After the 2026 legislative session's passage of HB 2442, Washington cities and counties gained several new taxing and spending options. The law gives local governments greater flexibility in how they raise and use revenue for housing, public health, public safety, family services, and other community needs. Most provisions took effect on July 1, 2026, though some changes take effect on January 1, 2027.

One notable change is the introduction of a new sales tax for child and family services. Beginning January 1, 2027, cities and counties may impose a sales tax of up to 0.01 percent without voter approval. Revenue may fund childcare, before- and after-school programs, rental and shelter assistance, transportation, and other services that support children and families. If both a city and a county adopt the tax, the combined rate cannot exceed 0.01 percent.

HB 2442 also gives local governments greater flexibility in using existing revenue. Cities and counties may now use certain Real Estate Excise Tax (REET) funds to address nuisance properties. Revenue from the existing housing and related services sales tax may also be used to rehabilitate affordable housing and to provide rental assistance to certain low-income populations, including veterans, seniors, people with disabilities, and people experiencing or at risk of homelessness.

Counties also received broader options for other revenue sources. County rental car sales tax revenue, previously limited largely to sports-related purposes, may now fund criminal justice programs. These programs can include public defenders, diversion programs, reentry services, behavioral health programs, efforts to reduce homelessness, and crisis response. Flood control zone districts may also provide financial assistance to households and businesses damaged by flooding when the governor declares an emergency.

The law also creates a new option for counties to levy a public health clinic property tax of up to five cents per $1,000 of assessed value. Counties must use the revenue for public health clinics and related services. HB 2442 also allows county veterans' assistance and mental health and developmental disability levies to be collected separately from the county's regular property tax levy and to be excluded from the state's $5.90 aggregate levy rate limit.

For businesses and taxpayers, the key point is that HB 2442 does not automatically impose all of these taxes. Instead, it gives local elected officials additional options to raise revenue or redirect existing funds. As cities and counties consider using these new authorities, businesses may want to closely monitor local budget discussions, particularly decisions on sales and property taxes, housing, public health, and criminal justice spending.

HB 2442 significantly expands financial flexibility for local governments in Washington. Supporters may view these tools as a way to address growing service needs and budget pressures, while businesses and taxpayers may focus on how the new authority affects overall tax burdens and local spending priorities. The impact will ultimately depend on which options individual cities and counties adopt.

Read the original MRSC article: Local Governments See Updates to Sales Taxes and Other Revenues After 2026 Legislative Session.

Part 2: Is WEIA Funding Being Used as Intended?
In Part 1 of this series, we explained that WEIA was established to support education, training, and career pathways. The goal was to help more Washington residents gain the skills needed for good jobs and to help employers find qualified workers.

The concern is that WEIA may not always be used as intended. This doesn't mean the money has been spent illegally. A more accurate concern is that some WEIA funds might replace existing higher education funding rather than add new investment in workforce education.

This is the difference between “supplementing” and “supplanting.” Supplementing means adding new money on top of what the state already spends. Supplanting means replacing one funding source with another. WEIA was generally intended to supplement higher education funding, not merely to backfill the regular state budget.

This issue became more apparent in the 2025-2027 state operating budget. That budget allowed WEIA funds to replace other higher education funding during that period. Even if that is legal under the budget language, it raises an important policy question: is WEIA expanding workforce education, or is it helping balance the broader state budget?

One significant example involved the University of Washington. According to the Workforce Education Investment Accountability and Oversight Board, the 2025-2027 budget reallocated $400 million from General Fund-State support to WEIA for UW's general operations. The Board called this a concerning precedent because it moved WEIA further toward general higher education support rather than targeted workforce investment.

At the same time, not all WEIA spending is questionable. The account still funds programs that fulfill its purpose, including the Washington College Grant, high-demand degree programs, Guided Pathways, student basic needs, College in the High School, and other student supports. These initiatives can help students earn credentials and transition into the workforce.

