BP BHEAD INT S [atlas:bill]

AN ACT Relating to property tax reform; amending RCW 84.55.005, 84.55.010, 84.55.020, 35.61.210, 70.44.060, 84.08.115, 84.40.045, 84.56.050, 84.52.054, 84.56.020, 84.41.030, 84.41.041, and 84.40.0301; adding a new section to chapter 84.41 RCW; adding a new chapter to Title 84 RCW; creating new sections; repealing RCW 84.56.022; and prescribing penalties.

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

PART I

STATUTORY LIMITATIONS STRENGTHENED

Sec. 101. RCW 84.55.005 and 1994 c 301 s 49 are each amended to read as follows:

As used in this chapter((~~, the term~~)):

(1) "Inflation" means the percentage change in the implicit price deflator for personal consumption expenditures for the United States as published for the most recent twelve-month period by the bureau of economic analysis of the federal department of commerce in September of the year before the taxes are payable; and

(2) "Regular property taxes" has the meaning given it in RCW 84.04.140, and also includes amounts received in lieu of regular property taxes.

Sec. 102. RCW 84.55.010 and 1979 ex.s. c 218 s 2 are each amended to read as follows:

(1) The implementation of any level of tax levy increase permitted in subsection (2) of this section shall only be made following a separate public hearing by and affirmative vote of the legislative body of the taxing district. If, however, the taxing district chooses not to take an increase in its levy, a public meeting or vote is not necessary.

(2) Except as provided in this chapter, the levy for a taxing district in any year shall be set so that the regular property taxes payable in the following year shall not exceed one hundred six percent or one hundred percent plus inflation, whichever is lower, of the amount of regular property taxes lawfully levied for such district in the highest of the three most recent years in which such taxes were levied for such district plus an additional dollar amount calculated by multiplying one-half of the increase in assessed value in that district resulting from new construction, improvements to property, and one-half of any increase in the assessed value of state-assessed property by the regular property tax levy rate of that district for the preceding year.

Sec. 103. RCW 84.55.020 and 1971 ex.s. c 288 s 21 are each amended to read as follows:

(2) Notwithstanding the limitation set forth in RCW 84.55.010, the first levy for a taxing district created from consolidation of similar taxing districts shall be set so that the regular property taxes payable in the following year shall not exceed one hundred six percent or one hundred percent plus inflation, whichever is lower, of the sum of the amount of regular property taxes lawfully levied for each component taxing district in the highest of the three most recent years in which such taxes were levied for such district plus the additional dollar amount calculated by multiplying one-half of the increase in assessed value in each component district resulting from new construction and improvements to property by the regular property tax rate of each component district for the preceding year.

Sec. 104. RCW 35.61.210 and 1990 c 234 s 3 are each amended to read as follows:

The board of park commissioners may levy or cause to be levied a general tax on all the property located in said park district each year not to exceed fifty cents per thousand dollars of assessed value of the property in such park district. In addition, the board of park commissioners may levy or cause to be levied a general tax on all property located in said park district each year not to exceed twenty-five cents per thousand dollars of assessed valuation. Although park districts are authorized to impose two separate regular property tax levies, the levies shall be considered to be a single levy for purposes of the ((~~one hundred six percent~~)) limitation provided for in chapter 84.55 RCW.

The board is hereby authorized to levy a general tax in excess of its regular property tax levy or levies when authorized so to do at a special election conducted in accordance with and subject to all the requirements of the Constitution and laws of the state now in force or hereafter enacted governing the limitation of tax levies. The board is hereby authorized to call a special election for the purpose of submitting to the qualified voters of the park district a proposition to levy a tax in excess of the seventy-five cents per thousand dollars of assessed value herein specifically authorized. The manner of submitting any such proposition, of certifying the same, and of giving or publishing notice thereof, shall be as provided by law for the submission of propositions by cities or towns.

The board shall include in its general tax levy for each year a sufficient sum to pay the interest on all outstanding bonds and may include a sufficient amount to create a sinking fund for the redemption of all outstanding bonds. The levy shall be certified to the proper county officials for collection the same as other general taxes and when collected, the general tax shall be placed in a separate fund in the office of the county treasurer to be known as the "metropolitan park district fund" and paid out on warrants.

Sec. 105. RCW 70.44.060 and 1990 c 234 s 2 are each amended to read as follows:

All public hospital districts organized under the provisions of this chapter shall have power:

(1) To make a survey of existing hospital and other health care facilities within and without such district.

