State Reps. Travis Couture, Jim Walsh, and Matt Marshall issued a sharp warning Friday after House Democrats advanced a controversial plan that redirects billions from the Law Enforcement Officers’ and Firefighters’ (LEOFF) Plan 1 pension surplus to help close a state budget gap and shift more than $500 million into a separate climate account.
The lawmakers described the move as a desperate fiscal maneuver to mask years of unsustainable spending by the majority party.
“When you strip away the legislative jargon, this is a $4 billion grab from the retirement security of our first responders,” said Couture, R-Allyn. “By scuttling over half a billion dollars into a climate account while ignoring our proposed affordability budget, the majority is choosing a shell game over the needs of working Washingtonians and retirees.”
The bill’s passage comes despite record state revenues and a massive tax increase passed during the previous session. Republican leaders say the maneuver sets a dangerous precedent for every other public pension fund in Washington.
“For years, raiding this pension was considered a ‘third rail’ because it’s fiscally reckless and fundamentally wrong,” said Walsh, R-Aberdeen. “Washington used to pride itself on well-funded pensions, but this move signals a shift toward the same mismanagement we see in states like Illinois or New York.”
The legislation now heads to the Senate, where it is already scheduled for a public hearing. Critics argue the plan treats a one-time windfall as a permanent fix for ongoing budget shortfalls, while risking IRS violations that could threaten the fund’s tax status.
“The majority has spent themselves into a hole and is now asking retired police and firefighters to dig them out,” said Marshall, R-Eatonville. “Instead of prioritizing our paramount duties like education, they are dumping these funds into a climate program that already has its own revenue streams. This money should be off-limits, period.”
The “Pension Raid” Breakdown
To make this complex bill easy to understand, the Representatives highlighted five major red flags:
- A $4 Billion seizure: The state is taking money meant for the retirement of police and firefighters to fix a budget hole caused by record-high state spending.
- The climate shell game: Over $500 million of the raided money is being shifted into the Climate Commitment Act (CCA) account – an account that has plenty of funds since CCA auctions consistently bring in far more dollars than originally expected.
- One-time money for ongoing issues: Using “one-time” pension money to cover ongoing, permanent state expenses is unsustainable and a recipe for future deficits.
- IRS and legal risks: Preliminary research suggests no other state has attempted a raid of this scale. This could trigger federal IRS violations, putting the tax-exempt status of the entire pension system at risk.
- A dangerous precedent: If the state is allowed to raid this pension today, there is nothing to stop it from targeting teachers or general state employee funds tomorrow.
What’s Next
House Bill 2034 is now moving through the Senate. It is scheduled for a public hearing in the Senate Committee on Ways & Means on Feb. 26 at 1:30 p.m.
Those interested in weighing in can submit written testimony here or contact their lawmakers here.
The lawmakers noted that the raid is an admission of failure by the majority party. Despite record revenues and massive tax increases passed last session, the majority chose to ignore the Affordability First Budget Framework proposed by House Republicans. This plan would have solved the deficit by prioritizing rather than raiding retirement accounts.
Watch Reps. Matt Marshall, Jim Walsh, and Travis Couture fight the pension raid on the House floor: