Payroll expense tax

AN ACT Relating to enacting an excise tax on large operating 1
companies on the amount of payroll expenses above the minimum wage 2
threshold of the additional medicare tax to fund services to benefit 3
Washingtonians and establishing the Well Washington fund account; 4
adding a new section to chapter 43.79 RCW; adding a new Title to the 5
Revised Code of Washington to be codified as Title 50C RCW; creating 6
a new section; and prescribing penalties. 7
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:8
PART I9
LEGISLATIVE INTENT10
NEW SECTION. Sec. 1. (1) The legislature finds that the 2025 11
federal H.R. 1 reconciliation bill, Public Law 119-21, will result in 12
substantial cuts to staple silos of public sector spending.13
(2) The legislature finds that the office of financial management 14
has identified higher education, energy and economic development, 15
food assistance via the supplemental nutrition assistance program 16
(SNAP, i.e. "food stamps"), and health care (especially medicaid) as 17
state spending areas most impacted by H.R. 1. The office of financial 18
management has said that "H.R. 1 will influence how Washingtonians 19
access basic services, get health care, and pursue education."20
S-3552.1
SENATE BILL 6093
State of Washington 69th Legislature 2026 Regular Session
By Senators Saldaña, Lovelett, Alvarado, Frame, and Nobles
Read first time 01/13/26. Referred to Committee on Ways & Means.
p. 1 SB 6093
(3) The legislature finds that programs thousands of 1
Washingtonians depend upon will be defunded as a result of H.R. 1. 2
Washington state stands to lose up to $51 billion in federal medicaid 3
funding in the next decade. 250,000 Washingtonians are thus in danger 4
of losing medicaid coverage, and another 150,000 Washingtonians are 5
at risk of losing access to the state's health care exchange. H.R. 1 6
would negatively impact urban health clinics and force many rural 7
hospitals to close. 900,000 Washingtonians will lose food stamps. The 8
state department of social and health services has noted that "H.R. 1 9
ends long-standing Supplemental Nutrition Assistance Program 10
eligibility for refugees, asylees, and Afghan and Ukrainian 11
Humanitarian Parolees." H.R. 1 will shift the cost of administering 12
these SNAP benefits to Washington state— a cost burden of $200 million 13
in annual expenses. H.R. 1 will eliminate financial assistance for 14
thousands of Washingtonians pursuing higher education. It will also 15
repeal clean energy project tax credits. 16
(4) Though the legislature finds that many of the austerity 17
measures of H.R. 1 already began in 2025, the legislature also finds 18
that it has a window of opportunity to mitigate H.R. 1 before it goes 19
into full effect in 2027 and 2028. The legislature finds that failure 20
to take proactive measures to fill funding gaps created by H.R. 1 21
before they occur will result in greater, avoidable costs to 22
Washington state, and greater hardship endured by Washingtonians.23
(5) The legislature further finds that it is the apparent intent 24
of President Trump to remain in office after 2028, that the United 25
States supreme court has stripped key provisions from the federal 26
voting rights act, and that ongoing federal austerity budgeting is 27
thus a strong potentiality. 28
(6) The legislature finds that H.R. 1 defunds the public sector 29
in order to grant massive tax breaks to American corporations. H.R. 1 30
extends $148 billion in tax cuts to companies that comprise the S&P 31
500 stock market index. The richest one percent of Americans will 32
receive an estimated $121 billion in net tax cuts in 2026 as a result 33
of H.R. 1. T-Mobile will see a $1.5 billion tax break in 2026. 34
Amazon's cash flow will be raised by $15 billion annually between 35
2025-2027. Also as a result of H.R. 1, Microsoft was permitted to 36
deduct $69.7 billion in capital expenditures from federal tax 37
reporting in 2025. The legislature finds that many of these tax 38
breaks go to companies that are either headquartered in Washington 39
state, or that have a heavy presence here. 40
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(7) The legislature finds that windfall corporate tax benefits 1
will accrue as Washington has one of the most corporate-friendly tax 2
regimes of any state in the country. In chapter 421, Laws of 2025 3
(Engrossed Substitute Senate Bill No. 5813), the legislature found 4
that "Washington's tax system remains the second most regressive in 5
the nation as it asks those with the least to pay the most as a 6
percentage of their income." In that law, the legislature affirmed 7
"that a tax system that is fair and works for everyone is essential 8
to help Washingtonians thrive." The legislature finds that the 9
regressivity of Washington's tax code contributes to budgetary 10
shortfalls of the state's own making, worsening the impact of 11
regressive federal tax policy. 12
(8) The legislature finds that Washington state businesses depend 13
upon a healthy economic climate to reap profits and create jobs. The 14
proliferation of high-earning jobs is a strong indicator of the 15
economic health of a large operating company that has enjoyed the 16
many benefits of doing business in Washington state. The legislature 17
finds that substantial federal divestment from Washington state will 18
harm these businesses. Washington's department of social and health 19
services estimates that for every $1.00 of supplemental nutrition 20
assistance program spending in Washington state, $1.50 in economic 21
activity is generated. 22
(9) The legislature finds that all high earners in the United 23
States are subject to an "additional medicare tax." For married 24
individuals filing separately, the surtax is .9 percent of wages made 25
above the $125,000 threshold; unlike the standard medicare tax, this 26
surtax is not divided equally between the worker and their boss. The 27
legislature finds that if employees can bolster the social safety 28
net, so can their employers. 29
(10) Therefore, the legislature intends to create the "well 30
Washington fund account" to maintain the economic health of 31
Washington state. 32
PART II33
WELL WASHINGTON FUND ACCOUNT34
NEW SECTION. Sec. 2. A new section is added to chapter 43.79 35
RCW to read as follows: 36
(1) The well Washington fund account is created in the state 37
