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WashingtonHB 24422025-2026 Regular SessionHouseWALLET

Providing local governments tax resources and fund flexibility.

Sponsored By: April Berg (Democratic)

Signed by Governor

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Bill Overview

Analyzed Economic Effects

13 provisions identified: 5 benefits, 1 costs, 7 mixed.

Flood zones can fund recovery help

Flood control zones can fund county-run recovery help for households and businesses damaged by floods within the zone. The governor must issue an emergency proclamation covering the flood. Zones can spend the money or transfer it to the county for this assistance. They can also grant money to local governments and other political subdivisions within their boundaries for legally authorized flood-control purposes. The law sets no grant amount and does not guarantee a payment to every affected household.

New fire districts require local input

Beginning July 1, 2026, cities forming fire districts must consult relevant labor groups about funding, governance, services, and employment. Cities within public hospital districts must also consult them about effects on their property tax levies. Fire districts can contract with their forming cities for administrative, technology, finance, and human resources services. Districts created after July 1, 2026, must provide for independently elected boards within two years. The elected-board rule excludes cities with more than 500,000 people.

Rental-car taxes can fund criminal justice

Counties can use existing 1% retail rental-car tax proceeds for criminal justice, alongside previously allowed stadium and sports purposes. The money cannot subsidize a professional sports team. In counties with at least 1,000,000 residents, at least 75% must retire specified stadium debt until fully paid. This change adds a permitted spending use without changing the tax rate.

Cities gain flexibility with property-sale taxes

Beginning July 1, 2026, cities and counties gain more uses for the specified additional real estate excise tax revenue. They can use it for purposes allowed under the broader local real estate excise tax law. They can also use it to address nuisance properties. Capital-project requirements and applicable planning rules still apply. Local spending choices determine which projects residents receive.

More local funding options for affordable housing

Beginning July 1, 2026, the housing tax’s required allocation of at least 60% can fund repairs and housing operations or upkeep. Income and priority-group rules still apply, including the 60% county median income limit for covered housing and programs. Remaining revenue can fund housing upkeep, housing services, rental help, and behavioral health treatment. A separate local housing sales tax can also support operations and upkeep of existing and new affordable or supportive housing. Cities, counties, and public housing authorities can pool the first tax’s receipts through interlocal agreements and pledge them to bonds.

Voters can approve longer property tax increases

Voters can authorize annual regular property tax increases for up to 10 consecutive years, up from six. Approval requires a majority of votes on the measure at a primary or general election. The ballot must state the first-year rate, later growth factor or index, and limited purposes. Longer approvals can extend how long affected property owners pay the increases.

City taxes change with fire districts

For fire districts formed before July 1, 2026, cities must reduce general-fund levies when specified district taxes start. Financing plans must carry the reduced lawful city levy into future limit calculations, with further reductions for later district levies. For districts formed on or after July 1, 2026, participating city levy-rate ceilings must subtract specified district levy rates. That newer rule excludes cities with more than 500,000 people as of 2025. Cities can also restore levy capacity lost during district formation, allowing higher future taxes within applicable limits.

Counties can tax property for clinics

Counties can levy up to $0.05 per $1,000 of assessed property value each year for public health clinics. The money can pay only for clinic operations, upkeep, and capital expenses. Counties can collect it separately or within their regular levy, outside the $5.90 combined local levy cap. The levy is also exempt from the annual levy-growth limit in its first year. Property owners pay more where counties adopt it, while the money supports clinic services.

Fire funding gains property tax protection

Beginning July 1, 2026, fire districts and regional fire authorities can protect specified levies from required tax-cap reductions. They can place up to $0.25 per $1,000 of assessed value outside the $5.90 combined local levy cap. This authority applies only when those specified fire taxes otherwise face reductions. It preserves fire-service funding, but property owners may pay more when the authority is used.

Inflation limits growth in county levies

Starting with taxes collected in 2027, specified county levies use a growth factor capped at the lesser of 101% or 100% plus inflation. This covers veterans’ assistance, developmental disability and mental health services, and public health clinics. Inflation uses the federal personal consumption price index’s implicit price deflator, measured as of September 25 before the tax year. Counties with fewer than 10,000 people use a 101% factor instead. These limits restrain levy growth but also limit revenue growth for the services.

