With the end of the legislative session, lawmakers have finalized their 2023-2025 operating budget. This budget determines how much funding state agencies and services will receive for the next two years. The final budget increases funding for critical state services like public schools, early learning, and long-term care so that our kids have a great education, parents can go to work, and older adults can receive the care they need. However, of the roughly $70 billion in state dollars appropriated in the final budget, less than $2 billion – not even 3% of total state funds – will go toward promoting economic security through cash assistance to Washingtonians¹.

Thanks to the work of statewide advocates, the final 2023-2025 operating budget includes funding for needed changes to the Temporary Assistance for Needy Families (TANF) program, Working Families Tax Credit (WFTC), and a guaranteed basic income program (GBI) in Tacoma. While these gains are important, legislators failed to take action to give more Washingtonians access to opportunity by omitting funding for a statewide GBI program, a baby bonds program, additional important changes to TANF, and more. 

How the final budget funds economic security  

Cash assistance programs are crucial to Washingtonians’ well-being because they allow people with very low incomes to pay for basic expenses like rent, food, clothes, and school supplies. Growing evidence shows that cash assistance programs help improve people’s economic security, health and education outcomes, and employment and housing stability. In addition, cash assistance programs help reduce racial inequities that lawmakers created through centuries of racist economic policies designed to funnel wealth to white people and exclude Black, Indigenous, and People of Color from economic and social opportunity. 

The final budget includes $21.6 million to fund an 8% increase in benefits to many cash assistance programs including TANF, Aged, Blind, or Disabled Cash Assistance Program (ABD), Refugee Cash Assistance (RCA), Pregnant Women Assistance (PWA), and the Consolidated Emergency Assistance Program (CEAP). This means that many households who face the greatest barriers to financial stability can have more resources to find their footing. However, these programs could have an even greater impact if legislators had kept the funding level of $40 million from the House budget proposal. 

Temporary Assistance for Needy Families 

The final budget spends about $28.9 million in state and federal funds to make important changes to TANF. This amount is a reduction of $39.7 million from the House budget proposal of $68.6 million. The changes include: 

• Raising the asset limits, which means that families with up to $12,000 and one car will qualify for TANF,
• Implementing a $500 earned income disregard², which means that families can keep the first $500 plus half of their remaining earnings every month, and
• Eliminating the 60-month time limit for TANF families without an eligible adult, also known as child-only cases, so that child-only households can participate in TANF beyond 5 years.   

There is also a diaper benefit of $100 per month, which was the higher amount proposed by the Senate, for TANF families with young children to alleviate the rising cost of this essential item. These changes will help families to build up savings and access help when they need it. They will also help increase racial equity by removing barriers to access that disproportionately harm families of color. 

Working Families Tax Credit 

The final budget includes $7.2 million for important changes to the WFTC, namely including people whose tax status is Married Filing Separately and extending the time to apply for the credit for all eligible households from one year to three years. Including the Married Filing Separately (MFS) status will greatly benefit survivors of domestic violence, who commonly rely on the MFS status to avoid further financial abuse. In addition, extending the application period to three years will align our state’s process with the Internal Revenue Service’s and, more importantly, give people sufficient time to apply for the credit they are entitled to. 

Guaranteed Basic Income 

The final budget also includes $1.9 million to continue the successful guaranteed basic income (GBI) program, Growing Resilience in Tacoma (GRIT). The 110 families that participated in GRIT received $500 a month for 13 months and spent over 80% of the money to pay for basic needs like food, school supplies, clothes, housing, and utilities, which demonstrates that GBI is good for families and local economies. This will make Washington the second state behind California to use state dollars to fund a proven solution to improving financial security. Of note, GBI differs from current public assistance programs by providing greater freedom and dignity to participants through unconditional, unrestricted cash payments.  

Aged, Blind, or Disabled Cash Assistance Program 

Lastly, the final budget allocates $53.7 million over the next 5 years to remove the requirement for ABD participants to repay a portion of their ABD payments when they also receive Supplemental Security Income (SSI). This will increase financial and housing stability for older and disabled people with the lowest incomes. 

Missed opportunities to improve economic security 

Lawmakers failed to include many important cash assistance programs in the final budget. These programs would help increase financial security, reduce intergenerational poverty, and have an outsized benefit for Black, Indigenous, and People of Color who have faced historical and persistent racist economic policies that create barriers to economic security.  

• The Evergreen Basic Income Pilot Program would have provided monthly cash payments equal to the cost of rent for a two-bedroom apartment to qualifying participants throughout the state for two years. This policy would have simultaneously increased housing stability and economic security at a time when housing and other costs continue to rise. 
• The Washington Future Fund would have deposited $4,000 into an investment account for every baby that receives care under Medicaid before their first birthday. Under this program, the child could have withdrawn the funds between the ages of 18 and 35 to buy a home, receive postsecondary education, or start a business. The initial investment per person could have grown up to $11,300 in the span of 18 years and to $30,300 in 35 years, with the passage of a constitutional amendment that allows the state to invest the funds in private equities. Lawmakers also failed to pass the constitutional amendment. 
• A full child support pass-through would have allowed TANF participants to keep 100% of child support payments. Currently, the state takes all of the child support payments and passes through only $50 to parents with one child and only $100 to parents with two or more children. A full child support pass-through incentivizes people to make their child support payments and increases the resources that children have to support their growth and development.  
• Permanently eliminating the time limit for TANF participants would have given families more financial stability during their time of need. The current time limit extension ends on June 30, 2023. With the harsh time limit back in place, thousands of families, particularly Black, Indigenous, and Latinx families, will lose a critical lifeline and face greater barriers to making ends meet, exacerbating racial inequities from a program with roots in racism. 
• Unemployment insurance for all immigrants would have created a new unemployment benefit system that provides workers who face job loss with wage replacement regardless of their immigration status.
• The age expansion to the Working Families Tax Credit would have expanded eligibility for this important tax credit to anyone age 18 or older. This change would provide much-needed cash to young workers and working seniors. 

Lawmakers’ failure to pass these policies means that hundreds of thousands of families will continue to face financial instability, housing insecurity, and be unable to meet their basic needs. Families should be able to focus their time on building connections and growing with one another, not worrying about whether they will have a roof over their heads or food on the table. As a state, we must prioritize the well-being of all our neighbors and ensure that everyone has access to opportunity. We urge lawmakers to take bolder action in the next legislative session to meaningfully improve economic security for Washingtonians.