BILL REQ. #:  S-2240.1 

READ FIRST TIME 03/02/09.   

     AN ACT Relating to adopting the recommendations of the citizen commission for performance measurement of tax preferences to clarify the legislative intent of certain deductions and exemptions; amending RCW 82.04.280, 82.04.280, and 84.36.840; amending 2006 c 300 s 12 (uncodified); adding a new section to chapter 82.04 RCW; creating new sections; repealing RCW 84.36.130; providing an effective date; providing a contingent effective date; providing an expiration date; providing a contingent expiration date; and declaring an emergency.

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

Sec. 101   RCW 82.04.280 and 2006 c 300 s 6 are each amended to read as follows:
     Upon every person engaging within this state in the business of: (1) Printing, and of publishing newspapers, periodicals, or magazines; (2) 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) operating a cold storage warehouse or storage warehouse, but not including the rental of cold storage lockers; (5) 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) 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)), which the department must publish by rule every fifth year by September 30th, 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) 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 shall be equal to the gross income of the business multiplied by the rate of 0.484 percent.
     As used in this section, "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, "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, "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. 102   RCW 82.04.280 and 2006 c 300 s 7 are each amended to read as follows:
     Upon every person engaging within this state in the business of: (1) Printing, and of publishing newspapers, periodicals, or magazines; (2) 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) operating a cold storage warehouse or storage warehouse, but not including the rental of cold storage lockers; (5) 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) 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)), which the department must publish by rule every fifth year by September 30th, 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) 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 shall be equal to the gross income of the business multiplied by the rate of 0.484 percent.
     As used in this section, "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, "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, "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.

NEW SECTION.  Sec. 103   A new section is added to chapter 82.04 RCW to read as follows:
     For the standard deduction in RCW 82.04.280(6), the department must study radio and television broadcasting, excluding network, national and regional advertising to establish the standard deduction computed as a ratio of the network, national and regional advertising revenue to the total advertising revenue of the radio or television station expressed as a percentage. The department must complete the study using the best available information. This study must be completed by August 1, 2009, and the standard deduction must be published by rule by December 1, 2009. The study must be repeated every fifth year thereafter by March 30th and the rule must be published every fifth year by September 30th.

NEW SECTION.  Sec. 201   (1) The legislature recognizes the rich and diverse traditions represented by Washington's nonprofit homes for the sick or infirm and nonprofit hospitals for the sick and the value they provide to the residents and communities they serve as well as the employees who provide loving compassionate care.
     (2) The legislature finds requiring uniform and public reporting of community benefit is one way these facilities can continue to demonstrate the value provided in a manner consistent with the values of transparency and public accountability. Further, the legislature finds that Washington should adopt national standards for reporting of community benefits for nonprofit hospitals and consistent reporting standards for nonprofit homes for the sick or infirm.

Sec. 202   RCW 84.36.840 and 2007 c 111 s 305 are each amended to read as follows:
     (1) In order to determine whether organizations, associations, corporations, or institutions, except those exempted under RCW 84.36.020 and 84.36.030, are exempt from property taxes, and before the exemption ((shall be)) is allowed for any year, the superintendent or manager or other proper officer of the organization, association, corporation, or institution claiming exemption from taxation ((shall)) must file with the department of revenue a statement certifying that the income and the receipts thereof, including donations to it, have been applied to the actual expenses of operating and maintaining it, or for its capital expenditures, and to no other purpose. This report ((shall)) must also include a statement of the receipts and disbursements of the exempt organization, association, corporation, or institution.
     (2) Educational institutions claiming exemption under RCW 84.36.050 ((shall)) must also file a list of all property claimed to be exempt, the purpose for which it is used, the revenue derived from it for the preceding year, the use to which the revenue was applied, the number of students who attended the school or college, the total revenues of the institution with the source from which they were derived, and the purposes to which the revenues were applied, listing the items of such revenues and expenditures in detail.
     (3) Nonprofit homes for the sick or infirm and nonprofit hospitals for the sick claiming exemptions under RCW 84.36.040(1) (c) and (d) must also file on an annual basis no later than June 30th of each year, with the department of revenue a community benefit report for the preceding year. Nonprofit hospitals for the sick must file a copy of the federal income tax form 990 "Schedule H" with the department to report data on community benefits, including charity care. Nonprofit homes for the sick or infirm must file a report on community benefits, including charity care, on a standardized form developed by the department. The standardized form must provide the same or similar relevant data as required for the federal income tax form 990 "Schedule H" to report data on community benefits, including charity care. Reports filed under this subsection must be submitted electronically to the department by June 30, 2010, for community benefits provided during calendar year 2009, and by June 30th in each subsequent year thereafter. The department must provide electronic notice of the filing due date by May 31st of each year. The department may waive the requirement to file reports electronically for good cause shown. If the report is not received by the filing deadline, the exemption must be removed.
     (4) The reports required under subsections (1) and (2) of this section may be submitted electronically, in a format provided or approved by the department, or mailed to the department. The reports ((shall)) must be submitted on or before March 31st of each year. The department ((shall)) must remove the tax exemption from the property of any organization, association, corporation, or institution that does not file the required report with the department on or before the due date. However, the department ((shall)) must allow a reasonable extension of time for filing upon receipt of a written request on or before the required filing date and for good cause shown therein.

NEW SECTION.  Sec. 301   RCW 84.36.130 (Airport property in this state for smaller airports belonging to municipalities of adjoining states) and 1998 c 201 s 1 & 1961 c 15 s 84.36.130 are each repealed.

NEW SECTION.  Sec. 401   Part headings used in this act are not any part of the law.

Sec. 402   2006 c 300 s 12 (uncodified) is amended to read as follows:
     (1)(a) ((This act and)) Section 102, chapter . . ., Laws of 2009 (section 102 of this act), 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) ((This act)) 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 ((shall)) 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 ((this act)) 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 ((shall)) must make a determination that ((this act)) chapter 149, Laws of 2003 is no longer effective, and all taxes that would have been otherwise due ((shall be)) 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 ((of this act)), chapter 149, Laws of 2003. The department is not authorized to make a second determination regarding the effective date of ((this act)) chapter 149, Laws of 2003.

NEW SECTION.  Sec. 403   (1) Section 103 of this act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 1, 2009.
     (2) Section 102 of this act takes effect if the contingency in section 402 of this act occurs.

NEW SECTION.  Sec. 404   Section 101 of this act expires on the date that section 102 of this act takes effect.