BILL REQ. #: H-4078.2
| State of Washington | 61st Legislature | 2010 Regular Session |
Read first time 02/01/10. Referred to Committee on Finance.
AN ACT Relating to community reinvestment of oil windfall profits; amending RCW 43.325.020, 70.94.017, 82.04.230, 82.04.240, 82.04.240, 82.04.250, 82.04.250, 82.04.255, 82.04.270, 82.04.280, 82.04.280, 82.04.290, 39.35C.020, 39.35C.100, 82.03.130, and 82.03.140; amending 2009 c 461 s 9 (uncodified); reenacting and amending RCW 43.325.040; adding a new title to the Revised Code of Washington to be codified as Title 82A RCW; adding a new section to chapter 82.04 RCW; adding a new section to chapter 39.35C RCW; adding a new section to chapter 43.21F RCW; prescribing penalties; providing effective dates; providing a contingent effective date; providing expiration dates; and providing contingent expiration dates.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
NEW SECTION. Sec. 1
(2) The legislature further finds that the federal stimulus money
and accounting procedures used to balance the 2009-2011 budget will
most probably not be available to mitigate any projected revenue
shortfall in the 2011-2013 budget. Therefore, it is in the best
interests of the people of Washington state to mitigate the devastating
effects of the aforementioned cuts by looking at new ways to raise
revenue for the short term, and to look at long-term solutions to the
state's revenue problems. This can be done while at the same time
securing fairness, adequacy, and stability within our state revenue
structure.
(3) It is the legislature's intent with this act to move the state
forward with two goals: (a) Raising immediate revenue to mitigate the
cruel impacts of draconian budget cuts; and (b) initiating inquiry and
proceedings toward long-term solutions to the state's unfair,
inadequate, and volatile revenue problems. These goals allow all the
people of the state to: Collectively share the financial
responsibilities of this recession so that everyone is pitching in to
get us all through the recession together; ensure that we leave no one
behind; and position our state for recovery by reforming our revenue
structure to encourage healthy economic development.
NEW SECTION. Sec. 2
(1) "Affiliated corporation" means a corporation that is a member
of a group of two or more corporations with a common owner or owners,
either corporate or noncorporate, when more than fifty percent of the
voting stock of each member corporation is directly or indirectly owned
by the common owner or owners or by one or more of the member
corporations.
(2) "Business activity" means any activity engaged in with the
object of gain, benefit, or advantage to the taxpayer or to another
person or class, directly or indirectly.
(3) "Corporation" means any corporation as defined by the laws of
this state or organization of any kind treated as a corporation for tax
purposes under the laws of this state, wherever located, which if it
were doing business in this state would be a taxpayer. The business
conducted by a partnership which is directly or indirectly held by a
corporation is considered the business of the corporation to the extent
of the corporation's distributive share of the partnership income,
inclusive of guaranteed payments to the extent prescribed by rule.
(4) "Combined group" means the group of all persons whose income
and apportionment factors are required to be taken into account under
section 9 (1) or (2) of this act in determining the taxpayer's share of
the net business income or loss apportionable to this state.
(5) "Department" means the department of revenue.
(6) "Gasoline price" means the average of the retail gasoline
prices published during the taxable year for the west coast less
California, as published by the federal energy information
administration or its successor agency.
(7) "Internal revenue code" means Title 26 of the United States
Code of 1986, and amendments thereto, as existing on January 1, 2010.
(8) "Person" means any individual, firm, partnership, general
partner of a partnership, limited liability company, registered limited
liability partnership, foreign limited liability partnership,
association, corporation (whether or not the corporation is, or would
be if doing business in this state, subject to tax under this title),
company, syndicate, estate, trust, business trust, trustee, trustee in
bankruptcy, receiver, executor, administrator, assignee, or
organization of any kind.
(9) "Partnership" means a general or limited partnership, or
organization of any kind treated as a partnership for business purposes
under the laws of this state.
(10) "Petroleum business" means a corporation engaged in any of the
following activities: Exploration, production, refining,
manufacturing, processing, transportation, and marketing of oil and gas
or any commodity, product, or feedstock derived from oil or gas,
including petrochemicals.
(11) "Petroleum refining" means refining crude petroleum into
refined petroleum by fractionation, straight distillation of crude oil,
cracking, or similar methods.
(12) "Tax haven" means a jurisdiction that, during the tax year in
question:
(a) Is identified by the organization for economic cooperation and
development (OECD) as a tax haven or as having a harmful preferential
tax regime; or
(b) Exhibits the following characteristics established by the OECD
in its 1998 report entitled harmful tax competition: An emerging
global issue as indicative of a tax haven or as a jurisdiction having
a harmful preferential tax regime, regardless of whether it is listed
by the OECD as an uncooperative tax haven:
(i) Has no or nominal effective tax on the relevant income; and
(ii)(A) Has laws or practices that prevent effective exchange of
information for tax purposes with other governments on taxpayers
benefiting from the tax regime;
(B) Has tax regime which lacks transparency. A tax regime lacks
transparency if the details of legislative, legal, or administrative
provisions are not open and apparent or are not consistently applied
among similarly situated taxpayers, or if the information needed by tax
authorities to determine a taxpayer's correct tax liability, such as
accounting records and underlying documentation, is not adequately
available;
(C) Facilitates the establishment of foreign-owned entities without
the need for a local substantive presence or prohibits these entities
from having any commercial impact on the local economy;
(D) Explicitly or implicitly excludes the jurisdiction's resident
taxpayers from taking advantage of the tax regime's benefits or
prohibits enterprises that benefit from the regime from operating in
the jurisdiction's domestic market; or
(E) Has created a tax regime which is favorable for tax avoidance,
based upon an overall assessment of relevant factors, including whether
the jurisdiction has a significant untaxed offshore financial/other
services sector relative to its overall economy.
(13) "Taxable income" means federal taxable income after making the
additions, subtractions, apportionments, and allocations provided under
this title.
(14) "Taxable year" means the taxpayer's taxable year as defined
under the internal revenue code.
(15) "Taxpayer" means a corporation receiving income subject to tax
under this title.
(16) "Unitary business" means a single economic enterprise that is
made up either of separate parts of a single business entity or of a
commonly controlled group of business entities that are sufficiently
interdependent, integrated, and interrelated through their activities
so as to provide a synergy and mutual benefit that produces a sharing
or exchange of value among them and a significant flow of value to the
separate parts. Any business conducted by a partnership shall be
treated as conducted by its partners, whether directly held or
indirectly held through a series of partnerships, to the extent of the
partner's distributive share of the partnership's income, regardless of
the percentage of the partner's ownership interest or its distributive
or any other share of partnership income. A business conducted
directly or indirectly by one corporation is unitary with that portion
of a business conducted by another corporation through its direct or
indirect interest in a partnership if the conditions under this
subsection are satisfied.
(17) "United States" means the fifty states of the United States,
the District of Columbia, and United States' territories and
possessions.
NEW SECTION. Sec. 3
| If the gasoline price is: | The tax rate is: |
| Less than $1.75 | zero |
| Equal to or greater than $1.75, but less than $1.85 | 10% |
| Equal to or greater than $1.85, but less than $1.95 | 12% |
| Equal to or greater than $1.95, but less than $2.05 | 14% |
| Equal to or greater than $2.05, but less than $2.15 | 16% |
| Equal to or greater than $2.15, but less than $2.25 | 18% |
| Equal to or greater than $2.25, but less than $2.35 | 20% |
| Equal to or greater than $2.35, but less than $2.45 | 22% |
| Equal to or greater than $2.45, but less than $2.55 | 24% |
| Equal to or greater than $2.55, but less than $2.65 | 26% |
| Equal to or greater than $2.65, but less than $2.75 | 28% |
| Equal to or greater than $2.75 | 30% |
NEW SECTION. Sec. 4
NEW SECTION. Sec. 5
(1) Add amounts that have been deducted in computing federal
taxable income to the extent the amounts have been carried over from
taxable years ending before the effective date of this section.
