| Washington State House of Representatives Office of Program Research |
BILL ANALYSIS |
| Finance Committee | |
HB 3137
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: Providing property tax relief for property damaged in the 2007 floods.
Sponsors: Representatives DeBolt, Kessler, Orcutt, Alexander, Hunt, Blake, Williams, Rolfes, Loomis, Sullivan, VanDeWege, Haler, Kelley, Dunn, Kretz, Ross, Bailey, McCune, Skinner, Herrera and Ormsby.
Brief Summary of Bill |
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Hearing Date: 2/12/08
Staff: Don Taylor (786-7388).
Background:
The property tax is the oldest tax in Washington, predating statehood. The property tax is by far
the largest source of revenue for local governments and the state levy produces a major share of
state tax revenue; the combined total for 2007 was $7.7 billion. The tax applies to real and
personal property, unless specifically exempted. The average combined levy rate for taxes due in
2007 was $10.48 per $1,000 of assessed value. Thus, the owner of property valued at $300,000
could expect to pay annual property taxes of $3,144, based on the statewide average rate.
The State Constitution requires that regular property tax levies (those imposed without a vote of
the people) cannot exceed 1.0 percent of the fair market value of the property. A statutory limit,
adopted by the voters in 2001, restricts the rate of increase in regular levy revenues for all taxing
districts to 1.0 percent or the rate of inflation; whichever is lower, unless a higher growth rate is
specifically authorized by the voters. However, this limit does not apply to the taxes paid by
owners of individual parcels, nor does it include voter-approved special levies.
Many counties in the state experienced severe flooding during the storms of early December,
2007. The damage was particularly heavy in Lewis County, but property in other Western
Washington counties also sustained major damage. The Federal Emergency Management
Agency designated 10 counties as being eligible for disaster assistance: Clallam, Grays Harbor,
King, Kitsap, Lewis, Mason, Pacific, Snohomish, Thurston and Wahkiakum.
Summary of Bill:
A new exemption from the state property tax levy is established for property whose assessed
value was reduced by 10 percent or more as a result of a natural disaster occurring in December
2007. To qualify the county in which the property is located must have been declared a disaster
area by the President. The exemption from the state levy applies to the amount of value which is
subject to abatement and last for three years. Taxes already paid in the year the property first
qualifies for the exemption, are eligible for refund.
Appropriation: None.
Fiscal Note: Requested on February 11, 2008.
Effective Date: The bill contains an emergency clause and takes effect immediately.