Newsletter — January 08, 2026 | | |
POLICY
ECONOMY
ON THE LOCAL FRONT
POLITICAL NEWS
RETAIL THEFT & PUBLIC SAFETY
IN THE NEWS
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Start of the 2026 Washington legislative session
The 2026 Washington State Legislative session convenes this month, beginning the 60-day short session held in even-numbered years. During this session, lawmakers will focus on supplemental budget adjustments and policy proposals that address emerging issues facing the state. Legislators will meet in Olympia through early March to debate bills that impact Washington’s economy, employers, and communities.
Key topics expected to receive attention this session include state budget pressures, tax and fee proposals, public safety and organized retail crime, workforce and employment-related policies, and regulatory and technology issues. Many bills are already being pre-filed, setting the stage for a fast-paced and highly focused session.
WR will be actively engaged throughout the session, advocating on behalf of retailers of all sizes and ensuring the industry’s perspective is heard as legislation moves forward.
Members are encouraged to participate in advocacy efforts by signing up for WR’s VoterVoice platform. VoterVoice allows you to easily send messages to state and federal legislators to share your support or concerns on key retail-related issues. WR will provide timely updates and sample messages to help you engage quickly and effectively.
To learn more about WR’s policy goals, review WR’s 2026 Legislative Priorities.
Sign up for VoterVoice.
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New rules advance worker notification requirements
In 2025, the Washington State Legislature passed Engrossed Substitute Senate Bill 5525, establishing new requirements intended to protect workers facing unemployment due to business closures or mass layoffs. The law created a new act within Title 49 RCW and outlines advance notice obligations for certain employers.
Under the legislation, employers with 50 or more full-time employees generally may not proceed with a business closing or mass layoff until 60 days after providing written notice to the Employment Security Department and to affected employees. If employees are represented, notice must be provided to the applicable bargaining representative. The law also authorizes civil penalties for employers that do not comply with these notice requirements, subject to specific exceptions outlined in the statute.
The Employment Security Department is implementing the law through a phased rulemaking process. As part of the first stage, the Department has permanently adopted new language in WAC 192 01 001, the rule governance statement. This rule clarifies the Department’s authority and approach to administering the new act.
The updated rule will take effect on January 11, 2026. Additional rulemaking phases are expected as implementation continues.
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Governor outlines support for proposed millionaires’ tax
Governor Bob Ferguson announced his support for a proposed millionaires’ tax during a December 23, 2025, press conference, framing it as a long-term policy change rather than a solution to the state’s immediate budget challenges. He emphasized that revenue from the tax would take several years to materialize and should be directed toward relief for working families and small businesses most affected by Washington’s tax structure.
The proposal would apply to individuals earning more than $1 million in annual income, not to net worth or asset values such as home equity. According to the governor’s office, fewer than one-half of one percent of Washington residents would be affected, and the tax could generate at least three billion dollars annually once fully implemented. Ferguson also expressed support for adjusting the income threshold over time to account for inflation.
The governor highlighted Washington’s reliance on regressive taxes, noting that lower-income households pay a higher share of their income in taxes than higher earners. He suggested potential uses of future revenue could include expanding the Working Families Tax Credit, reducing certain taxes on small businesses, increasing funding for public education, and removing sales taxes on essential goods.
Ferguson acknowledged that lawmakers will ultimately shape the details and said he looks forward to continued discussions during the legislative session.
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Emerging product responsibility bills in 2026
The 2026 legislative session is only 60-days, but the Legislature still has the appetite to pass product responsibility bills. WR has been working with policymakers on the following product responsibility proposals:
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Post-Consumer Recycled Content (HB 2271) - Proposed legislation would require certain products and packaging to include minimum levels of post-consumer recycled content. These mandates are intended to stimulate demand for recycled materials and support recycling markets.
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Bottle Recycling (HB 1607/ SB 5502) - Lawmakers are expected to revisit bottle recycling legislation with the goal of increasing container recovery rates and reducing litter. The Washington proposal appears to be inspired from other states with similar laws that have gone into effect. If it were to pass, the bill would impose new obligations on producers and distributors to fund or manage recycling programs.
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Mattress recycling (HB 1901) – While four states have implemented mattress recycling programs relying on a point-of-sale fee funding model with measurable successes, our state’s proposal creates a producer responsibility structure. Producers will pay the recycling costs with extensive collection network requirements and agency oversight authorities beyond comparable programs in other states.
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Retail bags (HB 2233/SB 5965) – To reduce plastic bags given out by retailers, this proposal adds definitions to “film plastic,” “single-use plastic carryout bag,” and “third-party platform,” with other requirements and clarifications to retailers and even manufacturer/distributor or third-party platforms.
