BILL REQ. #:  H-1611.2 

READ FIRST TIME 02/22/13.   

     AN ACT Relating to the disposition of surplus property for the development of affordable housing; amending RCW 47.12.063, 79.11.005, 79A.05.170, 79A.05.175, 53.08.090, 53.08.091, 81.112.080, 36.34.135, and 39.102.020; adding a new section to chapter 43.19 RCW; adding a new section to chapter 43.20A RCW; adding a new section to chapter 72.09 RCW; adding a new section to chapter 79A.05 RCW; adding a new section to chapter 35.21 RCW; adding a new section to chapter 36.34 RCW; adding a new chapter to Title 39 RCW; and repealing RCW 43.19.19201, 43.20A.037, 43.63A.510, 47.12.064, and 72.09.055.

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

NEW SECTION.  Sec. 1   (1) A governmental entity may sell, lease, exchange, or donate surplus property to an eligible organization at a price that is less than fair market value, or may create beneficial sales terms including, but not limited to, extended closings, if the affordable housing to be developed on the property will be occupied primarily by extremely low-income, very low-income, federally qualified low-income, or low-income households.
     (2) A governmental entity disposing of surplus property under subsection (1) of this section must: (a) Enter into a recorded covenant with the eligible organization or a loan note in the name of the governmental entity, to ensure that the property will meet the required income, rent, and sales price restrictions; and (b) monitor compliance with the covenant or loan note.
     (3) An eligible organization may obtain surplus property through purchase, lease, exchange, or donation, under reasonable option and conveyance conditions, in return for: (a) A recorded covenant to provide rental housing for extremely low-income, very low-income, federally qualified low-income, or low-income households for at least forty years; or (b) a loan note in the name of a governmental entity for homeownership programs in which the homeowners are extremely low-income, very low-income, federally qualified low-income, or low-income.
     (4) As an alternative to the requirements of this section, counties, cities, and towns may sell surplus property at a discount for affordable housing that may be part of mixed-income or mixed-use developments, provided that the affordable housing complies with the guidelines for affordable housing, income levels, affordable rents, affordable sales prices, and minimum terms of affordability under RCW 36.70A.540 for affordable housing incentive programs.
     (5) The authority granted to counties, cities, and towns in this section is in addition to, and must not be construed to limit, any existing authority.

NEW SECTION.  Sec. 2   The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
     (1) "Affordable housing" means residential housing that is rented or owned by a person who qualifies as an extremely low-income, very low-income, federally qualified low-income, or low-income household or who is from a special needs population, and for which monthly housing costs, including utilities other than telephone, do not exceed thirty percent of the household's maximum allowed monthly income for the housing unit. "Affordable housing" also means farmworker housing.
     (2) "Eligible organization" means a county, city, or town government, local housing authority, public development authority, community renewal agency, regional support network established under chapter 71.24 RCW, nonprofit community or neighborhood-based organization, federally recognized Indian tribe in the state of Washington, or nonprofit housing assistance organization, including such entities materially participating as a general partner or managing members of a partnership, limited liability company, or equivalent organization.
     (3) "Extremely low-income household" means a single person, family, or unrelated persons living together whose income is at or below thirty percent of the county area median income where the affordable housing is located, adjusted for household size.
     (4) "Federally qualified low-income household" means a single person, family, or unrelated persons living together whose income is more than fifty percent but is at or below sixty percent of the county area median income where the affordable housing is located, adjusted for household size.
     (5) "Governmental entity" means the state department of corrections, enterprise services, natural resources, social and health services, or transportation, the state parks and recreation commission, a county, city, or town government, a port district, or a regional transit authority.
     (6) "Low-income household" means a single person, family, or unrelated persons living together whose income is more than sixty percent but is at or below eighty percent of the county area median income where the affordable housing is located, adjusted for household size.
     (7) "Moderate-income household" means a single person, family, or unrelated persons living together whose income is more than eighty percent but is at or below one hundred fifteen percent of the county area median income where the affordable housing is located.
     (8) "Primarily" means fifty-one percent or more.
     (9) "Real property" means land, buildings, or buildings and land. "Real property" also includes air rights.
     (10) "Surplus property" means real property, or any interest in real property, that is not required for the governmental entity's needs or the discharge of its responsibilities. "Surplus property" includes, but is not limited to, real property, or any interest in real property, declared surplus by a governmental entity under that entity's own policies and procedures. However, "surplus property" does not include either state forest lands managed by the department of natural resources or real property that is or will be developed for industrial purposes by port districts.
     (11) "Very low-income household" means a single person, family, or unrelated persons living together whose income is at or below fifty percent of the county area median income for the county where the affordable housing is located, adjusted for household size.

