The "Expanding Employee Ownership Act" aims to promote employee ownership structures in Washington State by establishing a dedicated program to support businesses transitioning to such models. The act creates the Washington Employee Ownership Program, which will be administered by the Department and overseen by the newly formed Washington Employee Ownership Commission. This program will provide technical support, resources, and a referral service for businesses considering employee ownership, as well as develop materials to educate business owners and employees about the benefits of these structures. Additionally, the program will include a revolving loan program to assist small businesses in financing their transition to employee ownership, contingent upon federal funding.

To incentivize the creation of employee ownership structures, the act introduces a tax credit for businesses converting to worker-owned cooperatives, employee ownership trusts, or employee stock ownership plans. The credit allows for reimbursement of up to 50% of conversion costs, with specific caps depending on the type of ownership structure. The total amount of credits is limited to $2 million annually, and the program is set to expire on July 1, 2030. The act also establishes an employee ownership revolving loan program account to manage funds related to the program, ensuring that all financial activities are properly accounted for and utilized solely for the program's purposes.