The concern isn’t whether WEIA supports education; it does. The real question is whether it’s funding new workforce investment or simply covering more of the usual higher-education budget.

Part 2 explains why the use of WEIA has become a significant policy issue. Part 3 will clarify why accountability is important and what businesses need to monitor.
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Coming next in Part 3: We will focus on results, transparency, and ways WEIA can better serve employers, students, and communities such as the Tri-Cities.

Washington State Legislature, RCW 43.79.195, Workforce Education Investment Account
https://app.leg.wa.gov/RCW/default.aspx?cite=43.79.195
Washington State Legislature, RCW 82.04.299, Workforce Education Investment Surcharge
https://app.leg.wa.gov/rcw/default.aspx?cite=82.04.299
Washington State Department of Revenue, Workforce Education and Select Advanced Computing Businesses
https://dor.wa.gov/taxes-rates/business-occupation-tax/workforce-education/select-advanced-computing-businesses
Washington Student Achievement Council, Washington College Grant and Workforce Education Investment Act Information
https://wsac.wa.gov/wcg
Workforce Education Investment Accountability and Oversight Board, 2025 Legislative Report
https://wsac.wa.gov/sites/default/files/2025-WEIAOB.Legislative.Report.pdf
Washington State Legislature, 2025 House Bill Report on ESHB 2081
https://lawfilesext.leg.wa.gov/biennium/2025-26/Htm/Bill%20Reports/House/2081-S.E%20HBR%20PL%2025.htm

This article was written with contributions from AI to organize the information and improve its readability.​

The Workforce Education Investment Account, often called WEIA, plays a vital role in Washington’s education and workforce funding system. It was established to help more people access higher education, job training, financial aid, and career-connected learning.

This topic is complex because it involves state budgets, business taxes, higher education funding, and questions about how the money is being used. To make it easier to understand, this three-part series breaks the issue into smaller parts.

Part 1 explains what WEIA is and why it matters to businesses. Part 2 examines concerns about whether WEIA is being used as originally intended. Part 3 emphasizes accountability and explains why results matter for employers, students, and communities like the Tri-Cities.

​Washington employers face a long-term challenge: finding enough trained workers to fill available jobs. The Workforce Education Investment Account, or WEIA, was created to help address this issue by supporting higher education, financial aid, apprenticeships, and workforce training.

WEIA is a dedicated state account for education and training beyond high school. The funds can support colleges, universities, student aid, workforce programs, and career-connected learning. In simple terms, the account is designed to help more people earn degrees, certificates, apprenticeships, and other credentials that lead to good jobs.

This matters to businesses because workforce shortages hinder growth. When employers struggle to find qualified workers, it becomes more difficult to expand, serve customers, complete projects, or stay competitive. A stronger education and training system can help build a larger talent pipeline for industries like health care, construction, manufacturing, clean energy, agriculture, technology, and professional services.

In the Tri-Cities, this issue is especially critical. Local employers need skilled workers in energy, agriculture, health care, construction, advanced manufacturing, research, transportation, and public infrastructure. State workforce investments should help connect students and workers to these real job opportunities.

WEIA is partially funded through Washington’s business tax system. One key funding source is a surcharge on certain large advanced computing companies. This does not affect most small or midsized local businesses, but it still matters because it demonstrates how the state uses business-related tax policies to support workforce education.

The main question is whether WEIA is providing new value. If the account offers more training options, stronger student support, and better links between education and employers, it can help fill workforce shortages. If it simply replaces other state funding, its value becomes less certain.

WEIA should be judged by results. For businesses, the goal is clear: more trained workers, more completed credentials, and stronger pathways into family-wage jobs.
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Next in Part 2: We will explore concerns that WEIA might be replacing existing higher education funding rather than adding new workforce investment.

