Newsletter — February 26, 2026

IN THE NEWS

• WR launches search for next president and CEO
• WR attends TVW gala and views plans for new building

POLICY

• What we are tracking — WR Legislative Hot List
• Senate Policy Committee acts on email marketing reform bill
• Rulemaking update on employer documentation for mass layoffs

ECONOMY

• Washington lawmakers propose competing budgets amid debate over taxes and reserves
• Supreme Court limits presidential tariff authority
• Working families tax cut boosts households and retail

ON THE LOCAL FRONT

• Seattle office market shows signs of stabilization
• Seattle prepares for lasting impact from 2026 World Cup

RETAIL THEFT & PUBLIC SAFETY

• Retailers respond to rising theft with store changes
• Lacey police arrest suspect in organized retail theft case
• Retail theft trends present ongoing challenges for retailers

WR launches search for next president and CEO

WR has launched a national search for its next President and Chief Executive Officer following the planned retirement of longtime leader Renée Sunde.

Since December 2025, Interim CEO Alesha Shemwell has provided continuity and stability while the WR Board of Directors conducts a comprehensive search. She will continue serving until a new CEO is selected.

WR is seeking a strategic leader to guide advocacy efforts, strengthen member engagement, and position the association for continued success in a changing retail environment.

Learn more about the role and apply here.

WR attends TVW gala and views plans for new building

WR staff and guests recently attended the annual gala for TVW, Washington’s public affairs network, committed to providing unfiltered access to state government coverage. The event welcomed a broad cross-section of civic leaders, legislators, journalists, nonprofit partners, and business representatives to honor TVW’s work facilitating transparent, accessible civic engagement.

Attendees heard reflections on the network’s role in broadcasting legislative sessions, public meetings, and educational programming that help Washington residents follow government proceedings without filters. The evening also underscored the importance of reliable public affairs coverage in fostering an informed civic environment.

During the program, TVW shared plans for a new four-story building addition in Olympia that will expand studio capacity, enhance production capabilities, and create space for community engagement. The project is intended to modernize operations and position the network to meet growing demand for public affairs coverage across Washington and for audiences accessing content nationwide and worldwide.

Funds raised through the gala will help sustain expanded programming and outreach aimed at reaching wider audiences. WR’s participation highlighted its interest in supporting institutions that contribute to informed public dialogue and civic participation across diverse sectors

What we are tracking — WR Legislative Hot List

WR is closely monitoring the bills that have advanced through the legislative process. Each week, we’ll spotlight our weekly “hot list” key legislation that could have the most significant impact on WR members.

Commercial Electronic Mail Act (CEMA) (SB 5976/HB 2274)

HB 2274 has advanced out of the Washington State Senate Business, Trade & Economic Development Committee, clearing the opposite chamber policy cutoff and moving to Senate Rules. The bill must now be pulled to the Senate floor for a vote before the March 6 opposite chamber deadline.

The amended bill makes two significant changes to existing law: 

• Proportional statutory damages: Reduces damages from $500 per message to $100 per message, or actual damages, whichever is greater. This maintains enforcement authority while better aligning penalties with actual harm. 
• Knowledge requirement: Requires plaintiffs to prove the sender either actually knew the message was false or misleading, or reasonably should have known based on objective facts. This eliminates automatic liability based solely on wording and focuses enforcement on intentional or clearly deceptive conduct. 

While not comprehensive reform, the bill provides much-needed stability in the current litigation environment and preserves core consumer protections. It also reflects legislative recognition that a law written in 1998 must be updated to reflect today’s marketing practices and technology. Because this is a short 60-day session, broader structural reform will require interim stakeholder engagement. WR is committed to ensuring retailers’ operational realities are part of those discussions as lawmakers consider long-term updates in 2027.

Position: WR supports this bill.

Status: Passed out of Senate policy committee; now in Senate Rules awaiting consideration by the full Senate before the March 6 deadline.

Employer Medicaid Reimbursement (SB 6173)

SB 6173 would require employers to reimburse the state for healthcare costs if their employees utilize Apple Health (Medicaid). Stakeholders are concerned this would create a significant new employer cost, effectively operating as a hidden tax on businesses, with estimated impacts approaching $1 billion across the employer community. A large coalition of employer and industry groups is actively coordinating opposition, with AWB leading engagement.