treasury. Beginning July 1, 2026, all revenues created from the high 38
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earners payroll tax on large operating companies in section 4 of this 1
act must be deposited into the state general fund. Beginning July 1, 2
2027, and for every year thereafter, 51 percent of all revenues 3
created by said tax shall be deposited in the well Washington fund 4
account, with the remaining 49 percent, as well as all interest and 5
penalties provided in Title 50C RCW, deposited into the state general 6
fund. 7
(2) Moneys in the account may be spent only after appropriation. 8
Expenditures from the account may be used only for higher education, 9
health care (especially medicaid), cash assistance programs, and 10
energy and housing programs. 11
PART III12
WELL WASHINGTON FUND OVERSIGHT AND ACCOUNTABILITY BOARD13
NEW SECTION. Sec. 3. (1) The well Washington fund oversight and 14
accountability board is established. The board consists of 25 15
members, as provided in this subsection:16
(a) Ten total members of the house of representatives, comprising 17
two members serving on each of the following committees or their 18
successor committees, with one member from each committee belonging 19
to one of the two major political caucuses: Appropriations, early 20
learning and human services, health and wellness, environment and 21
energy, and housing. 22
(b) Ten total members of the senate, comprising two members 23
serving on each of the following committees or their successor 24
committees, with one member from each committee belonging to one of 25
the two major political caucuses: Ways and means, human services, 26
health and long-term care, environment, energy, and technology, and 27
higher education. 28
(c) The following five members, appointed by the governor with 29
the consent of the senate, each with respective expertise on the 30
intersection of federal and state funding in the following five areas 31
of public policy: Higher education, health care (especially 32
medicaid), cash assistance programs, housing, and the environment.33
(2) Board members shall hold their offices for a term of three 34
years and until their successors are appointed. The board shall have 35
two cochairs. One of the cochairs shall be one of the gubernatorial 36
appointees and designated by the governor, and the other cochair, 37
selected by the house, shall be one of the house members or 38
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appointees outlined in this section. Thirteen voting members of the 1
board constitute a quorum for the transaction of business. The board 2
shall meet three times per year. 3
(3) The purposes of the board are to: 4
(a) Provide guidance and recommendations to the legislature on 5
emergent funding needs due to the actuality or potentiality of 6
federal funding withdrawal from public sector spending silos 7
identified in this act; and 8
(b) Ensure accountability that the well Washington fund account 9
is producing the intended results with respect to reducing and 10
mitigating the impact of federal austerity budgeting in key silos of 11
public sector spending in Washington state. 12
(4) The board shall report its recommendations to the house 13
appropriations and senate ways and means committees of the 14
legislature, or their successor committees, by November 1st of each 15
year. 16
PART IV17
HIGH EARNERS PAYROLL TAX ON LARGE OPERATING COMPANIES18
NEW SECTION. Sec. 4. (1)(a) Beginning July 1, 2026, a payroll 19
expense tax on high earning jobs is levied on large operating 20
companies engaged in business within the state of Washington as 21
provided in this section. The payroll expense tax is the total amount 22
of calendar year wages for each employee in employment of the 23
employer in excess of the minimum wages subject to the additional 24
medicare tax, as determined by treasury decision 9645 of the internal 25
revenue service, multiplied by a rate of five percent.26
(b) For purposes of this subsection: 27
(i) "High earning job" means a job with wages that are in excess 28
of the minimum wages subject to the additional medicare tax, set at 29
$125,000 by treasury decision 9645 of the internal revenue service.30
(ii) "Large operating company" means a company that employs more 31
than 20 people, maintains more than $5,000,000 in gross receipts or 32
sales, and maintains an address in the United States.33
(2)(a) Each employer must remit the tax imposed under this 34
section to the department in a manner specified by the department.35
(b) In the payment of any taxes provided in this section, a 36
fractional part of a cent is disregarded unless it amounts to one-37
half cent or more, in which case it is increased to one cent.38
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(3) The commissioner must annually set the employee wage amount 1
excluded from tax under this section in an amount less than the 2
minimum wages subject to taxation for the additional medicare tax as 3
determined by treasury decision 9645 of the internal revenue service.4
(4) The tax under this section is imposed on the employer. An 5
employer may not make any deductions from employee wages to pay for 6
this tax. 7
NEW SECTION. Sec. 5. EXEMPTION. The payroll expense tax under 8
section 4 of this act does not apply to any employer with total 9
employee wages less than $7,000,000 for the prior calendar year.10
NEW SECTION. Sec. 6. CREDIT. (1) In computing the tax due under 11
this chapter, a credit is allowed against the tax imposed in this 12
chapter and in accordance with this section, for any eligible city 13
payroll expense tax paid by the employer.14
(2)(a) The amount of credit is equal to the total amount of 15
eligible city payroll expense tax remitted to the city during the 16
immediately prior state tax reporting period. The amount of the 17
credit may not exceed the tax that would be owed for the city payroll 18
expense tax in effect on February 1 of each year. 19
(b) No employer may claim a credit under this section for 20
reporting periods for which no tax was due to the city.21
(3) The credit under this section may not exceed the tax 22
otherwise due under this chapter for the tax reporting period. No 23
refunds may be granted for credits under this section.24
(4) The department may contract, under chapter 39.34 RCW, with 25
any city imposing an eligible city payroll expense tax to facilitate 26
