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AN ACT Relating to the tax relief for low-income residential renters; amending RCW 84.52.043 and 84.55.005; adding a new section to chapter 84.52 RCW; adding a new chapter to Title 36 RCW; creating a new section; prescribing penalties; and providing a contingent effective date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. The legislature recognizes that a portion of the rent paid on residential property represents the property taxes that are imposed on the residence. The purpose of this chapter is to give to low-income renters property tax relief on their principal residences similar to that given to low-income senior citizen homeowners and to authorize local funding of the program by county-wide property tax levies.

NEW SECTION. Sec. 2. Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

(1) "Claimant" means a person who files a claim under this chapter and who is domiciled in the state for the entire calendar year for which the person files a claim. If two or more individuals of a household meet the qualifications for a claim under this chapter, they may determine between them as to who the claimant shall be.

(2) "Combined disposable income" means the disposable income of the person claiming the exemption, plus the disposable income of each member of the claimant's family, for the preceding calendar year.

(3) "Department" means the state department of revenue.

(4) "Disposable income" has the meaning given in RCW 84.36.383.

(5) "Member of the family" means any person other than the claimant for whom the claimant is entitled to a dependency exemption under section 151 of the federal internal revenue code of 1986, as existing on the effective date of this act.

(6) "Preceding calendar year" means the calendar year preceding the year in which the claim is made.

(7) "Rent" means the amounts actually paid in cash or its equivalent during the calendar year solely for the right of occupancy of a residence, exclusive of payments for refundable cleaning or damage deposits or payments for any utilities, services, furniture, furnishings, or personal appliances furnished by the lessor as a part of the rental agreement. Rent advances shall be considered as paid in the year in which the amount would have been due if it had not been paid in advance. The department shall by rule provide a simple method of determining rent if the rental agreement includes charges for utilities, services, furniture, furnishings, or personal appliances and does not separately state the amount of these charges.

(8) "Residence" means a dwelling in this state which is used as a claimant's principal place of residence, including the land on which such dwelling stands not to exceed one acre. "Residence" includes mobile homes and houseboats. "Residence" also includes a part of a multifamily dwelling or multipurpose building and, if appropriate, part of the land on which it is situated. "Residence" does not include personal property, such as furniture and appliances, other than a stove and refrigerator.

NEW SECTION. Sec. 3. (1) A low-income person who rents his or her primary residence in this state for the entire calendar year is entitled to tax relief as provided in this chapter.

(2) The amount of relief for which the claimant is entitled shall be calculated on the basis of combined disposable income.

(3) A person who otherwise qualifies under this chapter and has a combined disposable income of twelve thousand five hundred dollars plus an additional two thousand five hundred dollars for each member of the person's family is entitled to receive relief equal to the amount of regular and excess taxes paid on the property in the year in which the claim is filed on the greater of twenty thousand dollars or twenty percent of the value of the residence, not to exceed thirty thousand dollars.

A person who otherwise qualifies under this chapter and has a combined disposable income of ten thousand five hundred dollars plus an additional two thousand five hundred dollars for each member of the person's family is entitled to receive relief equal to the amount of regular and excess taxes paid on the property in the year in which the claim is filed on the greater of thirty thousand dollars or thirty percent of the value of the residence, not to exceed fifty thousand dollars.

A person who otherwise qualifies under this chapter and has a combined disposable income of seven thousand five hundred dollars plus an additional two thousand five hundred dollars for each member of the person's family is entitled to receive relief equal to the amount of regular and excess taxes paid on the property in the year in which the claim is filed on the greater of thirty-four thousand dollars or fifty percent of the value of the residence.

(4) Value shall equal the lesser of the assessed value of the rented personal residence while occupied by the claimant or one hundred times the average monthly rent paid. In those cases in which the claimant resided in more than one primary residence during the year, the values shall be averaged based on the length of time the claimant resided in each residence.

NEW SECTION. Sec. 4. (1) A claim for rent relief under this chapter shall be made and filed between January 2nd and October 1st for rent paid the preceding calendar year. The claim shall be filed with the county assessor of the county in which the claimant resides when the claim is filed solely upon forms as prescribed and furnished by the department of revenue. If the claimant no longer resides in the state, the claim shall be filed with the assessor of the last county in which the claimant resided. For cases in which the claimant resided in one or more other counties during the preceding calendar year, the county assessor of the county in which the claimant currently resides shall coordinate the relief with the other county assessors.

(2) If the county assessor determines that the lessor and lessee have not dealt with each other at arm's length and the rent charged is excessive, the county assessor may adjust the rent to a reasonable amount for the purposes of this chapter.

(3) If the assessor finds that the applicant does not meet the qualifications set forth in this chapter, the claim shall be denied. If the claimant has received relief in prior years based on erroneous information, the claimant is liable for the amount received and interest on the amount received as computed under RCW 82.32.050. If the claim for relief involves an intent to defraud, the claimant is liable for an additional penalty equal to fifty percent of the amount received.

(4) The county legislative authority shall adopt procedures for claimants to appeal denials of relief and rent adjustments under this section.

(5) The county assessor shall publicize the qualifications and manner of making claims under this chapter through communications media, including such paid advertisements or notices as the assessor deems appropriate.