(2) To construct, condemn and purchase, purchase, acquire, lease, add to, maintain, operate, develop and regulate, sell and convey all lands, property, property rights, equipment, hospital and other health care facilities and systems for the maintenance of hospitals, buildings, structures, and any and all other facilities, and to exercise the right of eminent domain to effectuate the foregoing purposes or for the acquisition and damaging of the same or property of any kind appurtenant thereto, and such right of eminent domain shall be exercised and instituted pursuant to a resolution of the commission and conducted in the same manner and by the same procedure as in or may be provided by law for the exercise of the power of eminent domain by incorporated cities and towns of the state of Washington in the acquisition of property rights: PROVIDED, That no public hospital district shall have the right of eminent domain and the power of condemnation against any health care facility.

(3) To lease existing hospital and other health care facilities and equipment and/or other property used in connection therewith, including ambulances, and to pay such rental therefor as the commissioners shall deem proper; to provide hospital and other health care services for residents of said district by facilities located outside the boundaries of said district, by contract or in any other manner said commissioners may deem expedient or necessary under the existing conditions; and said hospital district shall have the power to contract with other communities, corporations, or individuals for the services provided by said hospital district; and they may further receive in said hospitals and other health care facilities and furnish proper and adequate services to all persons not residents of said district at such reasonable and fair compensation as may be considered proper: PROVIDED, That it must at all times make adequate provision for the needs of the district and residents of said district shall have prior rights to the available hospital and other health care facilities of said district, at rates set by the district commissioners.

(4) For the purpose aforesaid, it shall be lawful for any district so organized to take, condemn and purchase, lease, or acquire, any and all property, and property rights, including state and county lands, for any of the purposes aforesaid, and any and all other facilities necessary or convenient, and in connection with the construction, maintenance, and operation of any such hospitals and other health care facilities, subject, however, to the applicable limitations provided in subsection (2) of this section.

(5) To contract indebtedness or borrow money for corporate purposes on the credit of the corporation or the revenues of the hospitals thereof, and the revenues of any other facilities or services that the district is or hereafter may be authorized by law to provide, and to issue and sell: (a) Revenue bonds, revenue warrants, or other revenue obligations therefor payable solely out of a special fund or funds into which the district may pledge such amount of the revenues of the hospitals thereof, and the revenues of any other facilities or services that the district is or hereafter may be authorized by law to provide, to pay the same as the commissioners of the district may determine, such revenue bonds, warrants, or other obligations to be issued and sold in the same manner and subject to the same provisions as provided for the issuance of revenue bonds, warrants, or other obligations by cities or towns under the Municipal Revenue Bond Act, chapter 35.41 RCW, as may hereafter be amended; (b) general obligation bonds therefor in the manner and form as provided in RCW 70.44.110 and 70.44.130, as may hereafter be amended; or (c) interest-bearing warrants to be drawn on a fund pending deposit in such fund of money sufficient to redeem such warrants and to be issued and paid in such manner and upon such terms and conditions as the board of commissioners may deem to be in the best interest of the district; and to assign or sell hospital accounts receivable, and accounts receivable for the use of other facilities or services that the district is or hereafter may be authorized by law to provide, for collection with or without recourse. General obligation bonds shall be issued and sold in accordance with chapter 39.46 RCW. Revenue bonds, revenue warrants, or other revenue obligations may be issued and sold in accordance with chapter 39.46 RCW.

(6) To raise revenue by the levy of an annual tax on all taxable property within such public hospital district not to exceed fifty cents per thousand dollars of assessed value, and an additional annual tax on all taxable property within such public hospital district not to exceed twenty-five cents per thousand dollars of assessed value, or such further amount as has been or shall be authorized by a vote of the people. Although public hospital districts are authorized to impose two separate regular property tax levies, the levies shall be considered to be a single levy for purposes of the ((~~one hundred six percent~~)) limitation provided for in chapter 84.55 RCW. Public hospital districts are authorized to levy such a general tax in excess of their regular property taxes when authorized so to do at a special election conducted in accordance with and subject to all of the requirements of the Constitution and the laws of the state of Washington now in force or hereafter enacted governing the limitation of tax levies. The said board of district commissioners is authorized and empowered to call a special election for the purpose of submitting to the qualified voters of the hospital district a proposition or propositions to levy taxes in excess of its regular property taxes. The superintendent shall prepare a proposed budget of the contemplated financial transactions for the ensuing year and file the same in the records of the commission on or before the first Monday in September. Notice of the filing of said proposed budget and the date and place of hearing on the same shall be published for at least two consecutive weeks in a newspaper printed and of general circulation in said county. On the first Monday in October the commission shall hold a public hearing on said proposed budget at which any taxpayer may appear and be heard against the whole or any part of the proposed budget. Upon the conclusion of said hearing, the commission shall, by resolution, adopt the budget as finally determined and fix the final amount of expenditures for the ensuing year. Taxes levied by the commission shall be certified to and collected by the proper county officer of the county in which such public hospital district is located in the same manner as is or may be provided by law for the certification and collection of port district taxes. The commission is authorized, prior to the receipt of taxes raised by levy, to borrow money or issue warrants of the district in anticipation of the revenue to be derived by such district from the levy of taxes for the purpose of such district, and such warrants shall be redeemed from the first money available from such taxes when collected, and such warrants shall not exceed the anticipated revenues of one year, and shall bear interest at a rate or rates as authorized by the commission.