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Supplemental budget proposal highlights fiscal approach
Governor Bob Ferguson has released a proposed two-year balanced supplemental budget totaling about $79 billion. The plan represents a 1.5 percent increase over previously enacted budgets and comes as the state faces a projected $2.3 billion shortfall tied to lower-than-expected revenue and critical agency requests.
The proposal addresses the gap through a mix of strategies, including roughly $800 million in spending reductions, $425 million in fund reallocations, and a $1 billion transfer from the state rainy day fund, which is projected to hold just over $2 billion for the 2025 to 27 biennium.
While the Governor states the budget does not rely on new taxes, it does repeal or modify several tax preferences. These changes include ending a sales tax exemption for replacement data center servers, adjusting the preferential tax rate for prescription drug wholesalers, and modifying how certain insurance-related taxes interact. Together, these changes would generate additional state revenue.
During the budget rollout, the Governor also reiterated support for a potential income-based tax on high earners, though it is not assumed in the current proposal. Analysis is ongoing, and stakeholders continue to review the potential impacts on the business community.
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Mayor Katie Wilson took the reins of Seattle City Government on January 1
As the New Year's fireworks display began at the Space Needle, Seattle’s leadership changed hands. Mayor Katie Wilson, City Attorney Erika Evans, and Councilmember Dionne Foster assumed their new positions.
At her ceremonial swearing-in on January 2, Mayor Wilson delivered her inaugural address, declaring that “this is your city.” In her speech, the new Mayor did not lay out a series of new programs or even commitments on issues like public safety and homelessness. Instead, she called on the people of Seattle to join her effort to make the city a better place to live and work.
Mayor Wilson was also somewhat introspective, talking about the transition she must make.
I’m a rabble-rouser. I campaigned on affordability, on homelessness, on taxing the rich. I’ve spent my career organizing with the people who get left out of those official narratives.
But now I’m the mayor. It’s my job to channel excitement for major projects, and not just that, I have to genuinely care about them enough to exercise good judgment and make the best decisions possible for our city.
Can I do that? Can I be the mayor of the waterfront and the World Cup and the stadiums and the Seattle Center and the convention center and any other centers that we might decide to build?
Well. Good news for our city: Yes, yes, I can. I’ll do it in my own way, but yes, I can do that.
She discussed the need to build trust in her leadership and in city government by getting results.
That means listening and responding, solving problems, and getting results. That means making true, tangible progress on problems like homelessness, where progress has eluded our city for many years. That means paying attention to the details.
She closed by asking the people of Seattle to each play their own role in building a better Seattle.
With all of you is where the real power lies. And that is why I intend to govern in a way that creates space for organizers and ordinary people to do the work of pushing our city and our society forward, towards realizing our highest and best aspirations. Because I know that what I am able to accomplish in office will depend on what you’re able to build on the outside.
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Seattle City Council selects new president
The Seattle City Council has unanimously elected Joy Hollingsworth as its new president, marking the first time a Black woman has held the role in the city’s history. Hollingsworth replaces Sara Nelson and will serve as the primary organizer of the council’s legislative work.
In remarks following the vote, Hollingsworth emphasized a collaborative approach, noting that the presidency is intended to facilitate the work of the full council rather than override it. The position is largely administrative and includes overseeing legislative staff, assigning committee roles, and determining how and when legislation moves through the council.
The vote came as the council welcomed a new member, Dionne Foster, who was sworn in this week. Foster joins Alexis Mercedes Rinck and Eddie Lin, both of whom are newer members, as part of a shifting council dynamic. With several members serving less than a full term, seniority was not a deciding factor in the leadership selection.
Alongside the leadership vote, the council announced updated committee assignments. Dan Strauss will lead Finance, Native Communities and Tribal Governments, which oversees the city budget. Bob Kettle will continue to chair Public Safety, while Rob Saka remains over Transportation. Maritza Rivera will chair Libraries, Education, and Neighborhoods. Foster will lead Housing, Arts and Civil Rights; Lin will chair Land Use and Sustainability, and Rinck will oversee Human Services, Labor and Economic Development. Hollingsworth will also chair the Governance and Utilities Committee.
Council colleagues cited Hollingsworth’s steady leadership during the city’s long-term growth planning process as a key reason for their support. Hollingsworth closed by committing to respectful engagement with all who work with the council.
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Storefront repair fund offers help for damaged businesses
Seattle business owners facing property damage may be eligible for financial assistance through the Storefront Repair Fund. The program reimburses the cost of repairing eligible storefront damage, helping businesses recover from incidents that disrupt operations and customer access.
