‘Why did they need to open up that account?’: Curley, I-645 sponsor question why WA income tax strips pension protections

Washington’s new income tax didn’t just create a 9.9% bracket for millionaires. According to the man leading the campaign to repeal it, lawmakers quietly reached into 11 separate sections of state law and stripped pension protections that have shielded public employees since 1947.

While speaking with Brian Heywood, founder of Let’s Go Washington and sponsor of Initiative 645, on “The John Curley Show” on KIRO Newsradio, Curley said this buried provision in Senate Bill 6346 raises a big question.

“I don’t make a million dollars, so they’re not coming after me, so I don’t have to worry that all of a sudden they have now exposed my pension,” Curley said, putting himself in the shoes of a union member. “And then as they start to say this stuff out loud, they go, ‘Well, wait a minute, hold up, why did they bother exposing my pension? Why did they need to all of a sudden open up that account?'”

What changed in the law

Prior to SB 6346, Washington law explicitly declared that pension income, disability allowances, death benefits, and accumulated contributions for public employees were exempt from any state, county, or municipal tax. Those benefits were also shielded from execution, garnishment, and attachment. Heywood said lawmakers amended 11 statutes governing nearly every public retirement system in the state to remove those protections.

The Washington Policy Center flagged the pension amendments in February while the bill was still moving through the legislature. Republicans proposed an amendment during the House floor debate on March 9 that would have excluded public pension income from the new tax. Democrats rejected it on a 52-44 vote, according to an amendment tracker maintained by Let’s Go Washington.

Two ‘nasty’ provisions, not one

Heywood told Curley there are actually two separate threats baked into the law.

“Indisputably, unquestionably, what the legislature and the unions supported was a change in Washington state law that makes all retirement money subject to an income tax,” Heywood said.

Heywood believes the second provision is potentially more damaging. He said the law also removed the longstanding prohibition against garnishing or seizing retirement assets to satisfy a state tax lien. Previously, Washington law forbade the state from going after pension money to collect unpaid taxes.

“If they change the numbers so now $50,000 qualifies you for the income tax, and you miss a $1,000 payment, they can actually come in and seize your retirement assets to pay that tax lien,” Heywood said.

The union question

Curley pressed Heywood on what he called the paradox at the center of the story: the very unions whose members stand to lose their pension protections are funding the campaign to keep the tax in place.

Heywood noted $5.1 million had been raised for the No on I-645 campaign, with 96% of it coming from public employee unions.

“The sock puppets in Olympia don’t do things without their union puppet masters giving them the okay,” Heywood said. “I really don’t think that the union bosses talked to their union members when they did this.”

Curley asked why union leaders would expose their own members.

“The union doesn’t care if that money gets taken out of their members’ dues, because the union will get it back somehow,” Heywood responded.

‘You can’t cut a pie if you don’t have the pie’

The conversation turned to the opposition’s primary argument, that repealing the income tax would force devastating cuts to school funding and social services.

“You can’t cut a pie if you don’t have the pie,” Curley retorted. “There’s no cutting involved. They don’t have the thing to begin with.”

Heywood pointed out income tax collections are not scheduled to start until 2029, meaning there is no existing revenue to cut. He also cited the state constitution and the McCleary decision, which he said legally prohibits the legislature from underfunding schools.

“If they say they’re going to cut funding for schools, they’re going against the very constitution,” Heywood said.

The harder messaging battle

Curley acknowledged that the pro-repeal side faces a harder messaging battle.

Opponents of I-645 need voters to make only one mental step — millionaires should pay their fair share, and if they don’t, kids will suffer. Supporters of I-645 need voters to go a few steps further, claiming the tax threshold will drop, protections were removed for a reason, and Olympia’s spending habits make expansion inevitable.

“When people understand, even just getting people to ask the question, ‘Hey, I wonder if that income tax is going to come for me,’ it changes people’s minds,” Heywood responded.

Curley revisited the list of retirement systems now exposed under the amended law, from public employees, teachers, judges, firefighters, to the Washington State Patrol.

“The big story, of course, is it was protected. Now it is not protected,” Curley said. “If you’re a public union member, the state can come after your pension money.”

Watch the full discussion in the video above.

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