NEW SECTION.  Sec. 3   A new section is added to chapter 43.19 RCW to read as follows:
     The department may sell, lease, exchange, or donate surplus property to an eligible organization for the purpose of affordable housing as specified in chapter 39.-- RCW (the new chapter created in section 19 of this act).

NEW SECTION.  Sec. 4   A new section is added to chapter 43.20A RCW to read as follows:
     The department may sell, lease, exchange, or donate surplus property to an eligible organization for the purpose of affordable housing as specified in chapter 39.-- RCW (the new chapter created in section 19 of this act).

Sec. 5   RCW 47.12.063 and 2011 c 376 s 2 are each amended to read as follows:
     (1) It is the intent of the legislature to continue the department's policy giving priority consideration to abutting property owners in agricultural areas when disposing of property through its surplus property program under this section.
     (2) Whenever the department determines that any real property owned by the state of Washington and under the jurisdiction of the department is no longer required for transportation purposes and that it is in the public interest to do so, the department may sell the property or exchange it in full or part consideration for land or improvements or for construction of improvements at fair market value to any person through the solicitation of written bids through public advertising in the manner prescribed under RCW 47.28.050 or in the manner prescribed under RCW 47.12.283.
     (3) The department may forego the processes prescribed by RCW 47.28.050 and 47.12.283 and sell the real property to any of the following entities or persons at fair market value:
     (a) Any other state agency;
     (b) The city or county in which the property is situated;
     (c) Any other municipal corporation;
     (d) Regional transit authorities created under chapter 81.112 RCW;
     (e) The former owner of the property from whom the state acquired title;
     (f) In the case of residentially improved property, a tenant of the department who has resided thereon for not less than six months and who is not delinquent in paying rent to the state;
     (g) Any abutting private owner but only after each other abutting private owner (if any), as shown in the records of the county assessor, is notified in writing of the proposed sale. If more than one abutting private owner requests in writing the right to purchase the property within fifteen days after receiving notice of the proposed sale, the property shall be sold at public auction in the manner provided in RCW 47.12.283;
     (h) To any other owner of real property required for transportation purposes;
     (i) In the case of property suitable for residential use, any nonprofit organization that is dedicated to providing affordable housing to very low-income, low-income, and moderate-income households as defined in ((RCW 43.63A.510)) section 2 of this act and is eligible to receive assistance through the Washington housing trust fund created in chapter 43.185 RCW; or
     (j) A federally recognized Indian tribe within whose reservation boundary the property is located.
     (4) The department also may forego the processes prescribed by RCW 47.28.050 and 47.12.283, and may sell, lease, exchange, or donate surplus property to an eligible organization as specified in chapter 39.-- RCW (the new chapter created in section 19 of this act) for the purpose of affordable housing or, in the case of surplus property not suitable for residential use, for purposes that support or complement the development of affordable housing.
     (5) When selling real property pursuant to RCW 47.12.283, the department may withhold or withdraw the property from an auction when requested by one of the entities or persons listed in subsection (3) of this section and only after the receipt of a nonrefundable deposit equal to ten percent of the fair market value of the real property or five thousand dollars, whichever is less. This subsection does not prohibit the department from exercising its discretion to withhold or withdraw the real property from an auction if the department determines that the property is no longer surplus or chooses to sell the property through one of the other means listed in subsection (2) of this section. If a transaction under this subsection is not completed within sixty days, the real property must be put back up for sale.
     (((5))) (6) Sales to purchasers may at the department's option be for cash, by real estate contract, or exchange of land or improvements. Transactions involving the construction of improvements must be conducted pursuant to chapter 47.28 RCW and Title 39 RCW, as applicable, and must comply with all other applicable laws and rules.
     (((6))) (7) Conveyances made pursuant to this section shall be by deed executed by the secretary of transportation and shall be duly acknowledged.
     (((7))) (8) Unless otherwise provided, all moneys received pursuant to the provisions of this section less any real estate broker commissions paid pursuant to RCW 47.12.320 shall be deposited in the motor vehicle fund.

NEW SECTION.  Sec. 6   A new section is added to chapter 72.09 RCW to read as follows:
     The department may sell, lease, exchange, or donate surplus property to an eligible organization for the purpose of affordable housing as specified in chapter 39.-- RCW (the new chapter created in section 19 of this act).

Sec. 7   RCW 79.11.005 and 2003 c 334 s 201 are each amended to read as follows:
     (1) The department ((is authorized to)) may sell any real property not designated or acquired as state forest lands, but acquired by the state, either in the name of the forest board, the forestry board, or the division of forestry, for administrative sites, lien foreclosures, or other purposes whenever it shall determine that the lands are no longer or not necessary for public use.
     (2) The department also may sell, lease, exchange, or donate surplus property, other than state forest lands, to an eligible organization for the purpose of affordable housing as specified in chapter 39.-- RCW (the new chapter created in section 19 of this act).
     (3) Except as otherwise provided in subsection (2) of this section and chapter 39.-- RCW (the new chapter created in section 19 of this act), the sale may be made after public notice to the highest bidder for such a price as approved by the governor, but not less than the fair market value of the real property, plus the value of improvements thereon. Any instruments necessary to convey title must be executed by the governor in a form approved by the attorney general.
     (((3))) (4) All amounts received from the sale must be credited to the fund of the department of government that is responsible for the acquisition and maintenance of the property sold.