The fund provides reimbursement of up to three thousand dollars per incident, with a limit of three separate incidents per business. Multiple grants may be requested in a single application, as long as each claim is tied to a different incident that occurred on a different date. Businesses that have previously received funding may apply again if a new eligible incident occurs.
Covered repairs include damage to doors, locks, fences, gates, signs, and broken or etched windows. To qualify, the damage must have occurred on or after July 1, 2024. The program does not cover losses related to stolen merchandise or graffiti.
Applications are open through December 2026 or until available funds are exhausted. Retailers and other business owners are encouraged to review eligibility requirements and apply promptly, as funding is limited and demand may be high.
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Cash rounding guidance takes shape amid penny shortage
Retailers across the country continue to navigate challenges caused by the ongoing penny shortage. While many retailers have adopted similar approaches to handling cash transactions without pennies, practices can vary based on store size, location, and operational needs. National retail advocates remain engaged with federal and state partners to encourage consistent and practical guidance.
At the federal level, updated language is being prepared for the Common Cents Act in the US House of Representatives. The proposal would allow optional rounding in cash transactions and aim to provide clarity by superseding conflicting requirements across jurisdictions. Discussions with congressional staff are ongoing. Federal agencies are also involved, including efforts to develop frequently asked questions through the Treasury Department that could help set expectations for businesses and consumers, even if such guidance is not legally binding. Additional attention has been directed toward ensuring federal nutrition assistance rules are addressed in any rounding framework.
States are also exploring solutions. Utah has issued guidance, Texas is considering similar action, and New York has introduced legislation on cash rounding. To support consistency, model legislative language has been developed to help states craft clear and uniform approaches.
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Seattle drug and public safety policy shifts draw debate
Recent developments in Seattle highlight an ongoing debate over how the city should address open drug use, low-level offenses, and public safety. The Seattle Police Officers Guild has raised concerns about a directive it says discourages arrests for open drug use and instead emphasizes referrals to diversion programs such as Law Enforcement Assisted Diversion (LEAD). The guild argues this approach limits enforcement options and may worsen public safety conditions, while city leadership has not publicly detailed the full scope or intent of the directive.
At the same time, newly-elected Seattle City Attorney Erika Evans took office with a platform focused on treatment, diversion, and alternative court models. A former federal prosecutor, Evans has said she plans to prioritize public safety while shifting away from what she views as ineffective or overly punitive practices. Her agenda includes working with the courts and public defense to establish a reimagined community court that combines accountability with access to services, such as treatment and structured community service.
Evans has also reiterated her intention not to charge violations of Stay Out of Drug Areas (SODA) or Stay Out of Areas of Prostitution (SOAP) orders. While judges may still issue such orders, her office would not pursue new criminal charges solely for violating them. Supporters see this as a move away from banishment-based enforcement, while critics argue it could weaken tools used to disrupt open-air drug activity and commercial sexual exploitation.
Editorial commentary and law enforcement voices have emphasized concerns about human trafficking and neighborhood safety, particularly along Aurora Avenue North. Advocates for SOAP orders argue they help target buyers and traffickers rather than exploited individuals, while Evans has called the policies discriminatory and has urged a focus on alternative strategies.
Together, these developments reflect a broader policy shift and a continuing conversation about balancing enforcement, treatment, accountability, and community impact in Seattle.
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Cargo theft highlights supply chain security challenges for retailers
WR note: This article is shared with a modified headline. The original content remains unchanged
Published in the Seattle Times
By Megan Ulu-Lani Boyanton , Seattle Times business reporter
Dec. 31, 2025
Costco recently found itself in a pinch after criminals allegedly stole $400,000 worth of lobster headed to its stores in Illinois and Minnesota.
Earlier this month, thieves pilfered a truck carrying lobster meat in Taunton, Mass., said Dylan Rexing, president and CEO of Rexing Companies, on Tuesday.
His business in Evansville, Ind., coordinates product shipments for manufacturing companies. In this instance, it planned the logistics to transport the lobster meat from a processor, which Rexing declined to name, to Costco through a carrier he had previously used.
Scammers made sure that didn’t happen, he said.
According to Rexing, criminals posed as the regular carrier over email, a scamming tactic known as spoofing. Then, in order to secure the goods on Dec. 12, thieves allegedly changed the name on the side of their truck and presented a phony driver’s license.
“We believe it’s a crime organization,” Rexing said in a phone interview.
Costco didn’t respond to a request for comment.
With crustaceans in mind, thieves have been trying for the whole seafood tower.
