Category: State Budget

Governor-elect Bob Ferguson, who will be sworn into office on Jan. 15, has unveiled his operating budget priorities for the 2025-27 biennium. While he does not provide a in-depth budget proposal, this release offers an overview of his fiscal approach. Ferguson’s priorities come after outgoing Governor Jay Inslee presented his budget proposals in mid-December.

Washington state faces a projected budget deficit of $10-12 billion over the next four years, prompting both Ferguson and Inslee to seek solutions. However, they took different approaches, particularly regarding new revenue. Inslee’s proposal focuses on a mix of spending reductions, delayed investments, and new revenue sources, including a wealth tax and increases to the business and occupation tax.

In contrast, Governor-elect Ferguson’s priorities favor operational efficiency and targeted budget reductions. He proposes a 6% reduction for most state agencies and a 3% reduction for four-year higher education institutions. His approach notably avoids new taxes, emphasizing that new revenue should only be considered as a last resort. However, like Inslee, Ferguson proposes delaying investments where possible, such as for new programs that have yet to be implemented. These measures are expected to save $4.4 billion, in addition to the roughly $3 billion in one-time savings and delayed investments outlined in Inslee’s recommendations.

Ferguson’s proposal does avoid cuts to basic education, the community and technical colleges, and public safety agencies, including the Washington Department of Corrections, Washington State Patrol, and the Criminal Justice Training Program. Pass-through entitlements, like the Washington College Grant, would also remain unaffected by budget reductions.

Additionally, Ferguson has identified four priority areas for $800 million in new investments: public safety, housing, the ferry system, and affordability.

The Washington State Legislature will use Inslee and Ferguson’s proposals as a starting point for 2025-27 budget negotiations. After the legislature passes their final budgets, they will go to Ferguson for his consideration and signature.

The 2025 legislative session begins this upcoming Monday, Jan. 13. For updates on the UW’s advocacy efforts, visit the News & Updates section of this website.

Today, Governor Jay Inslee released his operating, capital, and transportation budget proposals for the 2025-27 biennium. These proposals come as Washington state faces a projected budget shortfall of $10 to $12 billion over the next four years, caused by declining revenue, rising inflation, higher costs for state services, increased program caseloads, and growing workforce costs. The state’s budgets must balance over four years.

To address this shortfall, Gov. Inslee’s proposals include a combination of expenditure reductions and new revenue sources. The governor has proposed cutting or delaying approximately $2 billion in expenditures, which includes freezing nonessential hiring, contracts, and travel, as well as shifting surplus funds from state pension accounts. Additionally, he has introduced two new revenue sources. The first is a 1% Wealth Tax on Washington residents with global wealth exceeding $100 million, which is expected to generate $10.3 billion over the next four years. The second is a business and occupation (B&O) tax increase for businesses in the “services and other activities” category with annual revenues over $1 million, projected to raise $2.6 billion.

Governor Inslee emphasized during his press conference that the goal of his budget proposals is to preserve state services without taking steps backward.

For the UW, the operating budget proposal made only minor adjustments to existing state appropriations, including a 0.1% reduction in funding totaling about $720,000. Compensation adjustments for 2025-27 were authorized for collective bargaining agreements (CBAs) with represented staff and non-represented faculty and staff. However, the UW’s request for 100% state funding of compensation and benefits was not met. Additionally, none of the UW’s policy requests, including funding for high-demand degrees and student support services at all three campuses, were funded.

The operating budget proposal did include $182 million to maintain the Washington College Grant.

In the capital budget proposal, the construction and modernization of chemical sciences facilities in Seattle was fully funded. However, the majority of Seattle’s decarbonization projects were not funded due to a decrease in available funds from the Climate Commitment Account (CCA). Two energy renewal projects did receive appropriations from the State Bond Account.

Gov. Inslee’s budget proposal marks the beginning of the state’s budget process. The 2025-27 state operating, capital, and transportation budgets will be decided during the upcoming legislative session, starting on Jan. 13. The UW Office of State Relations will be in Olympia advocating to preserve UW investments in the budgets and advance the University’s priorities. For the latest session updates, visit the News & Updates section of this website.

