HB 2251 Washington House · 2025-2026 Regular Session

Concerning climate commitment act accounts.

HB 2251 creates a dedicated state account for climate funds generated by auctioning emissions allowances under Washington's Climate Commitment Act. The bill specifies that these funds must be used for concrete climate action programs, including reducing emissions across sectors (buildings, agriculture, industry), expanding clean energy projects, supporting environmental justice in overburdened communities (requiring at least 25% of funds for these areas), and assisting fossil fuel workers transitioning to clean energy jobs. It prohibits using these funds to replace existing state programs and mandates spending only on approved climate initiatives like wildfire-resilient forests, electric vehicle infrastructure, and clean water projects that address climate impacts. The bill directly affects state climate programs, tribal governments, and low-income communities through targeted funding streams.

Bill status signed all 5 stages cleared

Introduction

Jan 2026

Committee Review

Mar 2026

House Passage

Mar 2026

Senate Passage

Mar 2026

Signed into Law

Mar 2026

Introduced Jan 5, 2026 Signed Mar 25, 2026

Maddy AI version diff · 4 comparisons

What changed between versions

Engrossed Second Substitute Bill → Second Substitute Passed Legislature · 10 edits

MAJOR

This bill updates Washington's climate funding framework to align with new legislative priorities, shifting focus toward transportation electrification and forest resilience. It reorganizes several climate accounts, renaming the 'carbon emissions reduction account' to the 'climate commitment act transportation account' and adjusting how auction proceeds are distributed to prioritize active transportation, transit, and alternative fuels. The changes also modify reporting requirements, penalty structures for carbon intensity violations, and the timeline for transferring funds between accounts.

Scope change

The bill expands the scope of climate funding by explicitly directing a larger portion of auction proceeds to transportation-related climate projects and clarifies the use of funds for forest conservation and healthy forests.

FISCAL

The distribution of auction proceeds was altered; the 'carbon emissions reduction account' was renamed the 'climate commitment act transportation account,' and the percentage of funds allocated to it increased from 68% to 73% for most years, with a specific $300 million minimum deposit for fiscal year 2029.

Funding for the 'climate commitment act operating account' was reduced from 15% to 12% of remaining auction proceeds, though a special 50% distribution rule was added for fiscal year 2029.

The 'climate commitment act capital account' now receives a higher percentage of remaining auction proceeds (15% generally, but 50% for fiscal year 2029).

The 'climate commitment act operating account' is now explicitly intended to supplement, not supplant, existing expenditures for climate programs.

REQUIREMENT

Reporting deadlines for environmental justice assessments were extended, shifting from annual submissions to biennial submissions by December 31st of each odd-numbered year starting with the 2027-2029 biennium.

The bill adds a requirement for state agencies receiving transportation climate funds to report estimated emission reductions from fuel conversion activities using a specific reporting tool.

ENFORCEMENT

Penalties for failing to submit carbon intensity reports were increased to up to $10,000 per day, and penalties for misreporting credits were clarified to include up to $1,000 per credit or deficit.

ELIGIBILITY

An excise tax on banked zero-emission vehicle (ZEV) credits was introduced, charging 10% of the credit's value for credits held into future model years, with proceeds partially funding the new transportation account.

SCOPE

The definition of allowable expenditures for the climate commitment act transportation account was narrowed to strictly include active transportation, transit, alternative fuel/electrification, ferries, and rail, excluding general highway purposes.

TIMELINE

The effective date of the act remains July 1, 2027, but specific reporting and tax liability notification dates were adjusted to align with new fiscal and calendar year schedules.

Bill → Substitute Bill · 8 edits

MODERATE

This bill was renumbered and its title updated to reflect its current status as a substitute bill. The most significant substantive change involves a major restructuring of how auction proceeds are distributed to various climate accounts starting in fiscal year 2038. The new rules replace specific dollar-amount caps with percentage-based distributions and introduce new caps on funding for the operating account and air quality improvements, while increasing the share of funds directed to the carbon emissions reduction account.

Scope change

The bill's scope regarding future funding distribution has expanded and shifted from fixed dollar amounts to a percentage-based system with new maximum limits for specific accounts.

TECHNICAL

The bill number was changed from H-2685.2 to H-3268.1, and the title was updated from 'House Bill' to 'Substitute House Bill' to reflect legislative amendments.