A load of crab was also allegedly stolen on Dec. 2 from the same facility, which Rexing said he learned from the local police department. Taunton Police Department didn’t respond to a request for comment.
| | Image credit: Seattle police chase after a felony retail theft suspect at University Village on Dec. 23, 2025. (SPD) | |
Seattle police make arrests during holiday retail theft operation
Seattle police reported multiple arrests following an organized retail theft operation at University Village during the busy holiday shopping period. The incident occurred on December 23 as officers worked with store loss prevention teams to address theft activity at the shopping center.
According to police, two women were taken into custody after allegedly attempting to steal merchandise from a lingerie retailer in the early evening. Officers said they recovered more than $170 in unpaid merchandise, along with items investigators described as tools and weapons. Both suspects were booked as part of the ongoing investigation.
Later that evening, store staff identified two additional individuals suspected of stealing from the same retailer. Police arrested one suspect after a foot pursuit through the parking area, while the second individual was able to flee. Officers reported recovering roughly $760 in additional merchandise connected to that incident.
Police released images related to the pursuit and continue to search for the remaining suspect. Shoppers interviewed after the incident expressed surprise, noting that University Village is generally viewed as a safe and upscale retail destination.
The arrests highlight the continued challenges retailers face during peak shopping seasons, when higher foot traffic can create opportunities for theft. Law enforcement officials emphasized the importance of coordination between retailers and police to deter criminal activity and protect both customers and employees during high-volume shopping periods.
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Retailers respond to rising theft and safety concerns
Retail theft continues to rise across the country, prompting major retailers to invest more heavily in security, employee training, and partnerships with law enforcement. Companies, including Target and Walmart, report that theft and related violence have become one of the most significant non-labor cost pressures facing the industry, affecting store operations, staffing decisions, and customer experience.
According to recent National Retail Federation research, retailers experienced sharp increases in both the frequency and severity of shoplifting incidents between 2019 and 2023. The study found that the average number of shoplifting incidents rose significantly during that period, with reported dollar losses increasing at a similar pace. Many retailers also reported that theft incidents are increasingly accompanied by aggressive or violent behavior, raising concerns about employee and customer safety. As a result, a majority of retailers have expanded budgets for workplace violence prevention and staff training.
Large retailers are also strengthening collaboration with law enforcement. In late 2025, Target and Walmart participated in a coordinated effort with local police in Gastonia, North Carolina, known as Operation Naughty List. During the multi-week operation, officers worked undercover inside high-theft stores alongside loss prevention teams. The effort led to dozens of arrests, the filing of more than one hundred charges, and the recovery or prevention of several thousand dollars in stolen merchandise. Authorities also reported seizing illegal drugs and identifying repeat offenders.
Retail leaders have emphasized that theft prevention strategies must balance security with customer access. While some chains have locked up high-risk items, executives acknowledge the approach can frustrate shoppers. Industry groups continue to call for coordinated solutions that combine technology, training, and public-private partnerships to improve safety while maintaining a positive retail environment.
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You’re invited: The Future of Washington Commerce — A Small Business Success Celebration
WR is proud to co-host an exclusive reception with TikTok, celebrating the success of Washington’s small businesses and the growing impact of the digital economy. This special evening will bring together local business leaders and successful TikTok Shop sellers to highlight innovation, share insights, and discuss the future of digital commerce in our state.
Attendees will enjoy networking and conversation while learning more about how digital platforms are helping local entrepreneurs grow, compete, and thrive. Join us as we celebrate small business success and advocate for continued economic opportunity across Washington.
When:
January 15, 2026 | 5:30–7:30 PM
Where:
Heritage Room (Octapas)
604 Water Street SW
Olympia, WA 98501
RSVP:
Please RSVP by email to julia.montiel@tiktok.com or register online
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Washington lawmakers to join WR at NRF’s State Legislative Leadership Experience
For the first time, Washington State lawmakers will join WR at the NRF 2026 State Legislative Leadership Experience, held in conjunction with NRF’s Big Show in New York City. Previous scheduling conflicts with the start of the legislative session prevented Washington’s participation, making this a milestone opportunity for the state’s retail community.
The State Legislative Leadership Experience brings together lawmakers from across the country for an in-depth look at the scale, innovation, and economic impact of the retail industry. Participants gain firsthand exposure to how retailers operate in today’s rapidly changing environment, including store tours and interactive discussions focused on real-world challenges and solutions.
Throughout the multi-day program, legislators will attend NRF Big Show sessions, explore emerging retail technologies, and engage directly with industry leaders on policy issues affecting retailers nationwide. Topics include organized retail crime, data privacy, artificial intelligence, workforce needs, and supply chain resilience.
Washington’s participation in 2026 offers a valuable opportunity to strengthen relationships between retailers and policymakers while increasing awareness of retail’s role as a major employer and economic driver across the state.
Register to attend
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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.
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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
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