the administration of the credit authorized in this section.27
(5) For the purpose of this section, "eligible city payroll 28
expense tax" means a tax that is measured by annual employee 29
compensation and imposed by a city. 30
NEW SECTION. Sec. 7. DEFINITIONS. The definitions in this 31
section apply throughout this chapter unless the context clearly 32
requires otherwise.33
(1) "Commissioner" means the commissioner of the employment 34
security department. 35
(2) "Department" means the employment security department.36
(3) "Employee" has the same meaning as in RCW 50A.05.010.37
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(4) "Employer" has the same meaning as in RCW 50A.05.010.1
(5) "Employment" means personal service, of whatever nature, as 2
known to the common law or any other legal relationship performed for 3
wages or under any contract calling for the performance of personal 4
services, written or oral, express or implied. "Employment" includes 5
an individual's entire service performed within or without or both 6
within and without this state, if: 7
(a) The service is localized in this state; or 8
(b) The service is not localized in any state, but some of the 9
service is performed in this state; and 10
(i) The base of operations of the employee is in this state, or 11
if there is no base of operations, then the place from which such 12
service is directed or controlled is in this state; or13
(ii) The base of operations or place from which such service is 14
directed or controlled is not in any state in which some part of the 15
service is performed, but the individual's residence is in this 16
state. 17
(6) "Remuneration" has the same meaning as provided in RCW 18
50A.05.010. 19
(7) "Service is localized in this state" has the same meaning as 20
in RCW 50A.05.010. 21
(8) "Wages" means the remuneration paid by an employer to an 22
employee. 23
NEW SECTION. Sec. 8. EMPLOYER REQUIREMENTS. (1) In the form and 24
at the times specified in this chapter and by the commissioner, an 25
employer shall make reports, furnish information, and collect and 26
remit taxes as required by this chapter to the department. If the 27
employer is a temporary help company that provides employees on a 28
temporary basis to its customers, the temporary help company is the 29
employer for purposes of this section.30
(2)(a) An employer must keep at the employer's place of business 31
a record of employment, for a period of six years, from which the 32
information needed by the department for purposes of this chapter may 33
be obtained. This record must at all times be open to the inspection 34
of the commissioner. 35
(b) Information obtained under this chapter from employer records 36
is confidential and not open to public inspection, other than to 37
public employees in the performance of their official duties. 38
However, an interested party must be supplied with information from 39
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employer records to the extent necessary for the proper presentation 1
of the case in question. An employer may authorize inspection of the 2
employer's records by written consent. 3
(3) Before issuing a warning letter for failure to comply with 4
requirements relating to the collection of payroll expense taxes is 5
as provided in this chapter, the department shall enforce the 6
collection of taxes through conference and conciliation. This 7
requirement applies to: 8
(a) An employer that fails under this chapter to make the 9
required reports, or fails to remit the full amount of taxes when 10
due; 11
(b) An employer that willfully makes a false statement or 12
misrepresentation regarding a material fact, or willfully fails to 13
report a material fact, to avoid making the required reports or 14
remitting the full amount of the tax when due under this chapter;15
(c) A successor in the manner specified in section 11 of this 16
act; and 17
(d) An officer, member, or owner having either control or 18
supervision of payment or reporting of excess compensation taxes, or 19
both, or who is charged with the responsibility for the filing of 20
returns, in the manner specified in section 9 of this act.21
(4) Appeals are governed by section 24 of this act.22
NEW SECTION. Sec. 9. EMPLOYER PENALTIES. (1) An employer who 23
willfully fails to make the required reports is subject to penalties 24
as follows: (a) For the second occurrence, the penalty is $75; (b) 25
for the third occurrence, the penalty is $150; and (c) for the fourth 26
occurrence and for each occurrence thereafter, the penalty is $250.27
(2) An employer who willfully fails to remit the full amount of 28
taxes when due is liable, in addition to the full amount of taxes due 29
and amounts assessed as interest under section 10 of this act, to a 30
penalty equal to the tax and interest. 31
(3) Any moneys under this section must be deposited into the 32
general fund of the state. 33
(4) For the purposes of this section, "willful" means a knowing 34
and intentional action that is neither accidental nor the result of a 35
bona fide dispute. 36
(5)(a) Beginning January 1, 2027, the department shall enforce 37
the collection of penalties and interest pursuant to this section and 38
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section 10 of this act for any penalties and interest accruing after 1
the effective date of this section. 2
(b) The department shall enforce the collection of penalties 3
through conference and conciliation. 4
(6) These penalties may be appealed as provided in this chapter.5
NEW SECTION. Sec. 10. DELINQUENCY— ACCRUAL OF INTEREST. If taxes 6
are not paid on the date on which they are due and payable as 7
prescribed by the commissioner, the whole or part thereof remaining 8
unpaid must bear interest at the rate of one percent per month or 9
fraction thereof from and after such date until payment plus accrued 10
interest is received by the commissioner. The date as of which 11
payment of taxes, if mailed, is deemed to have been received may be 12
determined by such rules as the commissioner may prescribe. Interest 13
collected pursuant to this section must be paid into the general fund 14
of the state. Interest may not accrue on taxes from any estate in the 15
hands of a receiver, executor, administrator, trustee in bankruptcy, 16
common law assignee, or other liquidating officer subsequent to the 17