TIMELINE

The effective date and procedural history were updated to reflect the bill's progression through the legislature in February 2026.

The deadline for submitting annual reports was changed from September 30 to December 31, and the reporting frequency was adjusted to be biennial starting with the 2027-2029 biennium.

FISCAL

A reference to the administrative cost cap was corrected from subsection (7)(b) to (7)(a) to align with the correct statutory section.

The distribution rules for auction proceeds starting in fiscal year 2038 were completely rewritten. The old system of fixed dollar amounts and specific percentages was replaced with a new percentage-based system (50% to carbon reduction, remainder split among other accounts) and new annual funding caps for the operating and air quality accounts.

The transfer of remaining balances from the climate investment and climate commitment accounts after the 2025-2027 biennium was updated to include the natural climate solutions account.

REQUIREMENT

The requirement for the department to communicate calculated operating account amounts was expanded to include the office of financial management and legislative staff.

ENFORCEMENT

A previously deleted RCW section number (70A.505.110) was restored to the list of statutes where civil penalties apply.

Floor votes · Senate Mar 6, 2026 · House Feb 16, 2026

How they voted

36–14

Passed · 1 other

Total votes 51

Mar 6, 2026

D Democratic31

31 Yea

100% Yea

R Republican20

5 Yea 14 Nay 1

70% Nay

Vote distribution

All Yea All Nay Mixed No data

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Amendments

Mar 25, 2026

Signed into law

Governor signed.

executive

Mar 11, 2026

Upper · Passed

President signed.

upper

Mar 11, 2026

Lower · Passed

Speaker signed.

lower

Mar 11, 2026

Lower · Passed

Passed final passage; yeas, 54; nays, 40; absent, 0; excused, 4.

lower

Mar 11, 2026

Lower · Passed

House concurred in Senate amendments.

lower

Mar 6, 2026

Upper · Passed

Floor amendment(s) adopted.

upper

Mar 6, 2026

Amended

Committee amendment not adopted.

upper

Mar 2, 2026

Upper · Passed

Minority; without recommendation.

upper

Mar 2, 2026

Upper · Passed

Minority; do not pass.

upper

Mar 2, 2026

Upper · Passed

TRAN - Majority; do pass with amendment(s).

upper

Mar 2, 2026

Upper · Passed

Executive action taken in the Senate Committee on Transportation at 1:30 PM.

upper

Feb 27, 2026

Upper · Passed

Public hearing in the Senate Committee on Transportation at 2:30 PM.

upper

Feb 27, 2026

Committee

Referred to Transportation.

upper

Feb 26, 2026

Committee

And refer to Transportation.

upper

Feb 26, 2026

Upper · Passed

Minority; without recommendation.

upper

Feb 26, 2026

Upper · Passed

Minority; do not pass.

upper

Feb 26, 2026

Upper · Passed

WM - Majority; do pass with amendment(s).

upper

Feb 26, 2026

Upper · Passed

Executive action taken in the Senate Committee on Ways & Means at 1:30 PM.

upper

Feb 24, 2026

Upper · Passed

Public hearing in the Senate Committee on Ways & Means at 4:00 PM.

upper

Feb 16, 2026

Lower · Passed

Floor amendment(s) adopted.

lower

Feb 9, 2026

Committee

Referred to Rules 2 Review.

lower

Feb 9, 2026

Lower · Passed

Minority; without recommendation.

lower

Feb 9, 2026

Lower · Passed

Minority; do not pass.

lower

Feb 9, 2026

Lower · Passed

Executive action taken in the House Committee on Transportation at 1:30 PM.

lower

Feb 6, 2026

Lower · Passed

Public hearing in the House Committee on Transportation at 10:30 AM.

lower

Feb 3, 2026

Committee

Referred to Transportation.

lower

Jan 29, 2026

Lower · Passed

Minority; without recommendation.

lower

Jan 29, 2026

Lower · Passed

Minority; do not pass.

lower

Jan 29, 2026

Lower · Passed

Executive action taken in the House Committee on Appropriations at 4:00 PM.

lower

Jan 19, 2026

Lower · Passed

Public hearing in the House Committee on Appropriations at 4:00 PM.

lower

1 primary · 3 co-sponsors