(2) Add amounts that have been deducted in computing federal
taxable income to the extent the amounts have been carried back from
future taxable years.
(3) Add taxes on or measured by net income that have been deducted
under the internal revenue code in computing federal taxable income.
(4) Add gross income that has been excluded under section 103 of
the internal revenue code in computing federal taxable income, except
gross income derived from obligations of the state of Washington or
political subdivisions of the state of Washington. However, the amount
added under this subsection must be reduced by any expenses incurred in
the production of amounts added under this subsection, to the extent
the expenses have not been deducted in computing federal taxable
income.
(5) Deduct gross income that the state is prohibited from taxing
under the Constitution or laws of the United States, to the extent the
gross income was included in computing federal taxable income.
However, the amount deducted under this subsection must be reduced by
any expenses incurred in the production of amounts subtracted under
this subsection, to the extent the expenses have been deducted in
computing federal taxable income.
(6) Deduct income attributable to activities subject to tax under
chapter 82.04 RCW for periods prior to the effective date of this
section, to the extent the gross income was included in computing
federal taxable income. However, the amount deducted under this
subsection must be reduced by any expenses incurred in the production
of such income, to the extent the expenses have been deducted in
computing federal taxable income.
(7) Deduct income attributable to activities subject to tax under
chapter 82.16 RCW, to the extent the gross income was included in
computing federal taxable income. However, the amount deducted under
this subsection must be reduced by any expenses incurred in the
production of such income to the extent the expenses have been deducted
in calculating federal taxable income.
(8) Deduct income attributable to insurance business upon which a
tax based on gross premiums is paid to the state. However, the amount
deducted under this subsection must be reduced by any expense incurred
in the production of such income to the extent the expense has been
deducted in calculating federal taxable income.
(9) Add amounts upon which an S corporation is subject to tax under
subchapter S, chapter 1, subtitle A of the internal revenue code.
(10) Add amounts that have been deducted as intangible drilling and
development expenses under Sec. 263(c) of the internal revenue code in
excess of amounts that would have been deducted had the expenses been
capitalized and depreciated.
(11) Add amounts deducted on the percentage depletion basis under
Sec. 613 of the internal revenue code in excess of the amounts that
would have been deducted had the expenses been determined using the
cost depletion basis under Sec. 612 of the internal revenue code.
(12) Add amounts deducted as depreciation in excess of the amounts
allowable under Sec. 167 of the internal revenue code as that section
read on June 30, 1981.
NEW SECTION. Sec. 6
(1) The taxable income must be multiplied by a fraction. The
numerator of the fraction is the number of days in the fractional
taxable year. The denominator of the fraction is the number of days in
the entire taxable year.
(2) The taxable income must be adjusted, in accordance with rules
of the department, so as to include only such income and be reduced
only by such deductions as can be clearly determined from the permanent
records of the taxpayer to be attributable to the fractional taxable
year.
NEW SECTION. Sec. 7
NEW SECTION. Sec. 8
NEW SECTION. Sec. 9
(2) The department may, by rule, require the combined report to
include the income and associated apportionment factors of any persons
that are not included under subsection (1) of this section, but that
are members of a unitary business, in order to reflect proper
apportionment of income of entire unitary businesses. Authority to
require combination by rule under this subsection includes authority to
require combination of persons that are not, or would not be if doing
business in this state, subject to tax under this chapter.
(a) In addition, if the department determines that the reported
income or loss of a taxpayer engaged in a unitary business with any
person not included under subsection (1) of this section represents an
avoidance or evasion of tax by such taxpayer, the department may, on a
case-by-case basis, require all or any part of the income and
associated apportionment factors of such person to be included in the
taxpayer's combined report.
(b) With respect to inclusion of associated apportionment factors
under this subsection, the department may require the exclusion of any
one or more of the factors, the inclusion of one or more additional
factors which will fairly represent the taxpayer's business activity in
this state, or the employment of any other method to effectuate a
proper reflection of the total amount of income subject to
apportionment and an equitable allocation and apportionment of the
taxpayer's income.
NEW SECTION. Sec. 10
(1)(a) Each taxpayer member is responsible for tax based on its
taxable income or loss apportioned or allocated to this state, which
includes:
(i) Its share of any business income apportionable to this state of
each of the combined groups of which it is a member, determined under
subsection (2) of this section;
(ii) Its share of any business income apportionable to this state
of a distinct business activity conducted within and without the state
wholly by the taxpayer member, determined under RCW 82.56.010;
(iii) Its income from a business conducted wholly by the taxpayer
member entirely within the state;
(iv) Its income sourced to this state from the sale or exchange of
capital or assets, and from involuntary conversions, as determined
under subsection (3)(a)(vii) of this section, below;
(v) Its nonbusiness income or loss allocable to this state,
determined under RCW 82.56.010;
(vi) Its income or loss allocated or apportioned in an earlier
year, required to be taken into account as state source income during
the income year, other than a net operating loss; and
(vii) Its net operating loss carryover or carryback. If the
taxable income computed under this section results in a loss for a
taxpayer member of the combined group, that taxpayer member has a state
net operating loss. Such net operating loss is applied as a deduction
in a prior or subsequent year only if that taxpayer has state source
positive net income, whether or not the taxpayer is or was a member of
a combined reporting group in the prior or subsequent year.
(b) Except where otherwise provided, no tax credit or
post-apportionment deduction earned by one member of the group, but not
fully used by or allowed to that member, may be used in whole or in
part by another member of the group or applied in whole or in part
against the total income of the combined group; and a
post-apportionment deduction carried over into a subsequent year as to
the member that incurred it, and available as a deduction to that
member in a subsequent year, will be considered in the computation of
the income of that member in the subsequent year, regardless of the
composition of that income as apportioned, allocated, or wholly within
this state.
(2) The taxpayer's share of the business income apportionable to
this state of each combined group of which it is a member is the
product of:
(a) The business income of the combined group, determined under
subsection (3) of this section; and
(b) The taxpayer member's apportionment percentage, determined
under RCW 82.56.010, including in the property, payroll, and sales
factor numerators the taxpayer's property, payroll, and sales,
respectively, associated with the combined group's unitary business in
this state, and including in the denominator the property, payroll, and
sales of all members of the combined group, including the taxpayer,
which property, payroll, and sales are associated with the combined
group's unitary business wherever located. The property, payroll, and
sales of a partnership must be included in the determination of the
partner's apportionment percentage in proportion to a ratio the
numerator of which is the amount of the partner's distributive share of
partnership's unitary income included in the income of the combined
group in accordance with subsection (3)(b)(iii) of this section and the
denominator of which is the amount of the partnership's total unitary
income.
(3) The business income of a combined group is determined as
follows:
(a) From the total income of the combined group, determined under
(b) of this subsection, subtract any income, and add any expense or
loss, other than the business income, expense, or loss of the combined
group.
(b) Except as otherwise provided, the total income of the combined
group is the sum of the incomes, separately determined, of each member
of the combined group. The income of each member of the combined group
must be determined as follows:
(i) For any member incorporated in the United States, or included
in a consolidated federal corporate income tax return, the income to be
included in the total income of the combined group is the taxable
income for the corporation after making appropriate adjustments under
section 5 of this act.
(ii)(A) For any member not included in (a) of this subsection, the
income to be included in the total income of the combined group must be
determined as follows:
(I) A profit and loss statement shall be prepared for each foreign
branch or corporation in the currency in which the books of account of
the branch or corporation are regularly maintained.
(II) Adjustments must be made to the profit and loss statement to
conform it to the accounting principles generally accepted in the
United States for the preparation of such statements except as modified
under this title.
(III) Adjustments must be made to the profit and loss statement to
conform it to the tax accounting standards required by the department
by rule.
(IV) Except as otherwise provided by rule, the profit and loss
statement of each member of the combined group, and the apportionment
factors related thereto, whether United States or foreign, must be
translated into the currency in which the parent company maintains its
books and records.