The June state revenue forecast published yesterday projects revenue collections for the 2023-25 budget will decrease by $477 million from the February forecast bringing the total projected budget to $66.5 billion. The forecast also estimates revenue for the 2025-27 budget will decrease by $189 million with the total budget for the biennium at $71.5 billion. The 2025-27 budget cycle begins July 1, 2025 and ends on June 30, 2027. The Washington State Legislature is required by law to enact an operating budget that is balanced over four years, which is why the state revenue forecasts have a four-year outlook.

The decrease in revenue is largely attributed to lower receipts of the capital gains tax, personal income, and home construction. Notably, capital gains tax collections are down $324 million from the February forecast and sales tax collections are down $224 million. Additionally, the forecast shows that Seattle-area inflation continues to outpace the national average.

On the flip side, real estate excise taxes (REET) and property taxes came in higher than expected. The revenue dedicated to the Workforce Education Investment Account, which funds many higher education priorities, also increased slightly.

The Governor and State Legislature use the February, June, September, and November state revenue forecasts to inform their budget proposals and this most recent forecast is likely to cause some worry given the downward trajectory of collections. The state has $2.4 billion in reserves so the reduction in revenue will not have any drastic impact on current state operations and services, but state officials will be watching to see if the downward trajectory becomes a trend.

In September, state agencies, including the University of Washington, must submit their 2025-27 budget requests to the Office of Financial Management for consideration for inclusion in Gov. Jay Inslee’s budget proposals to the legislature. With the next revenue forecast scheduled for Sept. 27, agencies will only have the February and June forecasts to inform their decisions and priorities. However, both the September and November forecasts will be released before Gov. Inslee unveils his budget proposals in December.

For more information about the June revenue forecast, click here. Visit the Washington State Economic and Revenue Forecast Council website to view past publications.

Alongside UW Finance, Planning & Budgeting, the Office of State Relations will hold a 2024 legislative session debrief and 2025-27 state budget request process Q&A on Friday, April 5 from 11:00am-12:00pm via Zoom.

Highlights from this session will be shared, as well as a brief review of the final supplemental operating and capital budgets. A preview of what was included in the compromise budgets for the UW can be found here. Additionally, a good portion of the meeting will be dedicated to sharing information about how the UW’s 2025 legislative agenda will be formed and how to engage in the process.

To provide some background, Washington has a two-year budget cycle, with the biennial operating, capital, and transportations budget determined during the long 105-day legislative sessions held in odd-numbered years (e.g., 2025). The supplemental budget, negotiated during short legislative sessions held in even-numbered years (e.g., 2026), makes modest adjustments to the biennial budgets already in effect.

Before a biennial session, the UW President and Provost lead a process to establish the University’s legislative agenda with ideas and input from the campus community. The legislative agenda is finalized by September when it is submitted, as required by law, as decision packages to the state.

For the Zoom meeting link, please contact Morgan Hickel at mhickel@uw.edu. Due to the limited time available, questions are encouraged to be submitted beforehand to Morgan so they can be addressed in remarks.

The state’s supplemental operating and capital budgets were unveiled with funding included for all of the UW’s top priorities. Both budgets will be voted on by the House and Senate in the next 24 hours. The 2024 legislative session is scheduled to end on time tomorrow. After, the budgets will be delivered to the Governor for his consideration and signature.

In the operating budget, major investments for the UW and UW Medicine included:

• $2.5M (ongoing) to expand the School of Dentistry’s Regional Initiatives in Dental Education (RIDE) program, which trains dentists to serve the state’s rural and underserved populations.
• $330,000 (FY25), $455,000 (ongoing) for The Allen School Scholars Program, a one-year cohort-based program that supports students who are first generation, low-income, and from underserved communities who are pursuing a degree in computer science and computer engineering.
• $60M (one-time) for UW Medical Center and Harborview Medical Center to support their critical safety net care and medical training missions for the state.
• $20M (one-time) for the Center for Behavioral Health and Learning (formerly Behavioral Health Teaching Facility) at UW Medical Center-Northwest.

