Washington voters poised to authorize stock market investments for WA Cares Fund

NORTH CENTRAL WASHINGTON — A statewide measure that would allow the WA Cares Fund to be invested in higher yield markets is on track for approval in the Nov. 4 election.

The WA Cares Fund is a long-term care insurance program created by the legislature in 2019 to provide money to pay for long-term care services and support – such as nursing home care or assistance with daily living – for program beneficiaries, including seniors and people with disabilities. Senate Joint Resolution 8201 proposes a constitutional amendment that would allow payroll taxes collected for the state's long-term care fund to be invested in stock and other equities.

Currently,they can only be invested in fixed-income securities such as bonds and certificates of deposit, as the Washington Constitution generally prohibits investing public money in the stock of private companies. There are some current exemptions in the constitution, such as any public pension or retirement fund, workers' compensation funds, and money held in trust for the benefit of people with developmental disabilities. The Washington State Investment Board invests and manages these funds.

Preliminary results from the Washington Secretary of State show 56.78 percent approval across the state, with 589,290 'yes' votes to 448,606 'no' votes. Support for the measure is strong along the coastal counties, as well as Clark, Whitman, Spokane and Walla Walla counties. Chelan County voters were split on the measure, with 49.53 percent approval to 50.47 rejection ( 6,535 'yes' votes to 6,660 'no' votes).

Those in favor say the higher returns will increase the funding available without costing taxpayers. They project growth of $67 billion over the next 50 years, and cite the State Investment Board's management of $200 billion, with an average growth rate of 8 percent annually. The measure received supermajority bipartisan support from lawmakers, as well as support from organizations such as the WA Association Area Agencies on Aging, Washington State Nurses Association, and Washington Health Care Association.

Those against the measure called for "fiscal responsibility, not financial roulette," arguing that safeguards are needed to protect the publicly funded, multibillion dollar program. The argument points to the State Investment Board's significant losses during recessions and market crashes, including a 26.2 percent loss in 2008, and a 12.9 percent loss in 2022. Rather than having to cut benefits or increase tax rates when returns fall short, the opposition favored guaranteed municipal bonds of three to five percent. Lawmakers opposing the measure include state Sen. Bob Hasegawa, D-11th District, state Rep. Peter Abbarno, R-20th, state Sen. Mark Schoesler, R-9th, and state Rep. Joe Schmick, R-9th.

According to state-certified election results, a previous attempt to allow the fund to be invested in stocks and equity failed in 2020, with 54 percent of voters rejecting the measure.

Results will be updated as more votes are counted.

Taylor Caldwell: 509-433-7276 or [email protected]