date when such receiver, executor, administrator, trustee in 18
bankruptcy, common law assignee, or other liquidating officer 19
qualifies as such, but taxes accruing with respect to employment of 20
persons by any receiver, executor, administrator, trustee in 21
bankruptcy, common law assignee, or other liquidating officer become 22
due and draw interest in the same manner as taxes due from other 23
employers. Where adequate information has been furnished to the 24
department and the department has failed to act or has advised the 25
employer of no liability or inability to decide the issue, interest 26
may be waived.27
NEW SECTION. Sec. 11. TERMINATION OR DISPOSAL OF BUSINESS — TAX 28
PAYMENT— SUCCESSOR LIABILITY. Whenever any employer quits business, or 29
sells out, exchanges, or otherwise disposes of the employer's 30
business or stock of goods, any taxes payable under this chapter 31
shall become immediately due and payable, and the employer shall, 32
within 10 days, make a return and pay the taxes due; and any person 33
who becomes a successor to such business shall become liable for the 34
full amount of taxes and withhold from the purchase price a sum 35
sufficient to pay any taxes due from the employer until such time as 36
the employer produces a receipt from the employment security 37
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department showing payment in full of any taxes due or a certificate 1
that no tax is due and, if such taxes are not paid by the employer 2
within 10 days from the date of such sale, exchange, or disposal, the 3
successor shall become liable for the payment of the full amount of 4
taxes, and the payment thereof by such successor shall, to the extent 5
thereof, be deemed a payment upon the purchase price, and if such 6
payment is greater in amount than the purchase price the amount of 7
the difference shall become a debt due such successor from the 8
employer. A successor may not be liable for any tax due from the 9
person from whom that person has acquired a business or stock of 10
goods if that person gives written notice to the employment security 11
department of such acquisition and no assessment is issued by the 12
department within 180 days of receipt of such notice against the 13
former operator of the business and a copy thereof mailed to such 14
successor. 15
NEW SECTION. Sec. 12. DELINQUENCY— ORDER AND NOTICE OF 16
ASSESSMENT. At any time after the commissioner shall find that any 17
tax, interest, or penalties have become delinquent, the commissioner 18
may issue an order and notice of assessment specifying the amount 19
due, which order and notice of assessment shall be served upon the 20
delinquent employer in the manner prescribed for the service of a 21
summons in a civil action, or using a method by which the mailing can 22
be tracked or the delivery can be confirmed. Failure of the employer 23
to receive such notice or order whether served or mailed shall not 24
release the employer from any tax, or any interest or penalties 25
thereon.26
NEW SECTION. Sec. 13. JEOPARDIZED COLLECTION — IMMEDIATE 27
ASSESSMENT. If the commissioner has reason to believe that an 28
employer is insolvent or if any reason exists why the collection of 29
any taxes accrued will be jeopardized by delaying collection, the 30
commissioner may make an immediate assessment thereof and may proceed 31
to enforce collection immediately, but interest and penalties shall 32
not begin to accrue upon any taxes until the date when such taxes 33
would normally have become delinquent.34
NEW SECTION. Sec. 14. COLLECTION BY DISTRAINT, SEIZURE, AND 35
SALE. If the amount of tax, interest, or penalties assessed by the 36
commissioner by order and notice of assessment provided in this 37
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chapter is not paid within 10 days after the service or mailing of 1
the order and notice of assessment, the commissioner or the 2
commissioner's duly authorized representative may collect the amount 3
stated in said assessment by the distraint, seizure, and sale of the 4
property, goods, chattels, and effects of said delinquent employer. 5
There shall be exempt from distraint and sale under this section such 6
goods and property as are exempt from execution under the laws of 7
this state. 8
NEW SECTION. Sec. 15. COLLECTION BY DISTRAINT, SEIZURE, AND 9
SALE— PROCEDURE. The commissioner, upon making a distraint, must seize 10
the property and must make an inventory of the property distrained, a 11
copy of which must be mailed to the owner of such property or 12
personally delivered to the owner, and must specify the time and 13
place when such property must be sold. A notice specifying the 14
property to be sold and the time and place of sale must be posted in 15
at least two public places in the county wherein the seizure has been 16
made. The time of sale may be not less than 10 nor more than 20 days 17
from the date of posting of such notices. The sale may be adjourned 18
from time to time at the discretion of the commissioner, but not for 19
a time to exceed in all 60 days. The sale must be conducted by the 20
commissioner or the commissioner's authorized representative who 21
proceeds to sell such property by parcel or by lot at a public 22
auction, and who may set a minimum price to include the expenses of 23
making a levy and of advertising the sale, and if the amount bid for 24
such property at the sale is not equal to the minimum price so fixed, 25
the commissioner or the commissioner's representative may declare 26
such property to be purchased by the department for such minimum 27
price. In such event the delinquent account must be credited with the 28
amount for which the property has been sold. Property acquired by the 29
department as prescribed in this section may be sold by the 30
commissioner or the commissioner's representative at public or 31
private sale, and the amount realized must be placed in the general 32
fund of the state. In all cases of sale, as provided in this section, 33
the commissioner must issue a bill of sale or a deed to the purchaser 34
and such bill of sale or deed is prima facie evidence of the right of 35
the commissioner to make such sale and conclusive evidence of the 36
regularity of the commissioner's proceeding in making the sale, and 37
must transfer to the purchaser all right, title, and interest of the 38
