| Washington State House of Representatives Office of Program Research |
BILL ANALYSIS |
| Finance Committee | |
HB 1768
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: Authorizing a local real estate excise tax to be used for the maintenance and operation of parks.
Sponsors: Representatives Ericks, B. Sullivan, Hurst and Roberts.
Brief Summary of Bill |
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Hearing Date: 2/9/07
Staff: Mark Matteson (786-7145).
Background:
The real estate excise tax (REET) is imposed on each sale of real property, which includes both
the transfer of ownership and the transfer of controlling interests. Real property includes any
interest in land or anything affixed to land. The state tax rate is 1.28 percent. Additional local
rates are allowed. The combined state and local rate in most areas is 1.78 percent or less. The
highest rate is 2.78 percent in the City of Friday Harbor.
The Growth Management Act (GMA) included a modification to the original 0.25 percent REET
(also called "REET 1" or the "first REET") authority enacted for local governments and a new
0.25 percent REET authority (also called "REET 2" or the "second REET"), for the purposes of
providing assistance to local governments required to or choosing to plan under the GMA. The
changes meant that local governments subject to GMA requirements could impose taxes of up to
0.5 percent and that the proceeds would be used to finance capital projects identified in a capital
facilities plan element of a comprehensive plan. The modification to the first REET did not
affect jurisdictions not planning under GMA but who were eligible to impose the REET. There
are 267 cities and 37 counties that impose the first REET and 127 cities and 14 counties that
impose the second REET.
In 2001, the Legislative Task Force on Local Parks and Recreation recommended that the use of
the first or second REET proceeds be expanded to include operation and maintenance of park
facilities that had been acquired or developed with proceeds from the tax.
Summary of Bill:
Beginning in 2007, a city or county that imposes the second REET to finance capital projects
may use funds from the tax for the maintenance and operation of parks that were acquired or
developed using proceeds from the tax. Any funding from the tax for this purpose may not
supplant existing sources of funding for the maintenance and operation of parks.
Appropriation: None.
Fiscal Note: Requested on January 29, 2007.
Effective Date: The bill takes effect 90 days after adjournment of session in which bill is passed.