State revenue limit

AN ACT Relating to establishing a state revenue limit and 1
directing excess revenues be deposited in the budget stabilization 2
account; amending RCW 43.135.025 and 43.79.495; and adding a new 3
section to chapter 43.135 RCW. 4
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:5
Sec. 1. RCW 43.135.025 and 2020 c 218 s 3 are each amended to 6
read as follows: 7
(1) ((Each November, the economic and revenue forecast council 8
shall calculate the fiscal growth factor for each fiscal year of the 9
current biennium and the ensuing biennium.10
(2))) The state revenue limit for any fiscal year is the previous 11
fiscal year's state revenue limit increased by a percentage rate that 12
equals the fiscal growth factor.13
(2) For purposes of computing the state revenue limit for the 14
fiscal year beginning July 1, 2026, the phrase "the previous fiscal 15
year's state revenue limit" means the total state revenues deposited 16
into the state general fund and related funds, not including federal 17
funds, for the fiscal year beginning July 1, 2025, plus the fiscal 18
growth factor.19
(3) A state revenue limit committee is established for the 20
purpose of determining and adjusting the state revenue limit as 21
H-1982.1
HOUSE BILL 2055
State of Washington 69th Legislature 2025 Regular Session
By Representatives Couture, Barnard, and Stuebe
Read first time 03/25/25. Referred to Committee on Appropriations.
p. 1 HB 2055
provided in this chapter. The members of the state revenue limit 1
committee are the director of financial management, the state 2
treasurer or treasurer's designee, and the chairs and ranking 3
minority members of the senate committee on ways and means and the 4
house of representatives committee on finance, or their successor 5
committees. All actions of the state revenue limit committee taken 6
pursuant to this chapter require an affirmative vote of at least four 7
members. 8
(4) Each November, the state revenue limit committee shall adjust 9
the revenue limit for the preceding fiscal year based on actual 10
revenue collections and known changes in the fiscal growth factor and 11
then project a revenue limit for the next two fiscal years. If, by 12
November 30th, the state revenue limit committee has not adopted the 13
revenue limit adjustment and projected revenue limit as provided in 14
subsection (3) of this section, the state treasurer shall adjust or 15
project the revenue limit, as necessary.16
(5) The definitions in this subsection apply throughout this 17
chapter unless the context clearly requires otherwise.18
(a) "Fiscal growth factor" means ((the average growth in state 19
personal income for the prior ten fiscal years )) the average of the 20
sum of inflation and population change for each of the prior three 21
fiscal years. 22
(b) (("General fund" means the state general fund. )) "Inflation" 23
means the percentage change in the consumer price index for all urban 24
consumers for the Seattle-Tacoma-Bellevue area, or successor index, 25
for each fiscal year as published by the federal bureau of labor 26
statistics.27
(c) "Population change" means the percentage change in state 28
population for each fiscal year as reported by the office of 29
financial management.30
(d) "Related funds" means the Washington opportunity pathways 31
account, the workforce education investment account, the fair start 32
for kids account, and the education legacy trust account.33
NEW SECTION. Sec. 2. A new section is added to chapter 43.135 34
RCW to read as follows: 35
If the cost of any state program or function is shifted from the 36
state general fund or related funds on or after January 1, 2025, to 37
another source of funding, or if moneys are transferred from the 38
state general fund or related funds to another fund or account, the 39
p. 2 HB 2055
state revenue limit committee, acting pursuant to RCW 43.135.025, 1
shall lower the state revenue limit to reflect the shift. For the 2
purposes of this section, a transfer of money from the state general 3
fund or related funds to another fund or account includes any state 4
legislative action taken after July 1, 2025, that has the effect of 5
reducing revenues from a particular source, where such revenues would 6
otherwise be deposited into the state general fund or related funds, 7
while increasing the revenues from that particular source to another 8
state or local government account. 9
Sec. 3. RCW 43.79.495 and 2012 c 187 s 6 are each amended to 10
read as follows: 11
(1) The budget stabilization account is governed by the 12
provisions in Article VII, section 12 of the state Constitution and 13
this section. 14
(2) By June 30th of each fiscal year, the state treasurer shall 15
transfer an amount equal to one percent of the general state revenues 16
for that fiscal year to the budget stabilization account.17
(3) By June 30th of each fiscal year, the state treasurer must 18
compare revenue collections for that fiscal year for funds subject to 19
the state revenue limit contained in RCW 43.135.025. If revenue 20
collections exceed the state revenue limit for that year, the state 21
treasurer must, by June 30th of that year, transfer from the state 22
general fund to the budget stabilization account the amount by which 23
actual collections exceeded the revenue limit in that year. The 24
amount to be transferred must be reduced by any amounts being 25
transferred from the state general fund to the budget stabilization 26
account for that year under the extraordinary revenue provisions 27
contained in Article VII, section 12 of the state Constitution.28
(4) For the purposes of Article VII, section 12 of the state 29
Constitution, this section, and RCW 82.33.050, the state employment 30
growth forecast shall be based on the total nonfarm payroll 31
employment data series. 32
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