FINAL BILL REPORT

SHB 1388

                                   C 61 L 88

BYHouse Committee on Housing (originally sponsored by Representatives Nutley, J. Williams, Leonard, Sanders, Barnes, Wineberry, Padden, Heavey, Anderson, Jacobsen, Valle, May, Ballard, Nelson, Jesernig, Todd, Moyer, Lux, Unsoeld, Ferguson and Day)

Exempting temporary lodging for homeless persons from state and local excise taxation.

House Committe on Housing

Rereferred House Committee on Ways & Means/Revenue

Senate Committee on Ways & Means

SYNOPSIS AS ENACTED

BACKGROUND:

The use of hotel and motel facilities for emergency short term lodging (less than 30 days) of homeless persons by local nonprofit organizations is common throughout Washington. This approach to providing short term emergency shelter is cost-effective for many smaller emergency shelter programs.

In Washington retail sales taxes must be collected on all non-exempt retail sales based on a percentage of the selling price.  The Department of Revenue has determined that a retail sale includes the furnishing of lodging by a hotel, rooming house or other similar entity, and the granting of any similar license to use real property, as distinguished from the renting or leasing of real property.  The current state sales tax rate is 6.5 percent, with counties and cities authorized to levy an additional combined retail sales tax not to exceed 1.3 percent.

In addition to the state and local retail sales tax the Legislature has authorized a special excise tax on lodging in specified cities and counties.  The excise tax rate is 2 percent in Pierce and King Counties and the city of Tacoma, and 5 percent in the city of Seattle.

SUMMARY:

The use of hotel and motel facilities for emergency short-term lodging of homeless persons is exempt from special excise and retail sale taxation at the state and local level.  To qualify for the exemption the lodging must be provided on an emergency basis for less than 30 days and through a shelter voucher program administered by an eligible organization.

Eligible organizations include only cities, towns and counties, or their respective agencies, and groups that provide emergency food and shelter services to homeless persons.

VOTES ON FINAL PASSAGE:

      House 97   0

      Senate    47     0

EFFECTIVE:July 1, 1988