The 2025 legislative session adjourned on time yesterday following the passage of the state’s 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, adopted a final compromise budget that included 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.
The budget includes a 1.5% across-the-board reduction to UW’s base funding—an 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’s share of the UW’s “fund split,” which is the mix of state funding and tuition used for employee compensation and central services. These reductions are consistent across all of the state’s public four-year and two-year higher education institutions.
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 help avoid deeper cuts to the UW’s overall budget.
However, most of the University’s legislative priorities were not funded. Given the state’s budget constraints, lawmakers had little appetite for supporting new initiatives or funding requests.
Regarding the Washington College Grant, the state’s 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 UW for Washington students.
Like nearly all state agencies and programs, the UW will bear some of the burden during this difficult fiscal period. However, considering the broader context and earlier budget proposals, the final outcome could have been more challenging—for both the University and student financial aid.
Capital Budget
The 2025-27 capital budget includes full funding ($124M) for the UW’s top capital request: the construction of chemical sciences facilities and modernization of Bagley Hall on the Seattle campus. New facilities will help meet student demand, increase degree production, improve industry collaboration, and better support research.
Additional UW-related investments in the capital budget include:
- $3.9M (UW Building Account) for Phase 3 of UW Tacoma’s power infrastructure repairs.
- $1.7M for improvements to the UW’s soccer practice fields ahead of the 2026 FIFA World Cup.
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 UW typically has 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’s sidewalk inventory and accessibility mapping project, the WSDOT-UW professional civil engineering master’s degree fellowship program, and the UW Mobility Innovation Center.
Questions?
Throughout the session, the UW 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’s portion of the 2025-27 operating, capital, and transportation budgets will be available in the coming days on the UW Finance, Planning & Budgeting website here.