(7) To enter into any contract with the United States government or any state, municipality, or other hospital district, or any department of those governing bodies, for carrying out any of the powers authorized by this chapter.

(8) To sue and be sued in any court of competent jurisdiction: PROVIDED, That all suits against the public hospital district shall be brought in the county in which the public hospital district is located.

(9) To pay actual necessary travel expenses and living expenses incurred while in travel status for (a) qualified physicians who are candidates for medical staff positions, and (b) other qualified persons who are candidates for superintendent or other managerial and technical positions, when the district finds that hospitals or other health care facilities owned and operated by it are not adequately staffed and determines that personal interviews with said candidates to be held in the district are necessary or desirable for the adequate staffing of said facilities.

(10) To make contracts, employ superintendents, attorneys, and other technical or professional assistants and all other employees; to make contracts with private or public institutions for employee retirement programs; to print and publish information or literature; and to do all other things necessary to carry out the provisions of this chapter.

Sec. 106. RCW 84.08.115 and 1991 c 218 s 2 are each amended to read as follows:

(1) The department shall prepare a clear and succinct explanation of the property tax system, including but not limited to:

(a) The standard of true and fair value as the basis of the property tax.

(b) How the assessed value for particular parcels is determined.

(d) How district levy rates are determined, including the ((~~one hundred six percent~~)) limit under chapter 84.55 RCW.

(e) How the composite tax rate is determined.

(f) How the amount of tax is calculated.

(g) How a taxpayer may appeal an assessment, and what issues are appropriate as a basis of appeal.

(h) A summary of tax exemption and relief programs, along with the eligibility standards and application processes.

(2) Each county assessor shall provide copies of the explanation to taxpayers on request, free of charge. Each revaluation notice shall include information regarding the availability of the explanation.

PART II

FULL PROPERTY TAX DISCLOSURE

Sec. 201. RCW 84.40.045 and 1994 c 301 s 36 are each amended to read as follows:

(1) The assessor shall give notice of any change in the true and fair value of real property for the tract or lot of land and any improvements thereon no later than thirty days after appraisal((~~: PROVIDED, That~~)). However, no such notice shall be mailed during the period from January 15 to February 15 of each year((~~: PROVIDED FURTHER, That~~)). In addition, no notice need be sent with respect to changes in valuation of forest land made pursuant to chapter 84.33 RCW.

(2) The notice shall contain the following information and this information shall be separately stated on the notice:

(a) A statement of both the prior and the new true and fair value ((~~and~~)), stating separately land and improvement values;

(b) The ratio of the assessed value to the true and fair value on which the assessment of the property is based((~~, stating separately land and improvement values,~~)); and

(c) A brief statement of the procedure for appeal to the board of equalization and the time, date, and place of the meetings of the board.

(3) The notice shall be mailed by the assessor to the taxpayer. For the purposes of this section, "taxpayer" means any person charged, or whose property is charged, with property tax.

(4) If any taxpayer, as shown by the tax rolls, holds solely a security interest in the real property which is the subject of the notice, pursuant to a mortgage, contract of sale, or deed of trust, such taxpayer shall((~~, upon written request of the assessor,~~)) supply((~~, within thirty days of receipt of such request,~~)) to the assessor for the county in which the parcel is located for inclusion on the tax rolls the name and address of the person making payments for property tax purposes pursuant to the mortgage, contract of sale, or deed of trust, and thereafter such person shall also receive a copy of the notice provided for in this section. Willful failure to comply with ((~~such request within the time limitation provided for herein shall~~)) this subsection makes such taxpayer subject to a maximum civil penalty of five dollars for each parcel of real property in which it holds the security interest, the aggregate of such penalties in any one year not to exceed five thousand dollars. The penalties provided for ((~~herein~~)) in this subsection shall be recoverable in an action by the county prosecutor, and when recovered shall be deposited in the county current expense fund. ((~~The assessor shall make the request provided for by this section during the month of January.~~))

Sec. 202. RCW 84.56.050 and 1991 c 245 s 17 are each amended to read as follows:

(1) On receiving the tax rolls the county treasurer shall post all real and personal property taxes from the rolls to the treasurer's tax roll, and shall carry forward to the current tax rolls a memorandum of all delinquent taxes on each and every description of property, and enter the same on the property upon which the taxes are delinquent showing the amounts for each year.

