The Northwest Cooperative Development Center (NWCDC) praises the passage of Senate Bill 5096 Employee Ownership by the Washington Legislature and thanks Governor Inslee for signing it into law! Sponsored by State Senator Mike Padden (R-Spokane) and Senate Majority Leader Jamie Pedersen (D-Seattle), the law is, according to Jack Moriarty of Ownership America, the nation’s most comprehensive employee ownership bills. 5096 creates solid pathways for existing businesses to transition to Worker Cooperatives or Employee Stock Ownership Plans (ESOPS). This will create benefits for retiring owners, existing employees, and the communities served by these businesses. The bill maintains strong and resilient local economies through employee-owned businesses.
SB 5096 will provide means to help workers manage the transition to ownership through a one-time tax credit to assist with the costs of conversion and a revolving loan fund to ease the financial hurdles that workers face in trying to create a worker-owned business. It will also create a commission to oversee the efforts and obligate the State Department of Commerce to report on the number of employee owned businesses annually.
Co-Director of NWCDC, Dr. John McNamara comments, “This law puts Washington at the forefront of the movement towards worker ownership. SB 5096 will support building resilient local economies whether they are in Walla Walla or Seattle’s Central District. By supporting the ability of workers to control their economic destiny, Washington will be creating pathways to the next generation of ownership at a time when many small business owners are facing retirement without a clear succession plan.”
Almost half of Washington business owners are at or near the age of retirement. Still, it is projected that only about 20% of these businesses will transfer to a new generation of ownership. By creating a pathway for worker ownership, these businesses can continue to support their local economies and provide new benefits to the workers through collective ownership.
Worker cooperatives generally engage in higher productivity and enjoy better pay and benefits within a humane and safe working environment. Workers have a voice in how they do the work, providing a better quality of life and work-life balance along with stronger pay and benefits. Worker-owned businesses stay in their communities and the wealth that they generate circulates significantly more than other types of ownership.
Washington already has a number of worker cooperatives that transitioned from private ownership in a number of economic sectors including:
| Retail | Tech and Engineering | |
| Dumpster Values, Olympia | Working Systems Cooperative, Olympia | |
| Seattle E-Bike (EmPower), Seattle | Marine Survey and Assessments, Port Townsend | |
| Orca Books Co-operative, Olympia | Sound Audio Repair, Olympia | |
| Food and Beverages | Construction | |
| New Moon Cafe, Olympia | Metis Construction, Seattle | |
| Burial Grounds, Olympia | A-1 DesignBuild, Bellingham | |
| Jude’s Old Town Pizza, Seattle | Bellingham Bay Builders, Bellingham | |
| Patty Pan Cooperative, Seattle | ||
| Blue Heron Bakery (in process), Olympia |
One of the more unique models of conversion to employee ownership is the Spokane Workers Cooperative–a holding company that buys existing businesses and operates them as a worker cooperative.
NWCDC has assisted over a dozen Washington businesses to transition to worker cooperatives and looks forward to the new services and support offered by Senate Bill 5096. NWCDC, based in Olympia, Washington, has helped people start new cooperatives, convert existing businesses into cooperatives, and educate on the cooperative enterprise model for over 20 years in the pacific northwest region.