| Washington State House of Representatives Office of Program Research |
BILL ANALYSIS |
| Local Government Committee | |
HB 1232
This analysis was prepared by non-partisan legislative staff for the use of legislative members in
their deliberations. This analysis is not a part of the legislation nor does it constitute a
statement of legislative intent.
Brief Description: Clarifying that certain local government real estate excise tax proceeds may be used for the acquisition of equipment and software related to business applications.
Sponsors: Representatives Hunt, Alexander, Curtis, Simpson, Chandler, Armstrong and Appleton.
Brief Summary of Bill |
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Hearing Date: 1/23/07
Staff: Ethan Moreno (786-7386).
Background:
County legislative authorities may impose an excise tax on each sale of real property in
unincorporated areas of the county. Similarly, city legislative authorities also may impose an
excise tax on each sale of real property within the city's corporate limits. The rate of these real
estate excise taxes (REET) may not exceed 0.25 percent of the selling price.
Cities and counties with 5,000 or fewer residents and cities and counties that do not fully plan
under the Growth Management Act (GMA) may use local REET revenues only for capital
purposes identified in a capital improvements plan and for local capital improvements. Counties
with more than 5,000 residents and cities with more than 5,000 residents that fully plan under the
GMA may use local REET revenues only for financing qualifying capital projects, as that term
defined in statute, and for housing relocation assistance. Exceptions to these expenditure limits
are specified in statute for projects that use revenues pledged or committed by counties and cities
to prior to April 30, 1992.
"Capital project" means public works projects of a local government for planning, acquisition,
construction, reconstruction, repair, replacement, rehabilitation, or improvement of specific
infrastructure, including:
Summary of Bill:
"Capital purposes" and "local capital improvements" for which locally imposed REET revenues
may be used include specific information processing equipment and related physical facilities,
and software, regardless of its expected useful life, used by a city or county in the regular course
of business in connection with an improvement for which locally imposed REET revenues may
be used. These REET expenditure authorizations are not conditioned by whether the city or
county financed the improvement using proceeds from a locally imposed REET.
The definition of "capital project" is amended to specify, in part, that these projects include
include specific information processing equipment and related physical facilities, and software,
regardless of its expected useful life, used by a city or county in the regular course of business in
connection with systems, facilities, or projects for which locally imposed REET revenues may be
used. These REET expenditure authorizations are not conditioned by whether the city or county
financed the system, facility, or project using proceeds from a locally imposed REET.
Appropriation: None.
Fiscal Note: Not requested.
Effective Date: The bill takes effect 90 days after adjournment of session in which bill is passed.