How Did We Get Here?
The most significant development of the last week of February wasn’t just the hearings and fiscal committee actions—it was Governor Bob Ferguson’s news conference, where he outlined approximately $4 billion in additional budget cuts for the legislature to consider. These cuts, on top of those in Governor Inslee’s proposed budget, could cover nearly half of the state’s projected shortfall.
Currently, the state operates on a balanced budget that extends through June 30, 2025. However, the primary focus of the 2025 legislative session is crafting a new operating budget for the following years. A significant challenge looms: a projected $15 billion gap between expected tax revenue over the next four years and the state’s existing financial commitments, including funding for education, healthcare, corrections, and human services.
And last Friday, House Democrats launched a public campaign advocating for new revenue, unveiling a website illustrating what a “no-revenue” budget would look like under Governor Inslee’s proposal. To understand the implications of a prior governor’s budget, this website, and Governor Ferguson’s cost-cutting approach, it’s important to review how Washington State’s budgeting process works.
How Did We Get Here?
The budget process begins in the fall when state agencies submit funding requests to the Office of Financial Management (OFM). By law, the current governor must then propose a four-year budget in December that does not assume new revenue or changes to existing law. This initial proposal, drafted by Governor Inslee’s team, known as the “Book 1 Budget,” is a stark starting point—this year, it includes $12 billion in cuts, such as:
$3.5 billion from healthcare
Over $1 billion from higher education
$1.3 billion from human services and early learning
The legislature, constitutionally required to pass a balanced budget, will use this as a foundation for negotiations. On March 18, updated revenue and caseload forecasts will guide legislators in shaping their own budget proposals, incorporating spending reductions and potential revenue measures. The final budget must be approved by April 27, or the state could face one or more special sessions. And of course, the governor must agree to sign it.
Governor Ferguson’s Cost-Cutting Approach
Governor Ferguson has proposed a cost-reduction framework focused on improving efficiency before considering new revenue options. His plan includes:
Consolidating agency management roles by 10-25%
Cutting administrative positions
Limiting equipment purchases
Reducing travel expenses
Ferguson has emphasized, “Washingtonians expect that we will increase revenue as a last resort… I will not start contemplating additional revenue options until we have exhausted efforts to improve efficiency.” His stance, widely seen as a critique of past Democratic-led budgets, has created tension with majority party leaders. House Democrats, in particular, have reacted negatively, barring the governor’s policy advisors from legislative discussions in the wings without explicit invitations.
Pushback from Advocates
Even prior to this week’s announcement, Govenor Ferguson’s proposed cuts have drawn sharp criticism in the legislative arena. For example, OFM-request HB 1476 (Ormsby, D-3) seeks to delay nursing home rate adjustments until 2028. At a recent House Appropriations Committee hearing, SEIU 775 and representatives from 29 nursing homes strongly opposed the measure, arguing it would devastate facilities already struggling with rising costs. Of the 650 people who signed in, only three supported the bill. Among 30 testifiers, not one spoke in favor, aside from OFM representatives.
In response to the governor’s cost-cutting proposals, Senate Ways & Means Chair Senator June Robinson (D-38) issued a statement: “We appreciate the work the governor and state agencies have done to reach this point. Like them, we recognize that budget reductions are necessary and will carefully consider all the options that have been identified. But we have also reached the conclusion that reductions alone will not allow us to sustain the services Washingtonians rely on. People expect a government that remains functional and responsive, especially in times of federal instability.
Our job is to take a balanced approach — one that ensures critical services remain strong and communities have the support they need. To truly meet the needs of the people we serve, we must make thoughtful reductions and consider progressive revenue options that ensure fairness and long-term stability. We will continue advocating for a budget that upholds our shared values and keeps Washington moving forward.”
$4 Billion in Cuts
In developing the $4 billion in Ferguson’s proposed cuts, state agencies were instructed to assess programs based on specific criteria, targeting:
Recently launched programs
Those funded by temporary federal aid
Programs over four years old
Services reaching fewer than 1,000 people annually
Programs lacking performance tracking or mandated by legislation
These efforts will continue shaping the budget debate in the coming weeks as lawmakers determine how to close the state’s significant financial gap.
Kathleen Hosfeld | CEO/Executive Director (she/her)