WA House Passes Bill to Raid $4.5B from Pension Plan

Measure draws sharp opposition from House Republicans as state also passes record tax hikes

Published on Feb. 19, 2026

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The Washington State House has passed a bill that terminates the Law Enforcement Officers' and Firefighters' Retirement System Plan 1 (LEOFF 1), creates a new plan, and transfers $4.5 billion out of the well-funded LEOFF 1 plan. The fiscal policy decision drew strong rebuke from House Republicans, while pension plan advocates warn of future implications for other state pension plans.

Why it matters

LEOFF 1 is considered one of the best-funded pension plans in the nation, leading some lawmakers to warn that raiding the plan sets a dangerous precedent that could undermine the financial health of other state pension systems in the future. The move also comes as the state legislature has passed record tax increases, raising concerns that the pension funds are being tapped to pay for unsustainable new programs.

The details

House Bill 2034, sponsored by House Appropriations Committee Chair Timm Ormsby, D-Spokane, passed the state House in a 55-39 vote. The bill terminates LEOFF 1, which was created in the late 1960s for law enforcement and firefighters, and transfers $4.5 billion out of the plan, which is currently projected to be over 100% funded. While supporters claim the bill guarantees retirees will receive their promised benefits, critics argue it sets a dangerous precedent that could lead to future raids on the pension fund.

  • The fiscal policy decision was made during the 2026 legislative session.
  • House Bill 2034 was first introduced in the 2025 legislative session but did not clear the chamber.
  • The bill was reintroduced and passed the House in a 55-39 vote on February 13, 2026.

The players

Timm Ormsby

Chair of the House Appropriations Committee and sponsor of House Bill 2034.

Joe Fitzgibbon

Democratic state representative who argued the LEOFF 1 plan is in a "very healthy financial state" and that retirees will get what was promised.

John Ley

Republican state representative who questioned whether the promise to pay all benefits owed to LEOFF 1 members would be kept, citing past broken promises by lawmakers.

Joyce Willms

Executive Director of the LEOFF 1 Coalition, which argues the bill violates the state and U.S. Constitution and will open the door to future changes to other state pension plans.

Jim Walsh

Republican state representative who said the conventional wisdom was that raiding LEOFF 1 was a "third rail proposition" due to the state's strong fiscal reputation.

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What they’re saying

“Every nickel now of benefits owed to LEOFF 1 members will be paid. We guarantee that in this bill and we actually leave an extra buffer to make sure that if something unforeseeable happens, that there is a reserve ready to pay all of the benefits.”

— Joe Fitzgibbon, Democratic state representative (clarkcountytoday.com)

“I am wondering if this is another pie crust promise. A promise made, but a promise easily broken. If we do this, how many more times might a future legislature come and raid this fund? If this were a private corporation, we'd be screaming bloody murder.”

— John Ley, Republican state representative (clarkcountytoday.com)

“What the public is going to see is not that money is being shifted to balance the budget. They're going see the money's being used in so many ways on so many unsustainable programs that we've forced ourselves into a hole – a year after we have record increases in taxes. We're immediately coming back and asking our retirees to shoulder a massive, massive shift of their funds to balance the budget.”

— Matt Marshall, Republican state representative (clarkcountytoday.com)

“The conventional wisdom was raiding LEOFF 1 was a third rail proposition. Our fiscal rectitude in this state is something that distinguishes us from our neighbors to the south and other well populated states. We have been careful where they have been reckless.”

— Jim Walsh, Republican state representative (clarkcountytoday.com)

What’s next

The bill now moves to the state Senate, where it will face additional scrutiny and debate. Pension advocates have vowed to challenge the measure in court if it is ultimately signed into law.

The takeaway

This controversial move to raid a well-funded public pension plan to help balance the state budget raises concerns that it could set a dangerous precedent, undermining the financial health of other state pension systems in the future. The decision also comes amid record tax hikes, leading some to question whether the pension funds are being tapped to pay for unsustainable new programs.