Washington State Legislature, RCW 43.79.195, Workforce Education Investment Account
https://app.leg.wa.gov/RCW/default.aspx?cite=43.79.195
Washington State Legislature, RCW 82.04.299, Workforce Education Investment Surcharge
https://app.leg.wa.gov/rcw/default.aspx?cite=82.04.299
Washington State Department of Revenue, Workforce Education and Select Advanced Computing Businesses
https://dor.wa.gov/taxes-rates/business-occupation-tax/workforce-education/select-advanced-computing-businesses
Washington Student Achievement Council, Washington College Grant and Workforce Education Investment Act Information
https://wsac.wa.gov/wcg
Workforce Education Investment Accountability and Oversight Board, 2025 Legislative Report
https://wsac.wa.gov/sites/default/files/2025-WEIAOB.Legislative.Report.pdf
Washington State Legislature, 2025 House Bill Report on ESHB 2081
https://lawfilesext.leg.wa.gov/biennium/2025-26/Htm/Bill%20Reports/House/2081-S.E%20HBR%20PL%2025.htm
​This article was written with contributions from AI to organize the information and improve its readability.

Washington communities are being asked to weigh in on new state guidance that could shape how cities plan housing, businesses, transportation, and other development near major transit stations. The Washington State Department of Commerce has released a draft Transit-Oriented Development Guidebook and is accepting public comments through September 30, 2026.

Transit-oriented development, often called TOD, focuses on creating communities where housing, jobs, services, and businesses are located near major public transportation hubs. Under Washington law, certain cities must update their land use rules around light rail, commuter rail, and bus rapid transit stations. The new Commerce guidebook is intended to help those cities understand and implement these requirements.

The requirements currently apply to Spokane and Vancouver, as well as to certain cities in King, Pierce, and Snohomish counties that have qualifying rail or bus rapid transit stations. Counties are not required to establish station-area plans, though they may choose to participate. Federally recognized tribes may also choose to participate in a city's planning process.

The draft guidebook covers several aspects of the planning process. It explains how cities can define transit station areas, assess current development conditions, and update local development codes. It also provides guidance on permitting, impact fees, infrastructure funding, and methods for measuring the effectiveness of transit-oriented development policies. Other sections address community involvement, transportation choices, development design, and strategies to reduce displacement.

For businesses, developers, property owners, and employers, these policies are worth watching because changes to land-use and development rules can influence where housing and commercial development occur, which types of projects can be built, and how quickly projects move through local permitting systems. Transit-oriented development can also affect employees' access to jobs, transportation options, neighborhood growth, infrastructure needs, and future private investment.

Commerce will host a webinar on the draft guidebook at 1:30 p.m. on September 10, 2026. Public comments on the draft must be submitted by September 30. This webinar offers businesses, developers, local governments, community organizations, and other interested parties an opportunity to review the proposed guidance before it is finalized.

As Washington continues to address housing supply, transportation, and community growth, decisions about development near major transit corridors could have long-term effects on local economies. Even businesses outside the communities currently covered by the requirements may want to follow the process, since transit-oriented development policies could influence future conversations about growth and land use in other parts of the state.

Readers interested in the complete proposal, the draft guidebook, webinar details, or the public comment process can review the original Washington State Department of Commerce announcement at: Public Comment Opportunity: Draft Transit-Oriented Development Guidebook

Rules aim to protect workers, consumers, and the environment, but too many overlapping requirements can hinder business growth. A new study funded by the Association of Washington Business ranks Washington as the eighth-most regulated state, with over 200,000 state regulatory restrictions and roughly 1.3 million combined state and federal restrictions. The study shows that this overall burden leads to higher costs and more challenges, especially for small and mid-sized employers. (Tri-Cities Business News)

The study shows that over half of Washington’s regulatory requirements may be unnecessary or redundant paperwork. Compliance costs can divert funds and staff from hiring, training, equipment, expansion, and innovation. Businesses might also pass some of these costs to consumers through higher prices. These issues are especially important for Tri-Cities employers in agriculture, healthcare, manufacturing, and energy, which the study identifies as sectors under significant regulatory pressure.