WR and a broad coalition strongly oppose the bill, calling it a tax on part-time work that would significantly impact retail and hospitality. Although pulled from executive action temporarily, the bill is expected to return, as it is critical to the Senate’s budget plan, which relies on nearly $1 billion in projected savings. 

Position: WR is opposed to this bill.

Status: Executive session was scheduled on February 19 in Senate Committee on Ways & Means, no action taken – NTIB

Immigration enforcement employer requirements & penalties (HB 2105)

This bill is modeled after California’s 2017 Immigrant Worker Protection Act, but the initial version would significantly expand compliance requirements and penalties well beyond California’s framework, including establishing a private right of action and imposing high fines multiplied by the number of Washington-based employees. Primary concern is the Private Right of Action (PRA). 

The Immigrant Worker Protection Act has passed the House and is now advancing in the Senate, with the House bill serving as the vehicle. While improved, business groups still oppose it due to PRA-related litigation risk and compliance burdens. The bill sets penalties of $1,000 per worker per violation (higher if willful), allows courts to waive penalties in some cases, and limits PRA claims to injured parties. Although the prohibition on voluntary employer cooperation with federal inspections was removed, concerns remain about costly notice requirements and expanded Attorney General investigative authority, which could allow investigations without formal complaints. 

Position: WR is opposed to this bill.

Status: The bill is scheduled for public hearing in the opposite house (Senate Committee on Ways & Means) on February 26 – NTIB

Plastic Bag Ban (SB 5965) 

Multiple proposals this session would revise carryout bag policies, ranging from expanded plastic bag bans and fee increases to proposals that would repeal fees and thickness requirements. WR supports data-driven flexibility and opposes measures that disproportionately impact low-income shoppers. 

WR successfully supported a Senate amendment removing the ban on plastic consumer bags and lowering the paper bag fee. The amendment maintains the current 12-cent plastic bag fee, with gradual increases to 15 cents and then 18 cents over time. With this amendment adopted in the Senate, WR is neutral on the bill and is closely monitoring to ensure the changes remain intact as it moves through the House. 

Position: WR is neutral with amendments.

Status:The bill passed to Rules committee on February 23 for second reading - NTIB

DOR “technical” tax-administration cleanup bills (HB 2257 / SB 6113)  

This bill raises significant concern because it could expand taxation on advertising, particularly if constitutional challenges to the digital advertising tax succeed. Earlier language included a provision that would have eliminated the entire section — including existing deductions and exemptions — if any portion of the law was struck down, potentially broadening an advertising sales tax to cover physical signage, in-store displays, point-of-sale materials, print inserts, and circulars in addition to digital advertising. Due to the potential broad retail impact and ongoing legal scrutiny around differential treatment of digital versus traditional advertising, this remains a high-priority issue. As of 2/6/2026, the tax administration cleanup bill was amended to remove the Section 26 “blow-up” provision that could have eliminated key deductions and exemptions (including retail signage), with support from House leadership. 

A harmful amendment that would have repealed exemptions and deductions for digital advertising, signage, and shelf pricing was successfully removed from the Senate bill. This positive outcome followed joint advocacy by WR and approximately 30 other organizations. 

Position: WR has concerns with this bill.

Status: SB 6113 is scheduled for public hearing in the opposite house (House Committee on Finance) on February 27 – NTIB

Senate Policy Committee acts on email marketing reform bill

On February 25, HB 2274 passed out of the Senate Business, Trade & Economic Development Committee, clearing the opposite chamber policy cutoff. That’s an important step forward. The bill now moves to Senate Rules, where it must be pulled to the floor for a vote by the full Senate. The next major deadline is March 6, the last day to consider bills from the opposite chamber. The coming days are critical.

Key Changes in the Amended Bill 

The amended bill makes two significant changes to the existing law:

• Proportional statutory damages- Damages are reduced from $500 per message to $100 per message, or actual damages, whichever is greater. This preserves enforcement while aligning penalties more closely with real harm.
• Knowledge requirement- A plaintiff must prove the sender either actually knew what they were sending was false or misleading, or that objective facts show they reasonably should have known. This eliminates automatic liability based solely on wording and focuses enforcement on intentional or clearly deceptive conduct.

