WA Cares Heads Toward A Fiscal Cliff

Imagine you’ve been invited to the swankiest party of the year and promised unlimited food and drink while you party-party-all-night-long. Then you overhear the party planning committee talking about how they don't have the money to hire the DJ, the caterer, or the venue without a huge increase in the cover charge. That’s kind of what Washington’s paid family and medical leave program is facing: biggest benefits ever, but the money to pay for them will run dry in just a couple of years unless something changes. Cue the EDM while we take a look at what's going on...

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Here are Five Fast Facts on WA Cares heading toward a financial cliff:

1. 📈 Popularity Explosion - The program -- started in 2020 -- has exploded in growth. From July 2024 to June 2025 more than 320,000 applications were submitted (up 15% from the year before); over 240,000 people got a total of over $2 billion in benefit payments (about $300 million more than last year). Hm, giving out free stuff and people want more and more? Who wouldda thunk it...?

2. 🫴 Helping Hand - The program already needed a $200 million bailout in 2023 from the general fund, but another rescue seems unlikely with the state’s overall budget under stress. 

3. 🕳️ Caps And Holes - In 2025 workers pay about 0.92% of their wages into the program; this is projected to rise to 1.13% next year to help cover increasing costs, but the law caps it at just 1.2%, meaning the funding hits a ceiling by 2027. And, given the massive money hole it's already in, it'll stay there at the cap while the hole gets bigger and bigger each year.

4. 🤦 Swinging...And Missing - A bill (SB 5292) to change how the fund calculates its cost passed the Senate easily but died in the House; also, some proposed raising the tax cap to 2% by 2033, but that also didn’t pass. That's two strikes...who wants to try a third?

5. ⚠️ Big Warning Sign - By 2029, the program could be more than $350 million in the red unless lawmakers raise more money or cut benefits. It'll be like pouring water into a strainer and hoping it "fills up" before it runs out the holes in the bottom.

🔥Bottom line: So here’s the bottom line: Washington’s paid-leave program is doing its job — people are taking time off to care for themselves or their loved ones — but we're already running out of other people's money to pay for the program! Without more cash or fewer benefits, it’s headed for what economic geeks call a "fiscal cliff" (that’s code for “uh-oh”). State officials will need to make some tough choices — higher taxes, less time off, or other cuts — very soon to keep the promise going. Until then, the party might be over.

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What do you think the solution is?

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