(V) Income apportioned to this state must be expressed in United
States dollars.
(B) In lieu of the procedures set forth in (b)(ii)(A) of this
subsection, and subject to the determination of the department that it
reasonably approximates income, any member not included in (b)(i) of
this subsection may determine its income on the basis of the
consolidated profit and loss statement which includes the member and
which is prepared for filing with the securities and exchange
commission by related corporations. If the member is not required to
file with the securities and exchange commission, the department may
allow the use of the consolidated profit and loss statement prepared
for reporting to shareholders and subject to review by an independent
auditor. If above statements do not reasonably approximate income as
determined by the department, the department may accept those
statements with appropriate adjustments to approximate that income.
(iii) If a unitary business includes income from a partnership, the
income to be included in the total income of the combined group must be
the member of the combined group's direct and indirect distributive
share of the partnership's unitary business income.
(iv) All dividends paid by one to another of the members of the
combined group shall, to the extent those dividends are paid out of the
earnings and profits of the unitary business included in the combined
report, in the current or an earlier year, be eliminated from the
income of the recipient. This provision does not apply to dividends
received from members of the unitary business which are not a part of
the combined group.
(v) Except as otherwise provided by rule, business income from an
intercompany transaction between members of the same combined group
shall be deferred in a manner similar to 26 C.F.R. 1.1502-13. Upon the
occurrence of any of the following events, deferred business income
resulting from an intercompany transaction between members of a
combined group must be restored to the income of the seller, and is
apportioned as business income earned immediately before the event:
(A) The object of a deferred intercompany transaction is:
(I) Resold by the buyer to an entity that is not a member of the
combined group;
(II) Resold by the buyer to an entity that is a member of the
combined group for use outside the unitary business in which the buyer
and seller are engaged; or
(III) Converted by the buyer to a use outside the unitary business
in which the buyer and seller are engaged; or
(B) The buyer and seller are no longer members of the same combined
group, regardless of whether the members remain unitary.
(vi) A charitable expense incurred by a member of a combined group
shall, to the extent allowable as a deduction under internal revenue
code section 170, be subtracted first from the business income of the
combined group (subject to the income limitations of that section
applied to the entire business income of the group), and any remaining
amount shall then be treated as a nonbusiness expense allocable to the
member that incurred the expense (subject to the income limitations of
that section applied to the nonbusiness income of that specific
member). Any charitable deduction disallowed under the foregoing rule,
but allowed as a carryover deduction in a subsequent year, shall be
treated as originally incurred in the subsequent year by the same
member, and the rules of this section shall apply in the subsequent
year in determining the allowable deduction in that year.
(vii) Gain or loss from the sale or exchange of capital assets,
property described by internal revenue code section 1231(a)(3), and
property subject to an involuntary conversion, must be removed from the
total separate net income of each member of a combined group and shall
be apportioned and allocated as follows:
(A) For each class of gain or loss (short-term capital, long-term
capital, internal revenue code section 1231, and involuntary
conversions) all members' business gain and loss for the class must be
combined (without netting between such classes), and each class of net
business gain or loss separately apportioned to each member using the
member's apportionment percentage determined under subsection (2) of
this section.
(B) Each taxpayer member must then net its apportioned business
gain or loss for all classes, including any such apportioned business
gain and loss from other combined groups, against the taxpayer member's
nonbusiness gain and loss for all classes allocated to this state,
using the rules of internal revenue code sections 1231 and 1222,
without regard to any of the taxpayer member's gains or losses from the
sale or exchange of capital assets, internal revenue code section 1231
property, and involuntary conversions which are nonbusiness items
allocated to another state.
(C) Any resulting state source income (or loss, if the loss is not
subject to the limitations of internal revenue code section 1211) of a
taxpayer member produced by the application of this section must then
be applied to all other state source income or loss of that member.
(D) Any resulting state source loss of a member that is subject to
the limitations of internal revenue code section 1211 must be carried
forward by that member, and shall be treated as state source short-term
capital loss incurred by that member for the year for which the
carryover applies.
(viii) Any expense of one member of the unitary group which is
directly or indirectly attributable to the nonbusiness or exempt income
of another member of the unitary group must be allocated to that other
member as corresponding nonbusiness or exempt expense, as appropriate.
NEW SECTION. Sec. 11
NEW SECTION. Sec. 12
(a) The entire income and apportionment factors of any member
incorporated in the United States or formed under the laws of any
state, the District of Columbia, or any territory or possession of the
United States;
(b) The entire income and apportionment factors of any member,
regardless of the place incorporated or formed, if the average of its
property, payroll, and sales factors within the United States is twenty
percent or more;
(c) The entire income and apportionment factors of any member which
is a domestic international sales corporation as described in internal
revenue code sections 991 to 994, inclusive; a foreign sales
corporation as described in internal revenue code sections 921 to 927,
inclusive; or any member which is an export trade corporation, as
described in internal revenue code sections 970 to 971, inclusive;
(d) Any member not described in (a) through (c) of this subsection,
inclusive, shall include the portion of its income derived from or
attributable to sources within the United States, as determined under
the internal revenue code without regard to federal treaties, and its
apportionment factors related thereto;
(e) Any member that is a "controlled foreign corporation," as
defined in internal revenue code section 957, to the extent of the
income of that member that is defined in section 952 of subpart F of
the internal revenue code ("subpart F income") not excluding lower-tier
subsidiaries' distributions of such income which were previously taxed,
determined without regard to federal treaties, and the apportionment
factors related to that income; any item of income received by a
controlled foreign corporation is excluded if such income was subject
to an effective rate of income tax imposed by a foreign country greater
than ninety percent of the maximum rate of tax specified in internal
revenue code section 11;
(f) Any member that earns more than twenty percent of its income,
directly or indirectly, from intangible property or service related
activities that are deductible against the business income of other
members of the combined group, to the extent of that income and the
apportionment factors related thereto; and
(g) The entire income and apportionment factors of any member that
is doing business in a tax haven, where "doing business in a tax haven"
is defined as being engaged in activity sufficient for that tax haven
jurisdiction to impose a tax under United States constitutional
standards. If the member's business activity within a tax haven is
entirely outside the scope of the laws, provisions, and practices that
cause the jurisdiction to meet the criteria established in section
2(12) of this act, the activity of the member must be treated as not
having been conducted in a tax haven.
(2)(a) A water's-edge election is effective only if made on a
timely filed, original return for a taxable year by every member of the
unitary business subject to tax under this title. The department must
develop rules, and rules governing the impact if any, on the scope or
application of a water's-edge election, including termination or deemed
election, resulting from a change in the composition of the unitary
group, the combined group, the taxpayer members, and any other similar
change.
(b) Such election constitutes consent to the reasonable production
of documents and taking of depositions.
(c) In the discretion of the department, a water's-edge election
may be disregarded in part or in whole, and the income and
apportionment factors of any member of the taxpayer's unitary group may
be included in the combined report without regard to the provisions of
this section, if any member of the unitary group fails to comply with
any provision of this title or if a person otherwise not included in
the water's-edge combined group was availed of with a substantial
objective of avoiding state income tax.
(d) A water's-edge election is binding for and applicable to the
tax year it is made and all taxable years thereafter. It may be
withdrawn or reinstituted after withdrawal, only upon written request
for reasonable cause based on extraordinary hardship due to unforeseen
changes in state tax statutes, law, or policy, and only with the
written permission of the department. If the department grants a
withdrawal of election, he or she must impose reasonable conditions as
necessary to prevent the evasion of tax or to clearly reflect income
for the election period prior to or after the withdrawal.
NEW SECTION. Sec. 13
(2) The provisions of the internal revenue code relating to the
determination of reporting periods and due dates of payments of
estimated tax apply to the estimated tax payments due under this
section.
(3) The amount of the estimated tax is the annualized tax divided
by the number of months in the reporting period. No estimated tax
shall be due if the annualized tax is less than five hundred dollars.