While not a comprehensive reform, this bill provides much-needed stability in the current litigation climate and maintains core consumer protections. It also signals that the legislature recognizes that a law written in 1998 must be modernized for today’s technology and marketing environment.

Interim Reform Process Will Shape 2027 Updates

A 60-day legislative session limits how much structural reform can be accomplished. Comprehensive reform will require meaningful interim stakeholder engagement. WR is committed to ensuring retailers’ operational realities are fully understood as lawmakers work toward a durable, long-term solution in 2027. If you would like to be involved in the interim stakeholder workgroups, please email WR Director of Policy & Government Affairs Crystal Leatherman at cleatherman@washingtonretail.org.

Thank You to Our Members and Coalition Partners

The progress of HB 2274 reflects strong advocacy from WR members and coalition partners. Lawmakers consistently emphasized how important it was to hear directly from businesses across Washington. Thank you to everyone who responded to alerts, contacted legislators, and helped move this bill forward.

Next Steps: Senate Rules and Floor Vote Before March 6

The immediate focus is advancing HB 2274 out of Senate Rules and securing a full Senate vote before the March 6 deadline. Grassroots engagement will continue to matter. If you would like to be more involved in WR’s advocacy network, please click here.

Rulemaking update on employer documentation for mass layoffs

The Washington State Employment Security Department is developing draft rule language related to employer documentation requirements tied to mass layoff notifications. The rulemaking follows the passage of ESSB 5525 in 2025, which updated requirements connected to worker protections during business closures or large-scale layoffs.

The proposed rules focus on documentation needed when employers seek exceptions to required notice provisions. These updates are intended to clarify compliance expectations and outline the information employers must provide in specific circumstances.

WR encourages members to review the draft language and consider whether it may affect their operations, particularly those with multi-location footprints or fluctuating workforce needs. Clear and practical guidance is essential to ensure employers understand their responsibilities while maintaining flexibility during challenging business transitions.

Stakeholders may submit comments or suggestions on the draft rule language to esdgpuirules@esd.wa.gov by March 19, 2026. When submitting feedback, include “Employer Documentation” in the subject line to ensure it is directed appropriately. 

WR will continue monitoring this rulemaking process and provide updates as additional information becomes available.

Washington lawmakers propose competing budgets amid debate over taxes and reserves

Washington lawmakers are considering competing supplemental budgets for the 2025–27 biennium, highlighting differences over spending priorities, reserve levels, and potential new taxes on high earners. The Senate proposes a $79.4 billion budget with $2.3 billion in new spending for health care, public services, and legal liabilities. Funding would come in part from a future tax on income over $1 million and a $750 million transfer from the state’s rainy-day fund. The House’s $79.9 billion plan takes a more cautious approach, relying on existing revenue, unspent funds, and an $880 million draw from reserves, while also incorporating the proposed income tax in long-term projections.

Both plans respond to rising costs in Medicaid, public schools, childcare, and other mandatory expenses. Revenue forecasts show slightly higher collections than expected, about $200 million more over six years, but mandatory cost increases of nearly $3.7 billion over four years outweigh these gains. Senate leaders note that spending also reflects inflation, legal obligations, and ongoing program costs. Key items include $1 billion through 2029 to strengthen the state’s Self-Insurance Liability Account and $190 million for long-term care for roughly 3,000 residents who are lawfully present but not U.S. citizens.

Revenue strategies differ between chambers. The proposed income tax could eventually generate $3.5 billion annually, with about $2.3 billion projected for the general fund by 2029 under the Senate plan. Funds would support tax credits for working families, small business tax relief, and hygiene product exemptions. Both chambers also plan transfers from capital gains, public works accounts, and other sources to balance the budget.

Lawmakers must now reconcile the proposals, finalize policy measures, and pass a supplemental budget by March 12. Key decisions include whether to adopt the high-earner tax and how much to maintain in reserves, balancing immediate needs with long-term fiscal stability.

SeattleTimes.com

Supreme Court limits presidential tariff authority

The United States Supreme Court ruled 6 to 3 that tariffs imposed under the International Emergency Economic Powers Act exceeded presidential authority. The decision concludes that the 1977 law does not authorize a president to unilaterally impose broad tariffs during a declared national emergency.