Local sales taxes can support families

Beginning January 1, 2027, cities and counties can adopt a sales and use tax of up to 0.01%. Revenue must fund additional services for children and families, including child care, perinatal support, and before- or after-school health programs. It can also fund workforce capacity, shelter, rental help, and client transportation. Counties must credit any city tax as needed to keep the combined rate at or below 0.01%. Taxable purchases cost more where the tax is adopted, while the revenue supports family services.

Property taxes fund disability and mental healthcare

Counties must levy $0.025 per $1,000 of assessed property value annually for developmental disability or mental health community services. Beginning July 1, 2026, the specified county levy cannot exceed that rate. Counties can collect it separately or within their regular levy. It does not count toward the $5.90 combined local levy cap. Property owners pay the tax, while residents using these services benefit from the funding.

Property taxes support help for veterans

Beginning July 1, 2026, counties must levy $0.01125–$0.27 per $1,000 of assessed property value for veterans’ assistance. Counties can collect it separately or within their regular levy, outside the $5.90 combined local levy cap. Money is limited to veterans’ assistance, specified burial costs, and fund administration. A lower levy is allowed when the September reserve test is met. On the first Tuesday in September, the balance minus outstanding warrants must exceed the expected yield at $0.01125 per $1,000.

Sponsors & Cosponsors

Sponsor

  • April Berg

    Democratic • House

Cosponsors

  • Alex Ramel

    Democratic • House

  • Cindy Ryu

    Democratic • House

  • Davina Duerr

    Democratic • House

  • Gerry Pollet

    Democratic • House

  • Janice Zahn

    Democratic • House

  • Lisa Parshley

    Democratic • House

  • Nicole Macri

    Democratic • House

  • Sharon Wylie

    Democratic • House

  • Shaun Scott

    Democratic • House

  • Steve Bergquist

    Democratic • House

  • Steve Tharinger

    Democratic • House

  • Strom Peterson

    Democratic • House

  • Tarra Simmons

    Democratic • House

  • Timm Ormsby

    Democratic • House

Roll Call Votes

All Roll Calls

Yes: 130 • No: 111

House vote • 3/11/2026

Final Passage as Amended by the Senate

Yes: 51 • No: 45 • Other: 2

Senate vote • 3/5/2026

3rd Reading & Final Passage as Amended by the Senate

Yes: 26 • No: 22 • Other: 1

House vote • 2/17/2026

3rd Reading & Final Passage

Yes: 53 • No: 44 • Other: 1

Actions Timeline

  1. Effective date 7/1/2026*.

    3/25/2026House

  2. Chapter 221, 2026 Laws.

    3/25/2026House

  3. Governor signed.

    3/25/2026legislature

  4. Speaker signed.

    3/12/2026legislature

  5. President signed.

    3/12/2026legislature

  6. Delivered to Governor.

    3/12/2026legislature

  7. Passed final passage; yeas, 51; nays, 45; absent, 0; excused, 2.

    3/11/2026House

  8. House concurred in Senate amendments.

    3/11/2026House

  9. Third reading, passed; yeas, 26; nays, 22; absent, 0; excused, 1.

    3/5/2026House

  10. Rules suspended. Placed on Third Reading.

    3/5/2026House

  11. Committee amendment(s) adopted as amended.

    3/5/2026House

  12. Placed on second reading by Rules Committee.

    3/3/2026House

  13. Passed to Rules Committee for second reading.

    3/2/2026House

  14. Minority; without recommendation.

    3/2/2026House

  15. Minority; do not pass.

    3/2/2026House

  16. WM - Majority; do pass with amendment(s).

    3/2/2026House

  17. First reading, referred to Ways & Means.

    2/19/2026House

  18. Third reading, passed; yeas, 53; nays, 44; absent, 0; excused, 1.

    2/17/2026House

  19. Rules suspended. Placed on Third Reading.

    2/17/2026House

  20. Floor amendment(s) adopted.

    2/17/2026House

  21. 1st substitute bill substituted.

    2/17/2026House

  22. Rules Committee relieved of further consideration. Placed on second reading.

    2/12/2026House

  23. Referred to Rules 2 Review.

    2/9/2026House

  24. Minority; do not pass.

    2/7/2026House

  25. Minority; without recommendation.

    2/7/2026House

Bill Text

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