% REET dedicated to affordable housing projects. New authority for counties to impose utility excise taxes (up to 3%) on utility businesses in unincorporated areas. Enables cities/counties to adopt a local sales/use tax (0.01%) specifically to fund services such as child care, perinatal support, youth services, workforce supports, shelter/rental help, and transportation for clients. Modifies existing local sales/use tax authority for housing needs, with priorities for affordable housing, behavioral health facilities, and related support services.
● SB 6093 (Saldaña, D-37) – creates a new state excise tax on large companies’ payroll expenses above a high-wage threshold in order to fund state services that may be adversely impacted by recent federal budget changes.
● SB 6129 (Robinson, D-38) – sets a tax at 90 % of the taxable sales price on most nicotine products. Imposes an additional 10 % tax on flavored nicotine products.
However, even if these proposed revenue strategies are enacted, they will not generate funds quickly enough to cover Washington’s immediate financial obligations, leaving the state in a precarious short-term fiscal position. During the previous legislative session, lawmakers already implemented $8 billion in budget cuts – a scale that required significant sacrifice. Any additional reductions will likely be even more difficult. The challenge before the Legislature is not only balancing the budget over the long term but also managing a crisis that demands difficult choices now.
Potentially complicating those choices is the fact that all 98 seats in the Washington State House of Representatives will be up for election in 2026, since state representatives serve two‑year terms, and approximately half of the 49 seats in the Washington State Senate – where senators serve four‑year staggered terms – will also be on the ballot that year. These concurrent legislative races could heighten political pressures and strategic considerations for candidates and voters alike. Already, Senator Sharon Shewmake (D-42) of Bellingham has announced she will not seek reelection in what is one of Washington’s true swing districts. Additionally, Senator Saldaña (D-37) will not run again – instead she is pursuing a race for a role on the King County Council.
Important Dates:
· February 4 – Policy Committee Cutoff – House of Origin
· February 9 – Fiscal Committee Cutoff – House of Origin
· February 17 – Floor Cutoff
· February 25 – Policy Committee Cutoff – Opposite House
· March2 – Fiscal Committee Cutoff – Opposite House
· March 6 – Floor Cutoff
· March 12 – Sine Die
Upcoming Events Report:
Labor & Commerce (Senate) – SHR 1 and Virtual J.A. Cherberg – 1/19 @ 10:30am
· SB 5437 – Public Hearing – Prohibiting noncompetition agreements and clarifying nonsolicitation agreements. (Hearing is on the Proposed Substitute.) (Remote Testimony Available).
· SB 6058 – Public Hearing – Adding discretion to wage enforcement actions. (Remote Testimony Available).
Housing (House) – HHR C and Virtual JLOB – 1/19 @ 1:30pm
· HB 1974 – Public Hearing – Establishing land banking authorities. (Remote Testimony Available)
· HB 2265 – Public Hearing – Protecting tenants from periods of extreme heat. (Remote Testimony Available).
· HB 2452 – Public Hearing – Modifying requirements for service of rent increase notices. (Remote Testimony Available).
Local Government (Senate) – SHR 3 and Virtual JACB – 1/19 @ 1:30pm
· SB 6077 – Public Hearing – Concerning Washington’s property assessment appeal procedures. (Remote Testimony Available).
Appropriations (House) – HHR A and Virtual JLOB – 1/19 @ 4:00pm
· HB 2251 – Public Hearing – Concerning climate commitment act accounts. (Remote Testimony Available).
Transportation (House) – HHR B and Virtual JLOB – 1/19 @ 4:00pm
· HB 2134 – Public Hearing – Concerning regional transportation plans, of regional transportation planning organizations containing certain counties, providing for reductions in greenhouse gas emissions and vehicle miles traveled. (Remote Testimony Available).
Transportation (Senate) – SHR 1 and Virtual J.A. Cherberg – 1/19 @ 4:00pm
· SSB 5690 – Public Hearing – Concerning actions of the department of transportation to notify utility owners of projects and seek federal funding for utility relocation costs. (Remote Testimony Available).
Labor & Workplace Standards (House) – HHR D and Virtual JLOB – 1/20 @ 10:30am
· HB 2151 – Public Hearing – Adopting national standards for factory built housing and commercial structures. (Remote Testimony Available).
· HB 2372 – Public Hearing – Concerning workers’ compensation benefits. (Remote Testimony Available).
Environment, Energy & Technology (Senate) – SHR 1 and Virtual J.A. Cherberg – 1/20 @ 1:30pm
· SB 5984 – Public Hearing – Concerning regulation of artificial intelligence companion chatbots. (Remote Testimony Available).