Chief Justice John Roberts wrote that the statute’s reference to regulating importation does not clearly grant the power to levy tariffs. The majority also relied in part on the major questions doctrine, finding that decisions of vast economic and political significance require clear direction from Congress. The court emphasized that Congress has historically delegated tariff authority through explicit statutes with defined limits.

The ruling leaves unresolved whether importers could receive refunds for tariffs already collected, estimated at more than $200 billion in 2025. In dissent, Justice Brett Kavanaugh argued that tariffs are a traditional tool for regulating imports and that the statute provided sufficient authority. He also noted that other federal laws may permit future tariff actions with additional procedural steps.

Retailers and importers are watching closely, as the decision may reshape the legal framework for trade policy and influence future executive actions affecting supply chains and consumer costs. The National Retail Federation (NRF) called the ruling “much-needed certainty” for U.S. businesses and manufacturers. In a statement, Executive Vice President of Government Relations David French said the decision will help global supply chains operate without ambiguity and urged that lower courts ensure a seamless process to refund previously collected tariffs. “The refunds will serve as an economic boost and allow companies to reinvest in their operations, their employees, and their customers,” French said.

SCOTUS Blog

Working families tax cut boosts households and retail

This tax season, millions of American families are seeing larger refunds thanks to the Working Families Tax Cut. The law provides targeted relief through a more generous child tax credit, higher standard deduction, expanded state and local tax deduction caps, and new deductions for tips and overtime. Because these changes were applied retroactively, amilies are benefiting from a full year of relief, increasing take-home pay and disposable income.

That extra financial flexibility matters for retail. Consumer spending drives nearly 70% of the U.S. economy, and retail alone supports 55 million jobs while contributing $5.3 trillion annually to GDP. With more funds in their pockets, families are boosting store traffic, transaction volume, and seasonal demand.

The tax cut also supports retailers directly. Permanent provisions, including the Section 199A deduction for pass-through businesses, the 21% corporate tax rate, and full expensing for domestic research and development, give businesses certainty to invest, hire, and modernize operations.

By strengthening both household finances and the business environment, the Working Families Tax Cut fuels local economies, enhances financial stability for workers, and helps retailers remain competitive.

Seattle office market shows signs of stabilization

Seattle’s downtown office market ended 2025 with historically high vacancy rates, but recent data suggests the pace of increase is slowing.

According to reports from Cushman & Wakefield and CBRE Group Inc., downtown vacancy reached about 35 percent in the fourth quarter of 2025. Cushman & Wakefield reported a 35.6 percent rate, up 3.3 percent from 2024, while CBRE recorded 34.7 percent. The rise has been attributed largely to technology sector layoffs and companies downsizing office footprints, resulting in millions of square feet of vacated space.

Several major employers announced workforce reductions, including Amazon, Expedia Group, and Meta.

Despite elevated vacancies, there were signs of improvement late in the year. CBRE reported positive net absorption in the fourth quarter, marking the first quarterly gain in more than three years. Average asking rents increased 1.3 percent year over year to $47.62 per square foot. Class A rates across the Puget Sound region remained relatively stable at $51.35 per square foot.

Business leaders, including the Downtown Seattle Association and the Seattle Metropolitan Chamber of Commerce, noted that while challenges remain, renewed leasing activity and a slowing rise in vacancies may signal the market is approaching a turning point.

For retailers, downtown recovery efforts and continued employer engagement will be key factors to watch.

Seattle prepares for lasting impact from 2026 World Cup

With the 2026 FIFA World Cup approaching, leaders are focused not only on hosting matches but also on creating long-term economic and community benefits for the region. Under the direction of Peter Tomozawa, SeattleFWC26 is advancing legacy projects tied to arts, infrastructure, and small business engagement.

Plans include a Unity Loop walking trail connecting Lumen Field and Seattle Center, decorative flag installations, and small neon signs for storefronts to encourage visitor exploration of neighborhood business districts. Organizers also intend to launch a global innovation forum in 2027 to sustain momentum beyond the tournament.

Seattle is scheduled to host four group stage matches and two knockout matches. Visit Seattle estimates the event could generate at least $929 million in economic impact for King County, including more than $100 million in state and local tax revenue. Approximately 750,000 visitors are expected.

State lawmakers allocated $46.6 million for preparations, including $19.4 million for stadium upgrades and $22.6 million for transportation investments. In addition to the Seattle Center, fan zones are planned in communities across Washington.

