Critics Say WA Income Tax Won't Solve State Budget Problems + PSE Rates Could Rise 29% Over 3 Years

Washington voters will soon decide whether to repeal the state's new 9.9% individual income tax, Puget Sound Energy customers are fighting proposed utility rate increases, and a Washington farming family's $688,000 water-rights dispute has reached the state Supreme Court. First, Initiative 645 will appear on Washington's November 3 ballot and would repeal provisions creating the state's new individual income tax. The tax applies a 9.9% rate to taxable individual income above a $1 million standard deduction. I-645 would repeal the individual income-tax provisions while leaving several tax-relief measures from Senate Bill 6346 in place, including expansion of the Working Families Tax Credit, certain sales-tax exemptions and changes affecting small-business taxes. The Washington Research Council argues that whether the income tax survives or is repealed, lawmakers will still face significant state budget challenges. Senior research analyst Emily Makings says the income tax itself does not solve Washington's existing budget problems and argues lawmakers will still need to bring ongoing spending and revenues into alignment. Next, more than 100 Puget Sound Energy customers packed a public hearing as Washington regulators consider PSE's multiyear rate proposal. Customers urged the Washington Utilities and Transportation Commission to reject the proposed increases, with electric customers potentially facing substantial additional increases over the multiyear rate plan. The debate also turned to PSE's investors and shareholder dividends. Washington Attorney General Nick Brown's office has opposed portions of PSE's rate request and previously highlighted the utility's shareholder payouts, including $175.9 million in dividends in 2024 and $62.9 million in 2025. At the hearing, ratepayer Andrew Wiesenfeld criticized the proposed increases and argued PSE's investors should shoulder more of the company's capital needs rather than customers. The Utilities and Transportation Commission will ultimately decide what rate changes PSE is allowed to implement. Finally, a Washington farming family's decade-long water-rights dispute with the Department of Ecology has reached the Washington Supreme Court. Ron and Robin Fodé's case centers on a dispute over water rights, technical assistance and more than $688,000 in penalties imposed by the Department of Ecology. The Fodés and their attorneys with Pacific Legal Foundation argue Ecology failed to provide technical assistance required under Washington law before moving to enforcement and monetary penalties. Ecology disputes that interpretation, and a previous Washington Court of Appeals decision sided with the agency. During Washington Supreme Court arguments, Justice Helen Whitener questioned Ecology's attorney about where required written information and technical assistance appeared in the record. The Supreme Court has not yet ruled, and questioning during oral arguments does not necessarily indicate how the justices will ultimately decide the case. Today's Washington coverage examines Initiative 645, Washington's 9.9% income tax, the state budget, Puget Sound Energy rates, PSE customer bills, shareholder dividends, Washington utility regulation, Fodé Farms, Washington water rights, the Department of Ecology and the Washington Supreme Court. Follow The Center Square for continuing coverage of Washington taxes, energy costs, state government, agriculture, the Washington Supreme Court and the November 2026 election. Want the next important update by text? Get the Washington state government and policy developments worth your attention sent straight to your phone. Text TCSWA to 206-944-3016 or sign up here: https://joinsubtext.com/c/thecentersquarewa Msg & data rates may apply. #WashingtonState #PugetSoundEnergy #PSE #RateHike #WashingtonTaxes #IncomeTax #Initiative645 #WashingtonSupremeCourt #WaterRights #WashingtonFarmers #WAnews #TheCenterSquare #WashingtonInFocus