FINAL BILL REPORT

                  HB 2073

                         C 151 L 93

                     Synopsis as Enacted

Brief Description:  Modifying eligibility requirements for the nonprofit homes for the aging property tax exemption.

By Representative Wang.

House Committee on Revenue

Senate Committee on Health & Human Services

Background:  Nonprofit homes for the aging are residential housing facilities for persons at least 62 years of age.  These nonprofit homes are eligible for a property tax exemption.  Some nonprofit homes for the aging receive a full exemption and others receive a partial exemption.  The exemption amount is determined by a two part formula. 

The first part of the formula fully exempts nonprofit homes for the aging that are subsidized under a Federal Housing and Urban Development program (HUD).  It also fully exempts nonprofit homes with at least 50 percent of the occupied dwelling units occupied by households with disposable incomes below $22,000.

The second part of the formula provides a partial property tax exemption for the homes that do not qualify for a full exemption.  The percent of the property that is exempt is equal to twice the percentage of dwelling units occupied by persons with disposable incomes below $22,000.

There are 147 nonprofit homes for the aging in Washington.  Of these homes, 93 are fully exempt as HUD facilities and 31 others are fully exempt because they have 50 percent of the residents with disposable incomes below $22,000.  The remaining 25 are partially exempt.  The partial exemptions for this group ranges from 25 percent to 96 percent with an average of 63 percent.

A 1992 law directed the Department of Revenue to conduct a study of the property tax exemption for nonprofit homes for the aging.  The study was conducted with the assistance of a study committee composed of residents and managers of nonprofit homes for the aging, representatives of senior citizen advocacy organizations not associated with nonprofit homes for the aging, the county assessors, city officials, and county officials.

Summary:  The study committee recommendations are implemented.  Nonprofit homes for the aging financed with tax-exempt bonds requiring low income set asides are exempt from property tax.

The $22,000 income threshold is increased to the greater of $22,000 or 80 percent of county median income adjusted for family size.

Only the proportion of residents with incomes below the income threshold, rather than twice the proportion of residents with incomes below the income threshold is used when determining the partial exemption amount.

Housing units in which residents receive significant assistance with the activities of daily living are exempt.

The personal property of a nonprofit home for the aging is exempt from property tax.

Any increase in assessed value due to changes in the exemption amount by this bill are phased-in over three years.

Votes on Final Passage:

House  97 1

Senate 46 0

Effective:  July 25, 1993