(2) The treasurer shall notify each taxpayer in the county, at the expense of the county, of the amount of the real and personal property((~~, and the current and delinquent amount of tax due on the same; and the treasurer shall have printed on the notice the name of each tax and the levy made on the same~~)) taxes due and payable. The notice mailed to the taxpayer shall at a minimum contain the following information and this information must be separately stated on the notice:

(a) The name and address of the taxpayer;

(b) The name, address, and telephone number of the county issuing the notice;

(d) The legal property address and description;

(e) The year for which the assessment is being made;

(f) The current assessed valuation of the parcel's land value and improvement value as reported by the county assessor's office;

(g) Current billing information containing the name of each taxing jurisdiction levying a tax on the identified parcel, the amount of that jurisdiction's levy rate, and the total amount due for each taxing jurisdiction;

(h) The amount of taxes due as a result of regular property taxes and their share, expressed as a percentage, of the total amount of taxes due from the taxpayer;

(i) The amount of taxes due as a result of excess levies approved by the voters together with any special assessments and their share, expressed as a percentage, of the total amount of taxes due from the taxpayer;

(j) The total taxes due and payable from the taxpayer, including any delinquent taxes and any interest or penalties due; and

(k) A notice of the payment due dates and possible delinquency penalties and interest.

(3) The county treasurer shall be the sole collector of all delinquent taxes and all other taxes due and collectible on the tax rolls of the county((~~: PROVIDED, That~~)).

(4) For the purposes of this section, the term "taxpayer" ((~~as used in this section shall~~)) means any person charged, or whose property is charged, with property tax((~~; and~~)).

(5) The person to be notified under subsection (2) of this section is ((~~that~~)) the person whose name appears on the tax rolls ((~~herein mentioned: PROVIDED, FURTHER, That~~)) of the county issuing the notice. If no name so appears the person to be notified is that person shown by the treasurer's tax rolls or duplicate tax receipts of any preceding year as the payer of the tax last paid on the property in question. If any taxpayer, as shown on the tax rolls, holds solely a security interest in the real property that is the subject of the notice, the county treasurer shall transmit a duplicate copy of the notice to the person making payments for property tax purposes pursuant to a security agreement. The duplicate notice shall clearly state in bold-face type that it is not a bill and is for informational purposes only.

Sec. 203. RCW 84.52.054 and 1986 c 133 s 2 are each amended to read as follows:

(1) Any ballot proposition submitted to the voters requesting the additional tax provided for in ((~~subparagraph (a) of the seventeenth amendment to~~)) Article VII, section 2 (a) and (b) of the state Constitution ((~~as amended by Amendment 59 and as thereafter amended,~~)) and specifically authorized by RCW 84.52.052, ((~~as now or hereafter amended, and RCW~~)) 84.52.053 ((~~and~~)), 84.52.0531, and 84.52.056, or any other proposition submitted to the voters for regular or excess property tax levies shall ((be set forth in terms of dollars on the ballot of the proposition to be submitted to the voters, together with an estimate of the dollar rate of tax levy that will be required to produce the dollar amount; and)) contain the following information in the official ballot title submitted to the voters:

(a) The total dollar amount proposed to be collected during the entire period of the levy;

(b) An estimate of the dollar rate of the tax levy that will be required for each one thousand dollars of assessed value to produce the total dollar amount proposed in (a) of this subsection;

(c) An estimate of the total tax liability for one hundred thousand dollars of taxable value based on the estimated dollar amount of tax levy in (b) of this subsection for each year of the period for which the tax levy is proposed; and

(d) A statement of the proposed use or uses of the tax levies requested.

(2) Any ballot proposition submitted to the voters requesting the additional tax provided for in Article VII, section 2 (a) and (b) of the state Constitution and specifically authorized by RCW 84.52.052, 84.52.053, 84.52.0531, and 84.52.056, or any other proposition submitted to the voters for regular or excess property tax levies lasting longer than one year shall contain the following information in the official ballot title submitted to the voters:

(a) The total dollar amount proposed to be collected during the entire period of the levy;

(b) The total dollar amount proposed to be collected during each year of the period for which the tax levy is proposed. The total dollar amount for each annual levy in the period may be equal or in different amounts;

(c) An estimate of the dollar rate of the tax levy that will be required for each one thousand dollars of assessed value to produce the total dollar amounts proposed in (b) of this subsection;

(d) An estimate of the total tax liability for one hundred thousand dollars of taxable value based on the estimated dollar amount of tax levy in (b) of this subsection for each year of the period for which the tax levy is proposed; and

(e) A statement of the proposed use or uses of the tax levies requested.

