Coalition of Washington Officials Calls For Tax Code Reform And Increased Local Authority

King County Councilmember Teresa Mosqueda has joined 67 other elected officials from across Washington state in urging the Legislature and Governor to pass progressive revenue measures and provide local governments with greater authority over taxation.

In a letter sent Wednesday to Governor Bob Ferguson and legislative leaders, the coalition called for the passage of several bills aimed at addressing looming budget deficits. Among them are HB 1334, which would lift the 1% cap on property tax increases; SB 5775, granting local councils the authority to approve a public safety sales tax; and HB 2015, which would allow a local option tax to support public safety efforts.

The push comes as local governments face mounting financial challenges. King County alone projects a $150 million shortfall in its 2026–27 biennial budget. Without new revenue sources, officials warn that communities across the state could face devastating cuts to essential services, including public safety, public health, and human services.

“Our tax code hasn’t been significantly updated in 100 years,” Mosqueda and the other leaders wrote in their letter. “While our statewide population has grown significantly, we are not collecting enough revenue for the investments needed to support our communities and economy, including funding for infrastructure, housing and human services, public health, and public safety, to name a few.”

Local governments in Washington are particularly constrained by a 23-year-old law limiting property tax increases to 1% annually, plus revenue from new construction. With inflation and population growth outpacing this cap, counties and cities are struggling to maintain essential services.

“We are forced to over-rely on property tax revenue, which makes up 60% or more of county general fund budgets,” the letter stated. “With state-imposed limitations, combined with high inflation and very few sources of additional revenue, we now face budget deficits totaling hundreds of millions of dollars.”

The coalition also pointed to the lasting impact of federal funding cuts, noting that without additional state or local revenue tools, essential public services will remain vulnerable.

“Cuts of this magnitude would be the most serious our communities have experienced since the Great Depression,” the letter warned. “Unlike in past recessions, due to the structural nature of our budget deficits, cuts would not be restored through economic recovery.”

In their letter, the officials advocated for a mix of state and local revenue solutions. Proposed measures include a Statewide Payroll Tax, an Intangibles Tax on high-value assets, and a Large Corporation B&O Premium Tax. Additionally, they called for new local options, including a local payroll tax that would allow municipalities to diversify their revenue sources.

Supporters argue that these proposals would help rebalance the state’s tax code, which has long been criticized as one of the most regressive in the nation. Under the current system, low-income households pay a higher percentage of their income in taxes compared to wealthier residents.

“Those who have done well in Washington should do right by Washington,” the letter stated. “We urge you to support these near- and long-term solutions to ensure stable and sustainable budgeting so that we can take care of all Washingtonians and continue services that people depend on.”

The letter also pointed to public sentiment in favor of tax code reform. According to recent research, Washington voters broadly support investments in essential services such as housing, healthcare, childcare, and education — even if it means raising taxes on corporations and wealthy individuals.

“Voters have told us time and again that they want elected leaders to balance our tax code to pay for the things our communities need,” the letter said.

Among the signatories are elected officials from King, Pierce, Snohomish, and Thurston Counties, alongside leaders from Seattle, Tacoma, Spokane, and smaller cities like Bothell, Renton, and Shoreline. Prominent voices supporting the call include King County Executive Dow Constantine and Port of Seattle Commissioners Sam Cho and Hamdi Mohamed.

“Our communities need these investments,” the letter concluded. “Ask the wealthy few and profitable corporations to pay more in taxes. Those who have done well in Washington should do right by Washington.”