This report does not oppose reasonable safeguards. Its goal is to promote better regulation that is clear, proportional, and accountable while still delivering public benefits. Its economic estimates are scenarios, not precise forecasts, but they raise important questions about whether Washington can simplify overlapping rules, improve permitting processes, and reduce compliance costs without weakening essential protections. Business and community leaders are encouraged to review the study and take part in future regulatory reform discussions.

Read the full article: “New Study: Washington Among Most Regulated States, With Measurable Economic Costs”
https://www.awb.org/new-study-washington-among-most-regulated-states-with-measurable-economic-costs/

Washington Saves is a new state retirement savings program for workers who lack access to a workplace retirement plan. The program is set to launch in 2027 and will require some Washington employers to help employees contribute to an individual retirement account via payroll deductions.

Employees aged 18 and older are usually enrolled automatically, but participation is voluntary. Workers can opt out, adjust their contribution rate, or rejoin later. Their retirement accounts stay with them when they change jobs.
The default contribution rate will be between 3 and 7 percent of wages. The rate might increase over time, but employees can adjust their contributions within federal IRA limits.

The program generally applies to businesses that have been operating in Washington for at least two years, maintain a physical presence in the state, and do not offer a qualified retirement plan. Employers must also have accumulated at least 10,400 total employee work hours in the previous year, which is roughly equivalent to five full-time employees.
Covered employers will register for the program, provide employee information, process payroll deductions, and send contributions to Washington Saves. Employers will not need to contribute their own money, pay a program fee, choose investments, or offer financial advice.

Washington Saves could assist small businesses in providing employees with a simple retirement savings option without establishing a traditional employer-sponsored plan. Nonetheless, employers might need to update payroll procedures and inform employees about program details.
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Businesses should start reviewing their existing retirement plans, payroll systems, and employee work hours. More rules and registration details will be announced before the program starts.

Data centers are quickly becoming a vital part of the modern economy, and communities across Washington are asking an important question: Are we ready for what’s coming? At a recent Tri-City Regional Chamber of Commerce roundtable, representatives from Pacific Northwest National Laboratory, labor, Microsoft, and Sabey Data Centers discussed the economic benefits of data centers, their rising electricity needs, and what this rapidly evolving industry could mean for Washington and the Tri-Cities.

Central Washington already shows potential benefits. Communities like Quincy have attracted billions in investments, expanded their tax base, increased construction activity, and created permanent jobs—many offering competitive wages that don’t require a four-year degree. Data center companies have also contributed to funding electrical infrastructure, schools, hospitals, public facilities, and community programs, including substations and transmission upgrades necessary for their projects.

For the Tri-Cities, data centers could offer a significant opportunity for economic growth. The region possesses many of the key assets these companies look for, including available land, an energy and construction workforce, research capabilities at Pacific Northwest National Laboratory, and a strong history as an energy and technology center.

The main challenge is energy. Modern data centers, especially those supporting AI, require large amounts of electricity, while Washington already faces increasing demand from housing, manufacturing, transportation, agriculture, and other sectors. Without sufficient reliable power generation and transmission, one major energy user could hinder the ability of other businesses to grow in the region.

Water, land use, infrastructure, and community impacts also need careful review. While newer cooling technologies can lower water use, each project varies, so communities should clearly understand a facility’s electricity and water needs, infrastructure costs, permanent jobs, and long-term local benefits.

For the Tri-Cities, the question isn't just whether data centers are good or bad, but what kind of development suits the region and under what conditions. Data centers can provide major investment, tax revenue, jobs, and technological opportunities, but only if growth aligns with reliable energy, proper infrastructure, responsible resource use, and clear community benefits.
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View the video recording of the panel discussion: Keeping the lights on - Tri-City Regional Chamber of Commerce

Washington’s small businesses send a clear warning: it’s becoming more difficult to hire, expand, and stay competitive. A new report from the National Federation of Independent Business shows Washington’s Small Business Optimism Index at 94.5, compared to 98.5 nationwide. Only 5.3 percent of Washington owners plan to increase employment, versus 15.4 percent across the country, indicating that many employers remain cautious about hiring or expanding.

