HB 1887
In CommitteeHouse
Data broker registry & tax
Creating a data broker registry for the purpose of imposing a data broker severance tax.
This status may be delayed. See Action History below for the latest updates.
How does a bill become law?
- Introduced: The bill is filed and assigned a number.
- Committee: A subject-matter committee holds hearings, takes public testimony, and decides whether to advance the bill.
- Floor Vote: The full chamber (House or Senate) debates and votes on the bill.
- Opposite Chamber: The bill repeats the committee and floor vote process in the other chamber.
- Governor: The Governor reviews the bill and decides whether to sign or veto it.
- Signed: The bill has been signed into law.
AI Analysis
This bill establishes a new data broker registry and imposes a monthly severance tax on companies that collect and sell personal data of Washington residents. It requires data brokers to register with the Department of Licensing, disclose their data practices, and pay taxes based on how many Washington residents’ data they handle—starting in 2026. The goal is to increase transparency and generate state revenue from this growing industry.
- Creates a new data broker registry managed by the Department of Licensing, requiring businesses that collect and sell personal data of Washington residents to register annually starting January 1, 2026.
- Requires data brokers to disclose detailed information about their data practices—including what data is collected, how it’s used, who it’s sold to, security measures, and opt-out rights—when registering.
- Imposes a monthly severance tax on data brokers based on how many Washington residents’ data they collect, with rates increasing in tiers (e.g., $0.05 per resident for the first 500,000, up to $0.55 per resident for data on over 5 million residents).
- Exempts certain entities from registration, including government agencies, consumer reporting agencies (like credit bureaus), and financial institutions regulated under federal privacy laws.
- Makes registration information public on the Department of Licensing’s website to increase transparency about the data broker industry in Washington.
- Amends existing law (RCW 18.235.020) to include data brokers under the regulatory authority of the Department of Licensing, allowing it to discipline or suspend registrations for cause.
Who is affected
- Data brokers — Businesses that collect, sell, or share personal data of Washington residents as a core part of their operations must register with the state, report detailed data practices, and pay a monthly tax based on how many Washington residents' data they handle.
- Washington residents — Washington residents whose personal information (e.g., name, address, biometric data, location, health data) is collected and sold by third-party companies will be subject to new transparency and opt-out rights, and the state will track these companies more closely.
- Washington state agencies (specifically Department of Licensing) — The Department of Licensing will gain new authority to register, regulate, and discipline data brokers, and will administer the registration and tax systems.
- Exempt entities (government, credit bureaus, banks) — State and local governments, consumer reporting agencies (e.g., credit bureaus), and financial institutions operating under federal privacy rules are exempt from the new requirements.
Pro/Con Analysis
Stronger case for benefits
Potential Benefits (5)
The public registry and mandatory disclosures will significantly increase transparency about who is collecting Washingtonians’ personal data—including biometrics, health, and location—empowering residents to make informed choices and enabling civil society and journalists to hold bad actors accountable.
Rights & LibertiesPeopleRef: Sec. 5 (public registry); Sec. 4(1)(c)(i)-(ix) (disclosure requirements)The severance tax is projected to generate substantial new state revenue—potentially tens of millions annually—which, if directed toward public services (e.g., education, healthcare, digital literacy programs), would benefit everyday Washingtonians, especially low- and middle-income households.
FinancialPeopleRef: Sec. 10 (severance tax); Sec. 12 (revenue to Business and Professions Account)Mandating clear opt-out instructions and allowing third-party authorization (e.g., for seniors or people with disabilities) improves accessibility and agency for vulnerable populations who otherwise lack the capacity or tools to manage their data privacy.
Rights & LibertiesPeopleRef: Sec. 4(1)(c)(vi)-(viii); Sec. 4(1)(c)(ix)By requiring data brokers to disclose security measures and be subject to discipline under the Uniform Regulation of Business and Professions Act, the bill increases accountability for data breaches—potentially reducing identity theft and fraud risks for residents.
Public SafetyPeopleRef: Sec. 3(1); Sec. 1 (legislative findings)The definition of brokered personal data is broad and includes biometrics, geolocation, and data that *reasonably* identifies individuals—closing loopholes that allowed previous laws to exclude sensitive data types, thereby strengthening privacy protections for everyday residents.
Rights & LibertiesPeopleRef: Sec. 2(2)(g) (‘other information…can reasonably be associated’); Sec. 2(1)(a) (biometric information)
Potential Concerns (5)
The tiered severance tax will increase compliance and operational costs for data brokers, many of which are small- to mid-sized tech firms or data analytics startups; these costs may be passed on to Washington consumers in the form of higher subscription fees, advertising prices, or reduced free services—though large firms are better positioned to absorb them, the burden ultimately falls on users.
FinancialPeopleRef: Sec. 10 (monthly severance tax, tiers up to $0.55/resident)While the bill grants opt-out rights, the burden of exercising them falls on individuals—many of whom lack technical literacy or time to navigate complex privacy settings—limiting the practical impact of these rights and potentially creating a false sense of control over personal data.
Rights & LibertiesPeopleRef: Sec. 4(1)(c)(vii)(B); Sec. 4(1)(c)(vi)The opt-out mechanisms are limited to *use* and *provision* of data—not deletion or prevention of collection—so individuals cannot stop initial data harvesting, only reduce downstream sharing, which significantly weakens the protective effect for everyday residents.
Rights & LibertiesLean peopleRef: Sec. 4(1)(c)(viii); Sec. 4(1)(c)(vii)(A)Exemptions for financial institutions, credit bureaus, and publicly available data activities disproportionately benefit large, well-resourced entities (e.g., banks, Equifax, Experian), while smaller data brokers without federal regulatory cover bear the full compliance and tax burden—creating an uneven playing field.
Business & EmploymentLean peopleRef: Sec. 3(2)(a)-(d); Sec. 2(4)(a)-(b)The registration and reporting requirements—including monthly data counts, security disclosures, and opt-out procedures—will impose administrative costs on small and mid-sized tech firms, potentially discouraging local innovation and job growth in Washington’s tech sector.
Business & EmploymentLean peopleRef: Sec. 4(1)(c)(i)-(ix); Sec. 11(1)
Who Is Most Affected
Large data brokers (e.g., data aggregators, ad-tech firms, data marketplaces) will face significant compliance and tax costs, but are best positioned to absorb them; may pass costs to consumers or reduce data collection, which could reduce targeted ad revenue but improve public trust.
Small and mid-sized tech firms, startups, and local data analytics companies will bear disproportionate compliance costs relative to revenue, potentially reducing innovation and hiring in Washington’s tech ecosystem.
Residents gain transparency and opt-out rights, but must actively exercise them; low-income, elderly, and less digitally literate residents may benefit less unless accompanied by outreach and support.
Financial institutions, credit bureaus, and government agencies are exempt, preserving their existing regulatory frameworks but reinforcing their privileged status in the data economy.
The Department of Licensing gains new regulatory authority and funding, expanding its scope and influence—but must build new technical and legal capacity to oversee a complex, fast-evolving industry.