(3) The county assessor, in spreading ((~~this~~)) any voter-approved tax upon the rolls, shall determine the eventual dollar rate required to produce the amount of dollars so voted upon, regardless of the estimate of dollar rate of tax levy carried in ((~~said~~)) the proposition. ((In the case of a school district proposition for a particular period, the dollar amount and the corresponding estimate of the dollar rate of tax levy shall be set forth for each of the years in that period. The dollar amount for each annual levy in the particular period may be equal or in different amounts.))

NEW SECTION. Sec. 204. RCW 84.56.022 and 1995 c 180 s 1 & 1994 c 301 s 48 are each repealed.

PART III

REVISED BILLING PROCEDURES

Sec. 301. RCW 84.56.020 and 1996 c 153 s 1 are each amended to read as follows:

(1) The county treasurer shall be the receiver and collector of all taxes extended upon the tax rolls of the county, whether levied for state, county, school, bridge, road, municipal or other purposes, and also of all fines, forfeitures or penalties received by any person or officer for the use of his or her county.

(2) All taxes upon real and personal property made payable by the provisions of this title shall be due and payable to the county treasurer ((~~on or before the thirtieth day of April and, except as provided in this section, shall be delinquent after that date.~~

~~(2)~~)) as follows:

(a) One-half of the taxes shall be due and payable on or before the thirtieth day of April and shall be delinquent after that date.

(b) Any applicable interest and penalties for the first one-half of the taxes and the remaining one-half of the taxes shall be due and payable on or before the thirty-first day of October and shall be delinquent after that date.

(c) If, however, the total amount of taxes due on real and personal property by one person is less than one hundred dollars, the total amount must be paid on or before the thirtieth day of April and shall be delinquent after that date.

(3) Each tax statement shall include a notice that checks for payment of taxes due under this title may be made payable to "Treasurer of . . . . . . County" or other appropriate office, but tax statements shall not include any suggestion that checks may be made payable to the name of the individual holding the office of treasurer nor any other individual.

(((3) When the total amount of tax or special assessments on personal property or on any lot, block or tract of real property payable by one person is fifty dollars or more, and if one-half of such tax be paid on or before the thirtieth day of April, the remainder of such tax shall be due and payable on or before the thirty-first day of October following and shall be delinquent after that date.

(4) When the total amount of tax or special assessments on any lot, block or tract of real property or on any mobile home payable by one person is fifty dollars or more, and if one-half of such tax be paid after the thirtieth day of April but before the thirty-first day of October, together with the applicable interest and penalty on the full amount of tax payable for that year, the remainder of such tax shall be due and payable on or before the thirty-first day of October following and shall be delinquent after that date.

~~(5)~~)) (4) Delinquent taxes under this section are subject to interest at the rate of twelve percent per annum computed on a monthly basis on the full year amount of tax unpaid from the date of delinquency until paid. Interest shall be calculated at the rate in effect at the time of payment of the tax, regardless of when the taxes were first delinquent. In addition, delinquent taxes under this section are subject to penalties as follows:

(a) A penalty of three percent of the full year amount of tax unpaid shall be assessed on the tax delinquent on June 1st of the year in which the tax is due.

(b) An additional penalty of eight percent shall be assessed on the amount of tax delinquent on December 1st of the year in which the tax is due.

(((6) Subsection (5) of this section notwithstanding, no interest or penalties may be assessed for the period April 30, 1996, through December 31, 1996, on delinquent taxes imposed in 1995 for collection in 1996 which are imposed on the personal residences owned by military personnel who participated in the situation known as "Joint Endeavor."

~~(7)~~)) (5) For purposes of this chapter, "interest" means both interest and penalties.

((~~(8)~~)) (6) All collections of interest on delinquent taxes shall be credited to the county current expense fund; but the cost of foreclosure and sale of real property, and the fees and costs of distraint and sale of personal property, for delinquent taxes, shall, when collected, be credited to the operation and maintenance fund of the county treasurer prosecuting the foreclosure or distraint or sale; and shall be used by the county treasurer as a revolving fund to defray the cost of further foreclosure, distraint and sale for delinquent taxes without regard to budget limitations.

(7) As used in this section, "tax" includes special assessments.