The provisions of RCW 82.32.050 and 82.32.090 apply to underpayments of
estimated tax but do not apply to underpayments if the tax remitted to
the department under this title is either ninety percent of the tax
shown on the return or one hundred percent of the tax shown on the
previous year's tax return.
(4) For purposes of this section, the annualized tax is the
taxpayer's projected tax liability for the taxable year as computed
under section 6654 of the internal revenue code and the regulations
thereunder.
NEW SECTION. Sec. 14
(2) If a corporation's method of accounting is changed for federal
income tax purposes, it must be similarly changed for purposes of this
title.
NEW SECTION. Sec. 15
(2) The department may by rule require that certain taxpayers file,
on forms prescribed by the department, informational returns for any
period.
(3) If an adjustment to a taxpayer's federal return is made by the
taxpayer or the internal revenue service, the taxpayer must, within
ninety days of the final determination of the adjustment by the
internal revenue service or within thirty days of the filing of a
federal return adjusted by the taxpayer, file with the department on
forms prescribed by the department, a corrected return reflecting the
adjustments as finally determined. The taxpayer must pay any
additional tax due resulting from the finally determined internal
revenue service adjustment or a taxpayer adjustment without notice and
assessment. The period of limitation for the collection of the
additional tax, interest, and penalty due as a result of an adjustment
by the taxpayer or a finally determined internal revenue service
adjustment shall begin at the later of thirty days following the final
determination of the adjustment or the date of the filing of the
corrected return.
NEW SECTION. Sec. 16
NEW SECTION. Sec. 17
(2) All books and records and other papers and documents required
to be kept under this title are subject to inspection by the department
at all times during business hours of the day.
NEW SECTION. Sec. 18
(a) Liability of transferees;
(b) Time and manner of making returns, extensions of time for
filing returns, verification of returns, and the time when a return is
deemed filed.
(2) The department by rule may provide modifications and exceptions
to the provisions in subsection (1) of this section, if reasonably
necessary to facilitate the prompt, efficient, and equitable collection
of tax under this title.
NEW SECTION. Sec. 19
NEW SECTION. Sec. 20
NEW SECTION. Sec. 21
(2) Any person required to collect tax imposed under this title who
knowingly fails to collect, truthfully account for, or pay over the tax
is guilty of a class C felony as provided in chapter 9A.20 RCW.
(3) Any person who knowingly fails to pay tax, pay estimated tax,
make returns, keep records, or supply information, as required under
this title, is guilty of a gross misdemeanor as provided in chapter
9A.20 RCW.
NEW SECTION. Sec. 22
(2) Beginning January 1, 2012, and every six months thereafter, tax
proceeds in an amount determined under this subsection (2) must be
distributed in the manner provided in subsection (3) of this section.
The amount of proceeds to be distributed equals the sum of: (a) The
lesser of the amount in the account on the day prior to the date of
distribution or two hundred fifty million dollars; and (b) the amount
by which the balance in the account on the day prior to the date of
distribution, reduced by the amount determined under (a) of this
subsection, exceeds five hundred million dollars. The percentage
amounts in subsection (3) of this section must be adjusted ratably as
the distributions expire in subsection (3)(a) and (b) of this section.
(3) The amount of proceeds subject to distribution, as determined
under subsection (2) of this section, must be distributed as follows:
(a) Until July 1, 2018, eighteen percent must be deposited into the
energy freedom account created in RCW 43.325.040;
(b) Until July 1, 2022, one and four-fifths percent must be
deposited into the segregated subaccount of the air pollution control
account specified in RCW 70.94.017;
(c) Three and three-fifths percent must be deposited into the
general fund for distribution to state agencies, as provided by
legislative appropriation, to pay for agency heating and transportation
costs;
(d) Three and three-fifths percent must be deposited into the
general fund for distribution to school districts, as provided by
legislative appropriation, to pay for heating and pupil transportation
costs;
(e) One and four-fifths percent must be deposited into the energy
efficiency construction account created in RCW 39.35C.100 for the
construction of energy conservation projects;
(f) Forty-five percent must be distributed to a regional transit
authority under chapter 81.112 RCW, as provided by legislative
appropriation. The authority must use the money for a commuter rail
system or rail fixed guideway system that provides service to all
counties that comprise the regional transit authority;
(g) Thirteen and one-half percent must be distributed to the
department of community, trade, and economic development for the
purposes specified in section 40 of this act; and
(h) Twelve and seven-tenths percent must be deposited into the
general fund.
Sec. 23 RCW 43.325.020 and 2009 c 451 s 3 are each amended to
read as follows:
(1) The energy freedom program is established within the
department. The director may establish policies and procedures
necessary for processing, reviewing, and approving applications made
under this chapter.
(2) When reviewing applications submitted under this program, the
director ((shall)) must consult with those agencies and other public
entities having expertise and knowledge to assess the technical and
business feasibility of the project and probability of success. These
agencies may include, but are not limited to, Washington State
University, the University of Washington, the department of ecology,
the department of natural resources, the department of agriculture, the
department of general administration, local clean air authorities, the
Washington state conservation commission, and the clean energy
leadership council created in section 2, chapter 318, Laws of 2009.
(3) Except as provided in subsections (4) and (5) of this section,
the director, in cooperation with the department of agriculture, may
approve an application only if the director finds:
(a) The project will convert farm products, wastes, cellulose, or
biogas directly into electricity or biofuel or other coproducts
associated with such conversion;
(b) The project demonstrates technical feasibility and directly
assists in moving a commercially viable project into the marketplace
for use by Washington state citizens;
(c) The facility will produce long-term economic benefits to the
state, a region of the state, or a particular community in the state;
(d) The project does not require continuing state support;
(e) The assistance will result in new jobs, job retention, or
higher incomes for citizens of the state;
(f) The state is provided an option under the assistance agreement
to purchase a portion of the fuel or feedstock to be produced by the
project, exercisable by the department of general administration;
(g) The project will increase energy independence or diversity for
the state;
(h) The project will use feedstocks produced in the state, if
feasible, except this criterion does not apply to the construction of
facilities used to distribute and store fuels that are produced from
farm products or wastes;
(i) Any product produced by the project will be suitable for its
intended use, will meet accepted national or state standards, and will
be stored and distributed in a safe and environmentally sound manner;
(j) The application provides for adequate reporting or disclosure
of financial and employment data to the director, and permits the
director to require an annual or other periodic audit of the project
books; and
(k) For research and development projects, the application has been
independently reviewed by a peer review committee as defined in RCW
43.325.010 and the findings delivered to the director.
(4) When reviewing an application for a refueling project, the
coordinator may award a grant or a loan to an applicant if the director
finds:
(a) The project will offer alternative fuels to the motoring
public;
(b) The project does not require continued state support;
(c) The project is located within a green highway zone as defined
in RCW 43.325.010;
(d) The project will contribute towards an efficient and adequately
spaced alternative fuel refueling network along the green highways
designated in RCW 47.17.020, 47.17.135, and 47.17.140; and
(e) The project will result in increased access to alternative
fueling infrastructure for the motoring public along the green highways
designated in RCW 47.17.020, 47.17.135, and 47.17.140.
(5) When reviewing an application for energy efficiency
improvements, renewable energy improvements, or innovative energy
technology, the director may award a grant or a loan to an applicant if
the director finds:
(a) The project or program will result in increased access for the
public, state and local governments, and businesses to energy
efficiency improvements, renewable energy improvements, or innovative
energy technologies;
(b) The project or program demonstrates technical feasibility and
directly assists in moving a commercially viable project into the
marketplace for use by Washington state citizens;
(c) The project or program does not require continued state
support; or
(d) The federal government has provided funds with a limited time
frame for use for energy independence and security, energy efficiency,
renewable energy, innovative energy technologies, or conservation.
