Senate Democrats preview revenue plan as wealth tax falls out of budget talks

Jamie Peterson, speaking for Senate Democrats at a press availability, said the caucus is preparing a revenue and budget package to be debated on the floor within days, and that leadership already has alternate revenue 'plans B, C and D' ready if initial proposals do not proceed.

"This is a critical pivot for us," Peterson said, and later added, "We will not be tapping the rainy day fund." He told reporters he expects a set of revenue bills to be public and begin committee action within about a week, followed by floor debate and a full public process.

Peterson confirmed capital gains as "absolutely possible" as one of the revenue tools under consideration, while saying the wealth tax is "very likely" not to be the basis of this year's budget after recent developments. He said leaders are in active discussions with House leadership and with the governor's office and that staff are in daily contact on both revenue and spending details.

On executive coordination, Peterson said Democrats and the governor met recently and are exchanging comment letters and ideas. "Our staff are in daily communication ... seeking out the comment letters that came from the office of financial management," he said, describing the exchange as "robust." Peterson added the governor's office has proposed additional spending reductions for consideration.

Peterson emphasized procedural transparency for conference reports and budget bills, noting a rule that conference bills must sit on the bar for at least 24 hours before a vote and that a conference report requires agreement from conference committee members. He said that process will allow public review and that the leadership aims to avoid surprising the governor on final decisions.

On spending priorities, Peterson acknowledged competing demands: a bipartisan gas-tax proposal (including a 6¢/gallon increment in the Senate plan) is intended to fund long-term preservation and projects, and he said requests tied to hosting the FIFA World Cup include a $20 million ask from the Seattle Chamber of Commerce. Peterson cautioned that novel revenue sources — such as taxes on new payer categories — take time for the Department of Revenue to implement and therefore are less useful for near-term fiscal year needs.

Peterson characterized the budgeting effort as a balancing act between cuts and new revenue, and said leaders expect to present a package for public discussion within about a week once committees have acted.

The press availability did not include a formal vote or motion; lawmakers described ongoing negotiations and next steps in the legislative and conference process.