HOUSE BILL REPORT

                 SJM 8029

             As Reported By House Committee On:

                          Judiciary

Brief Description:  Petitioning Congress to allow states to require a notice requirement before imposing a federal lien on real property.

Sponsors:  Senators Morton, A. Smith, Hochstatter, Prince, McDonald, Oke, Bluechel, L. Smith, Sellar, McCaslin, Moyer, Winsley, Deccio, West and Roach.

Brief History:

  Reported by House Committee on:

Judiciary, February 18, 1994, DP.

HOUSE COMMITTEE ON JUDICIARY

Majority Report:  Do pass.  Signed by 13 members:  Representatives Appelwick, Chair; Johanson, Vice Chair; Padden, Ranking Minority Member; Ballasiotes, Assistant Ranking Minority Member; Campbell; Chappell; Eide; J. Kohl; Long; Morris; H. Myers; Scott and Tate.

Staff:  Pat Shelledy (786-7149).

Background:  A bill passed the Legislature in 1993 which was intended to ensure that property owners received notice that a federal lien had been filed against their property.  The legislation provided that such liens could be filed only if the federal government certified that a copy of the lien document had been sent by registered or certified mail to the property owner.

The Governor vetoed the bill because it conflicted with a federal constitutional provision that vests Congress with exclusive authority to impose and collect federal taxes.  Courts have held that states do not have authority to impose conditions on the collection of federal taxes, unless otherwise provided by Congress.

Summary of Bill:  Congress is requested to enact legislation to allow states that impose notice requirements on state tax liens to impose similar notice requirements on federal tax liens.

Fiscal Note:  Not requested.

Testimony For:  The bill is one small step towards fairness to property owners who now are potentially subject to liens without any notice.

Testimony Against:  None.

Witnesses:  Senator Morton, prime sponsor (pro).