Last year, the state of Washington passed the largest pro-employee ownership legislation ever passed in the U.S. (S.B. 5096). Earlier this year, Lorena Lowell was appointed the inaugural Program Director for the newly created Washington Office of Employee Ownership under the Department of Commerce.

In addition to creating the Office of Employee Ownership, here are some other key provisions of the new law, which could serve as a model for other states:

Commission Oversight: An appointed commission will oversee the new Office of Employee Ownership, comprising four legislative members (two from each party), five private-sector representatives (including those from employee-owned businesses, a business association, an economic development expert, and a financial institution experienced in ownership transitions), and two public-sector experts.

Tax Credits: A feasibility assessment and implementation tax credit will be established, Up to 50%, but no more than $25,000, of the costs of converting a qualified business to a worker-owned cooperative or an employee ownership trust. • Up to 50%, but no more than $100,000, of the costs of converting a qualified business to an employee stock ownership plan. This tax credit launched on July 1, 2024, and is managed by the Washington State Department of Revenue.

Revolving Loan Fund: A revolving loan fund will be created to support financing for ESOP or cooperative conversions, contingent upon the availability of federal funds, potentially utilizing resources from the State Small Business Credit Initiative (SSBCI).



For more information about the Office of Employee Ownership, reach out to Lorena Lowell, Director, at (360) 725-2809 or lorena.lowell@commerce.wa.gov.