PART IV

UNIFORM ANNUAL REVALUATION CYCLES

Sec. 401. RCW 84.41.030 and 1996 c 254 s 7 are each amended to read as follows:

Each county assessor shall maintain an active and systematic program of revaluation on a continuous basis, and shall establish a revaluation schedule which will result in revaluation of all taxable real property within the county ((at least once each four years and physical inspection of all taxable real property within the county at least once each six years. Each county assessor may disregard any program of revaluation, if requested by a property owner, and change, as appropriate, the valuation of real property upon the receipt of a notice of decision received under RCW 36.70B.130, 90.60.160, or chapter 35.22, 35.63, 35A.63, or 36.70 RCW pertaining to the value of the real property)) as required under this chapter.

Sec. 402. RCW 84.41.041 and 1987 c 319 s 4 are each amended to read as follows:

Each county assessor shall cause all taxable real property to be revalued at least once every year and physically inspected ((~~and valued~~)) at least once every six years in accordance with ((~~RCW 84.41.030, and in accordance with~~)) a plan filed with and approved by the department of revenue. Such revaluation plan shall provide that a reasonable portion of all taxable real property within a county shall be ((~~revalued and these newly-determined~~)) physically inspected and newly determined values based on these physical inspections shall be placed on the assessment rolls each year. ((The department may approve a plan that provides that all property in the county be revalued every two years. If the revaluation plan provides for physical inspection at least once each four years, during the intervals between each physical inspection of real property, the valuation of such property may be adjusted to its current true and fair value, such adjustments to be based upon appropriate statistical data.)) If the revaluation plan provides for physical inspection less frequently than once each ((~~four~~)) year((s)), during the intervals between each physical inspection of real property, the valuation of such property shall be adjusted to its current true and fair value, such adjustments to be made once each year and to be based upon appropriate statistical data.

The assessor may require property owners to submit pertinent data respecting taxable property in their control including data respecting any sale or purchase of said property within the past five years, the cost and characteristics of any improvement on the property and other facts necessary for appraisal of the property.

NEW SECTION. Sec. 403. A new section is added to chapter 84.41 RCW to read as follows:

(1) Each county assessor shall file an implementation plan for RCW 84.41.041 with the department by July 1, 1998.

(2) The department may approve a revaluation plan that provides for phased-in compliance with the annual statistical update requirement provided in RCW 84.41.041. A phased-in compliance plan must provide statistical updates for a reasonable portion of all taxable real property within a county each year, with full compliance with the annual statistical update requirement not later than for taxes levied for collection in 2002.

(3) Department approval of requests for phased-in compliance with the annual statistical update requirement shall be determined by the extent to which the requirement creates an undue burden or hardship upon the county requesting the approval. For the purposes of this section, "undue burden or hardship" means the requesting county does not at the time of application have the adequate tools or methods of valuation to ensure a smooth transition to annual statistical updates by 1998.

PART V

DISTRESSED PROPERTY TAXPAYER PROGRAM

NEW SECTION. Sec. 501. This chapter may be known and cited as the distressed property taxpayer relief act.

NEW SECTION. Sec. 502. The legislature finds that large and unanticipated increases in taxes on residential property usually attributable to rapid increases in property values, cause undue and excessive hardships for many homeowners. These increased tax burdens put many of these homeowners at risk of being unable to remain in their residences and maintain their property. Temporary financial hardships, such as unemployment, death of spouse, or unanticipated medical costs, may also cause some homeowners to have insufficient resources to pay property tax bills. The legislature therefore intends to provide such distressed taxpayers with the ability to defer taxes due so that they will be able to remain in their homes while still paying an equitable share of the overall property tax burden.

NEW SECTION. Sec. 503. The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.

(1) "Claimant" means a person who elects to defer payment of real property taxes by filing a claim to defer as provided in this chapter.

(2) "Combined disposable income" means the disposable income of the person claiming the exemption, plus the disposable income of his or her spouse, and the disposable income of each cotenant occupying the residence for the preceding calendar year.

(3) "Cotenant" means a person who resides with the claimant and who has an ownership interest in the real property.

(4) "Disposable income" means adjusted gross income as defined in the federal internal revenue code, as now or hereafter amended.

(5) "Equity value" means the amount by which the true and fair market value of residence as determined from the records of the county assessor exceeds the total amount of any liens or other obligations against the real property.

(6) "Real property" has the same meaning as provided in RCW 84.04.090. In addition, "real property" includes a mobile home that has substantially lost its identity as a mobile unit by virtue of its being fixed in location upon land owned by the owner of the mobile home and placed on a foundation (posts or blocks) with fixed pipe connections with sewer, water, or other utilities.

(7) "Real property taxes" means the total ad valorem property taxes levied on a residence in this state in the preceding calendar year.

