AWC sent a letter to legislators urging them to maintain funding for the Public Works Assistance Account and to oppose elimination of dedicates resources to the PWAA, as proposed by SB 5804.

Time is running out for city officials to advocate for the PWAA before the Legislature adjourns on April 27. Act now: Read the letter and then contact your legislators to relay the same message. Find more talking points in the articles below.

April 14, 2025

Members of the Washington State Legislature:

As you come down the home stretch of the legislative session and negotiate final budgets, we ask you to maintain funding for the Public Works Assistance Account (PWAA) in the budget agreement at a level that preserves existing loan and grant commitments and allows for continued new investments. Both chambers’ Capital Budget proposals currently do so, and we ask your support to ensure the final budget does as well.

Perhaps even more critically, we ask you to oppose the elimination of dedicated resources to the PWAA as is proposed by SB 5804, which permanently diverts the PWAA’s principal revenue streams (public utility tax, solid waste collection tax, real estate excise tax) to fund state culvert injunction response. Worse, this plan relies on funds historically meant for local infrastructure to pay for state culverts but lacks a dedicated component to address locally owned barriers in the same waterways. Permanent revenue diversion would destabilize the PWAA and risk eliminating it altogether, starving the account and communities of some $2.1 billion in infrastructure funding in the coming decade and leaving the account reliant on new infusions of bonds from the Legislature each biennium.

Cities and towns across the state face a significant need for infrastructure investments as they struggle to keep up with the costs of maintaining aging systems and expanding to support a growing population. Needs assessments for Washington’s water, wastewater, and solid waste systems total more than $31 billion over the next 20 years – The PWAA is an indispensable resource for keeping the costs of those repairs and expansions manageable for Washington’s residents.

For 40 years, the PWAA has been a primary source of infrastructure funding for local jurisdictions, large and small, in every corner of the state. It does so by providing grants and low-interest loans that help pay for much-needed but costly capital projects that local communities could not otherwise afford. The PWAA provides direct funding with limited red tape, enabling cities to address unmet infrastructure needs while keeping costs for our communities affordable. It has never seen a default and is instrumental to economic development – every $1 it invests generates $5 more in economic activity.

Unfortunately, due to state budget challenges, both chambers propose diverting significant funds from the PWAA to support the operating budget. While we wish this was not necessary, we appreciate that both chambers provide bond resources to “backfill” the PWAA in the short term, through their respective capital budgets.

However, SB 5804 proposes to make state construction bonds the primary financing mechanism for the PWAA by permanently diverting the principal revenue streams. This model replaces dedicated infrastructure dollars with a long-term policy whereby the state borrows money from the market at a higher interest rate and then loan it to cities at a lower rate. Cities believe this approach is unsustainable and will ultimately erode the PWAA’s capacity to fund future public works projects.

With infrastructure costs increasing and the need for repairs and expansion growing, now is not the time to divert even more funding from this highly regarded, critical funding tool, especially given uncertainty surrounding the federal government.

We understand the challenge of balancing investments in infrastructure with limited state-level revenues, especially during this challenging economic environment. But your leadership in prioritizing PWAA funding for local infrastructure projects is essential to the environment, health, and economic well-being of our communities. We urge you to find solutions that preserve PWAA funding now and into the future, to ensure that all parts of the state can thrive.

Thank you for your consideration,

Carl Schroeder
Deputy Director of Government Relations
Association of Washington Cities
360.485.7604
carls@awcnet.org

Act now: Oppose major diversions from the Public Works Assistance Account

April 2, 2025

As AWC has been warning for months, state budget writers proposed new sweeps of the Public Works Assistance Account (PWAA) to support the operating budget. The House operation budget (HB 1198) diverts $288 million from the account in FY 2026, while the Senate operating budget (SB 5167) diverts $165 million in FY 2026 (which would be transferred back to the PWAA in FY 2027).

Both chambers provide bond resources to “backfill” the account in the short term, through their respective capital budgets (HB 1216 and SB 5195). They replace dedicated infrastructure dollars by borrowing money from the market to provide lower-interest loans to cities. This model is not sustainable: it will result in the eroding of capacity for public works assistance if dedicated resources are continually swept for other needs.

An even more concerning, third development in the Senate (SB 5804) would permanently divert the PWAA’s principal revenue streams (public utility tax, solid waste collection tax, real estate excise tax) to fund state culvert injunction projects – without a dedicated component to address locally owned barriers Without ongoing state construction bond investments, this would all but defund the account indefinitely.

Cities strongly oppose all three sweeps of the PWAA. As we celebrate the 40th anniversary of the program, a national standard for infrastructure funding, we need to do all we can to protect it.

Don’t wait—all three bills are scheduled for hearings this week. Find your legislators in AWC’s directory and contact them today to urge them to oppose the diversions. Share these messages:

• One-time backfills through bonding are only a temporary solution that appears to protect previously awarded projects. Backfilling the funds does not ensure that funds are available for future projects. We ask the Legislature to preserve the funding now and into the future for critical local infrastructure needs.
• SB 5804 risks eliminating the PWAA altogether.
  • The bill would also redirect funding for local infrastructure projects to support state-owned culvert repair projects, leaving locally owned fish blocking culverts in the same waterways in place and likely resulting in no net benefits to fish and fish habitats.
• The PWAA has funded projects in communities large and small for 40 years.
  • Show your legislators how important the PWAA is to your city or town with examples of past and planned projects, especially those with implications for public health, safety, affordable housing, or economic growth.
• Removing access to low-cost public works funding will directly result in higher utility bills for residents, working counter to the state’s efforts on housing affordability.
• The need for funding is only growing: needs assessments for Washington’s water, wastewater, and solid waste systems total more than $31 billion over the next 20 years.
• Given the uncertainty surrounding the federal government, the PWAA may be one of the few tools available to cities to fund critical infrastructure projects.

