Community reinvestment prg.

AN ACT Relating to the community reinvestment program; amending 1
RCW 43.79.567; adding a new section to chapter 43.330 RCW; creating 2
new sections; and providing an expiration date. 3
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:4
NEW SECTION. Sec. 1. The legislature finds that in order to 5
address racial, economic, and social disparities in communities 6
across the state created by the historical design and enforcement of 7
state and federal criminal laws and penalties for drug possession and 8
use in Washington state, aggressive approaches and targeted resources 9
to support local design and control of community-based responses to 10
these outcomes are required.11
The legislature further finds that it initially appropriated 12
$1,000,000 for the development of a community reinvestment plan and 13
$200,000,000 for implementation of the plan in the 2023-2025 fiscal 14
biennium through the community reinvestment account in RCW 43.79.567. 15
The legislature subsequently appropriated an additional $60,000,000 16
and $50,000,000 for the 2025-2027 and 2027-2029 fiscal biennia. The 17
legislature finds that the initial phase of the program required use 18
of the department of commerce's existing programs and networks to 19
distribute money as quickly as possible. The department of commerce 20
and the office of equity published a preliminary report on December 21
H-2939.1
HOUSE BILL 2523
State of Washington 69th Legislature 2026 Regular Session
By Representatives Reeves, Hill, Davis, Gregerson, Parshley, Ormsby,
Santos, Donaghy, Scott, and Obras
Read first time 01/16/26. Referred to Committee on Technology,
Economic Development, & Veterans.
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1, 2022, a community reinvestment plan report on September 19, 2023, 1
and a community investment plan implementation report in October 2
2025. The legislature intends to transfer an amount no less than 3
$100,000,000 per year for continued implementation of the community 4
investment plan, annual reporting on the plan, and updates to the 5
plan. 6
The legislature recognizes that despite the development of a 7
community investment plan and reporting on implementation of the 8
plan, existing programs and networks may not reach the people who are 9
most affected by the historic laws and penalties for drug possession. 10
Therefore, the legislature intends for the next phase of 11
implementation to include policy direction for expenditure of the 12
legislative appropriations, annual reporting on distribution of the 13
appropriated funds, direction to update the community investment plan 14
every 10 years, and review of implementation of the program to date 15
by the Washington state institute for public policy.16
Sec. 2. RCW 43.79.567 and 2025 c 424 s 952 are each amended to 17
read as follows: 18
(1) The community reinvestment account is created in the state 19
treasury. Revenues to the account shall consist of appropriations and 20
transfers by the legislature and all other moneys directed for 21
deposit into the account. Moneys in the account may be spent only 22
after appropriation. 23
(2) Expenditures from the account may be used by the department 24
of commerce for: 25
(a) Economic development, which includes addressing wealth 26
disparities to promote asset building such as homeownership and 27
expanding access to financial resources including, but not limited 28
to, grants and loans for small businesses and entrepreneurs, 29
financial literacy training, and other small business training and 30
support activities; 31
(b) Civil and criminal legal assistance to provide postconviction 32
relief and case assistance, including the expungement of criminal 33
records and vacation of criminal convictions; 34
(c) Community-based violence intervention and prevention 35
services, which may include after-school programs focused on 36
providing education and mentorship to youths; 37
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(d) Reentry services to facilitate successful transitions for 1
persons formerly incarcerated in an adult correctional facility or 2
juvenile residential facility in Washington; and 3
(e) ((Beginning July 1, 2025, agricultural )) Agricultural and 4
economic support and services available to historically marginalized 5
communities. 6
(3) The distribution of the grants under this section must be 7
done in collaboration with "by and for community organizations" as 8
defined by the department of commerce and the office of equity. ((For 9
the 2025-2027 fiscal biennium, "by )) "By and for community 10
organizations" include, but are not limited to, those operated by and 11
for Black, Latino, Native American, Asian, Native Hawaiian, and 12
Pacific Islander communities. 13
NEW SECTION. Sec. 3. A new section is added to chapter 43.330 14
RCW to read as follows: 15
(1) The department shall, in partnership with the office of 16
equity, and "by and for community organizations" as used in RCW 17
43.79.567, update the community reinvestment plan every 10 years to 18
identify the distribution of funds allocated to the community 19
reinvestment account in RCW 43.79.567. The plan must include criteria 20
for eligible communities and programs, development of accountability 21
measures to ensure that distribution and use of funding meets 22
intended purposes, and tracking of outcomes for the funds.23
(2) At a minimum, the plan must address how the community 24
reinvestment account funding will: 25
(a) Produce significant long-term economic benefits to the state, 26
a region of the state, or a particular community in the state;27
(b) Result in significant long-term economic benefits in the form 28
of new jobs, job retention, increased personal wealth, or higher 29
incomes for citizens of the state or a particular community in the 30
state; and 31
(c) Ensure that: 32
(i) Projects or programs do not require continuing state support;33
(ii) An expenditure will not supplant private investment;34
(iii) An expenditure is accompanied by additional public or 35
private investment; and 36
(iv) Nonprofit, faith-based, and grassroots organizations are 37
prioritized for funding. 38
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(3) In updating the plan, the department is encouraged to 1
incorporate existing and ongoing work from relevant task forces and 2
work groups including, but not limited to, the social equity in 3
cannabis task force, the statewide reentry council, and the 4
homeownership disparities workgroup. 5
(4) The department shall submit a report consistent with RCW 6
43.01.036 to the governor and relevant committees of the legislature 7
by June 30, 2027, and every two years thereafter, that includes a 8
summary of implementation of the plan, including outcome-based 9
metrics. 10
(5) The office of equity must review the plan and the report.11
(6) The department shall use the plan to guide the distribution 12
of appropriated funds. The department must review and update the plan 13
every 10 years, with the first update due in 2032.14
(7) For the purposes of this section, "plan" means the community 15
reinvestment plan. 16
NEW SECTION. Sec. 4. (1) The Washington state institute for 17
public policy must conduct a study researching, analyzing, and 18
determining, to the extent practicable, the department of commerce's 19
distribution of and the recipient organizations' use of the funds 20
allocated under the community reinvestment account in RCW 43.79.567.21
(2) In conducting the study, the Washington state institute for 22
public policy may conduct fact-finding and stakeholder discussions 23
with the department of commerce, the office of equity, organizations 24
that received funds, and organizations that were eligible for funds 25
but did not receive funds. 26
(3) The department of commerce and the office of equity must 27
cooperate with the Washington state institute for public policy to 28
facilitate access to data or other resources necessary to complete 29
the work of this section. 30
(4) By June 30, 2027, and in compliance with RCW 43.01.036, the 31
Washington state institute for public policy shall submit a report to 32
the appropriate committees of the legislature with the findings of 33
its study under this section. 34
(5) This section expires June 1, 2028. 35
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