2026 Legislative Update: Week 5

It was a whirlwind weekend in the Washington State Legislature, as fiscal committees heard testimony and voted on bills ahead of the Monday, February 9 deadline for measures to advance out of those committees. That cutoff marked a critical juncture in the session, further winnowing down the universe of proposals that can continue moving forward this year. With that milestone now behind them, both chambers are pivoting to the next phase: extended caucus meetings, lengthy floor sessions, and strategic negotiations as lawmakers work toward the February 17 deadline for bills to pass out of their house of origin to remain viable.

Before bills reach the floor, they must clear a pivotal and often decisive hurdle, the Rules Committees in both the House and Senate. Once a bill has been approved by its policy and, if necessary, fiscal committee, it is referred to Rules, where members determine whether the measure will be placed on the floor calendar and in what order. In practical terms, Rules serves as another gatekeeper, deciding which proposals are positioned for debate and which may quietly stall without ever receiving a vote. While the fundamental role of the Rules Committees is similar in both chambers, the mechanics differ. In the House, Rules meetings are not publicly announced, and deliberations occur behind closed doors. In contrast, the Senate’s Rules process is open to the public, offering greater transparency into how decisions are made about floor scheduling.

A key factor in whether and when a bill is pulled to the floor is the anticipated level of controversy and the amount of debate time it will require. During the early days of floor action, leadership in both chambers typically prioritize measures that are broadly supported or relatively straightforward, allowing them to move efficiently through the process. More contentious or complex bills, particularly those expected to generate lengthy debate or many amendments, are often held until later in the floor calendar, frequently surfacing during extended evening sessions as deadlines draw near.

Following a record-breaking public hearing last Friday, the Senate Ways & Means Committee advanced the Millionaire’s Tax, SB 6346 (Pedersen, D-43), on Monday, February 9. The public hearing drew unprecedented engagement, with nearly 81,000 individuals signing in and more than 200 people providing testimony. On Monday, the committee adopted Senator Pedersen’s substitute bill and passed the measure without adopting any of the 11 amendments offered by Republican members. The effect of the substitute is:

• Increases the distribution amount for public defense services from 5% to 7%;
• Allocates 10% of the revenues for public defense services to cities and provides an alternate distribution mechanism for counties;
• Increases the charitable deduction from $50,000 to $100,000;
• Specifies that income excluded from federal AGI, including tribal treaty income, is also exempt from the state tax calculation unless a specific provision in state law requires otherwise;
• Authorizes a deduction for contributions to a capital construction fund by commercial fisherman and vessel operators where the amounts reduced federal taxable income;
• Increases the small business B&O tax credit to exempt approximately the first $300,000 of business income with a complete phaseout at $600,000;
• Specifies that DOR will continue with implementation efforts regardless of litigation; and
• Expands the intent section.

Anticipate majority Democrats to schedule floor action on the Millionaire’s Tax for Monday, February 16, as it will undoubtedly accrue a number of floor amendments and debate will be robust as Senate Republicans attempt to kill or slow down the bill. Monday, February 16 will play another key role in the state’s budget process, as the Economic and Revenue Forecast Council convenes to adopt the official revenue forecast. Budget writers in both chambers rely on this forecast as they refine spending plans, make adjustments to account for economic trends, and ensure proposed spending aligns with projected revenues. Operating budgets are expected to be released and heard during the week of February 22, with the Transportation and Capital budgets typically following shortly thereafter.

Important Dates:

• February 17 – Floor Cutoff
• February 25 – Policy Committee Cutoff (Opposite House)
• March 2 – Fiscal Committee Cutoff (Opposite House)
• March 6 – Floor Cutoff (Opposite House)
• March 12 – Sine Die

Upcoming Events:

Business, Trade & Economic Development (Senate) – SHR 2 and Virtual J.A. Cherberg – 2/18 @ 8:00am

• SHB 2334 – Public Hearing – Adjusting the price of a cash transaction to eliminate the need for pennies. (Remote Testimony Available). (If measure is referred to committee.)

Environment, Energy & Technology (Senate) – SHR 1 and Virtual J.A. Cherberg – 2/18 @ 8:00am

• E2SHB 2215 – Public Hearing – Concerning climate commitment act compliance obligations for fuels supplied or otherwise sold into Washington. (Remote Testimony Available). (If measure is referred to committee.)
• EHB 2575 – Public Hearing – Reducing certain reporting obligations under environmental or energy laws. (Remote Testimony Available). (If measure is referred to committee.)