Overall, the University’s section of the operating budget included funding for over 25 new provisos including funding to implement legislation.

Notable policy passed this session includes:

• House Bill 2112 requires opioid and fentanyl prevention education and resources at higher education institutions.
• House Bill 2348 expands existing county taxing authority which allows operational support for Harborview Medical Center.
• Senate Bill 5913 permits communication between employees of state institutions of higher education and student athletes regarding name, image, and likeness use.

The capital budget also makes significant investments in the UW:

• $5M to design the modernization of Chemical Sciences and renovation of Bagley Hall
• $38.9M for energy renewal and decarbonization projects, including centralized chilled water capacity improvements in Seattle, gas boiler replacements at UW Bothell and UW Tacoma, HVAC systems renewal at UWMC-Montlake, and central utility planning at UWMC-Northwest.
• $5M for Harborview Medical Center for predesign, siting, and design costs for the Behavioral Health Institute building and Pioneer Square behavioral health clinic.
• $2.58M to renovate the UW soccer practice field for the 2026 World Cup.

UW Finance, Planning & Budgeting will post a comprehensive summary of the budgets on their briefs page in the next few days.

A session debrief will be scheduled in a few weeks so stay tuned for the details. In the meantime, contact the Office of State Relations with questions about the final budgets

Following the release of the Senate budget proposals, the House unveiled their operating and capital budget proposals today with funding for the UW’s priorities.

Operating Budget

• $2.5M (ongoing) to expand the School of Dentistry’s Regional Initiatives in Dental Education (RIDE) program, which trains dentists to serve the state’s rural and underserved populations.
• $330,000 in FY25, $455,000 ongoing for the Allen School Scholars Program (formerly Startup), a one-year cohort-based program to support students who are first generation, low-income, and/or from underserved communities who are pursuing a degree in computer sciences or computer engineering.
• $50M (one-time) for UW Medical Center and Harborview Medical Center to support their critical and impactful safety net care and medical training missions for the state.
• $20M (one-time) for the Center for Behavioral Health and Learning (formerly Behavioral Health Teaching Facility) at UW Medical Center-Northwest.

On these items, the House budget proposal almost mirrors the Senate proposal. The Senate provided additional support for UW Medical Center and Harborview Medical Center. Like in the Senate, the House also funded various policy bills and studies.

Capital Budget

• $5M for the modernization of Chemical Sciences and renovation of Bagley Hall.
• $38.9M from the Climate Commitment Account for energy renewal and decarbonization projects, including centralized chilled water capacity improvements in Seattle, gas boiler replacements at UW Bothell and UW Tacoma, HVAC systems renewal at UW Medical Center Montlake, and central utility planning at UW Medical Center Northwest.

The House and Senate budget proposals are identical on these projects.

Now that both chambers have released their budget proposals, budget writers will work to reconcile the proposals into one operating and one capital budget. The House and Senate must pass the budgets before the end of session on March 7.

A detailed overview of the House and Senate budget proposals can be found on the UW Office of Planning & Budgeting’s briefs page. For questions about the budgets, contact the Office of State Relations.

The Senate published their operating budget proposal this evening with the following investments for the UW:

• $2.5M (ongoing) to expand the School of Dentistry’s Regional Initiatives in Dental Education (RIDE) program, which trains dentists to serve the state’s rural and underserved populations.
• $330,000 in FY25, $455,000 ongoing for The Allen School Scholars Program (formerly Startup), a one-year cohort-based program to support students who are first generation, low-income, and/or from underserved communities who are pursuing a degree in computer sciences or computer engineering.
• $65M (one-time) for UW Medical Center and Harborview Medical Center to support their critical and impactful safety net care and medical training missions for the state.
• $20M (one-time) for the Center for Behavioral Health and Learning (formerly Behavioral Health Teaching Facility) at UW Medical Center-Northwest.

Additionally, the proposal funds six policy bills, including codifying the Washington State elections database and extending the implementation timeline for 988 suicide prevention and mental health crisis system.

