WAWG
By Diana Carlen
WAWG Lobbyist
Gov. Ferguson wrapped up bill action and signed the Operating Supplemental Budget, Transportation Supplemental Budget and the Capital Supplemental Budget into law the first week of April. All budgets were signed with partial vetoes.
The Operating Supplemental Budget (SB 5998) included the following notable vetoes:
- Clean Energy Permitting/Planning: This section appropriates money for grants to support siting and permitting of clean energy projects. This year’s budget added a section that mandated priority shall be given to awards in jurisdictions where transmission constraints or rapid load growth threaten reliability and achievement of clean energy goals. The governor vetoed this section because funding has already been awarded and cannot be distributed in this manner.
- Climate Resilience Workgroup: This section would have reduced funding to the Department of Ecology to lead the interagency Climate Resilience Coordinating Council. State law mandates convening of this council and eliminating the funds to do so puts federal funding at risk. This means the amount funded in 2025 is maintained.
Gov. Ferguson also signed the vast majority of legislation that was sent to his office this year.
“Millionaires Tax” signed into law
On March 30, 2026, Gov. Ferguson signed ESSB 6346 into law, establishing a 9.9% tax on annual income exceeding $1 million. The policy will take effect Jan. 1, 2028, with the first tax payments due in 2029. The bill is a notable departure from Washington’s historical position as one of the few states without a broad-based income tax. Under the new law, only income above the $1 million threshold is subject to taxation. About $3.5 billion is anticipated to be generated from an estimated 21,000 filers.
As expected, there will be litigation and ballot measures challenging the new tax. The Citizen Action Defense Fund has announced its plan to sue, challenging the constitutionality of the income tax. Rob McKenna, former state attorney general and 2012 Republican candidate for governor, has been retained to lead the litigation.
In addition, Brian Heywood, founder of the political committee Let’s Go Washington, filed a referendum to the Secretary of State to give voters a chance to repeal the law this fall. But, as expected, the secretary of state’s office declined to process it, citing the Legislature’s inclusion of language that the new tax “is necessary for the support of the state government and its existing public institutions.” Democratic lawmakers put this so-called “necessity clause” into the law to prevent a referendum.
On April 3, Let’s Go Washington filed an emergency petition to the Washington Supreme Court to direct the Secretary of State to process the referendum. If successful, Let’s Go Washington must submit signatures of 154,455 voters by June to qualify for the fall ballot. Even if Let’s Go Washington loses the referendum court case at the Washington Supreme Court, Let’s Go Washington has said an initiative to overturn the law will be pursued either this year or next.
Federal Supreme Court debates mail-in ballot rules
The U.S. Supreme Court heard arguments on March 16 in a case out of Mississippi that could require all ballots containing federal races to be physically received by Election Day, not just postmarked by it.
If the Supreme Court decides the ballots must be physically received by election day, this is a huge departure from Washington’s current rules. Ballots postmarked by Election Day are currently accepted if received days or even weeks afterward. However, this only impacts the federal races, not the state ones, thus complicating the process. The Supreme Court ruling is anticipated in late June or early July.