NEW SECTION. Sec. 5. (1) All claims shall be made and signed by the person entitled to the relief, by his or her attorney in fact, or by the person's guardian.

(2) If the claimant is unable to submit his or her own claim, the claim may be submitted by a duly authorized agent or by a guardian or other person charged with the care of the person or property of the claimant.

(3) All claims for relief shall be accompanied by such documented verification of income and verification of the total amount of rent paid in the preceding calendar year as shall be prescribed by rule adopted by the department.

(4) Any person who signs a false claim with the intent to defraud is guilty of false swearing under RCW 9A.72.040.

NEW SECTION. Sec. 6. (1) The department shall adopt such rules and prescribe such forms as may be necessary and appropriate for implementation and administration of this chapter subject to chapter 34.05 RCW, the administrative procedure act.

(2) The department may conduct such audits of the administration of this chapter and the claims filed under this chapter as it considers necessary.

(3) Any information or facts concerning confidential income data obtained by the assessor or the department, or their agents or employees, under subsection (2) of this section shall be used only to administer this chapter. Notwithstanding any provision of law to the contrary, absent written consent by the person about whom the information or facts have been obtained, the confidential income data shall not be disclosed by the assessor or the assessor's agents or employees to anyone other than the department or the department's agents or employees nor by the department or the department's agents or employees to anyone other than the assessor or the assessor's agents or employees except in a judicial proceeding pertaining to the taxpayer's entitlement to the relief under this chapter. Any violation of this subsection is a misdemeanor.

NEW SECTION. Sec. 7. The county assessor shall certify to the county treasurer the name, address, and amount of rent relief to which each person is entitled by January 1st of the year following the year in which the claims are filed. The county treasurer shall send the amounts so certified to each qualified claimant by June 1st.

NEW SECTION. Sec. 8. A new section is added to chapter 84.52 RCW to read as follows:

The county may levy an ad valorem property tax, in excess of the one percent limitation, upon property in the county at a rate necessary to fund the claims approved in that year under chapter 36.-- RCW (sections 1 through 7 of this act) for payment the following year.

Levies under this section are in addition to county levies under RCW 84.52.043.

Sec. 9. RCW 84.52.043 and 1990 c 234 s 1 are each amended to read as follows:

Within and subject to the limitations imposed by RCW 84.52.050 as amended, the regular ad valorem tax levies upon real and personal property by the taxing districts hereafter named shall be as follows:

(1) Levies of the senior taxing districts shall be as follows: (a) The levy by the state shall not exceed three dollars and sixty cents per thousand dollars of assessed value adjusted to the state equalized value in accordance with the indicated ratio fixed by the state department of revenue to be used exclusively for the support of the common schools; (b) the levy by any county shall not exceed one dollar and eighty cents per thousand dollars of assessed value; (c) the levy by any road district shall not exceed two dollars and twenty-five cents per thousand dollars of assessed value; and (d) the levy by any city or town shall not exceed three dollars and thirty-seven and one-half cents per thousand dollars of assessed value. However any county is hereby authorized to increase its levy from one dollar and eighty cents to a rate not to exceed two dollars and forty-seven and one-half cents per thousand dollars of assessed value for general county purposes if the total levies for both the county and any road district within the county do not exceed four dollars and five cents per thousand dollars of assessed value, and no other taxing district has its levy reduced as a result of the increased county levy.

(2) ((~~Except as provided in RCW 84.52.100,~~)) The aggregate levies of junior taxing districts and senior taxing districts, other than the state, shall not exceed five dollars and ninety cents per thousand dollars of assessed valuation. The term "junior taxing districts" includes all taxing districts other than the state, counties, road districts, cities, towns, port districts, and public utility districts. The limitations provided in this subsection shall not apply to: (a) Levies at the rates provided by existing law by or for any port or public utility district; (b) excess property tax levies authorized in Article VII, section 2 of the state Constitution; (c) levies for acquiring conservation futures as authorized under RCW 84.34.230; and (d) levies for emergency medical care or emergency medical services imposed under RCW 84.52.069.

(3) This section does not apply to levies under section 8 of this act.

Sec. 10. RCW 84.55.005 and 1983 1st ex.s. c 62 s 11 are each amended to read as follows:

As used in this chapter, the term "regular property taxes" has the meaning given it in RCW 84.04.140((~~, and also includes amounts received in lieu of regular property taxes under RCW 84.09.080~~)). The term does not include property tax levies under section 8 of this act.

NEW SECTION. Sec. 11. The department of revenue, with the cooperation of the department of community development and the department of social and health services, shall report to the fiscal committees of the legislature by January 1, 1995, on any improvements in the administration and implementation of this chapter that will maximize the relief provided to persons eligible for public assistance and other income-based social service or housing programs of the department of community development or the department of social and health services.

NEW SECTION. Sec. 12. Sections 1 through 7 of this act shall constitute a new chapter in Title 36 RCW.

NEW SECTION. Sec. 13. This act shall take effect on January 1, 1994, if the proposed amendment to Article VII of the state Constitution (SJR -- S-0644.1/93) is validly submitted to and is approved and ratified by the voters at a general election held in November, 1993. If the proposed amendment is not so approved and ratified, this act shall be null and void in its entirety.