Act now—Ask your legislators to talk to their leadership and their budget writers about the importance of preserving this critical infrastructure funding program.

Find more talking points below and contact your legislators now.

The Public Works Assistance Account needs cities’ help: advocate for ongoing, full funding

March 21, 2025

This year, the Public Works Board (PWB) marks its 40th year of serving Washington’s local governments, big and small, with vital assistance for their infrastructure projects. Since its founding in 1985, the PWB has awarded more than $3.6 billion in loans and grants to over 2,200 infrastructure projects across the state.

Don't wait to spread the word about the important support cities receive from the Public Works Assistance Account (PWAA) and advocate for ongoing, full funding for the account.

This session, the PWAA is at risk of losing over $100 million to the state’s general fund. We cannot let this happen. Find your legislators in AWC’s legislator directory and incorporate these talking points when communicating with them:

• Share examples of current and/or planned infrastructure projects in need of funding, especially those with implications for public health, safety, affordable housing, or economic growth.
• Express how critical this funding is for cities of all sizes and backgrounds.
  • Cities and towns all over the state are struggling with infrastructure needs.
    • In the latest AWC City Conditions Survey, approximately 75% of cities reported infrastructure funding as a priority
  • This biennium, the PWB supported severely distressed and distressed communities with up to 50% in grant dollars for their infrastructure projects.
  • Statewide needs assessments for water, wastewater, and solid waste systems total more than $31 billion over the next 20 years.
• The PWAA is a reliable source of grants and low-interest loans for locals that keep costs down for residents.
  • Interest rates range between 0.42% - 1.69%.
  • In the past six years, PWAA awards have saved local governments $188 million in interest savings and grants.
  • The account has never had a loan default in 40 years.
  • The PWB awards about 60% of its funding to cities and towns.
• The PWAA is instrumental to promoting economic development.
  • An estimated $40M was generated in sales tax revenue by the construction investments in communities made possible by the $400+ million awarded by the PWB this biennium.
  • Every $1 invested from the account generates an additional $5 in economic activity.
• The account is already subject to more than $160 million in existing diversions. It cannot afford to lose more funding.
  • This biennium, the PWB received requests for $597 million in assistance, representing 195 projects statewide, far exceeding available funding. $415 was awarded to 152 projects, leaving $182 in 36 unfunded projects.
  • Loss of investments now will reduce the loan repayment revenue stream to the account, resulting in compounded reductions over time.

Statewide distribution of PWB-funded projects in FYs 2022-2025

$631 million project awards to 262 local projects

Source: Washington’s Infrastructure System Improvement Team (SYNC) dashboard, 2025

For more information, refer to AWC’s 2025 infrastructure investment fact sheet or the PWB’s fact sheet for your legislative district.

Source: Public Works Board, 2025

Public Works Assistance Account at risk of losing over $100 million

January 7, 2025

Governor Inslee’s 2025-27 budget proposal takes aim at the Public Works Assistance Account (PWAA) by sweeping $100 million to transfer to the state’s general fund and increasing existing diversions to other accounts.

The proposal appropriates $350 million for the PWAA in the 2025-27 biennial capital budget, while making the following diversions:

• New: $100 million sweep ($50 million/year) for transfer to state general fund.
• Existing: $114 million ($57 million/year) transfer for Move Ahead WA Account
  • Increase: $12 million in FY 2027, for a total of $69 million.
• Increase: $41 million for Water Pollution Control Revolving Account.
• Increase: $25 million for Drinking Water Assistance Account.
• Existing: $5 million for CARB revolving loans.

The $100 million diversion to the general fund is also planned for the 2027-29 biennium.

The PWAA was created in 1985 to provide grants and low- and no-interest loans to cities, counties, and public utility districts to fund basic infrastructure. Since its founding, the Public Works Board (PWB) has awarded over $3 billion to more than 2,000 local infrastructure projects in Washington. The account is a national model to fund crucial community needs and keep costs down for residents.

The PWAA was swept in the last round of state budget cuts during the Great Recession and the subsequent struggles to fund education in the wake of the McCleary decision. We finally achieved the full restoration of this critical account just last year.

Now, cities need to rally again to protect the PWAA:

• Tell your local legislators how critical this funding is for our cities.
• If the PWB has funded a project in your community, share the details with them and explain how PWAA dollars made a difference.
• For added help, refer to AWC’s 2025 infrastructure investment fact sheet or the PWB’s fact sheet for your legislative district.
• Remind your legislators that cities and towns across Washington are struggling with infrastructure needs. In the latest City Conditions Survey, 78% of responding cities reported infrastructure funding as a priority.

The proposed budget is a strong signal that the PWAA is at risk, with state revenues down and state agency budgets restricted. Governor-elect Ferguson is expected to release his budget priorities in the coming weeks. The legislative budget writers will then spend the 105-day session working on a final plan.