SENATE BILL REPORT

EHB 2777

BYRepresentatives Haugen, Wang, Zellinsky, Horn, Raiter, Nealey, Cooper, Ferguson, Nelson, Nutley, Wood, Rayburn, Phillips, Baugher, Kremen, May and Todd

Modifying provisions regarding local government tax levies.

House Committe on Revenue

Senate Committee on Ways & Means

Senate Hearing Date(s):February 22, 1990

Senate Staff:Terry Wilson (786-7715)

AS OF FEBRUARY 22, 1990

BACKGROUND:

Taxing districts, other than school districts, may impose property tax levies in excess of the 1 percent constitutional limit for a one-year period if authorized by the voters.

Taxing districts seeking voter approval for excess levies are subject to the 60 percent/40 percent voter approval requirement (60 percent favorable vote of at least 40 percent of those voting in the last general election).  In seeking levy approval, taxing districts must describe levies in terms of a dollar amount for ballot purposes.

In cases of general obligation bonded indebtedness levies, it is often impossible for a taxing district to know precisely the actual dollar amount required until the bonds are sold and the interest rate or rates, terms, and bond retirement provisions are evident.

Some taxing district levies are unique.  For example, emergency medical services levies (up to $.25 per $1,000 of assessed value) for periods of six years are required to be voter approved on a 60 percent/40 percent basis.  Yet, the $.25 is considered a regular levy under the $10.00 or 1 percent constitutional limitation.

Additionally, park and recreation districts, park and recreation services areas, and cultural arts, stadium and convention districts may impose a regular levy up to $.15, or $.25 in the case of cultural arts, stadium and convention districts, when approved by the voters on a 60 percent/40 percent basis for up to either a five or six-year period.

SUMMARY:

Taxing districts, except the state, may impose excess property tax levies for general purposes for periods up to six years.

Ballot propositions authorizing excess levies may state a maximum levy rate, instead of a dollar amount and an estimate of a levy rate.  Where more than one year is involved, the ballot proposition must provide a maximum levy rate for each year, or a maximum levy in dollars for each year and an estimate of the levy rate for each year.

A ballot proposition authorizing tax levies to retire voter approved general obligation bonds may state that authorization is being sought for excess levies sufficient to retire the bonds, rather than stating the maximum dollar amount.

The authority for emergency medical services districts, park and recreation districts, park and recreation services areas, and cultural arts, stadium and convention districts to impose voter approved regular property taxes is eliminated because the requirements for these levies are the same as for excess levies.

Emergency medical services property tax levies of $.25 per $1,000 of assessed valuation may continue in force during the time they were authorized by voters.

Six-year levies for taxing districts are contingent upon approval by the voters of a constitutional amendment in November 1990.

Appropriation:    none

Revenue:    yes

Fiscal Note:      available

Effective Date:The act takes effect January 1, 1991, if a proposed amendment to Article VII, Section 2 is approved by the voters.