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Washington State Makes it Official
Washington state recently passed legislation supporting and incentivizing employee ownership.
In Brief: The Washington legislature has passed a bill that will provide support for business owners looking to transition to employee ownership.
What’s In It: Called the Washington Employee Ownership Program, the program created by the legislation will provide resources for business owners who are looking to transition to two specific forms of employee ownership - co-ops or Employee Stock Ownership Plans (ESOPs). In addition to providing support services, the legislation includes financial incentives. Tax incentives for employee owned businesses will be implemented beginning in 2024, and a state loan program will be established to aid in firms’ transitions. The Program also plans to apply for federal funding offered through the WORK Act, which created a $50 million fund for employee ownership as part of the federal omnibus bill passed at the beginning of the year.
Why It Matters: The passage of this legislation puts Washington at the forefront of employee ownership policy. Few states have passed specific policy or tax legislation surrounding employee ownership. In addition to increasing the profile of employee ownership strategies in the state, it is important to note that the legislation received broad bipartisan support. Its sponsors included Republicans Mike Padden and Mark Schoesler, as well as Democrats Jamie Pederson and Bob Hasegawa. The bill passed without objection, highlighting the broad support for legislation that encourages transitions to employee ownership.
What’s Next: The Bill will now head to the Governor’s desk for signature.