WA Democrats May Bypass Gov. Ferguson Veto Threat With Hail Mary Wealth Tax Referendum Bill

After Gov. Bob Ferguson said he would not sign a budget balanced on the State Senate and House’s multi-billion dollar wealth tax proposals, Democrats are allegedly plotting a Hail Mary to tax the rich anyway. One suggestion floating around Olympia: A wealth tax as a referendum bill. That way, according to the state constitution, the legislature can bypass Ferguson’s threat of veto, and ask for approval from the people rather than one overbearing executive.

A referendum bill isn't common — believe me, I called around — but it's happened before in Washington State history. In 2010, the Legislature passed a bill to issue $505 million in bonds to fund energy efficiency projects in public schools. But instead of enacting it directly, lawmakers legislatively referred it to voters, allowing them to weigh in on Referendum 52 on their ballot that November. The measure failed with 53.7% of voters rejecting it.

In that case, then-Gov. Christine Gregoire signed the referendum bill before it went to voters, but her approval was purely symbolic. According to article II, section I of the Washington State constitution, “The veto power of the governor shall not extend to measures initiated by or referred to the people.” If the plain reading of that line holds up, lawmakers can cut Ferguson out of the process all together.

There’s pros and cons to the scheme. For one, without Ferguson in the way, lawmakers can pass a much more ambitious wealth tax. While the House penciled in $2.4 billion in wealth tax revenue for their two-year budget and the Senate $4.2 billion, Ferguson said he would approve a wealth tax no greater than $100 million a year as a test balloon for inevitable legal challenge and “the court of public opinion.”

On the flip side, a referendum means an expensive campaign fight leading up to November. For example, Democrats, progressives, anyone who understood the evils of defunding public education to give rich people a tax break, spent almost $50 million and countless hours to defeat the Let’s Go Washington initiatives last year.

To be sure, the conservatives would certainly launch a referendum if the State passed a wealth tax anyway, but in that case, they would have to collect 150,000 signatures, which could take months, maybe even long enough to delay the vote until 2026. Let’s Go Washington already threatening an initiative to repeal changes to their so-called “Parents Bill of Rights.”

It could be strategic to try to separate those measures for sake of capacity and because the issues might split the Democrat donors class, making it difficult to pool resources and run a unified campaign for the wealth tax and against any anti-trans shit Brian Heywood tries to pull. Plus, 2026 may yield a higher than usual progressive turnout as the midterm election after President Donald Trump took office.

For now, details are very limited and it's stil unclear if the Democrats will pursue the referendum at all. Stay tuned!