(8) "Residence" has the same meaning as that given in RCW 84.36.383, except that a residence shall include any additional property up to a total of five acres that comprises the residential parcel if this larger parcel size is required under land use regulations.

NEW SECTION. Sec. 504. A claimant may apply to defer payment of that amount of real property taxes imposed that exceeds six percent of the claimant's combined disposable income up to a maximum dollar amount of two thousand five hundred dollars per year. However, the combined amount of taxes deferred under this chapter shall never exceed fifty percent of the claimant's equity value in the real property for which the deferral is requested.

NEW SECTION. Sec. 505. The following conditions must be met in order to be eligible for the deferral program established in this chapter:

(1) The real property taxes must have been imposed upon a residence that was occupied by the claimant as a principal place of residence as of the first day of January of the year for which the deferral is claimed subject to the exceptions allowed under RCW 84.36.381(1);

(2) The claimant must meet the conditions of RCW 84.38.030 (3) and (4);

(3) The claimant must submit acceptable proof of his or her total combined disposable income for the year for which the deferral is claimed; and

(4) The claimant may not be receiving or applying for another exemption or deferral provided under this title.

NEW SECTION. Sec. 506. (1) A claimant electing to defer payment of real property taxes under this chapter shall annually file with the county assessor, on forms prescribed by the department and supplied by the assessor, a written declaration of the election. The claimant shall file the declaration to defer payment of real property taxes in duplicate by July 31st of the year the taxes are due. For good cause shown, the department may waive this filing deadline. A deferral under this chapter may not be granted for more than one year.

(2) The written claim for deferral of real property taxes must at a minimum contain the following information:

(a) The legal description of the residence for which the deferral is claimed;

(b) A list of all members of the claimant's household;

(d) Facts establishing the eligibility for deferral under this chapter; and

(e) Other relevant information required by rule of the department.

(3) A claim and renewal for deferral under this chapter must be made and signed by the claimant or by the claimant's attorney in fact, subject to the penalties as provided in chapter 9.72 RCW for false swearing. If the residence of the person is under mortgage, contract of sale, or deed of trust requiring accumulation of reserves out of which the holder of the mortgage, contract of sale, or deed of trust is required to pay real property taxes, the holder of the mortgage, contract of sale, or deed of trust must cosign the claim for deferral before a notary public or the county assessor or his or her deputy in the county where the residence is located. If a claim for exemption is made by a person living in a cooperative housing association, corporation, or partnership, the claim must be made and signed by the claimant and by the authorized agent of the cooperative.

(4) If the claimant is unable to submit his or her own claim for deferral, the claim must 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.

(5) A claim for deferral and a renewal application must be accompanied by documented verification of income as prescribed by this chapter.

(6) A person signing a false claim with the intent to defraud or evade the payment of tax is guilty of the offense of perjury.

(7) The real property taxes of a cooperative housing association, corporation, or partnership must be reduced by the amount of tax deferral to which a claimant residing therein is entitled and the cooperative shall reduce any amount owed by the claimant to the cooperative by the exact amount of tax deferral.

(8) In January of each year, the county assessor shall send to each claimant who has been granted deferral of real property taxes for the previous year renewal forms and notice to renew.

(9) The county assessor shall determine if each claimant must be granted a deferral for each year claimed, but the claimant may appeal this determination to the county board of equalization, whose decision is final as to the deferral of that year.

NEW SECTION. Sec. 507. If the claimant declaring the claimant's intention to defer real property taxes under this chapter ceases to reside permanently on the property for which the claim to defer is made between the date of filing the claim and December 15th of that year, the deferral otherwise allowable under this chapter may not be allowed on the tax roll. However, this section does not apply if the claimant dies, leaving a spouse or cotenant surviving, who is also eligible for the deferral provided in this chapter.

NEW SECTION. Sec. 508. (1) If a portion of a claimant's real property taxes is deferred under this chapter, the amount deferred and required to be paid under section 511 of this act becomes a lien in favor of the state upon the property for which the deferral is granted and has priority as provided in chapters 35.50 and 84.60 RCW. However, the interest of a mortgage, contract of sale, or deed of trust holder who is required to cosign a claim for deferral under section 506 of this act has priority to the deferred lien.

(2) The lien of the state may accumulate up to fifty percent of the amount of the claimant's equity value in the property for which the deferral is granted and must bear interest at the rate provided in RCW 82.32.050(2) from the time the claim for deferral is granted until the obligation is paid.

(3) For a mobile home that is considered real property as provided in this title, the department of licensing shall show the state's lien on the certificate of ownership for the mobile home.

(4) For other real property, the department shall file a notice of the deferral and the state's lien with the county recorder or auditor.