The House will release their operating and capital budget proposals tomorrow. The Senate has already unveiled their capital budget proposal, which funds the UW’s top priorities. Details about the Senate capital budget proposal can be found here.

After both chambers have released their proposals, budget writers will work to negotiate the final budgets. The budgets must be voted out of both the House and Senate by the last day of session, known as Sine Die, on March 7. They will then head to the Governor’s desk for consideration.

For questions about the budgets, please contact the Office of State Relations.

The Senate unveiled their capital budget proposal today with full funding for the UW’s top capital request: $5 million for the modernization of Chemical Sciences and renovation of Bagley Hall. The proposal also funded five UW energy renewal and decarbonization projects using Climate Commitment Act dollars, including centralized chilled water capacity improvements in Seattle, gas boiler replacements at UW Bothell and UW Tacoma, HVAC systems renewal at UW Medical Center Montlake, and central utility planning at UW Medical Center Northwest.

The proposal will be heard tonight in the Ways & Means Committee and Joe Dacca, Director of State Relations, will testify in support. The House will release their capital budget proposal in the next few days and it will be heard in the Capital Budget Committee this upcoming Tuesday, Feb. 20.

Regarding the operating budgets, the Senate plans to unveil their proposal this Sunday, Feb. 18 and the House will release theirs Monday afternoon. Both will be heard in their respective fiscal committees, Ways & Means and Appropriations, Monday evening. After the proposals are heard, budget writers from both chambers will work to reconcile them. Final budgets will be released and voted on before the end of legislative session on March 7.

For questions about the budget proposals or process, contact the Office of State Relations here.

The 2024 legislative session begins Jan. 8 and will run for 60 consecutive days. During this short session, legislators will pass the state’s supplemental operating, capital, and transportation budgets, which modify the biennial budgets passed last session.

Governor Jay Inslee kicked off the budget process by releasing his budget proposals earlier this month. His proposed budgets prioritize behavioral health care, opioid and fentanyl crisis, climate change and education. His behavioral health package devotes nearly $449 million to increasing state-run bed capacity, invest in hospital staffing, and strengthen behavioral health services for youths. An additional $68 million is allocated to the opioid crisis, including education, treatment, and prevention. $140 million is dedicated to the state’s housing/homelessness strategic agenda. This funding will include creating housing for those with intellectual and developmental disabilities, maintaining encampment resolution efforts, and creating a housing emergency fund.

The governor’s proposals also funded the University of Washington’s legislative priorities, as well as a few additional items:

Operating Budget

• $2.5M in FY25 (ongoing) for the UW School of Dentistry RIDE program to develop more dentists committed to practicing in Washington’s rural and underserved communities, where high quality dental care is often challenging to access.
• $330K in FY25 for the Paul G. Allen School of Computer Science & Engineering Startup Program to help prepare students with high potential and high academic need succeed in the Allen School and the workforce.
• $50M in one-time funding for UW Medical Center and Harborview Medical Center to continue serving the medical and behavioral health needs of Washingtonians, especially those who are most vulnerable, and training the next generation of health care providers.
• $20M in FY25 for Behavioral Health Teaching Facility support, which will operate 75 long-term beds.
• $239K in FY25 for Senate Bill 5447, Alternative Jet Fuels Reporting to calculate and report on jet fuel emissions around SeaTac International Airport.
• $153K in FY25 for Maintenance & Operations for the UW Medical Center-Northwest behavioral health renovation. 

Capital Budget

• $5M to design a new Chemical Sciences Building and modernize Bagley Hall to help meet course demand, increase degree production, attract and retain world-class faculty, and conduct cutting edge research.
• $38.9M from the Climate Commitment Act for energy renewal projects at the UW’s three campuses and UW Medical Center-Northwest. Funded projects include centralized cooling at UW Seattle, replacement of gas fired boilers at UW Tacoma and UW Bothell, and HVAC replacement at UW Medical Center-Northwest.

