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Bill

SB 5682

Concerning the Washington customized employment training program.

2025-2026 Regular Session Introduced by Drew Hansen and 1 co-sponsor

Extends the CETP B&O tax credit to July 1, 2031 while maintaining requirements and improving county-level reporting to support employer-focused workforce training.

Effective date 7/27/2025.
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WeVote Research Nonpartisan
Bill Summary · SB 5682

Summary: Senate Bill 5682 — Washington Customized Employment Training Program

Overview

SB 5682 extends and refines the Washington Customized Employment Training Program (CETP), maintains the related business and occupation (B&O) tax credit, and updates reporting requirements. The bill was signed into law in May 2025 and becomes effective 90 days after adjournment, with an explicit effective date of July 27, 2025. The expiration date for the CETP B&O tax credit is extended to July 1, 2031, and reporting requirements are updated to provide more county- and institution-level detail.

Purpose and intent

  • Continue to support employer-specific workforce training through CETP, helping Washington businesses attract, retain, and upskill workers.
  • Maintain a tax incentive (B&O tax credit) tied to CETP training costs, while ensuring accountability through performance metrics and enhanced reporting.
  • Encourage participation by smaller employers and promote training with transferable, portable skills.

Key provisions

  • B&O tax credit extension: The CETP B&O tax credit is extended from its prior expiration to July 1, 2031. The credit remains equal to 50% of the participant’s payments to the Employment Training Finance Account (up to the program rules and caps).

  • Program mechanics (unchanged foundational framework):

    • Up-front CETP costs are funded by the State Board for Community and Technical Colleges (SBCTC).
    • Training costs may cover basic education, English language for non-native speakers, technical/job-related instruction, skills assessment, and training-related equipment/materials.
    • Preference for small employers (fewer than 50 employees) and for training leading to transferable skills.
    • Maximum annual training cost per employee and annual caps apply (e.g., no more than $500,000 per calendar year per business).
    • Post-training: businesses repay 25% of training costs to the CETP account; the remaining 75% is paid in over the next 18 months.
    • Businesses are expected to hire CETP trainees; non-hire scenarios may require repayment or additional payments per program agreement.

  • Tax Preference Performance Statement (TPPS) and JLARC review: The bill keeps the existing TPPS and JLARC review framework. If JLARC finds that at least 75% of participating businesses complete training and repay the program loan, the Legislature intends to extend the expiration date of the tax preference.

  • SBCTC reporting (updated content and deadline):

    • Original reporting requirements were expanded and clarified.
    • By December 31, 2028, SBCTC must report to the higher education committees on:
    • (a) The distribution of credit eligibility by county (as indicated by CETP participants).
    • (b) The distribution of qualified training institutions providing CETP trainings by county.
    • (c) Efforts to broaden credit use across a wider range of industries and training institutions.

  • No new appropriation: The bill does not include additional funding beyond existing CETP financing mechanisms.

Who is affected

  • Small and medium-sized Washington businesses participating in CETP.
  • Trainees/employees receiving CETP training.
  • Community and technical colleges administering CETP.
  • SBCTC (administration and reporting responsibilities).

Timeline and procedural notes

  • Introduced: February 6, 2025
  • Passages: Senate and House in early to mid-2025
  • Governor’s action: Signed May 15, 2025
  • Effective date: 90 days after adjournment (effective July 27, 2025)
  • Key fiscal note: Fiscal impact described as available; appropriation: none

Why it matters

The bill formalizes a longer-duration tax credit framework linked to CETP, aims to sustain employer-focused training, and enhances transparency through county-level reporting. The 75% performance trigger provides a measurable benchmark for potential future extension of the tax preference.

Compiled from official sources — confirm details with the bill’s official record.

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