This bill creates a new public interest law program and a related business and occupation (B&O) tax credit by adding new sections to chapters 28B.77 and 82.04 RCW. The program authorizes annual student loan payoff grants of up to $10,000 for eligible lawyers who have worked at least one year as a prosecutor or a public defender contracted through the Office of Public Defense. It establishes a public interest law program account in the state treasury to receive private contributions and state appropriations, limits use of those funds to program operation and grants, and directs “the council” to administer the program, adopt rules, create application and verification processes, approve applicants, accept contributions, issue approved contribution receipts within 30 days, and publicize the program. The bill creates a new B&O tax credit for eligible law firms that make cash contributions to the program account. The credit equals the contribution amount up to $20,000 per calendar year, is nonrefundable, may be carried forward for one calendar year, and is available beginning January 1, 2027. Taxpayers must electronically file returns and include the council’s approved contribution receipt and other required information to claim the credit. Both the program and the tax credit provisions expire December 31, 2038. The council and the Department of Revenue must submit a joint annual report to the Legislature beginning January 1, 2028, with specified program and tax credit data. This is a creation of new law and a procedural/tax preference change (establishing a grant program and a tax credit), not a criminal or penalty change. The bill includes a legislative intent statement that the Legislature may extend the tax preference if participant counts rise and average annual grants exceed $100,000, and authorizes JLARC to use state data for review. The extracted text leaves some gaps: the specific identity or statutory reference for “the council” is not provided; one chapter citation in Sec. 4 is blank; detailed procedures for eligibility verification, application forms, grant award prioritization, and any amounts of state appropriations are not included; and the referenced state supreme court order and its full standards are not provided.

If enacted, prosecutors and public defenders who meet the eligible definition could receive annual student loan payoff grants of up to $10,000, funded from a new state treasury account that accepts private contributions and any state appropriations. Law firms would be encouraged to donate cash to that account because they could claim a business-and-occupation tax credit equal to their contribution, up to $20,000 per year; the credit is nonrefundable, can be carried forward one year, and requires electronic filing with the Department of Revenue and an approved contribution receipt issued by the program administrator within 30 days. The council named in the bill would be responsible for creating the program by December 31, 2026 and, if money is available, issuing the first grants by July 1, 2027, with the program and tax credit set to expire December 31, 2038. The most affected parties are eligible public lawyers (reduced loan burdens if funds are available), law firms (who may incur donation costs but receive tax credits that may not fully offset their tax liability if credits exceed taxes owed), and the unnamed council and Department of Revenue (which gain new administrative duties and reporting requirements). Key uncertainties in the provided facts include the identity of “the council,” the amount of any state appropriation, how applicants will be prioritized or verified, and how many grants will actually be funded, so actual grant availability and fiscal impacts are unclear.