delinquent employer in said property. The proceeds of any such sale, 39
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except in those cases wherein the property has been acquired by the 1
department, must be first applied by the commissioner in satisfaction 2
of the delinquent account, and out of any sum received in excess of 3
the amount of delinquent tax, interest, and penalties the 4
administration fund must be reimbursed for the costs of distraint and 5
sale. Any excess that thereafter remains in the hands of the 6
commissioner must be refunded to the delinquent employer. Sums so 7
refundable to a delinquent employer may be subject to seizure or 8
distraint in the hands of the commissioner by any other taxing 9
authority of the state or its political subdivisions.10
NEW SECTION. Sec. 16. NOTICE AND ORDER TO WITHHOLD AND DELIVER. 11
The commissioner may issue to any person, firm, corporation, 12
political subdivision, or department of the state, a notice and order 13
to withhold and deliver property of any kind whatsoever when the 14
commissioner has reason to believe that there is in the possession of 15
such person, firm, corporation, political subdivision, or department, 16
property which is due, owing, or belonging to any person, firm, or 17
corporation upon whom the department has served a notice and order of 18
assessment for tax, interest, or penalties. The effect of a notice to 19
withhold and deliver shall be continuous from the date such notice 20
and order to withhold and deliver is first made until the liability 21
is satisfied or becomes unenforceable because of a lapse of time. The 22
notice and order to withhold and deliver shall be served by the 23
sheriff or the sheriff's deputy of the county wherein the service is 24
made, using a method by which the mailing can be tracked or the 25
delivery can be confirmed, or by any duly authorized representative 26
of the commissioner. Any person, firm, corporation, political 27
subdivision, or department upon whom service has been made must 28
answer the notice within 20 days exclusive of the day of service, 29
under oath and in writing, and shall make true answers to the matters 30
inquired of in the notice. In the event there is in the possession of 31
any such person, firm, corporation, political subdivision, or 32
department, any property which may be subject to the claim of the 33
employment security department of the state, such property shall be 34
delivered forthwith to the commissioner or the commissioner's duly 35
authorized representative upon demand to be held in trust by the 36
commissioner for application on the indebtedness involved or for 37
return, without interest, in accordance with final determination of 38
liability or nonliability, or in the alternative, there shall be 39
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furnished a good and sufficient bond satisfactory to the commissioner 1
conditioned upon final determination of liability. Should any person, 2
firm, or corporation fail to make answer to an order to withhold and 3
deliver within the time prescribed herein, it shall be lawful for the 4
court, after the time to answer such order has expired, to render 5
judgment by default against such person, firm, or corporation for the 6
full amount claimed by the commissioner in the notice to withhold and 7
deliver, together with costs. 8
NEW SECTION. Sec. 17. WARRANT FOR ASSESSMENT. Whenever any 9
order and notice of assessment or jeopardy assessment has become 10
final in accordance with the provisions of this chapter the 11
commissioner may file with the clerk of any county within the state a 12
warrant in the amount of the notice of assessment plus interest, 13
penalties, and a filing fee under RCW 36.18.012(10). The clerk of the 14
county wherein the warrant is filed shall immediately designate a 15
superior court cause number for such warrant, and the clerk shall 16
cause to be entered in the judgment docket under the superior court 17
cause number assigned to the warrant, the name of the employer 18
mentioned in the warrant, the amount of the tax, interest, penalties, 19
and filing fee, and the date when such warrant was filed. The 20
aggregate amount of such warrant as docketed shall become a lien upon 21
the title to, and interest in all real and personal property of the 22
employer against whom the warrant is issued, the same as a judgment 23
in a civil case duly docketed in the office of such clerk. Such 24
warrant so docketed shall be sufficient to support the issuance of 25
writs of execution and writs of garnishment in favor of the state in 26
the manner provided by law in the case of civil judgment, wholly or 27
partially unsatisfied. The clerk of the court shall be entitled to a 28
filing fee under RCW 36.18.012(10), which shall be added to the 29
amount of the warrant, and charged by the commissioner to the 30
employer. A copy of the warrant shall be mailed to the employer using 31
a method by which the mailing can be tracked or the delivery can be 32
confirmed within five days of filing with the clerk.33
NEW SECTION. Sec. 18. LIENS. The claim of the employment 34
security department for any tax, interest, or penalties not paid when 35
due, shall be a lien prior to all other liens or claims and on a 36
parity with prior tax liens against all property and rights to 37
property, whether real or personal, belonging to the employer. In 38
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order to avail itself of the lien hereby created, the department 1
shall file with any county auditor where property of the employer is 2
located a statement and claim of lien specifying the amount of 3
delinquent taxes, interest, and penalties claimed by the department. 4
From the time of filing for record, the amount required to be paid 5
shall constitute a lien upon all property and rights to property, 6
whether real or personal, in the county, owned by the employer or 7
acquired by him or her. The lien shall not be valid against any 8
purchaser, holder of a security interest, mechanic's lien, or 9
judgment lien creditor until notice thereof has been filed with the 10
county auditor. This lien shall be separate and apart from, and in 11
addition to, any other lien or claim created by, or provided for in, 12
this chapter. When any such notice of lien has been so filed, the 13
commissioner may release the same by filing a certificate of release 14