For in-depth details, see the Washington State Office of Financial Management’s budgets highlights (hyperlink) and the brief prepared by the UW Office of Planning & Budgeting on their Briefs page.

The 2024 legislative session begins on Monday, Jan. 8 and is scheduled to run for 60 consecutive days. During this short-session, state lawmakers will negotiate modest adjustments to the state’s biennial operating, capital, and transportation budgets.

The University of Washington appreciates the recent investments the legislature has made to support higher education and the UW Medicine health system. State support remains essential to the UW’s long-term viability and pursuit of providing an excellent and accessible education for all Washington students, improving the health and sustainability of underserved communities, and promoting a prosperous economy.

The UW’s supplemental budget requests are limited to our top priorities in service to our students, faculty and staff, patients, and the state. The formal 2024 legislative agenda will be published in December. In the meantime, here is a preview of the UW’s priorities for the upcoming session:

Operating budget

UW School of Dentistry RIDE program expansion: $2.5M in fiscal year 2025 (ongoing)
Located in Spokane, the nationally renowned Regional Initiatives in Dental Education (RIDE) program has proven successful in training dentists to meet the needs of our state’s rural and underserved populations. RIDE’s innovative training model immerses students in community-based clinics to gain valuable field experience while also providing high quality dental care to communities with access-to-care challenges. In the classroom, RIDE is colocated with Eastern Washington University’s dental hygiene program to maximize resources and enhance training. Requested funds will enhance the RIDE program by doubling the number of students trained from 32 to 64 and by adding a second year of curriculum based in Spokane. The UW has already secured $1.5M in federal funds for dental simulation equipment and will attract additional research funding to Spokane with this expansion.

Permanent funding for the Paul G. Allen School of Computer Science & Engineering Startup Program: $330,000 in FY25 ($455,000 ongoing)
The UW continues to see unprecedented demand from students and employers for UW computer science degrees. The one-year cohort-based Startup Program provides holistic supports and prepares students with high potential and academic need to succeed in the CSE B.S. program. The program serves students who are first generation, low income and/or did not have access to advanced high school classes to assist in developing fundamental skills necessary for the rigor of the Allen School and the computing field. The state provided $455,000 in FY23 and one-time funding of $125,000 per year for the current biennium. This request bridges the gap in FY25 and makes the funding permanent.

UW Medicine safety net and medical training support
Serving the medical and behavioral health needs of Washington’s residents, especially those who are most vulnerable, and training the next generation of health care providers is necessary for the vitality of our state. Funding for UW Medical Center and Harborview Medical Center will further support their critical and impactful safety net care and medical training missions. UW Medicine received one-time funding for FY23 and FY24 and is making progress in addressing challenges including reimbursement rates and difficult-to-discharge patients. UW Medicine needs additional state support for FY25 to address increasing labor costs and prevent harmful service reductions.

Capital Budget

Design funding for the modernization of Chemical Sciences and Bagley Hall:  $5M
Chemistry is a core program at the UW and is required for students in most STEM and health sciences fields. Built in 1937 and 1957, the current facilities are overwhelmed by student demand and program constraints and do not meet the requirements for interdisciplinary, modern science education and research. Updating our facilities will help meet course demand and increase degree production as well as attract and retain world-class faculty conducting leading edge research.

Campus decarbonization projects:  $48.9M (Climate Commitment Account)
The UW has identified six projects that support foundational energy renewal and decarbonization efforts across all three campuses (Seattle, Bothell, Tacoma) and UW Medical Center facilities. The projects include: UW Seattle centralized chilled water capacity improvements, Clean Energy Institute tenant improvements and research-related needs, UW Bothell Central Plant improvements and gas boiler replacements, UW Tacoma gas boiler replacement, UWMC NW Campus Central Utility Plant planning, and UWMC Montlake Campus HVAC systems renewal. More information about the UW’s decarbonization strategy and plans can be found at UW Sustainability | Energy Transformation.

For questions, please contact Joe Dacca, Director of State Relations, at daccaj@uw.edu or Morgan Hickel, Associate Director of State Relations, at mhickel@uw.edu.