State Government & Tribal Relations (House) – HHR E and Virtual JLOB – 1/20 @ 1:30pm
· HB 2408 – Public Hearing – Improving government efficiency through amending and repealing obsolete statutory language. (Remote Testimony Available).
State Government, Tribal Affairs & Elections (Senate) – SHR 2 and Virtual J.A. Cherberg – 1/20 @ 1:30pm
· SB 5973 – Public Hearing – Protecting the integrity of the state initiative and referendum process by requiring a demonstration of support before issuance of a ballot measure title and authorizing citizen actions for certain signature gatherer compensation violations. (Remote Testimony Available).
Community Safety (House) – HHR D and Virtual JLOB – 1/20 @ 4:00pm
· HB 2209 – Public Hearing – Concerning sentencing enhancements for theft offenses, robbery, possessing stolen property, and trafficking stolen property. (Remote Testimony Available).
Housing (House) – HHR C and Virtual JLOB – 1/20 @ 4:00pm
· HB 2266 – Public Hearing – Encouraging permanent supportive housing, transitional housing, indoor emergency housing, and indoor emergency shelters. (Remote Testimony Available).
Ways & Means (Senate) – SHR 4 and Virtual JACB – 1/20 @ 4:00pm
· SB 6173 – Public Hearing – Creating an apple health employer assessment. (Remote Testimony Available).
Business, Trade & Economic Development (Senate) – SHR 2 and Virtual J.A. Cherberg – 1/21 @ 8:00am
· SB 6031 – Public Hearing – Enhancing public safety and enforcement of crimes that impact insurance. (Remote Testimony Available).
Civil Rights & Judiciary (House) – HHR A and Virtual JLOB – 1/21 @ 8:00am
· HB 2255 – Public Hearing – Concerning litigation finance. (Remote Testimony Available).
Technology, Economic Development, & Veterans (House) – HHR C and Virtual JLOB – 1/21 @ 8:00am
· HB 2503 – Public Hearing – Regulating artificial intelligence training data. (Remote Testimony Available).
Housing (Senate) – SHR 4 and Virtual JACB – 1/21 @ 10:30am
· SB 6001 – Public Hearing – Concerning scissor stair regulations in the state building code. (Remote Testimony Available).
· SB 6015 – Public Hearing – Concerning permit-ready residential building plans. (Remote Testimony Available).
· SB 6054 – Public Hearing – Concerning unreasonable restrictions on wildfire home hardening practices in common interest communities. (Remote Testimony Available).
· ESB 5729 – Public Hearing – Encouraging construction of affordable housing by streamlining the permitting process. (Hearing is on the Proposed Substitute.) (Remote Testimony Available).
· SB 5884 – Exec Session – Expanding the limited sales and use tax incentive program to encourage redevelopment of underutilized property.
· SB 5885 – Exec Session – Expanding opportunities for affordable housing developments on properties owned by religious organizations.
· SB 6026 – Exec Session – Concerning residential development in commercial and mixed-use zones.
· SB 6027 – Exec Session – Modifying requirements and allowed uses for certain funding related to providing and maintaining affordable housing and related services.
State Government & Tribal Relations (House) – HHR E and Virtual JLOB – 1/21 @ 1:30pm
· HB 2260 – Public Hearing – Concerning requirements pertaining to signatures and addresses of ballot measure petitioners and petition signature gatherers. (Remote Testimony Available).
· HB 2259 – Public Hearing – Protecting the integrity of the state initiative and referendum process by requiring a demonstration of support before issuance of a ballot measure title and authorizing citizen actions for certain signature gatherer compensation violations. (Remote Testimony Available).
Business, Trade & Economic Development (Senate) – SHR 2 and Virtual J.A. Cherberg – 1/22 @ 8:00am
· SB 6031 – Exec Session – Enhancing public safety and enforcement of crimes that impact insurance.
Community Safety (House) – HHR D and Virtual JLOB – 1/22 @ 8:00am
· HB 2362 – Exec Session – Concerning impaired driving.
Housing (House) – HHR C and Virtual JLOB – 1/22 @ 8:00am
· HB 1974 – Exec Session – Establishing land banking authorities.
· HB 2452 – Exec Session – Modifying requirements for service of rent increase notices.
· HB 2236 – Exec Session – Concerning the housing finance commission.
Law & Justice (Senate) – SHR 4 and Virtual JACB – 1/22 @ 10:30am
· SB 5974 – Exec Session – Modernizing and strengthening laws concerning sheriffs, police chiefs, town marshals, law enforcement agency volunteers, youth cadets, specially commissioned officers, and police matrons.
