‘Not something I take lightly’: WA Democrats tap rainy day fund, proposed ‘millionaire tax’ to close budget gap

Despite a looming budget deficit, Washington Democrats unveiled their proposed supplemental budget in Olympia.

The budget includes dipping into the state’s rainy day fund.

Democratic Senator June Robinson detailed that her draft balances $2.5 billion in additional spending with $750 million from the fund and more from the proposed “millionaire tax.”

“None of these decisions are easy, and using money from the rainy day fund is not something I take lightly, but had to balance a lot of other costs,” Robinson said.

Senator Derek Stanford said a combination of unreliable federal funding, the Trump administration’s tariff policies, and a lack of steady state tax revenue is forcing Democrats’ hands to spend $2.5 billion more, just to maintain services.

“Our state has always had a bit of sensitivity to sort of boom and bust cycles because of our revenue structure. The millionaire’s tax would be a significant step towards smoothing that out,” Stanford said.

During the budget meeting, Robinson emphasized the constraints lawmakers face.

“We need to find a way to balance our budget and provide the services that we’re best able to provide with the limited resources we have,” she said.

Washington Republicans argued the proposed budget is irresponsible.

Democrats rely on ‘millionaire tax’ to fill WA budget gap

The “millionaire tax” would impose a 9.9% tax on Washington residents with more than $1 million in annual income. It is projected to add $3 billion annually to the budget, starting in 2029.

When the “millionaire tax” cleared the Senate Ways and Means Committee, Republicans argued that it does nothing to make Washington more affordable.

“Other than if you want to go to bed at night and say, ‘Hey, that millionaire, he’s going to pay more, but I don’t have money to buy food tomorrow,’” Republican Senator Perry Dozier said.

The tax passed the Senate last week, with critics saying the bill opens the door for a tax on the middle class.

“If this bill passes today, future legislatures can easily come back and change the threshold from $1 million down to $500,000 to $250,000; they can apply it to anyone that they want to,” Republican Senator Chris Gildon said before the bill passed the Senate.

Democratic Senator Lisa Wellman said lawmakers are just looking to close the wealth gap.

“This is not about penalizing wealthy people, wealthy Washingtonians. It is simply asking for proportionality in our tax structure at a time when the gap between rich and poor has never been greater,” she said prior to the tax passing in the Senate.

Lawmakers have until March 12 to vote on a budget.

Contributing: Luke Duecy, Aaron Granillo and Frank Lenzi, KIRO Newsradio; Julia Dallas, MyNorthwest