(6)(a) The director may approve a project application for
assistance under subsection (3) of this section up to ((five)) fifteen
million dollars. In no circumstances ((shall)) may this assistance
constitute more than fifty percent of the total project cost.
(b) The director may approve a refueling project application for a
grant or a loan under subsection (4) of this section up to fifty
thousand dollars. In no circumstances ((shall)) may a grant or a loan
award constitute more than fifty percent of the total project cost.
(7) The director ((shall)) must enter into agreements with approved
applicants to fix the terms and rates of the assistance to minimize the
costs to the applicants, and to encourage establishment of a viable
bioenergy or biofuel industry, or a viable energy efficiency, renewable
energy, or innovative energy technology industry. The agreement
((shall)) must include provisions to protect the state's investment,
including a requirement that a successful applicant enter into
contracts with any partners that may be involved in the use of any
assistance provided under this program, including services, facilities,
infrastructure, or equipment. Contracts with any partners ((shall))
must become part of the application record.
(8) The director may defer any payments for up to twenty-four
months or until the project starts to receive revenue from operations,
whichever is sooner.
Sec. 24 RCW 43.325.040 and 2009 c 564 s 942 and 2009 c 451 s 5
are each reenacted and amended to read as follows:
(1) The energy freedom account is created in the state treasury.
All receipts from appropriations made to the account, distributions to
the account under section 22 of this act, and any loan payments of
principal and interest derived from loans made under the energy freedom
account must be deposited into the account. Moneys in the account may
be spent only after appropriation. Expenditures from the account may
be used only for financial assistance for further funding for projects
consistent with this chapter or otherwise authorized by the
legislature.
(2) The green energy incentive account is created in the state
treasury as a subaccount of the energy freedom account. All receipts
from appropriations made to the green energy incentive account
((shall)) must be deposited into the account, and may be spent only
after appropriation. Expenditures from the account may be used only
for:
(a) Refueling projects awarded under this chapter;
(b) Pilot projects for plug-in hybrids, including grants provided
for the electrification program set forth in RCW 43.325.110; and
(c) Demonstration projects developed with state universities as
defined in RCW 28B.10.016 and local governments that result in the
design and building of a hydrogen vehicle fueling station.
(3)(a) The energy recovery act account is created in the state
treasury. State and federal funds may be deposited into the account
and any loan payments of principal and interest derived from loans made
from the energy recovery act account must be deposited into the
account. Moneys in the account may be spent only after appropriation.
(b) Expenditures from the account may be used only for loans, loan
guarantees, and grants that encourage the establishment of innovative
and sustainable industries for renewable energy and energy efficiency
technology, including but not limited to:
(i) Renewable energy projects or programs that require interim
financing to complete project development and implementation;
(ii) Companies with innovative, near-commercial or commercial,
clean energy technology; and
(iii) Energy efficiency technologies that have a viable repayment
stream from reduced utility costs.
(c) The director ((shall)) must establish policies and procedures
for processing, reviewing, and approving applications for funding under
this section. When developing these policies and procedures, the
department must consider the clean energy leadership strategy developed
under section 2, chapter 318, Laws of 2009.
(d) The director ((shall)) must enter into agreements with approved
applicants to fix the term and rates of funding provided from this
account.
(e) The policies and procedures of this subsection (3) do not apply
to assistance awarded for projects under RCW 43.325.020(3).
(4) Any state agency receiving funding from the energy freedom
account is prohibited from retaining greater than three percent of any
funding provided from the energy freedom account for administrative
overhead or other deductions not directly associated with conducting
the research, projects, or other end products that the funding is
designed to produce unless this provision is waived in writing by the
director.
(5) Any university, institute, or other entity that is not a state
agency receiving funding from the energy freedom account is prohibited
from retaining greater than fifteen percent of any funding provided
from the energy freedom account for administrative overhead or other
deductions not directly associated with conducting the research,
projects, or other end products that the funding is designed to
produce.
(6) Subsections (2), (4), and (5) of this section do not apply to
assistance awarded for projects under RCW 43.325.020(3).
(7) During the 2009-2011 fiscal biennium, the legislature may
transfer from the energy freedom account to the state general fund such
amounts as reflect the excess fund balance of the account.
Sec. 25 RCW 70.94.017 and 2007 c 348 s 102 are each amended to
read as follows:
(1) Money deposited in the segregated subaccount of the air
pollution control account under RCW 46.68.020(2) ((shall)) must be
distributed as follows:
(a) Eighty-five percent ((shall)) must be distributed to air
pollution control authorities created under this chapter. The money
must be distributed in direct proportion with the amount of fees
imposed under RCW 46.12.080, 46.12.170, and 46.12.181 that are
collected within the boundaries of each authority. However, an amount
in direct proportion with those fees collected in counties for which no
air pollution control authority exists must be distributed to the
department.
(b) The remaining fifteen percent ((shall)) must be distributed to
the department.
(2) Money distributed to air pollution control authorities and the
department under subsection (1) of this section must be used as
follows:
(a) Eighty-five percent of the money received by an air pollution
control authority or the department is available on a priority basis to
retrofit school buses with exhaust emission control devices or to
provide funding for fueling infrastructure necessary to allow school
bus fleets to use alternative, cleaner fuels. In addition, the
director of ecology or the air pollution control officer may direct
funding under this section for other publicly or privately owned diesel
equipment if the director of ecology or the air pollution control
officer finds that funding for other publicly or privately owned diesel
equipment will provide public health benefits and further the purposes
of this chapter.
(b) The remaining fifteen percent may be used by the air pollution
control authority or department to reduce transportation-related air
contaminant emissions and clean up air pollution, or reduce and monitor
toxic air contaminants.
(3) One-half of the money deposited in the segregated subaccount of
the air pollution control account under section 22 of this act shall be
distributed to air pollution control authorities and the remainder
shall be distributed to the department. Air pollution control
authorities and the department must use the money to retrofit school
buses with exhaust emission control devices or to provide funding for
fueling infrastructure necessary to allow school bus fleets to use
alternative, cleaner fuels. In addition, the director of ecology or an
air pollution control officer may direct funding under this section for
other publicly owned diesel equipment if the director or an officer
finds that funding for other publicly owned diesel equipment will
provide public health benefits and further the purposes of this
chapter.
(4) Money in the air pollution control account may be spent by the
department only after appropriation.
(((4))) (5) This section expires July 1, 2020.
Sec. 26 RCW 82.04.230 and 2006 c 300 s 5 are each amended to read
as follows:
Upon every person engaging within this state in business as an
extractor, except persons taxable as an extractor under any other
provision in this chapter; as to such persons, the amount of the tax
with respect to such business shall be equal to the value of the
products, including byproducts, extracted for sale or for commercial or
industrial use, multiplied by the rate of ((0.484)) 0.4719 percent.
The measure of the tax is the value of the products, including
byproducts, so extracted, regardless of the place of sale or the fact
that deliveries may be made to points outside the state.
Sec. 27 RCW 82.04.240 and 2004 c 24 s 4 are each amended to read
as follows:
Upon every person engaging within this state in business as a
manufacturer, except persons taxable as manufacturers under other
provisions of this chapter; as to such persons, the amount of the tax
with respect to such business ((shall be)) is equal to the value of the
products, including byproducts, manufactured, multiplied by the rate of
((0.484)) 0.4719 percent.
The measure of the tax is the value of the products, including
byproducts, so manufactured regardless of the place of sale or the fact
that deliveries may be made to points outside the state.
Sec. 28 RCW 82.04.240 and 2003 c 149 s 3 are each amended to read
as follows:
(1) Upon every person engaging within this state in business as a
manufacturer, except persons taxable as manufacturers under other
provisions of this chapter; as to such persons, the amount of the tax
with respect to such business ((shall be)) is equal to the value of the
products, including byproducts, manufactured, multiplied by the rate of
((0.484)) 0.4719 percent.