Washington business owners are primarily concerned about labor costs, taxes, and government regulations. Labor costs ranked highest for 19.1 percent of respondents from Washington, more than double the national rate of 8.5 percent. These worries could cause businesses to delay hiring, raise prices, cut back on investments, or reconsider expansion plans.
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Although the survey does not connect the results to any specific policy, it suggests that lawmakers and community leaders should consider how new taxes and regulations affect small businesses. In the Tri-Cities, a robust small-business environment helps support jobs, local services, and regional growth. 

View the full report: “Washington Small Business Economic Trends: Winter 2026”
https://www.nfib.com/wp-content/uploads/2026/07/Washington-SBET-winter-2026.pdf​

This is Part 4 and the final article in the series on data centers in the Tri-Cities and Washington State. Part 1 explained what data centers are, Part 2 discussed their economic benefits, and Part 3 looked at the risks. This last article ties those ideas together by highlighting questions that local leaders, residents, and business groups should ask before backing major new projects.

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The first question is whether a project aligns with the region’s long-term economic goals. A data center should not be judged solely on the size of the investment or the building itself. Leaders should ask whether it enhances the Tri-Cities’ role in energy, science, and technology, and whether it helps attract related industries, workforce training, and infrastructure that benefit the broader region.


The second question is who will bear the costs for the necessary infrastructure. Data centers may require significant electric service, transmission upgrades, substations, water systems, roads, and fiber. Communities should ensure these costs are clearly allocated and not passed on to residents or local businesses. Even a strong project can lose public support if people feel they are being asked to subsidize it.


The third question is whether the project uses power and water responsibly. This includes reviewing cooling systems, water reuse, energy efficiency, load management, and electricity sources. The fourth question is whether the public benefit is clear and measurable. Leaders should ask about permanent jobs, construction jobs, tax revenue, and whether local workers and businesses will have a genuine opportunity to benefit.
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For the Tri-Cities, data centers can be a good fit if growth is carefully managed. The region has many of the right strengths, and AI will likely continue to boost demand. However, projects should be supported because they benefit the community, not just because the industry is expanding. The best approach is to welcome investment, ask tough questions, protect key resources, and ensure the region gains long-term benefits.

This is Part 3 of the series on data centers in the Tri-Cities and Washington State. Part 2 explained why many communities see data centers as an economic opportunity. This article concentrates on the risks. The final article will examine the policy and planning questions local leaders need to consider before approving more projects.


The main concern is electricity. Data centers consume a lot of power, and AI data centers use even more because they constantly run advanced chips. For the Tri-Cities and the Northwest, that means leaders can't see a data center as an economic boost. They also need to assess whether the grid can support it without overloading homes, businesses, and other users.


Water is another concern. Not all data centers use water in the same way, but some can place heavy demands on local supplies depending on their cooling systems. Projects can reduce pressure through better design and reuse systems, but water planning needs to be part of the project from the start.


A third concern is public cost and infrastructure strain. Large data centers may require upgrades to transmission lines, substations, roads, fiber optics, and utility systems. Without clear agreements, communities might worry that residents or existing businesses will bear too much of the cost. There is also the issue of land use. Data centers can occupy large sites and take up valuable industrial capacity while providing fewer permanent jobs than some people expect.
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The lesson isn't that data centers are harmful to the Tri-Cities. It's that they require careful planning. Strong projects can deliver real value, but weak agreements can impose too much burden on the community. In Part 4, this series will examine the practical questions local leaders should ask to see if a proposal truly benefits the region’s long-term public interest.