S-243                 _______________________________________________

                                                   SENATE BILL NO. 3860

                        _______________________________________________

State of Washington                              49th Legislature                              1985 Regular Session

By Senators Vognild, Lee, McManus, Zimmerman, Bauer and Johnson

Read first time 2/7/85 and referred to Committee on Ways and Means.

AN ACT Relating to property taxation; adding new sections to chapter 84.36 RCW; and providing an effective date.

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

NEW SECTION. Sec. 1.     (1) A property owner may defer payment of property taxes under this title on any building, structure, or addition to an existing building or structure for not more than three consecutive years following completion of construction if the building, structure, or addition is:

          (a) Commercial property being constructed in the furtherance of the production of income; and

          (b) Not in use or occupied on or before the effective date of this act.

          (2) If the building, structure, or addition qualifies for a deferral under this section, any machinery or equipment located at the construction site which is or will be installed as part of the building, structure, or addition is also subject to a deferral under this section.

NEW SECTION. Sec. 2.     (1) A property owner requesting a deferral under section 1 of this act shall apply to the county assessor, on forms prescribed by the department of revenue, no later than thirty days before the tax is due.  The applicant shall provide such information as the department may by rule require, including proof satisfactory to the department that the property for which a deferral is sought meets the requirements of section 1 of this act.

          (2) The county assessor shall transmit one copy of each deferral application to the department of revenue.  The department may audit any application and shall notify the assessor no later than August 31st if the deferral has been approved or disapproved.  Persons receiving a deferral shall provide annual verification in the manner prescribed by the department to prove that the property continues to qualify for the deferral.

          (3) Property for which a deferral has been approved by the department shall be listed for property tax purposes.  Collection of the taxes otherwise payable shall be deferred as provided under section 1 of this act.

NEW SECTION. Sec. 3.     Property taxes deferred under sections 1 and 2 of this act shall be repaid over a period of not more than five years commencing the year after the last year of deferral.  Deferred taxes shall be repaid in equal assessments or as otherwise prescribed by the department.

NEW SECTION. Sec. 4.     (1) Credits may be claimed as provided in this section against taxes deferred under sections 1 and 2 of this act.  The credits may be allowed by the department only if the applicant provides proof satisfactory to the department that new jobs were created in this state that were directly related to the property for which the applicant received a deferral.

          (2) The maximum credits allowable against deferred taxes payable in any year shall be calculated as follows:

          (a) For the creation of one job, the amount of the credit shall be the total deferral amount multiplied by five percent;

          (b) For the creation of two through ten jobs, the amount of the credit shall be the total deferral amount multiplied by five percent, less previous credits; and

          (c) For additional jobs above ten, the amount of the credit shall be the total deferral amount multiplied by one percent, less previous credits.

          (3) Property owners seeking credits under this section shall apply in the same manner as for a deferral under section 2 of this act.  The department shall prescribe by rule the information required to obtain a credit under this section.  No credit may be taken under this section until it has been approved by the department.  The department shall provide proof of the credit which shall be transmitted to the county assessor.

NEW SECTION. Sec. 5.     Sections 1 through 4 of this act are each added to chapter 84.36 RCW.

NEW SECTION. Sec. 6.     This act shall take effect on January 1, 1986, and shall be effective for property taxes payable in 1986 and thereafter.