(2) Upon every person engaging within this state in the business of
manufacturing semiconductor materials, as to such persons, the amount
of tax with respect to such business ((shall)), in the case of
manufacturers, be equal to the value of the product manufactured, or,
in the case of processors for hire, ((be)) is equal to the gross income
of the business, multiplied by the rate of 0.275 percent. For the
purposes of this subsection "semiconductor materials" means silicon
crystals, silicon ingots, raw polished semiconductor wafers, compound
semiconductors, integrated circuits, and microchips. This subsection
(2) expires twelve years after the effective date of this act.
(3) The measure of the tax is the value of the products, including
byproducts, so manufactured regardless of the place of sale or the fact
that deliveries may be made to points outside the state.
Sec. 29 RCW 82.04.250 and 2008 c 81 s 5 are each amended to read
as follows:
(1) Upon every person engaging within this state in the business of
making sales at retail, except persons taxable as retailers under other
provisions of this chapter, as to such persons, the amount of tax with
respect to such business shall be equal to the gross proceeds of sales
of the business, multiplied by the rate of ((0.471)) 0.4592 percent.
(2) Upon every person engaging within this state in the business of
making sales at retail that are exempt from the tax imposed under
chapter 82.08 RCW by reason of RCW 82.08.0261, 82.08.0262, or
82.08.0263, except persons taxable under RCW 82.04.260(11) or
subsection (3) of this section, as to such persons, the amount of tax
with respect to such business ((shall be)) is equal to the gross
proceeds of sales of the business, multiplied by the rate of 0.484
percent.
(3) Upon every person classified by the federal aviation
administration as a federal aviation regulation part 145 certificated
repair station and that is engaging within this state in the business
of making sales at retail that are exempt from the tax imposed under
chapter 82.08 RCW by reason of RCW 82.08.0261, 82.08.0262, or
82.08.0263, as to such persons, the amount of tax with respect to such
business ((shall be)) is equal to the gross proceeds of sales of the
business, multiplied by the rate of .2904 percent.
Sec. 30 RCW 82.04.250 and 2007 c 54 s 5 are each amended to read
as follows:
(1) Upon every person engaging within this state in the business of
making sales at retail, except persons taxable as retailers under other
provisions of this chapter, as to such persons, the amount of tax with
respect to such business ((shall be)) is equal to the gross proceeds of
sales of the business, multiplied by the rate of ((0.471)) 0.4592
percent.
(2) Upon every person engaging within this state in the business of
making sales at retail that are exempt from the tax imposed under
chapter 82.08 RCW by reason of RCW 82.08.0261, 82.08.0262, or
82.08.0263, except persons taxable under RCW 82.04.260(11), as to such
persons, the amount of tax with respect to such business ((shall be))
is equal to the gross proceeds of sales of the business, multiplied by
the rate of 0.484 percent.
Sec. 31 RCW 82.04.255 and 1997 c 7 s 1 are each amended to read
as follows:
(1) Upon every person engaging within the state as a real estate
broker; as to such persons, the amount of the tax with respect to such
business ((shall be)) is equal to the gross income of the business,
multiplied by the rate of ((1.5)) 1.4625 percent.
(2)(a) Except as provided otherwise in this subsection, the measure
of the tax on real estate commissions earned by the real estate broker
((shall be)) is the gross commission earned by the particular real
estate brokerage office including that portion of the commission paid
to salesmen or associate brokers in the same office on a particular
transaction((: PROVIDED, HOWEVER, That)).
(b) Where a real estate commission is divided between an
originating brokerage office and a cooperating brokerage office on a
particular transaction, each brokerage office ((shall)) must pay the
tax only upon their respective shares of said commission((: AND
PROVIDED FURTHER, That)).
(c) Where the brokerage office has paid the tax as provided
((herein)) in this section, salesmen or associate brokers within the
same brokerage office ((shall)) may not be required to pay a similar
tax upon the same transaction.
Sec. 32 RCW 82.04.270 and 2004 c 24 s 5 are each amended to read
as follows:
Upon every person engaging within this state in the business of
making sales at wholesale, except persons taxable as wholesalers under
other provisions of this chapter; as to such persons, the amount of tax
with respect to such business ((shall be)) is equal to the gross
proceeds of sales of such business multiplied by the rate of ((0.484))
0.4719 percent.
Sec. 33 RCW 82.04.280 and 2009 c 461 s 2 are each amended to read
as follows:
(1) Upon every person engaging within this state in the business
of: (((1))) (a) Printing materials other than newspapers, and of
publishing periodicals or magazines; (((2))) (b) building, repairing or
improving any street, place, road, highway, easement, right-of-way,
mass public transportation terminal or parking facility, bridge,
tunnel, or trestle which is owned by a municipal corporation or
political subdivision of the state or by the United States and which is
used or to be used, primarily for foot or vehicular traffic including
mass transportation vehicles of any kind and including any
readjustment, reconstruction or relocation of the facilities of any
public, private or cooperatively owned utility or railroad in the
course of such building, repairing or improving, the cost of which
readjustment, reconstruction, or relocation, is the responsibility of
the public authority whose street, place, road, highway, easement,
right-of-way, mass public transportation terminal or parking facility,
bridge, tunnel, or trestle is being built, repaired or improved; (((3)
extracting for hire or processing for hire, except persons taxable as
extractors for hire or processors for hire under another section of
this chapter; (4))) (c) operating a cold storage warehouse or storage
warehouse, but not including the rental of cold storage lockers;
(((5))) (d) representing and performing services for fire or casualty
insurance companies as an independent resident managing general agent
((licensed under the provisions of RCW 48.05.310)); (((6))) (e) radio
and television broadcasting, excluding network, national and regional
advertising computed as a standard deduction based on the national
average thereof as annually reported by the federal communications
commission, or in lieu thereof by itemization by the individual
broadcasting station, and excluding that portion of revenue represented
by the out-of-state audience computed as a ratio to the station's total
audience as measured by the 100 micro-volt signal strength and delivery
by wire, if any; (((7))) (f) engaging in activities which bring a
person within the definition of consumer contained in RCW 82.04.190(6);
as to such persons, the amount of tax on such business is equal to the
gross income of the business multiplied by the rate of 0.484 percent.
((As used in this section,)) (2) The following definitions apply
throughout this section unless the context clearly requires otherwise.
(a) "Cold storage warehouse" means a storage warehouse used to
store fresh and/or frozen perishable fruits or vegetables, meat,
seafood, dairy products, or fowl, or any combination thereof, at a
desired temperature to maintain the quality of the product for orderly
marketing.
((As used in this section,)) (b) "Storage warehouse" means a
building or structure, or any part thereof, in which goods, wares, or
merchandise are received for storage for compensation, except field
warehouses, fruit warehouses, fruit packing plants, warehouses licensed
under chapter 22.09 RCW, public garages storing automobiles, railroad
freight sheds, docks and wharves, and "self-storage" or "mini storage"
facilities whereby customers have direct access to individual storage
areas by separate entrance. "Storage warehouse" does not include a
building or structure, or that part of such building or structure, in
which an activity taxable under RCW 82.04.272 is conducted.
((As used in this section,)) (c) "Periodical or magazine" means a
printed publication, other than a newspaper, issued regularly at stated
intervals at least once every three months, including any supplement or
special edition of the publication.