Major gathering spaces will include Seattle Center, Pacific Place, Waterfront Park, and Victory Hall in SODO. Programming will feature large viewing screens, cultural performances, interactive activities, and family-friendly spaces. Most locations plan to operate throughout the tournament, not only on Seattle match days, with combined capacity reaching about 15,000 attendees at peak times.

Organizers say the distributed approach is designed to spread economic activity across neighborhoods and create opportunities for local vendors and small and BIPOC-owned businesses. Additional activations are planned downtown and in neighborhoods such as the Chinatown International District and Central District.

Beyond Seattle, nine official fan zones are planned statewide, including in Bellingham, Bremerton, Everett, Olympia-Lacey, Spokane, Tacoma, Tri-Cities, Vancouver, and Yakima, extending potential economic and tourism benefits to communities across Washington.

Retailers respond to rising theft with store changes

National retailers, including Walmart and Target, say organized retail crime and ongoing inventory losses are driving significant changes inside their stores.

Company leaders report theft levels remain above historical norms, contributing to hundreds of millions of dollars in losses. In response, retailers have expanded security measures such as locked display cases, receipt checks, visible security presence, and increased surveillance technology. Frequently secured items include beauty products, baby formula, laundry detergent, and over-the-counter medications.

Some stores are also testing additional strategies, including adding more floor associates, reorganizing product placement, and adjusting entry and exit points to better manage traffic flow.

While retailers describe these steps as necessary to protect merchandise and maintain operations, some shoppers report frustration with longer wait times and limited access to everyday essentials. Social media posts reflect mixed reactions, with customers citing inconvenience and delays when assistance is required to unlock items. 

Industry observers note that retailers are working to balance loss prevention efforts with customer experience, a challenge that has intensified as theft pressures continue into 2026

Lacey police arrest suspect in organized retail theft case

Law enforcement agencies in Thurston County recently arrested a man accused of multiple thefts from Home Depot stores in Lacey, underscoring continued concerns about organized retail crime in the region.

According to the Lacey Police Department, the suspect is linked to eight incidents involving the theft of large quantities of lumber and tools. The investigation was led by a Crime Reduction Unit officer who identified the individual as a repeat offender with a history of property crimes and assault.

On January 7, officers from Lacey Police, with assistance from the Tumwater Police Department and a K9 unit from the Olympia Police Department, served a search warrant at the suspect’s property. After approximately one hour, the individual was taken into custody. Authorities also sought recovery of the stolen merchandise as part of the warrant.

The suspect was booked on charges of organized retail theft, resisting arrest, and two outstanding misdemeanor warrants

Retail theft trends present ongoing challenges for retailers

Retail theft continues to affect stores nationwide, with recent data highlighting increases in both incidents and related safety concerns. According to a study by the National Retail Federation and the Loss Prevention Research Council, retailers reported an 18 percent rise in average shoplifting incidents in 2024 compared with 2023. Threats or acts of violence during theft events increased 17 percent over the same period.

The Federal Bureau of Investigation defines organized retail theft as large-scale merchandise theft intended for resale, often involving coordinated groups. Recent reports have detailed multi-state theft rings and high-value incidents, including approximately $180,000 in stolen collectibles from a California store and more than $9,000 in beauty products taken from a CVS location.

At the same time, some analysts have questioned elements of retail theft data, noting that inventory systems, returns, and reporting methods can also influence shrink figures. 

Retailers are responding with a range of strategies, including expanded employee training, enhanced security measures, and, in some cases, locked merchandise displays. Industry experts note that no single solution has proven fully effective, and many emphasize the importance of balancing loss prevention efforts with customer experience and employee safety.

WR diversity statement

WR is committed to the principles of justice, equity, diversity, and inclusion. We strive to create a safe, welcoming environment in which these principles can thrive.

We value all people regardless of race, ethnicity, gender, religion, age, identity, sexual orientation, nationality, or disability, and that is the foundation of our commitment to those we serve.

Alesha Shemwell, Interim CEO — 360.200.6450 — Email

Crystal Leatherman, Dir of Policy & Government Affairs — 360.200-6453 — ‬Email

Rose Gundersen, State and Local Gov't Affairs Associate — 360.200.6452 — Email