NEW SECTION.  Sec. 8   A new section is added to chapter 79A.05 RCW to read as follows:
     The commission may sell, lease, exchange, or donate surplus property to an eligible organization for the purpose of affordable housing as specified in chapter 39.-- RCW (the new chapter created in section 19 of this act).

Sec. 9   RCW 79A.05.170 and 1991 sp.s. c 13 s 23 are each amended to read as follows:
     (1) Except for those lands subject to section 8 of this act and chapter 39.-- RCW (the new chapter created in section 19 of this act), any lands owned by the ((state parks and recreation)) commission, which are determined to be surplus to the needs of the state for development for state park purposes and which the commission proposes to deed to a local government or other entity, shall be accompanied by a clause requiring that if the land is not used for outdoor recreation purposes, ownership of the land shall revert to the ((state parks and recreation)) commission.
     (2) The ((state parks and recreation)) commission, in cases where land subject to such a reversionary clause is proposed for use or disposal for purposes other than recreation, shall require that, if the land is surplus to the needs of the commission for park purposes at the time the commission becomes aware of its proposed use for nonrecreation purposes, the holder of the land or property shall reimburse the commission for the release of the reversionary interest in the land. The reimbursement shall be in the amount of the fair market value of the reversionary interest as determined by a qualified appraiser agreeable to the commission. Appraisal costs shall be borne by the local entity which holds title to the land.
     (3) Any funds generated under a reimbursement under this section shall be deposited in the parkland acquisition account which is hereby created in the state treasury. Moneys in this account are to be used solely for the purchase or acquisition of property for use as state park property by the commission, as directed by the legislature; all such funds shall be subject to legislative appropriation.

Sec. 10   RCW 79A.05.175 and 2007 c 145 s 1 are each amended to read as follows:
     Except for those lands subject to section 8 of this act and chapter 39.-- RCW (the new chapter created in section 19 of this act), whenever the commission finds that any land under its control cannot advantageously be used for park purposes, it is authorized to dispose of such land by the method provided in this section or by the method provided in RCW 79A.05.170. If such lands are school or other grant lands, control thereof shall be relinquished by resolution of the commission to the proper state officials. If such lands were acquired under restrictive conveyances by which the state may hold them only so long as they are used for park purposes, they may be returned to the donor or grantors by the commission. All other such lands may be either sold by the commission to the highest bidder or exchanged for other lands of equal value by the commission, and all conveyance documents shall be executed by the governor. All such exchanges shall be accompanied by a transfer fee, to be set by the commission and paid by the other party to the transfer; such fee shall be paid into the parkland acquisition account established under RCW 79A.05.170. The commission may accept sealed bids, electronic bids, or oral bids at auction. Bids on all sales shall be solicited at least twenty days in advance of the sale date by an advertisement appearing at least once a week for two consecutive weeks in a newspaper of general circulation in the county in which the land to be sold is located. If the commission feels that no bid received adequately reflects the fair value of the land to be sold, it may reject all bids, and may call for new bids. All proceeds derived from the sale of such park property shall be paid into the park land acquisition account. All land considered for exchange shall be evaluated by the commission to determine its adaptability to park usage. The equal value of all lands exchanged shall first be determined by the appraisals to the satisfaction of the commission. No sale or exchange of state park lands shall be made without the unanimous consent of the commission.

NEW SECTION.  Sec. 11   A new section is added to chapter 35.21 RCW to read as follows:
     Every city and town, including every code city operating under Title 35A RCW, may sell, lease, exchange, or donate surplus property to an eligible organization for the purpose of affordable housing as specified in chapter 39.-- RCW (the new chapter created in section 19 of this act). The authority granted to cities and towns, including code cities, in this section is in addition to, and must not be construed to limit, any existing authority.

NEW SECTION.  Sec. 12   A new section is added to chapter 36.34 RCW to read as follows:
     Every county may sell, lease, exchange, or donate surplus property to an eligible organization for the purpose of affordable housing as specified in chapter 39.-- RCW (the new chapter created in section 19 of this act). The authority granted to counties in this section is in addition to, and must not be construed to limit, any existing authority.