Sec. 34 RCW 82.04.280 and 2009 c 461 s 3 are each amended to read
as follows:
(1) Upon every person engaging within this state in the business
of: (((1))) (a) Printing materials other than newspapers, and of
publishing periodicals or magazines; (((2))) (b) building, repairing or
improving any street, place, road, highway, easement, right-of-way,
mass public transportation terminal or parking facility, bridge,
tunnel, or trestle which is owned by a municipal corporation or
political subdivision of the state or by the United States and which is
used or to be used, primarily for foot or vehicular traffic including
mass transportation vehicles of any kind and including any
readjustment, reconstruction or relocation of the facilities of any
public, private or cooperatively owned utility or railroad in the
course of such building, repairing or improving, the cost of which
readjustment, reconstruction, or relocation, is the responsibility of
the public authority whose street, place, road, highway, easement,
right-of-way, mass public transportation terminal or parking facility,
bridge, tunnel, or trestle is being built, repaired or improved; (((3)
extracting for hire or processing for hire, except persons taxable as
extractors for hire or processors for hire under another section of
this chapter; (4))) (c) operating a cold storage warehouse or storage
warehouse, but not including the rental of cold storage lockers;
(((5))) (d) representing and performing services for fire or casualty
insurance companies as an independent resident managing general agent
((licensed under the provisions of RCW 48.05.310)); (((6))) (e) radio
and television broadcasting, excluding network, national and regional
advertising computed as a standard deduction based on the national
average thereof as annually reported by the Federal Communications
Commission, or in lieu thereof by itemization by the individual
broadcasting station, and excluding that portion of revenue represented
by the out-of-state audience computed as a ratio to the station's total
audience as measured by the 100 micro-volt signal strength and delivery
by wire, if any; (((7))) (f) engaging in activities which bring a
person within the definition of consumer contained in RCW 82.04.190(6);
as to such persons, the amount of tax on such business is equal to the
gross income of the business multiplied by the rate of 0.484 percent.
((As used in this section,)) (2) The following definitions apply
throughout this section unless the context clearly requires otherwise.
(a) "Cold storage warehouse" means a storage warehouse used to
store fresh and/or frozen perishable fruits or vegetables, meat,
seafood, dairy products, or fowl, or any combination thereof, at a
desired temperature to maintain the quality of the product for orderly
marketing.
((As used in this section,)) (b) "Storage warehouse" means a
building or structure, or any part thereof, in which goods, wares, or
merchandise are received for storage for compensation, except field
warehouses, fruit warehouses, fruit packing plants, warehouses licensed
under chapter 22.09 RCW, public garages storing automobiles, railroad
freight sheds, docks and wharves, and "self-storage" or "mini storage"
facilities whereby customers have direct access to individual storage
areas by separate entrance. "Storage warehouse" does not include a
building or structure, or that part of such building or structure, in
which an activity taxable under RCW 82.04.272 is conducted.
((As used in this section,)) (c) "Periodical or magazine" means a
printed publication, other than a newspaper, issued regularly at stated
intervals at least once every three months, including any supplement or
special edition of the publication.
Sec. 35 RCW 82.04.290 and 2008 c 81 s 6 are each amended to read
as follows:
(1) Upon every person engaging within this state in the business of
providing international investment management services, as to such
persons, the amount of tax with respect to such business ((shall be))
is equal to the gross income or gross proceeds of sales of the business
multiplied by a rate of 0.275 percent.
(2)(a) Upon every person engaging within this state in any business
activity other than or in addition to an activity taxed explicitly
under another section in this chapter or subsection (3) of this
section; as to such persons the amount of tax on account of such
activities ((shall be)) is equal to the gross income of the business
multiplied by the rate of ((1.5)) 1.4625 percent.
(b) This subsection (2) includes, among others, and without
limiting the scope hereof (whether or not title to materials used in
the performance of such business passes to another by accession,
confusion or other than by outright sale), persons engaged in the
business of rendering any type of service which does not constitute a
"sale at retail" or a "sale at wholesale." The value of advertising,
demonstration, and promotional supplies and materials furnished to an
agent by his principal or supplier to be used for informational,
educational and promotional purposes ((shall)) may not be considered a
part of the agent's remuneration or commission and ((shall)) is not
((be)) subject to taxation under this section.
(3)(a) Until July 1, 2024, upon every person engaging within this
state in the business of performing aerospace product development for
others, as to such persons, the amount of tax with respect to such
business ((shall be)) is equal to the gross income of the business
multiplied by a rate of 0.9 percent.
(b) "Aerospace product development" has the meaning as provided in
RCW 82.04.4461.
NEW SECTION. Sec. 36 A new section is added to chapter 82.04 RCW
to read as follows:
Upon every person engaging within this state in the business of
extracting for hire or processing for hire, except persons taxable as
extractors for hire or processors for hire under another section of
this chapter; as to such persons, the amount of tax on such business is
equal to the gross income of the business multiplied by the rate of
0.4719 percent.
Sec. 37 RCW 39.35C.020 and 2001 c 214 s 21 are each amended to
read as follows:
(1) Each state agency and school district ((shall)) must implement
cost-effective conservation improvements and maintain efficient
operation of its facilities in order to minimize energy consumption and
related environmental impacts and reduce operating costs. Each state
agency ((shall)) must undertake an energy audit and implement cost-effective conservation measures pursuant to the time schedules and
requirements set forth in chapter 43.19 RCW, except that any state
agency that, after December 31, 1997, has completed energy audits and
implemented cost-effective conservation measures, or has contracted
with an energy service company for energy audits and conservation
measures, is deemed to have met the requirements of this subsection for
those facilities included in the audits and conservation measures.
Each school district ((shall)) must undertake an energy audit and
implement cost-effective conservation measures pursuant to the time
schedules and requirements set forth in RCW 39.35C.025. Performance-based contracting ((shall be)) is the preferred method for completing
energy audits and implementing cost-effective conservation measures.
(2) The department shall assist state agencies and school districts
in identifying, evaluating, financing, and implementing cost-effective
conservation projects at their facilities. The assistance ((shall))
must include the following:
(a) Notifying state agencies and school districts of their
responsibilities under this chapter;
(b) Apprising state agencies and school districts of opportunities
to develop and finance such projects;
(c) Providing technical and analytical support, including
procurement of performance-based contracting services;
(d) Reviewing verification procedures for energy savings; and
(e) Assisting in the structuring and arranging of financing for
cost-effective conservation projects.
(3) Conservation projects implemented under this chapter shall have
appropriate levels of monitoring to verify the performance and measure
the energy savings over the life of the project. The department
((shall)) must solicit involvement in program planning and
implementation from utilities and other energy conservation suppliers,
especially those that have demonstrated experience in performance-based
energy programs.
(4) The department shall comply with the requirements of chapter
39.80 RCW when contracting for architectural or engineering services.
(5) The department ((shall)) must recover any costs and expenses it
incurs in providing assistance pursuant to this section, including
reimbursement from third parties participating in conservation
projects. The department ((shall)) must enter into a written agreement
with the public agency for the recovery of costs.
NEW SECTION. Sec. 38 A new section is added to chapter 39.35C
RCW to read as follows:
(1) Subject to available funding, the department must administer a
grant program for state agencies and school districts. The purpose of
this grant program is to provide funds to state agencies and schools
for the construction of energy conservation projects. A state agency
or school district must file an application with the department. The
department must rule on the application within sixty days. The
application must be in a form and manner prescribed by the department,
but must contain the following:
(a) A general description of the energy conservation project;
(b) The expected cost of the energy conservation project;
(c) The expected savings from the energy conservation project; and
(d) Documentation verifying the estimates in (b) and (c) of this
subsection.
(2) A state agency or school district may not receive more than
five percent of the money distributed on an annual basis to the energy
efficiency construction account created in RCW 39.35C.100 for an energy
conservation project.
Sec. 39 RCW 39.35C.100 and 1996 c 186 s 414 are each amended to
read as follows:
(1) The energy efficiency construction account is hereby created in
the state treasury. Moneys in the account may be spent only after
appropriation and only for the following purposes:
(a) Construction of energy efficiency projects, including project
evaluation and verification of benefits, project design, project
development, project construction, and project administration. Moneys
from distributions under section 22 of this act must be used only for
energy efficiency projects that constitute energy conservation
projects.
(b) Payment of principal and interest and other costs required
under bond covenant on bonds issued for the purpose of (a) of this
subsection.
(2) Sources for this account may include:
(a) Distributions under section 22 of this act;
(b) General obligation and revenue bond proceeds appropriated by
the legislature;
(((b))) (c) Loan repayments under RCW 39.35C.060 sufficient to pay
principal and interest obligations; and
(((c))) (d) Funding from federal, state, and local agencies.