when it shall appear that the amount of delinquent tax, interest, and 15
penalties have been paid, or when such assurance of payment shall be 16
made as the commissioner may deem to be adequate. Fees for filing and 17
releasing the lien provided herein may be charged to the employer and 18
may be collected from the employer utilizing the remedies provided in 19
this chapter for the collection of taxes. 20
NEW SECTION. Sec. 19. LIENS— INSOLVENCY, DISSOLUTION, OR 21
DISTRIBUTION OF ASSETS. In the event of any distribution of an 22
employer's assets pursuant to an order of any court, including any 23
receivership, probate, legal dissolution, or similar proceeding, or 24
in case of any assignment for the benefit of creditors, composition, 25
or similar proceeding, tax, interest, or penalties then or thereafter 26
due shall be a lien upon all the assets of such employer. Said lien 27
is prior to all other liens or claims except prior tax liens, other 28
liens provided by this chapter, and claims for remuneration for 29
services of not more than $250 to each claimant earned within six 30
months of the commencement of the proceeding. The mere existence of a 31
condition of insolvency or the institution of any judicial proceeding 32
for legal dissolution or of any proceeding for distribution of assets 33
shall cause such a lien to attach without action on behalf of the 34
commissioner or the state. In the event of an employer's adjudication 35
in bankruptcy, judicially confirmed extension proposal, or 36
composition, under the federal bankruptcy act of 1898, as amended, 37
tax, interest, or penalties then or thereafter due shall be entitled 38
to such priority as provided in that act, as amended.39
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NEW SECTION. Sec. 20. CIVIL ACTIONS— SERVICE OF PROCESS. (1) If 1
after due notice, any employer defaults in any payment of tax, 2
interest, or penalties, the amount due may be collected by civil 3
action in the name of the state, and the employer adjudged in default 4
shall pay the cost of such action. Any lien created by this chapter 5
may be foreclosed by decree of the court in any such action. Civil 6
actions brought under this chapter to collect tax, interest, or 7
penalties from an employer shall be heard by the court at the 8
earliest possible date and shall be entitled to preference upon the 9
calendar of the court over all other civil actions except petitions 10
for judicial review under this chapter, cases arising under the 11
unemployment compensation laws of this state, and cases arising under 12
the industrial insurance laws of this state.13
(2) Any employer that is not a resident of this state and that 14
exercises the privilege of having one or more individuals perform 15
service for it within this state, and any resident employer that 16
exercises that privilege and thereafter removes from this state, 17
shall be deemed thereby to appoint the secretary of state as its 18
agent and attorney for the acceptance of process in any action under 19
this chapter. In instituting such an action against any such employer 20
the commissioner shall cause such process or notice to be filed with 21
the secretary of state and such service shall be sufficient service 22
upon such employer, and shall be of the same force and validity as if 23
served upon it personally within this state if the commissioner shall 24
forthwith send notice of the service of such process or notice, 25
together with a copy thereof, by registered mail, return receipt 26
requested, to such employer at its last known address and such return 27
receipt, the commissioner's affidavit of compliance with the 28
provisions of this section, and a copy of the notice of service shall 29
be appended to the original of the process filed in the court in 30
which such action is pending. 31
NEW SECTION. Sec. 21. INJUNCTION FROM CONTINUING IN BUSINESS. 32
Any employer who is delinquent in the payment of tax, interest, or 33
penalties may be enjoined upon the suit of the state of Washington 34
from continuing in business in this state or employing persons herein 35
until the delinquent tax, interest, and penalties have been paid, or 36
until the employer has furnished a good and sufficient bond in a sum 37
equal to double the amount of tax, interest, and penalties already 38
delinquent, plus such further sum as the court deems adequate to 39
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protect the department in the collection of tax, interest, and 1
penalties which will become due from such employer during the next 2
ensuing calendar year, said bond to be conditioned upon payment of 3
all tax, interest, and penalties due and owing within 30 days after 4
the expiration of the next ensuing calendar year or at such earlier 5
date as the court may fix. Action under this section may be 6
instituted in the superior court of any county of the state wherein 7
the employer resides, has its principal place of business, or where 8
it has anyone performing services for it, whether or not such 9
services constitute employment. 10
NEW SECTION. Sec. 22. COMPROMISE OF CLAIMS. The commissioner 11
may compromise any claim for tax, interest, or penalties due and 12
owing from an employer where collection of the full amount due and 13
owing, whether reduced to judgment or otherwise, would be against 14
equity and good conscience. Whenever a compromise is made by the 15
commissioner in the case of a claim for tax, interest, or penalties, 16
whether reduced to judgment or otherwise, there shall be placed on 17
file in the department a statement of the amount of tax, interest, 18
and penalties imposed by law and claimed due, attorneys' fees and 19
costs, if any, a complete record of the compromise agreement, and the 20
amount actually paid in accordance with the terms of the compromise 21
agreement. If any such compromise is accepted by the commissioner, 22
within such time as may be stated in the compromise or agreed to, 23
such compromise shall be final and conclusive and except upon showing 24
of fraud or malfeasance or misrepresentation of a material fact the 25
case shall not be reopened as to the matters agreed upon. In any 26
suit, action, or proceeding, such agreement or any determination, 27
collection, payment, adjustment, refund, or credit made in accordance 28
therewith shall not be annulled, modified, set aside, or disregarded.29
