AN ACT
Relating to property tax exempt eligibility status for nonprofit homes for the
aging; amending RCW 84.36.041; and creating new sections.
BE IT ENACTED BY THE LEGISLATURE
OF THE STATE OF WASHINGTON:
Sec.
1. RCW
84.36.041 and 1991 sp.s. c 24 s 1 are each amended to read as follows:
(1)
All real and personal property used by a nonprofit home for the aging that is
reasonably necessary for the purposes of the home is exempt from taxation if
the benefit of the exemption inures to the home and:
(a) At
least fifty percent of the occupied dwelling units in the home are occupied by
eligible residents; or
(b)
The home is subsidized under a federal department of housing and urban
development program. The department of revenue shall provide by rule a
definition of homes eligible for exemption under this subsection (b),
consistent with the purposes of this section.
(2) A home
for the aging is eligible for a partial exemption if the home does not meet the
requirements of subsection (1) of this section because fewer than fifty percent
of the occupied dwelling units are occupied by eligible residents. The amount
of exemption shall be calculated by multiplying the assessed value of the
property reasonably necessary for the purposes of the home by a fraction. The
numerator of the fraction is the number of dwelling units occupied by eligible
persons multiplied by two. The denominator of the fraction is the total number
of occupied dwelling units. The fraction shall never exceed one.
(3) To
be exempt under this section, the property must be used exclusively for the
purposes for which the exemption is granted, except as provided in RCW
84.36.805.
(4) A
home for the aging is exempt from taxation only if the organization operating
the home is exempt from income tax under section 501(c) of the federal internal
revenue code as existing on January 1, 1989, or such subsequent date as the
director may provide by rule consistent with the purposes of this section.
(5)
Each eligible resident of a home for the aging shall submit the form required
under RCW 84.36.385 to the county assessor by July 1st of the assessment year.
An eligible resident who has filed a form for a previous year need not file a
new form until there is a change in status affecting the person's eligibility.
(6) In
determining the true and fair value of a home for the aging for purposes of the
partial exemption provided by subsection (2) of this section, the assessor
shall apply the computation method provided by RCW 84.34.060 and shall consider
only the use to which such property is applied during the years for which such
partial exemptions are available and shall not consider potential uses of such
property.
(7) A
home for the aging that was exempt for taxes levied for collection in 1990 and
is not fully exempt under this section is entitled to partial exemptions as
follows:
(a)
For taxes levied for collection in 1991 and 1992, two-thirds of the assessed
value that would otherwise be subject to tax under this section is exempt from
taxation.
(b)
For taxes levied for collection in 1993, one-third of the assessed value that
would otherwise be subject to tax under this section is exempt from taxation.
(8) As
used in this section:
(a)
"Eligible resident" means a person who would be eligible for an
exemption of ((regular)) property taxes under RCW 84.36.381 (1)
through (4) if the person owned a single-family dwelling and has a
combined disposable income, as defined in RCW 84.36.383, of twenty-two thousand
dollars or less. For the purposes of determining eligibility under this
section, a "cotenant" as used in RCW 84.36.383 means a person who
resides with an eligible resident and who shares personal financial resources
with the eligible resident.
(b)
"Home for the aging" means a residential housing facility that (i)
provides a housing arrangement chosen voluntarily by the resident, the
resident's guardian or conservator, or another responsible person; (ii) has
only residents who are at least sixty-two years of age or who have needs for
care generally compatible with persons who are at least sixty-two years of age;
and (iii) provides varying levels of care and supervision, as agreed to at the
time of admission or as determined necessary at subsequent times of
reappraisal.
(9)
A for-profit home for the aging that converts to nonprofit status after the
effective date of this act and would otherwise be eligible for tax exemption
under this section may not receive the tax exemption until five years have
elapsed since the conversion. The exemption shall then be ratably granted over
the next five years.
NEW
SECTION. Sec. 2. The
department of revenue shall conduct a study of the property tax exemption for
nonprofit homes for the aging. The study shall be conducted with the
assistance of a study committee formed by the department of revenue and
composed of representatives from management and residents of the nonprofit
homes for the aging provider community, recognized senior citizen advocacy
organizations not associated with the nonprofit homes of the aging provider
community, the county assessors, city officials, and county officials. The
department shall submit a report to the house of representatives revenue
committee and to the senate ways and means committee by November 30, 1992, that
examines the property tax exemption for nonprofit homes for the aging. The
study may include issues such as:
(1)
The impact of the 1989 and 1991 changes to the property tax exemption for homes
for the aging.
(2)
How the nonprofit charitable aspect of the home for the aging should be
factored into the calculation of a property tax exemption.
(3)
What consideration should be given for the traditional role that homes for the
aging have played in providing housing, health care, and financial security for
the elderly.
(4)
Whether the incomes of the residents should be a factor in determining the
level of property tax exemption.
(5)
The proper income threshold for calculating property tax relief for homes for
the aging.
(6)
Whether there should be a direct link with the income thresholds in the senior
citizen homeowner tax relief program.
(7)
Whether the exemption should be restructured to provide relief
"equivalent" to the senior citizen homeowner program.
(8)
Whether the tax relief should be provided directly to the resident or to the
nonprofit home for the aging.
(9)
How common areas and personal property should be treated under the property
tax.
NEW
SECTION. Sec. 3. The
combined disposable income threshold of twenty-two thousand dollars or less
contained in section 1 of this act shall be effective for taxes levied for
collection in 1993 and thereafter.
