PORT ANGELES — The 24th Legislative District’s three state lawmakers briefed the Port Angeles Business Association about the pressures that are expected to shape the 2026 legislative session during the group’s weekly breakfast meeting at Jazzy Joshua’s.
State Sen. Mike Chapman, D-Port Angeles, and Reps. Steve Tharinger, D-Port Townsend, and Adam Bernbaum, D-Port Angeles, outlined the fiscal constraints they anticipate when lawmakers return to Olympia on Jan. 12, the first day of the 60-day session.
On Tuesday, they described a landscape defined by slowing revenue growth, increasing social-service demands and the first full budget proposal from Gov. Bob Ferguson.
Chapman said early signals from the governor’s office point toward a “no-new-revenue” operating budget. Lawmakers, he said, are waiting to see where reductions might fall.
“We just don’t know yet where those cuts could land, so we were preparing for several scenarios,” Chapman said.
Tharinger, chair of the House Capital Budget Committee, said Washington is facing an estimated $1 billion shortfall in the current two-year operating budget — a number that will grow to more than $2 billion once long-term caseload obligations and the state’s four-year balanced-budget requirements are factored in.
He said such gaps often prompt legislators to revisit accounts that support construction and infrastructure, creating additional pressure on the capital budget even when the need for local projects remains high.
The state’s financial picture, the lawmakers said, was further complicated by declining fuel-tax revenue, inflationary construction costs and new federal mandates — including about $200 million Washington will have to spend to build an IT system to administer upcoming Medicaid work-requirement rules. Those obligations, they said, add costs without actually helping people.
Together, the delegation said the combination of restricted revenue growth and rising expenses will make the upcoming session unusually tight as legislators try to protect core services while advancing policy priorities important to their districts.
Chapman defended the Climate Commitment Act, which passed in 2021 and took effect in January 2023, noting that it funded the Working Families Tax Credit and was upheld by voters in November 2024. He acknowledged that compliance credits increased some costs for fuel suppliers but that the system is designed to shrink over time as emissions decline.
He also pointed to the Legislature’s recent gas-tax increase, emphasizing that the bill authorizing it “was a bipartisan piece of legislation coming out of the Senate.” Although he said he heard criticism from both parties, he noted that the tax was funding projects in Clallam and Jefferson counties, including resurfacing work, fish-passage barrier removal and safety improvements.
Bernbaum said a proposed road-usage charge has drawn more public opposition than any other bill in state history. Still, he said, lawmakers would eventually need a method to ensure electric and hybrid vehicles contribute equitably to road maintenance, since reductions in gasoline consumption has reduced fuel-tax revenues.
“We knew we had to do something,” he said. “The current model wasn’t going to sustain us long-term.”
On the subject of roundabouts, lawmakers said more are likely to be added in the region. While they acknowledged public frustration — particularly from commuters on U.S. Highway 101 — they said safety data clearly support the design.
“They reduced serious crashes dramatically — that’s just what the numbers showed,” Chapman said, citing federal statistics indicating up to a 75 percent drop in injury collisions.
The delegation rejected the idea that rural districts are disadvantaged compared to communities along the state’s political and economic spine.
Tharinger said the state’s capital-budget investments on the Olympic Peninsula contradict the notion that rural areas are overlooked. He pointed to recent funding for behavioral-health facilities, water-system upgrades, community colleges and early learning centers.
“We’d made a lot of investments in the 24th (District) and on the Peninsula,” he said.
He added that Office of Financial Management data showed that, for every $1 Peninsula residents paid in state taxes, they received about $1.35 back in services and investment. In contrast, King County residents received roughly 90 cents for every dollar they contributed, he said, underscoring how state funds typically flow from urban tax bases to rural communities.
Chapman cited the $32 million Elwha River Bridge replacement, tax extensions and exemptions for the timber and agriculture sectors, and bipartisan support for several rural economic-development initiatives. Many urban-district lawmakers, he said, grew up in rural communities and still approach policy with rural needs in mind.
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Reporter Paula Hunt can be reached by email at paula.hunt@peninsuladailynews.com.