NEW SECTION. Sec. 40 A new section is added to chapter 43.21F
RCW to read as follows:
(1) The department, in consultation with the joint committee on
energy supply and energy conservation, must administer a business
renewable energy grant program. The purpose of this grant program is
to allocate funds to Washington businesses that invest in renewable
energy sources.
(2) To receive a grant under this section, a person must submit an
application to the department for approval of the facility, system, or
vehicle that uses, or will use, a renewable energy source. The
application must include:
(a) The name and address of the applicant and location of the
proposed renewable energy system;
(b) The applicant's tax registration number;
(c) A description of the proposed facility or system that will use
a renewable energy source or, in the case of a vehicle that uses
biofuel, a description of the vehicle;
(d) A copy of the electrical permit from the applicable local
jurisdiction, if the renewable energy source will be used within a
facility or system; and
(e) Any other information the department requires.
(3) Within sixty days of receiving an application for a renewable
energy source grant, the department shall notify the applicant as to
whether the department has approved the application.
(4) Upon approval by the department and subject to available
funding, the department shall distribute to the qualifying applicant an
amount not to exceed five percent of the qualifying applicant's taxes
due and payable for the prior calendar year under chapter 82.04 RCW.
(5) For the purposes of this section, "renewable energy source"
means biofuel, a wind generator, or any device or combination of
devices or elements that rely upon direct sunlight as an energy source
for use in the generation of electricity.
Sec. 41 RCW 82.03.130 and 2005 c 253 s 7 are each amended to read
as follows:
(1) The board shall have jurisdiction to decide the following types
of appeals:
(a) Appeals taken pursuant to RCW 82.03.190.
(b) Appeals from a county board of equalization pursuant to RCW
84.08.130.
(c) Appeals by an assessor or landowner from an order of the
director of revenue made pursuant to RCW 84.08.010 and 84.08.060, if
filed with the board of tax appeals within thirty days after the
mailing of the order, the right to such an appeal being hereby
established.
(d) Appeals by an assessor or owner of an intercounty public
utility or private car company from determinations by the director of
revenue of equalized assessed valuation of property and the
apportionment thereof to a county made pursuant to chapter 84.12 and
84.16 RCW, if filed with the board of tax appeals within thirty days
after mailing of the determination, the right to such appeal being
hereby established.
(e) Appeals by an assessor, landowner, or owner of an intercounty
public utility or private car company from a determination of any
county indicated ratio for such county compiled by the department of
revenue pursuant to RCW 84.48.075((: PROVIDED, That)).
(i) ((Said)) The appeal must be filed after review of the ratio
under RCW 84.48.075(3) and not later than fifteen days after the
mailing of the certification; and
(ii) The hearing before the board ((shall)) must be expeditiously
held in accordance with rules prescribed by the board and ((shall))
takes precedence over all matters of the same character.
(f) Appeals from the decisions of sale price of second-class
shorelands on navigable lakes by the department of natural resources
pursuant to RCW ((79.94.210)) 79.125.450.
(g) Appeals from urban redevelopment property tax apportionment
district proposals established by governmental ordinances pursuant to
RCW 39.88.060.
(h) Appeals from interest rates as determined by the department
((of revenue)) for use in valuing farmland under current use assessment
pursuant to RCW 84.34.065.
(i) Appeals from revisions to stumpage value tables used to
determine value by the department ((of revenue)) pursuant to RCW
84.33.091.
(j) Appeals from denial of tax exemption application by the
department of revenue pursuant to RCW 84.36.850.
(k) Appeals pursuant to RCW 84.40.038(3).
(l) Appeals pursuant to RCW 84.39.020.
(m) Appeals relating to tax deficiencies and refunds, including
penalties and interest under Title 82A RCW.
(2) Except as otherwise specifically provided by law hereafter, the
provisions of RCW 1.12.070 ((shall)) apply to all notices of appeal
filed with the board of tax appeals.
Sec. 42 RCW 82.03.140 and 2000 c 103 s 1 are each amended to read
as follows:
(1) In all appeals over which the board has jurisdiction under RCW
82.03.130, a party taking an appeal may elect either a formal or an
informal hearing, such election to be made according to rules of
practice and procedure to be promulgated by the board((: PROVIDED,
That)).
(2) Nothing ((shall)) prevents the assessor or taxpayer, as a party
to an appeal pursuant to RCW 84.08.130, within twenty days from the
date of the receipt of the notice of appeal, from filing with the clerk
of the board notice of intention that the hearing be a formal one((:
PROVIDED, HOWEVER, That)).
(3) Nothing ((herein shall)) in this section may be construed to
modify the provisions of RCW 82.03.190((: AND PROVIDED FURTHER,
That)).
(4) Upon an appeal under RCW 82.03.130(1) (e) or (l), the director
((of revenue)) may, within ten days from the date of its receipt of the
notice of appeal, file with the clerk of the board notice of its
((intention that the hearing be held pursuant to chapter 34.05 RCW))
election of a formal hearing.
(5) In the event that appeals are taken from the same decision,
order, or determination, as the case may be, by different parties and
only one of such parties elects a formal hearing, a formal hearing
((shall)) must be granted.
Sec. 43 2009 c 461 s 9 (uncodified) is amended to read as
follows:
(1)(a) Section 28, chapter . . ., Laws of 2010 (section 28 of this
act), section 34, chapter . . ., Laws of 2010 (section 34 of this act),
section 3, chapter 461, Laws of 2009, section 7, chapter 300, Laws of
2006, and section 4, chapter 149, Laws of 2003 are contingent upon the
siting and commercial operation of a significant semiconductor
microchip fabrication facility in the state of Washington.
(b) For the purposes of this section:
(i) "Commercial operation" means the same as "commencement of
commercial production" as used in RCW 82.08.965.
(ii) "Semiconductor microchip fabrication" means "manufacturing
semiconductor microchips" as defined in RCW 82.04.426.
(iii) "Significant" means the combined investment of new buildings
and new machinery and equipment in the buildings, at the commencement
of commercial production, will be at least one billion dollars.
(2) Chapter 149, Laws of 2003 takes effect the first day of the
month in which a contract for the construction of a significant
semiconductor fabrication facility is signed, as determined by the
director of the department of revenue.
(3)(a) The department of revenue must provide notice of the
effective date of this act to affected taxpayers, the legislature, and
others as deemed appropriate by the department.
(b) If, after making a determination that a contract has been
signed and chapter 149, Laws of 2003 is effective, the department
discovers that commencement of commercial production did not take place
within three years of the date the contract was signed, the department
must make a determination that chapter 149, Laws of 2003 is no longer
effective, and all taxes that would have been otherwise due are deemed
deferred taxes and are immediately assessed and payable from any person
reporting tax under RCW 82.04.240(2) or claiming an exemption or credit
under section 2 or 5 through 10 , chapter 149, Laws of 2003. The
department is not authorized to make a second determination regarding
the effective date of chapter 149, Laws of 2003.
NEW SECTION. Sec. 44
NEW SECTION. Sec. 45
NEW SECTION. Sec. 46
NEW SECTION. Sec. 47 Sections 23 and 24 of this act expire June
30, 2016.
NEW SECTION. Sec. 48 Sections 26, 27, 29, 31 through 33, 35, and
36 of this act take effect January 1, 2011.
NEW SECTION. Sec. 49 Section 27 of this act expires on the date
that section 28 of this act takes effect.
NEW SECTION. Sec. 50 Sections 28 and 34 of this act take effect
on the later of: January 1, 2011, or the date the contingency in
section 43 of this act occurs.
NEW SECTION. Sec. 51 Section 29 of this act expires July 1,
2011.
NEW SECTION. Sec. 52 Section 30 of this act takes effect July 1,
2011.
NEW SECTION. Sec. 53 Section 33 of this act expires on the date
that section 34 of this act takes effect.