AN ACT Relating to the collection of certain taxes and fees as a result of a high capacity transit system approved by the voters of a regional transit authority in 2016; amending RCW 82.44.135 and 81.112.360; adding a new section to chapter 82.44 RCW; adding new sections to chapter 81.112 RCW; adding a new section to chapter 36.01 RCW; creating a new section; and declaring an emergency.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

Sec. 1.  RCW 82.44.135 and 2006 c 318 s 9 are each amended to read as follows:

(1) Before a local government subject to this chapter may impose a motor vehicle excise tax, the local government must contract with the department for the collection of the tax. Except as otherwise provided in this section, the department may charge a reasonable amount, not to exceed one percent of tax collections, for the administration and collection of the tax.

NEW SECTION.  Sec. 2.  A new section is added to chapter 82.44 RCW to read as follows:

If the department enters into a contract with a regional transit authority for the collection of a motor vehicle excise tax authorized in RCW 81.104.160(1), and after the regional transit authority implements a market value adjustment program as directed in section 3 of this act, the department must clearly indicate, when issuing notices to persons renewing vehicle registrations under RCW 46.16A.110, the net result after application of the credit. The department must include as part of the notices an insert that provides a description of the market value adjustment program and how it affects taxpayers generally.

NEW SECTION.  Sec. 3.  A new section is added to chapter 81.112 RCW to read as follows:

(1) A regional transit authority that includes portions of a county with a population of more than one million five hundred thousand and that imposes a motor vehicle excise tax under RCW 81.104.160(1) must establish a market value adjustment program to be implemented for vehicles with registrations that are due or become due on or after September 1, 2018.

(2) Under the market value adjustment program, the authority must provide a credit against the motor vehicle excise tax due in an amount equal to the tax due under RCW 81.104.160(1) calculated using the vehicle valuation methodology authorized under RCW 81.104.160(1), less the tax otherwise due calculated using the vehicle valuation schedule of percentages in RCW 82.44.035, as applied to eighty-five percent of the value of the vehicle, if the resulting difference is positive.

(3) The program may be funded by any resources available to the authority including, but not limited to:

(a) Unrestricted tax proceeds or other revenues; and

(b) Savings from the delivery of projects.

(4)(a) The program must be implemented in a manner that allows the delivery of the system and financing plan approved by the authority's voters in 2016 to the extent practicable. Building on past and ongoing cost-savings efforts, the agency must continue to evaluate measures that may be needed to reduce costs. These measures include, but are not limited to:

(i) Designing projects using the principles of practical design, as described for use by the department of transportation under RCW 47.01.480;

(ii) Efficiencies realized in coordinating and integrating activities with other transit agencies and local governments, including through shared maintenance and operations, joint procurement, joint marketing, joint customer services, and joint capital projects; and

(iii) Revising project contingency budgets, if practicable.

(b) If, when implementing the program, the authority is not able to deliver projects according to the system and financing plan approved by the authority's voters in 2016, the authority must identify savings and cost reductions, first, from projects other than light rail projects and bus rapid transit projects, and second, from light rail projects and bus rapid transit projects.

(5) Until the plan has been completed, the authority must submit an annual report to the transportation committees of the legislature by December 31st of each year on the status of the delivery of the plan. The report must include detail on the extent to and manner in which the authority has used cost savings to maintain the delivery of the plan as approved by the voters.

(6) The department of licensing is authorized to make rules to implement this section.

NEW SECTION.  Sec. 4.  A new section is added to chapter 81.112 RCW to read as follows:

(1) Beginning July 1, 2019, and continuing through the end of June 2020, the authority must allow an additional one-time credit against the motor vehicle excise tax due with respect to any vehicle for which the 0.8 percent tax in RCW 81.104.160(1) was paid before September 1, 2018. The one-time credit amount on the 0.8 percent tax paid before September 1, 2018, must be calculated using the market value adjustment program credit methodology in section 3 of this act, except that the total amount of credit applied under this section and section 3 of this act may not exceed the current motor vehicle excise tax liability with respect to the vehicle. The authority may develop a system for issuing one-time credits in consultation with the department of licensing.

(2) The department of licensing is authorized to make rules to implement this section.

Sec. 5.  RCW 81.112.360 and 2015 3rd sp.s. c 44 s 422 are each amended to read as follows:

(1) ((Beginning January 1, 2017)) After a regional transit authority adopts a resolution affirming that payment of a sales and use tax offset fee will not impact delivery of a regional transit system plan approved by voters in 2016, and until the requirements in subsection (((4))) (3) of this section are met, ((a)) the regional transit authority must pay to the department of revenue, for deposit into the Puget Sound taxpayer accountability account, a sales and use tax offset fee.

(2) A sales and use tax offset fee is three and twenty-five one-hundredths percent of the total payments made by the regional transit authority to construction contractors on construction contracts that are (a) for new projects identified in the system plan funded by any proposition approved by voters after January 1, 2015, and (b) excluded from the definition of retail sale under RCW 82.04.050(10).

(3) ((Fees are due monthly by the twenty-fifth day of the month, with respect to payments made to construction contractors during the previous month.

(4))) A sales and use tax offset fee is due until the regional transit authority has paid five hundred eighteen million dollars in payments over a period of no more than five years.

(((5))) (4) Except as otherwise provided in this section, the provisions of chapter 82.32 RCW apply to this section.

(((6))) (5) The department of revenue must oversee the collection of the sales and use tax offset fee and may adopt rules necessary to implement this section.

NEW SECTION.  Sec. 6.  A new section is added to chapter 36.01 RCW to read as follows:

Any project permit requirement adopted by a county does not apply to a regional transit authority light rail project, located in the unincorporated area of the county, if the project is part of a system plan approved by the voters of the regional transit authority after January 1, 2016, and pursuant to chapter 81.112 RCW.

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