NEW SECTION. Sec. 23. UNCOLLECTIBLE ACCOUNTS. The commissioner 30
may charge off as uncollectible and no longer an asset of the general 31
fund of the state, any delinquent tax, interest, penalties, or 32
credits if the commissioner is satisfied that there are no cost-33
effective means of collecting the tax, interest, or penalties.34
NEW SECTION. Sec. 24. GENERALLY. (1) Any aggrieved party may 35
file an appeal from any determination or redetermination with the 36
commissioner within 30 days after the date of notification or 37
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mailing, whichever is earlier, of such determination or 1
redetermination to the party's last known address. If an appeal with 2
respect to any determination is pending as of the date when a 3
redetermination is issued, such appeal, unless withdrawn, shall be 4
treated as an appeal from such redetermination. 5
(2) Upon receipt of a notice of appeal, the commissioner shall 6
request the assignment of an administrative law judge under chapter 7
34.12 RCW to conduct a hearing in accordance with chapter 34.05 RCW 8
and issue a proposed order. 9
NEW SECTION. Sec. 25. ASSESSMENTS. (1) When an order and notice 10
of assessment has been served upon or mailed to a delinquent 11
employer, the employer may within 30 days file an appeal with the 12
department, stating that the assessment is unjust or incorrect and 13
requesting a hearing. The appeal must set forth the reasons why the 14
assessment is objected to and the amount of tax, if any, which the 15
employer admits to be due. If no appeal is filed, the assessment 16
shall be conclusively deemed to be just and correct except that in 17
such case, and in cases where payment of tax, interest, or penalties 18
has been made pursuant to a jeopardy assessment, the commissioner may 19
properly entertain a subsequent application for refund. The filing of 20
an appeal on a disputed assessment with the administrative law judge 21
stays the distraint and sale proceeding provided for in this chapter 22
until a final decision has been made, but the filing of an appeal 23
shall not affect the right of the commissioner to perfect a lien, as 24
provided by this chapter, upon the property of the employer. The 25
filing of a petition on a disputed assessment stays the accrual of 26
interest and penalties on the disputed taxes until a final decision 27
is made.28
(2) Within 30 days after notice of denial of refund or adjustment 29
has been mailed or delivered, whichever is the earlier, to an 30
employer, the employer may file an appeal with the department for a 31
hearing unless assessments have been appealed from and have become 32
final. The employer shall set forth the reasons why such hearing 33
should be granted and the amount which the employer believes should 34
be adjusted or refunded. If no appeal is filed within said 30 days, 35
the determination of the commissioner as stated in the notice shall 36
be final. 37
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NEW SECTION. Sec. 26. WHEN DEEMED FILED AND RECEIVED. The 1
appeal or petition from a determination, redetermination, order and 2
notice of assessment, appeals decision, or commissioner's decision is 3
deemed filed and received if properly addressed and with sufficient 4
postage:5
(1) If transmitted through the United States mail, on the date 6
shown by the United States postal service cancellation mark;7
(2) If mailed but not received by the addressee, or where 8
received and the United States postal service cancellation mark is 9
illegible, erroneous, or omitted, on the date it was mailed, if the 10
sender establishes by competent evidence that the appeal or petition 11
was deposited in the United States mail on or before the date due for 12
filing; or 13
(3) In the case of a metered cancellation mark by the sender and 14
a United States postal service cancellation mark on the same envelope 15
or other wrapper, the latter shall control. 16
NEW SECTION. Sec. 27. ASSESSMENTS— PROCEDURE. In any proceeding 17
before an administrative law judge involving an appeal from a 18
disputed order and notice of assessment or a disputed denial of 19
refund or adjustment, the administrative law judge, after affording 20
the parties a reasonable opportunity for hearing, shall affirm, 21
modify, or set aside the notice of assessment or denial of refund. 22
The parties shall be duly notified of such decision together with the 23
reasons, which shall be deemed to be the final decision unless within 24
30 days after the date of notification or mailing, whichever is the 25
earlier, of such decision, further appeal is perfected pursuant to 26
the provisions of this chapter relating to review by the 27
commissioner.28
NEW SECTION. Sec. 28. HEARING PROCEDURES. The manner in which 29
any dispute is presented to the administrative law judge, and the 30
conduct of hearings and appeals, shall be in accordance with rules 31
adopted by the commissioner. A full and complete record shall be kept 32
of all administrative law judge proceedings. All testimony at any 33
appeal hearing shall be recorded, but need not be transcribed unless 34
further appeal is taken.35
NEW SECTION. Sec. 29. COMMISSIONER REVIEW— INITIATION. Within 30 36
days from the date of notification or mailing, whichever is the 37
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earlier, of any decision of an administrative law judge, the 1
commissioner on the commissioner's own order may, or upon petition of 2
any interested party shall, take jurisdiction of the proceedings for 3
the purpose of review. Appeal from any decision of an administrative 4
law judge may be perfected so as to prevent finality of such decision 5
if, within 30 days from the date of notification or mailing of the 6
decision, whichever is the earlier, a petition in writing for review 7
by the commissioner is received by the commissioner or by such 8
representative of the commissioner as the commissioner by rule shall 9
prescribe. The commissioner may also prevent finality of any decision 10
of an administrative law judge and take jurisdiction of the 11
proceedings for the commissioner's review by entering an order so 12
providing on the commissioner's own motion and mailing a copy thereof 13
to the interested parties within the same period allowed for receipt 14
of a petition for review. The time limit provided for the 15