NEW SECTION. Sec. 509. The county assessor shall:

(1) Immediately transmit one copy of a claim to defer real property taxes under this chapter to the department. The department may audit a claim and shall notify the assessor as soon as possible of a claim in which a factor appears to disqualify the claimant for the deferral sought;

(2) Compute the real property tax rates for the property located within the county as if a deferral provided by this chapter did not exist; and

(3) As soon as possible, notify the department and the county treasurer of the amount of real property taxes deferred for that year.

NEW SECTION. Sec. 510. (1) After receipt of the notification from the county assessor of the amount of deferred real property taxes under this chapter, the department shall certify to the state treasurer the amount due the respective municipal corporations and the state treasurer shall pay, from amounts appropriated for that purpose, to the treasurers of the municipal corporations the amounts, equivalent to the amount of real property taxes deferred, to be distributed to the taxing districts which levied the taxes so deferred.

(2) If the claimant has, at the time of filing the declaration to defer, already paid a portion of the claimant's real property taxes for the current year, any portion that exceeds the amount of real property tax that would have been allowed to be deferred under this chapter must be deducted from the amount to be paid by the state.

NEW SECTION. Sec. 511. A real property tax deferred under this chapter becomes due and payable together with interest as provided in section 508(2) of this act:

(1) Upon the sale of the property that has a deferred real property tax lien upon it;

(2) Upon the death of the claimant with an outstanding deferred real property tax lien. However, a surviving spouse or cotenant who remains eligible for a deferral under this chapter may elect to incur the real property tax lien that is then payable by that spouse or cotenant as provided in this section;

(3) Upon the condemnation of property with a deferred real property tax lien upon it by a public or private body exercising eminent domain power, except as otherwise provided in RCW 84.60.070;

(4) At the time the claimant ceases to reside permanently in the residence for which the deferral has been granted; or

(5) Upon the failure of a condition in section 505 of this act.

NEW SECTION. Sec. 512. (1) Upon the occurrence of an event listed in section 511 of this act, the county treasurer shall collect all the amounts deferred under this chapter, together with interest, in the manner provided in chapter 84.56 RCW. For purposes of collection of deferred real property taxes, chapters 84.56, 84.60, and 84.64 RCW apply.

(2) When a deferred real property tax, together with interest, is collected the moneys must be credited to a special account in the county treasury. The county treasurer shall remit the amount of deferred real property tax together with interest to the department within thirty days from the date of collection.

(3) The department shall deposit the deferred real property taxes in the state general fund.

NEW SECTION. Sec. 513. (1) A surviving spouse of the claimant may elect to continue the property in its deferred tax status if the property is the residence of the spouse or cotenant of the claimant and the spouse or cotenant meets the requirements of this chapter.

(2) The election under this section to continue the property in its deferred status by the spouse or cotenant of the claimant must be filed in the same manner as an original claim for deferral is filed under this chapter within ninety days from the date of the claimant's death. Thereupon, the property with respect to which the deferral of real property taxes is claimed must continue to be treated as deferred property. If the property has been continued in its deferred status by the filing of the spouse or cotenant of the claimant of an election under this section, the spouse or cotenant of the claimant may continue the property in its deferred status in subsequent years by filing a declaration under this chapter so long as the spouse or cotenant meets the qualifications in this chapter. For good cause shown, the department may waive the ninety-day filing deadline in this section.

NEW SECTION. Sec. 514. A claimant may at any time pay a part or all of the deferred real property taxes, but the payment does not affect the deferred tax status of the property.

NEW SECTION. Sec. 515. This chapter is not intended to nor may it be construed to prevent the collection, by foreclosure, of personal property or special assessments taxes that become a lien against tax-deferred property.

NEW SECTION. Sec. 516. The department shall devise the forms and adopt rules consistent with chapter 34.05 RCW and this chapter as are necessary or desirable to permit the effective administration of this chapter.

NEW SECTION. Sec. 517. Sections 501 through 516 of this act constitute a new chapter in Title 84 RCW.

PART VI

TAX APPEAL REFORM

Sec. 601. RCW 84.40.0301 and 1994 c 301 s 35 are each amended to read as follows:

Upon review by any court, or appellate body, of a determination of the valuation of property for purposes of taxation, it shall be presumed that the determination of the public official charged with the duty of establishing such value is correct but this presumption shall not be a defense against any correction indicated by ((~~clear, cogent and convincing~~)) a preponderance of the evidence.

PART VII

EFFECTIVE DATE

NEW SECTION. Sec. 701. This act is effective for taxes levied for collection in 1998 and thereafter.

PART VIII

MISCELLANEOUS

NEW SECTION. Sec. 801. Part headings used in this act are not any part of the law.