Finance (House) – HHR A and Virtual JLOB – 1/22 @ 1:30pm
· HB 2334 – Public Hearing – Adjusting the price of a cash transaction to eliminate the need for pennies. (Remote Testimony Available)
· HB 2100 – Public Hearing – Enacting an excise tax on large operating companies on the amount of payroll expenses above the minimum wage threshold of the additional medicare tax to fund services to benefit Washingtonians and establishing the Well Washington fund account. (Remote Testimony Available).
Local Government (Senate) – SHR 3 and Virtual JACB – 1/22 @ 1:30pm
· SB 6016 – Exec Session – Considering critical aquifer recharge areas when revising an urban growth area.
· SB 6077 – Exec Session – Concerning Washington’s property assessment appeal procedures.
Ways & Means (Senate) – SHR 4 and Virtual JACB – 1/22 @ 4:00pm
· SB 6113 – Public Hearing – Concerning taxes administered by the department of revenue. (Remote Testimony Available).
· SB 6162 – Public Hearing – Concerning property tax reform. (Remote Testimony Available).
· SB 6114 – Public Hearing – Defining the terms “fixture” and “affixed” for excise tax purposes. (Remote Testimony Available).
Consumer Protection & Business (House) – HHR B and Virtual JLOB – 1/23 @ 8:00am
· HB 2399 – Public Hearing – Prohibiting the post-loss assignment of benefits in property insurance. (Remote Testimony Available).
Labor & Commerce (Senate) – SHR 1 and Virtual J.A. Cherberg – 1/23 @ 8:00am
· SB 6067 – Public Hearing – Concerning workers’ compensation benefits. (Remote Testimony Available).
State Government & Tribal Relations (House) – HHR E and Virtual JLOB – 1/23 @ 8:00am
· HB 2198 – Public Hearing – Improving regulatory efficiency by integrating executive order 25-03, concerning permitting and licensing processes, into chapter 43.42A RCW. (Remote Testimony Available).
Civil Rights & Judiciary (House) – HHR A and Virtual JLOB – 1/23 @ 10:30am
· HB 2304 – Public Hearing – Increasing the supply of condominiums by expanding the types of condominium buildings that may be subject to an express warranty of quality and express warranty insurance coverage. (Remote Testimony Available).
· HB 2095 – Exec Session – Protecting vulnerable users of public ways.
Housing (Senate) – SHR 4 and Virtual JACB – 1/23 @ 10:30am
· SB 6069 – Public Hearing – Encouraging permanent supportive housing, transitional housing, indoor emergency housing, and indoor emergency shelters. (Remote Testimony Available).
· SB 6091 – Public Hearing – Prohibiting real estate brokers from marketing residential properties to an exclusive group of prospective buyers or real estate brokers. (Remote Testimony Available).
Labor & Workplace Standards (House) – HHR D and Virtual JLOB – 1/23 @ 10:30am
· HB 2151 – Exec Session – Adopting national standards for factory built housing and commercial structures.
· HB 2191 – Exec Session – Concerning workers’ wages and benefits in the construction industry.
· HB 2345 – Exec Session – Concerning contributions in the state paid family and medical leave program.
Local Government (House) – HHR E and Virtual JLOB – 1/23 @ 10:30am
· HB 2228 – Exec Session – Concerning scissor stair regulations in the state building code.
· HB 2273 – Exec Session – Reducing embodied carbon emissions of buildings and building materials.
· HB 2381 – Exec Session – Concerning performance-based building codes for low-rise residential buildings.
· HB 2418 – Exec Session – Concerning permit review processes.
State Government, Tribal Affairs & Elections (Senate) – SHR 2 and Virtual J.A. Cherberg – 1/23 @ 10:30am
· SB 5973 – Exec Session – Protecting the integrity of the state initiative and referendum process by requiring a demonstration of support before issuance of a ballot measure title and authorizing citizen actions for certain signature gatherer compensation violations.
· SB 5968 – Exec Session – Improving regulatory efficiency by integrating executive order 25-03, concerning permitting and licensing processes, into chapter 43.42A RCW.
Technology, Economic Development, & Veterans (House) – HHR C and Virtual JLOB – 1/23 @ 10:30am
· HB 2157 – Exec Session – Regulating high-risk artificial intelligence system development, deployment, and use.
· HB 2225 – Exec Session – Concerning regulation of artificial intelligence companion chatbots.
Finance (House) – HHR A and Virtual JLOB – 1/23 @ 1:30pm
· HB 2258 – Public Hearing – Authorizing cities and counties the ability to levy a household excise tax for the operation, maintenance, and capital needs of animal control and shelter systems. (Remote Testimony Available).