SB 5550
In CommitteeSenate
Transportation funding/CCA
Funding the state transportation system using climate commitment act revenues.
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 redirects Climate Commitment Act auction revenues to fund major highway and bridge projects—including the I-5 bridge replacement—while also updating how auction proceeds are allocated across state accounts. It changes spending rules for the Carbon Emissions Reduction Account to include highway and bridge work, and adds new requirements for auction fairness, labor standards, and equity.
- Directs Climate Commitment Act auction revenues to fund major highway and bridge projects—including the I-5 bridge over the Columbia River, US 395 North Spokane corridor, SR 520 bridge, and Gateway freight project.
- Requires $127.3M–$359.1M per year (depending on fiscal year) from auction proceeds to be deposited into the Carbon Emissions Reduction Account, with remaining proceeds split between the Climate Investment Account and Air Quality and Health Disparities Improvement Account.
- Starts in FY25, redirects 50% of *additional* auction proceeds (beyond legislatively obligated amounts) into the Multimodal Transportation Account.
- Amends the Carbon Emissions Reduction Account to allow spending on highway and bridge maintenance, repairs, and replacements—including for active transportation and transit users—while still prioritizing carbon emission reductions.
- Adds new auction rules: limits on how much allowances a single bidder can buy (e.g., 25% for covered entities), requirements for bid guarantees, confidentiality of bidding data, and anti-collusion measures.
- Mandates labor and equity standards for projects funded from the Climate Investment Account, including family-sustaining wages, health benefits, apprenticeships, and outreach to justice-affected individuals and diverse businesses.
Who is affected
- Transportation agencies — State and local transportation agencies (e.g., WSDOT, regional transit authorities) will receive new funding sources for highway, bridge, and multimodal projects, including major infrastructure like the I-5 bridge replacement and SR 520 improvements.
- Covered and opt-in entities (emitters) — Businesses that emit greenhouse gases (e.g., large manufacturers, power plants, transportation companies) must buy allowances in auctions and are subject to purchase limits and reporting requirements.
- Communities historically impacted by transportation and environmental policies — Low-income, frontline, and historically marginalized communities may benefit from targeted investments in transit, active transportation, and freight emission reductions, as well as labor equity requirements on funded projects.
- Workers and contractors — Workers and contractors on state-funded transportation and climate projects will be subject to new labor standards (e.g., family-sustaining wages, benefits, apprenticeships) and equity requirements.
Pro/Con Analysis
Potential Benefits (5)
Mandating family-sustaining wages, health benefits, apprenticeships, and outreach to justice-affected individuals and diverse businesses on projects funded from the Climate Investment Account improves labor standards and economic opportunity for historically excluded workers on major infrastructure projects.
Public SafetyPeopleRef: Sec. 4(1), Sec. 4(2)(a), Sec. 5(1)(b)Requiring that highway and bridge projects funded from the Carbon Emissions Reduction Account “favor bridges used by active transportation and transit users” and explicitly include active transportation, transit, rail, and ferries expands multimodal access and safety for everyday commuters—including low-income riders, seniors, and people with disabilities—who rely on alternatives to driving.
TransportationPeopleRef: Sec. 4(1), Sec. 4(2)(a)The 25% purchase cap for covered entities and 4% cap for general market participants helps prevent market concentration and reduces the risk of price manipulation by large players, supporting fairer participation in the carbon market.
Business & EmploymentPeopleRef: Sec. 3(6)(a), Sec. 3(6)(b)Expanding the Carbon Emissions Reduction Account’s permissible uses to include congestion reduction and freight decarbonization aligns spending with the program’s statutory goal of reducing transportation-sector emissions—especially if projects are evaluated for net emissions impact rather than just vehicle throughput.
EnvironmentLean peopleRef: Sec. 4(1)Requiring bid guarantees and independent financial administration of auctions improves market integrity and reduces counterparty risk, protecting the state’s revenue stream and ensuring more predictable funding for climate and transportation programs.
FinancialLean peopleRef: Sec. 3(5), Sec. 3(7)(a)-(f)
Potential Concerns (5)
Redirecting a large share of climate auction revenues to highway and bridge projects—including the I-5 bridge replacement—may divert funds from other high-impact climate programs (e.g., clean transit, EV infrastructure, freight decarbonization) that could deliver greater emissions reductions per dollar and benefit a broader cross-section of Washingtonians, especially in urban and low-income areas.
TransportationIndustryRef: Sec. 2; Sec. 4(2)(a)The requirement that 50% of *additional* auction proceeds beyond legislatively obligated amounts go to the Multimodal Transportation Account creates a structural bias toward highway infrastructure over climate mitigation; because the baseline allocation to the Carbon Emissions Reduction Account is set at $359M annually (FY26–FY37), only proceeds *above* that level trigger multimodal funding—meaning highway projects receive priority until emissions allowances shrink enough to push auction revenues above the threshold, which may not occur for years.
FinancialIndustryRef: Sec. 3(7)(c)(iii), Sec. 3(7)(e)The 25% purchase cap for covered entities and 4% cap for general market participants may reduce auction competition and increase prices for smaller emitters or new market entrants, while large incumbent firms (e.g., Chevron, PSE, Avista) can more easily absorb compliance costs and maintain market share, reinforcing industry concentration.
Business & EmploymentIndustryRef: Sec. 3(6)(a), Sec. 3(6)(b)Allowing expenditures from the Carbon Emissions Reduction Account to include highway maintenance and replacement—even for roads that primarily serve single-occupancy vehicles—risks increasing vehicle miles traveled and long-term emissions if not paired with strict performance metrics, potentially undermining the program’s core emissions-reduction mandate.
EnvironmentLean industryRef: Sec. 4(2)(a)Making bidding data—including bid prices, strategies, and participation intent—confidential and exempt from public disclosure limits transparency and public oversight of the auction process, potentially shielding anti-competitive behavior from scrutiny by watchdogs, journalists, and affected communities.
Rights & LibertiesLean industryRef: Sec. 3(9)
Who Is Most Affected
State and local transportation agencies (e.g., WSDOT, Sound Transit, regional transit authorities) gain new, dedicated funding streams for major infrastructure—including the I-5 bridge, SR 520, and Gateway freight project—potentially accelerating timelines and scope of critical projects. However, reliance on volatile auction revenues introduces budget uncertainty, and the emphasis on highways may divert attention from high-need transit and active transportation investments in urban centers.
Large emitters (e.g., power plants, refineries, manufacturers) face purchase limits and increased compliance costs, but may benefit from stable allowance prices due to reduced auction competition. Smaller emitters and new market participants may struggle to compete under the 25%/4% caps and bid-guarantee requirements, potentially consolidating market power among incumbents.
Frontline and low-income communities may benefit from labor equity requirements on funded projects and targeted freight decarbonization, but could be harmed if highway expansions increase local air pollution and displacement. The bill’s equity language is strong, but without enforceable performance metrics, benefits may be limited to project-level hiring rather than systemic improvements in environmental health.
Workers on state-funded transportation and climate projects gain enforceable labor standards—including family-sustaining wages, health benefits, and apprenticeships—which improve job quality and access for underrepresented groups. However, contractors may pass increased labor costs to agencies, potentially slowing project delivery or reducing scope if budgets are constrained.