Federal Court Fish Barrier Injunction.  In response to a lawsuit filed by 21 northwest Washington tribes, the U.S. District Court found that the state of Washington has a treaty-based duty to preserve fish runs.  On March 29, 2013, the Court issued a permanent injunction requiring the state to provide and maintain fish passages for salmon at numerous culverts under state-owned roads.  As part of the injunction, the state was required to expeditiously identify culverts blocking fish passage and repair or replace the identified culverts. 

To date, the Department of Transportation has corrected 146 injunction barrier culverts.  The cost to repair remaining identified barrier culverts is estimated to cost in excess of $5 billion.

Public Works Assistance Account.  The Public Works Assistance Account was created to provide a source of funding to assist local governments with infrastructure projects.  The Public Works Board is authorized to make low-interest or interest-free loans from the account to finance the repair, replacement, or improvement of public works systems.  The account receives dedicated revenue from loan repayments as well as a portion of the state real estate excise tax, public utility tax on local water and sewage, and solid waste tax. 

Special Tax Revenue Bonds.  Article VIII, Section 1 of the Washington State Constitution limits the amount of debt that can be issued and secured by the full faith and credit of the state as a formula measured by the amount of general state revenue (GSR).   Amendment 60 and amendment 107 to Article VIII clarify that taxes levied for specific purposes and required to be deposited for those purposes into specified funds or accounts other than the general fund are excluded from GSR.

The Legislature intends to dedicate a portion of taxes levied on light and power utilities to projects identified in response to the federal injunction to improve salmon and steelhead recovery and habitat restoration and mitigate the impact of fish passage barriers.

Deposit of Tax Revenue.  Effective January 1, 2026, a tax of 2.01053 percent is levied on light and power utilities, which must be deposited into the Federal Injunction Salmon Habitat (FISH) Restoration Account.  Taxes levied on light and power utilities and deposited to the general fund are reduced by a commensurate amount.

Taxes previously directed to the Public Works Assistance Account from the state real estate excise tax, public utility tax on local water and sewage, and solid waste tax are directed to the general fund.

Federal Injunction Salmon Habitat Bonds.  The State Finance Committee is authorized to issue special tax revenue bonds for up to $5 billion. The bond authorization expires when the full authorization has been issued and dispersed. The bonds issued:

• are not a general obligation of the state and the full faith, credit, and taxing powers of the state are not pledged for their payment;
• are payable solely from and secured by the FISH tax;
• include the Legislature's pledge to appropriate the FISH tax revenues pledged to the payment of the bonds issued; and
• must be structured for the debt service obligations to be completed by December 31, 2075.

Federal Injunction Salmon Habitat Bond Accounts.  The FISH Restoration Account is created in the state Treasury for the purpose of receiving tax proceeds.  Moneys in the account must first be used for the payment of principal and interest on bonds. 

Funds must otherwise be used solely for fish habitat restoration projects identified in response to the federal court injunction issued under United States v. Washington to improve salmon and steelhead habitat restoration and mitigate the impact of fish passage barriers.  

Funds may also be used to address a combination of local and state habitat restoration projects if a mediation or settlement agreement identifies the projects as necessary to maximize impacts to salmon and steelhead population.

The FISH Bond Retirement Account is created and used only for the payment of principal and interest on authorized bonds. 

Court Decision.  If the court finds the state finance committee may not issue special tax obligations as provided in this act, the bonding provisions of the bill expire. 

• Amends the title;
• Amends the tax rate on light and power businesses to maintain overall tax neutrality;
• Consolidates the Federal injunction Salmon Habitat Account into the Federal Injunction Salmon Habitat Restoration Account;
• Makes technical changes suggested by the Office of the State Treasurer;
• Removes the 15-year dispersal period and instead expires the authorization when the amount of authorized bonds have been dispersed;
• Authorizes the use of funds for both local and state projects if a mediation or settlement agreement identifies the projects as necessary to maximize impacts to salmon and steelhead population; and
• Delays the effective date of tax provisions until January 1, 2026.

The committee recommended a different version of the bill than what was heard. PRO: Redirecting funds toward culvert restoration provides a necessary solution for addressing fish passage barriers while maintaining funding for other transportation projects. Tribal communities in Western Washington ceded millions of acres in exchange for fishing rights, yet settlement and infrastructure development have caused fish populations to decline. Restoring fish habitats remains one of the most effective steps the state can take. This is an opportunity to establish dedicated funding for environmental restoration while meeting legal and treaty obligations to tribal nations.

CON: Reducing Public Works Assistance Account funding will undermine local public works projects by eliminating nearly two-thirds of the program’s revenue. While the state has diverted funds in the past, lawmakers promised to restore them, making this proposal particularly concerning.

Additionally, limiting access to the Public Works Assistance Account shifts financial burdens onto utility customers, who already cover costs for utility relocations related to culvert projects. Without these funds, local governments will likely impose new taxes or raise rates to sustain infrastructure investments.

This bill prioritizes culvert restoration over broader infrastructure needs. PWAA funding plays a crucial role in supporting local utilities, allowing them to distribute infrastructure costs over time in a manageable way. These funds help maintain aging infrastructure and support emergency response projects, ensuring local governments can provide safe and resilient public services. By focusing solely on state-managed culverts, the bill neglects the necessity of fixing local culverts to ensure effective fish migration.