Last week, members of the AGC Seattle District and the Construction Leadership Council (CLC) traveled to Olympia to meet with legislators and share the construction industry’s perspective on several policy proposals under consideration this session.
The visit provided an important opportunity for contractors to engage directly with lawmakers about how legislative decisions affect the construction industry. Members emphasized the need for policies that protect workers while also recognizing the unique realities of construction, an industry that is cyclical, seasonal, payroll-intensive, and operates on thin margins.
Key Issues Discussed
Wage Theft Legislation (HB 2191/SB 6068 and HB 2479)
Members expressed opposition to HB 2191 and SB 6068, the “contractor liability” bills, which would make general contractors responsible for unpaid wages of subcontractors at any tier. Members shared concerns that this approach unfairly shifts liability to firms with no direct contractual relationship or control over lower-tier subcontractors, increasing cost and risk on every project to address a small number of bad actors.
In contrast, AGC members voiced support for HB 2479, which creates a wage recovery program administered by the Department of Labor & Industries. This proposal targets bad actors directly, helps workers recover unpaid wages, and applies across all industries without imposing broad new liability on responsible contractors.
Prevailing Wage Escalator (SB 5061)
Members also raised concerns with SB 5061, which would automatically adjust public works contracts to the most current prevailing wage rates. Contractors explained how prevailing wages can increase suddenly and unpredictably, creating significant risk on contracts. AGC suggested a potential compromise that would allow prevailing wage increases above a 5% threshold to qualify as good cause for contract price adjustments.
Payroll Tax (HB 2100)
Discussions included HB 2100, which proposes a new state payroll tax on wages above $125,000 for employers with a payroll of more than $7 million. Members noted that construction margins are often just 2–3%, making it difficult to absorb new payroll taxes. They also highlighted that the industry’s seasonal workforce fluctuations or a one-time large project could unintentionally push small or mid-sized companies over the payroll thresholds.
Proposed State Income Tax (“Millionaire’s Tax”)
While no bill has been introduced, members shared concerns about the potential impact of a proposed state income tax on pass-through businesses. Contractors explained that business income is often reinvested into payroll, equipment, and bonding capacity, and that a single strong year or one-time project could trigger a tax liability that does not reflect actual cash flow.
The Olympia visit reinforced the value of direct engagement between legislators and the construction industry. Hearing directly from AGC members helps lawmakers better understand how policy proposals translate into real-world impacts on jobs, projects, and costs for taxpayers.