Technology, Economic Development, & Veterans (House) – HHR C and Virtual JLOB – 2/18 @ 8:00am

• ESB 5649 – Public Hearing – Creating a Washington state supply chain competitiveness infrastructure program. (Remote Testimony Available).

Environment & Energy (House) – HHR B and Virtual JLOB – 2/18 @ 10:30am

• ESB 6246 – Public Hearing – Concerning emissions from emissions-intensive, trade-exposed facilities under the climate commitment act. (Remote Testimony Available).

Housing (Senate) – SHR 4 and Virtual JACB – 2/18 @ 10:30am

• ESHB 1500 – Exec Session – Concerning resale certificates for units in common interest communities.
• EHB 1501 – Exec Session – Concerning inquiries into association governance or operations by unit owners in common interest communities.
• EHB 1687 – Public Hearing – Concerning social housing public development authorities. (Remote Testimony Available).
• 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).
• SHB 2452 – Public Hearing – Modifying requirements for service of rent increase notices. (Remote Testimony Available).
• E2SHB 1974 – Exec Session – Establishing land banking authorities. (If measure is referred to committee.)
• SHB 2228 – Exec Session – Concerning scissor stair regulations in the state building code.

Consumer Protection & Business (House) – HHR B and Virtual JLOB – 2/18 @ 1:30pm

• SSB 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).

Transportation (House) – HHR B and Virtual JLOB – 2/18 @ 4:00pm

• ESB 5705 – Public Hearing – Improving traffic safety by modifying penalty amounts for certain traffic infractions. (Remote Testimony Available).

Housing (House) – HHR C and Virtual JLOB – 2/19 @ 8:30am

• SSB 6054 – Public Hearing – Concerning unreasonable restrictions on wildfire home hardening practices in common interest communities. (Remote Testimony Available).

Transportation (House) – HHR B and Virtual JLOB – 2/19 @ 4:00pm

• 2SSB 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).

Ways & Means (Senate) – SHR 4 and Virtual JACB – 2/19 @ 4:00pm

• SB 6351 – Public Hearing – Increasing fiscal resources for students and children by providing targeted sales tax exemptions for schools and certain before-and-after school care programs and arts and cultural classes. (Remote Testimony Available).
• ESHB 1717 – Public Hearing – Creating a sales and use tax remittance program for affordable housing. (Remote Testimony Available).
• SB 6228 – Exec Session – Removing a tax exemption for the warehousing and reselling of prescription drugs.
• SB 6231 – Exec Session – Removing a tax exemption for the replacement of equipment for data centers.
• SB 6229 – Exec Session – Concerning taxation of a long-term capital gain of a section 1202 small business stock.
• SB 6173 – Exec Session – Creating an apple health employer assessment.

Labor & Commerce (Senate) – SHR 1 and Virtual J.A. Cherberg – 2/20 @ 8:00am

• HB 2264 – Public Hearing – Concerning unemployment insurance benefits for workers separated from employment as a result of employer-initiated layoffs or workforce reductions. (Remote Testimony Available).
• 2SHB 2345 – Public Hearing – Concerning contributions in the state paid family and medical leave program. (Remote Testimony Available). (If measure is referred to committee.)

Housing (Senate) – SHR 4 and Virtual JACB – 2/20 @ 10:30am

• 2SHB 1859 – Public Hearing – Expanding opportunities for affordable housing developments on properties owned by religious organizations. (Remote Testimony Available).

Labor & Workplace Standards (House) – HHR D and Virtual JLOB – 2/20 @ 10:30am

• ESB 6058 – Public Hearing – Adding discretion to wage enforcement actions. (Remote Testimony Available).

Technology, Economic Development, & Veterans (House) – HHR C and Virtual JLOB – 2/20 @ 10:30am

• ESSB 5984 – Public Hearing – Regulating artificial intelligence companion chatbots. (Remote Testimony Available).

Finance (House) – HHR A and Virtual JLOB – 2/20 @ 1:30pm

• HB 2736 – Public Hearing – Reinstating estate tax rates that applied immediately before May 20, 2025, for estates of decedents dying on or after July 1, 2026. (Remote Testimony Available).

Bill Status Report: