Governor Bob Ferguson has released his proposed 2026 Supplemental Budget, marking the start of budget negotiations as the Washington State Legislature prepares to convene for the 2026 session. The supplemental budget occurs at the midpoint of the two-year biennium and allows the state to make adjustments to ensure the budget remains balanced.
The Governor’s proposal includes approximately $800 million in spending reductions to address a projected shortfall driven by federal funding cuts and cost shifts, rising costs to maintain existing commitments, and a revenue system that does not provide sustainable long-term funding.
Two notable elements of the Governor’s approach address both immediate and long-term fiscal challenges:
- Balancing the budget over two years: Washington is the only state required by law to balance its budget over a four-year period, though this requirement may be waived under specific economic conditions. With those conditions met, the Governor proposes a budget that balances through June 30, 2027. This approach reduces pressure to resolve longer-term funding gaps immediately and helps avoid deeper cuts in the current supplemental budget.
- Planning for long-term revenue stability: To support sustainable funding beyond the current biennium, the Governor has endorsed a tax on individuals earning more than $1 million in annual income. Fewer than one-half of one percent of Washingtonians would be affected, and the proposal is projected to generate at least $3 billion in annual revenue.
For more detail on the Governor’s proposed budget, please see this analysis which highlights where the budget lands in areas of child welfare, early learning, juvenile rehabilitation, human services, and legal aid.
The Washington State Legislature will convene on January 12, 2026 for a 60-day session. Stay tuned for our weekly legislative updates which we will post each Friday during the session.