commissioner's assumption of jurisdiction on the commissioner's own 16
motion for review shall be deemed to be jurisdictional.17
NEW SECTION. Sec. 30. COMMISSIONER REVIEW — PROCEDURE. After 18
having acquired jurisdiction for review, the commissioner shall 19
review the proceedings in question. Prior to rendering a decision, 20
the commissioner may order the taking of additional evidence by an 21
administrative law judge to be made a part of the record in the case. 22
Upon the basis of evidence submitted to the administrative law judge 23
and such additional evidence as the commissioner may order to be 24
taken, the commissioner shall render a decision in writing affirming, 25
modifying, or setting aside the decision of the administrative law 26
judge. Alternatively, the commissioner may order further proceedings 27
to be held before the administrative law judge, upon completion of 28
which the administrative law judge shall issue a new decision in 29
writing affirming, modifying, or setting aside the previous decision 30
of the administrative law judge. The new decision of the 31
administrative law judge may be appealed as provided under section 29 32
of this act. The commissioner shall mail the decision of the 33
commissioner to the interested parties at their last known addresses.34
NEW SECTION. Sec. 31. COMMISSIONER REVIEW — WHEN FINAL — 35
COMMISSIONER AS PARTY. Any decision of the commissioner involving a 36
review of an administrative law judge decision, in the absence of a 37
petition as provided in chapter 34.05 RCW, becomes final 30 days 38
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after notification or mailing, whichever is earlier. The commissioner 1
shall be deemed to be a party to any judicial action involving any 2
such decision and shall be represented in any such judicial action by 3
the attorney general. 4
NEW SECTION. Sec. 32. APPLICABILITY OF FINDINGS, 5
DETERMINATIONS, ETC., TO OTHER ACTIONS. Any finding, determination, 6
conclusion, declaration, or final order made by the commissioner, or 7
the commissioner's representative or delegate, or by an appeal 8
tribunal, administrative law judge, reviewing officer, or other agent 9
of the department for the purposes of this chapter, shall not be 10
conclusive, nor binding, nor admissible as evidence in any separate 11
action outside the scope of this chapter between an employee and the 12
employee's present or prior employer before an arbitrator, court, or 13
judge of this state or the United States, regardless of whether the 14
prior action was between the same or related parties or involved the 15
same facts or was reviewed pursuant to section 35 of this act.16
NEW SECTION. Sec. 33. WAIVER OF TIME LIMITATIONS. For good 17
cause shown the administrative law judge or the commissioner may 18
waive the time limitations for administrative appeals or petitions 19
set forth in this chapter.20
NEW SECTION. Sec. 34. JUDICIAL REVIEW. (1) In all court 21
proceedings under or pursuant to this chapter the decision of the 22
commissioner shall be prima facie correct, and the burden of proof 23
shall be upon the party challenging the decision.24
(2) If the court determines that the commissioner has acted 25
within the commissioner's power and has correctly construed the law, 26
the decision of the commissioner shall be confirmed; otherwise, the 27
decision shall be reversed or modified. In case of a modification or 28
reversal the superior court shall refer the decision to the 29
commissioner with an order directing the commissioner to proceed in 30
accordance with the findings of the court. 31
(3) Whenever any order and notice of assessment shall have become 32
final in accordance with the provisions of this chapter, the court 33
shall upon application of the commissioner enter a judgment in the 34
amount provided for in the order and notice of assessment, and the 35
judgment shall have and be given the same effect as if entered 36
pursuant to a civil action instituted in the court.37
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NEW SECTION. Sec. 35. JUDICIAL REVIEW — PROCEDURE. Judicial 1
review of a decision of the commissioner involving the review of a 2
decision of an administrative law judge under this chapter may be had 3
only in accordance with the procedural requirements of RCW 34.05.452.4
NEW SECTION. Sec. 36. REMEDIES EXCLUSIVE. The remedies provided 5
in this chapter for determining the justness or correctness of 6
assessments, refunds, adjustments, or claims shall be exclusive and 7
no court shall entertain any action to enjoin an assessment or 8
require a refund or adjustment except in accordance with the 9
provisions of this chapter. Matters which may be determined by the 10
procedures set out in this chapter shall not be the subject of any 11
declaratory judgment.12
NEW SECTION. Sec. 37. DEPOSITING FUNDS. (1) Until July 1, 2027, 13
all tax, interest, and penalties collected under this chapter must be 14
deposited in the general fund of the state.15
(2) Beginning July 1, 2027, 51 percent of all taxes collected 16
under this chapter must be deposited in the well Washington fund 17
account; and the remaining 49 percent, as well as all interest and 18
penalties collected under this chapter, must be deposited in the 19
general fund of the state. 20
NEW SECTION. Sec. 38. PROCUREMENT EXEMPTION. The department is 21
exempt from the requirements of chapter 39.26 RCW until October 1, 22
2026, for purposes of implementing Title 50C RCW (the new title 23
created in section 42 of this act).24
NEW SECTION. Sec. 39. RULE MAKING. The department may adopt 25
rules as necessary to implement this title. 26
NEW SECTION. Sec. 40. SHORT TITLE. This act may be known and 27
cited as the well Washington fund act.28
NEW SECTION. Sec. 41. SEVERABILITY. If any provision of this 29
act or its application to any person or circumstance is held invalid, 30
the remainder of the act or the application of the provision to other 31
persons or circumstances is not affected.32
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NEW SECTION. Sec. 42. CODIFICATION. Sections 1 and 3 through 40 1
of this act constitute a new chapter in a new title to be codified as 2
Title 50C RCW.3
NEW SECTION. Sec. 43. NECESSITY OF ACT. This act is necessary 4
for the support of the state government and its existing public 5
institutions.6
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