The 2025 legislative session adjourned on time yesterday following the passage of the state鈥檚 2025-27 operating, capital, and transportation budgets. Washington state operates on a two-year budget cycle, with the biennial budgets adopted during long 105-day sessions held in odd-numbered years.
This year, the state faced a significant operating budget deficit due to lower-than-expected tax collections and increased caseloads for state programs and agencies. To close the gap, legislators adopted a final compromise budget that includes a combination of new revenue and spending reductions.
The transportation budget also faced a shortfall, which was addressed through a bipartisan revenue package.
With session now concluded, the budgets have been sent to the Governor, who may sign them into law, veto them in full, or issue partial vetoes.
Operating Budget
For the UW, the final operating budget is an overall improvement compared to the earlier proposals from the House and Senate, but it still includes some difficult reductions. Like nearly all state agencies and programs, the 91探花will bear some of the burden during this difficult fiscal period.
The budget includes a 1.5% across-the-board reduction to UW鈥檚 base funding鈥攁n amount that splits the difference between the 2% cut proposed by the House and the 1% cut from the Senate. It also reduces the state鈥檚 share of the UW鈥檚 鈥渇und split,鈥� which is the mix of state funding and tuition used for employee compensation and central services. These reductions applied to all of the state鈥檚 public four-year and two-year higher education institutions. Fund splits still vary by institution.
Notably, the final budget does not include state employee furloughs or other cost-saving measures that had been in the House and Senate proposals. These omissions helped avoid deeper cuts to the UW鈥檚 overall budget.
However, most of the University鈥檚 were not funded. Given the state鈥檚 budget constraints, lawmakers had little appetite for supporting new initiatives or funding requests.
Regarding the Washington College Grant, the state鈥檚 flagship financial aid program, maximum awards will be provided to students attending public institutions with family incomes up to 60% of the state median family income (MFI). Preserving this commitment helps maintain access to the 91探花for Washington students.
Capital Budget
The 2025-27 capital budget includes a number of UW-related investments:
- $124M for the the construction of chemical sciences facilities and modernization of Bagley Hall on the Seattle campus. This was the UW’s top capital request.
- $3.9M ( 91探花Building Account) for Phase 3 of 91探花Tacoma鈥檚 power infrastructure repairs.
- $1.7M for improvements to the UW鈥檚 soccer practice fields ahead of the 2026 FIFA World Cup.
- $8.05M via the Department of Commerce for the 91探花Sunbreak Tower affordable housing project.
- $3.25M via the Department of Commerce for the 91探花Medicine Airlift Northwest hangar in Chelan.
However, the budget does not include funding for decarbonization projects on the Seattle campus. The University requested funding from the Climate Commitment Account (CCA) for the first 10 projects outlined in its five-part energy decarbonization strategy. Due to limited CCA funds, lawmakers generally prioritized completing existing state projects rather than funding new ones.
Transportation Budget
The 91探花typically has more limited engagement with the transportation budget but this year, requested accelerated funding for access, safety, and efficiency improvements to the Burke-Gilman Trail on or near the Seattle campus. The final transportation budget fulfills this request, allocating $9.4 million in 2025-27 and $6.6 million in 2027-29.
The budget also includes funding for the UW鈥檚 sidewalk inventory and accessibility mapping project, the WSDOT- 91探花professional civil engineering master鈥檚 degree fellowship program, a SR 520 noise reduction study, and the 91探花Mobility Innovation Center.
Questions?
Throughout the session, the 91探花Office of State Relations has advocated on behalf of the University in Olympia, working to mitigate budget reductions where possible during this very challenging budget year. For questions about the session outcomes, please contact Morgan Hickel at mhickel@uw.edu.
A detailed summary of the UW鈥檚 portion of the 2025-27 operating, capital, and transportation budgets will be available in the coming days on the 91探花Finance, Planning & Budgeting website here.