Sec. 13   RCW 53.08.090 and 1994 c 26 s 1 are each amended to read as follows:
     (1) A port commission may sell, lease, exchange, or donate surplus property, other than property that is or will be developed for industrial purposes, to an eligible organization for the purpose of affordable housing as specified in chapter 39.-- RCW (the new chapter created in section 19 of this act).
     (2) Except for those lands subject to subsection (1) of this section and chapter 39.-- RCW (the new chapter created in section 19 of this act), a port commission may, by resolution, authorize the managing official of a port district to sell and convey port district property of ten thousand dollars or less in value. The authority shall be in force for not more than one calendar year from the date of resolution and may be renewed from year to year. Prior to any such sale or conveyance the managing official shall itemize and list the property to be sold and make written certification to the commission that the listed property is no longer needed for district purposes. Any large block of the property having a value in excess of ten thousand dollars shall not be broken down into components of ten thousand dollars or less value and sold in the smaller components unless the smaller components be sold by public competitive bid. A port district may sell and convey any of its real or personal property valued at more than ten thousand dollars when the port commission has, by resolution, declared the property to be no longer needed for district purposes, but no property which is a part of the comprehensive plan of improvement or modification thereof shall be disposed of until the comprehensive plan has been modified to find the property surplus to port needs. The comprehensive plan shall be modified only after public notice and hearing provided by RCW 53.20.010.
     (3) Nothing in this section shall be deemed to repeal or modify procedures for property sales within industrial development districts as set forth in chapter 53.25 RCW.
     (((2))) (4) The ten thousand dollar figures in subsection (((1))) (2) of this section shall be adjusted annually based upon the governmental price index established by the department of revenue under RCW 82.14.200.

Sec. 14   RCW 53.08.091 and 2010 c 8 s 16001 are each amended to read as follows:
     Except for those lands subject to RCW 53.08.090(1) and chapter 39.-- RCW (the new chapter created in section 19 of this act), or in cases where the full purchase price is paid at the time of the purchase, every sale of real property or personal property under authority of RCW 53.08.090 or 53.25.110 shall be subject to the following terms and conditions:
     (1) The purchaser shall enter into a contract with the district in which the purchaser shall covenant that he or she will make the payments of principal and interest when due, and that he or she will pay all taxes and assessments on such property. Upon failure to make payments of principal, interest, assessments, or taxes when due all rights of the purchaser under said contract may, at the election of the district, after notice to said purchaser, be declared to be forfeited. When the rights of the purchaser are declared forfeited, the district shall be released from all obligation to convey land covered by the contract, and in the case of personal property, the district shall have all rights granted to a secured party under chapter 62A.9 RCW;
     (2) The district may, as it deems advisable, extend the time for payment of principal and interest due or to become due;
     (3) The district shall notify the purchaser in each instance when payment is overdue, and that the purchaser is liable to forfeiture if payment is not made within thirty days from the time the same became due, unless the time be extended by the district;
     (4) Not less than four percent of the total purchase price shall be paid on the date of execution of the contract for sale and not less than four percent shall be paid annually thereafter until the full purchase price has been paid, but any purchaser may make full payment at any time. All unpaid deferred payments shall draw interest at a rate not less than six percent per annum.
     Nothing in this section shall be deemed to supersede other provisions of law more specifically governing sales of port district property. It is the purpose of this section to provide additional authority and procedures for sale of port district property no longer needed for port purposes.

Sec. 15   RCW 81.112.080 and 1992 c 101 s 8 are each amended to read as follows:
     An authority shall have the following powers in addition to the general powers granted by this chapter:
     (1) To carry out the planning processes set forth in RCW 81.104.100;
     (2) To acquire by purchase, condemnation, gift, or grant and to lease, construct, add to, improve, replace, repair, maintain, operate, and regulate the use of high capacity transportation facilities and properties within authority boundaries including surface, underground, or overhead railways, tramways, busways, buses, bus sets, entrained and linked buses, ferries, or other means of local transportation except taxis, and including escalators, moving sidewalks, personal rapid transit systems or other people-moving systems, passenger terminal and parking facilities and properties, and such other facilities and properties as may be necessary for passenger, vehicular, and vessel access to and from such people-moving systems, terminal and parking facilities and properties, together with all lands, rights-of-way, property, equipment, and accessories necessary for such high capacity transportation systems. When developing specifications for high capacity transportation system operating equipment, an authority shall take into account efforts to establish or sustain a domestic manufacturing capacity for such equipment. The right of eminent domain shall be exercised by an authority in the same manner and by the same procedure as or may be provided by law for cities of the first class, except insofar as such laws may be inconsistent with the provisions of this chapter. Public transportation facilities and properties which are owned by any city, county, county transportation authority, public transportation benefit area, or metropolitan municipal corporation may be acquired or used by an authority only with the consent of the agency owning such facilities. Such agencies are hereby authorized to convey or lease such facilities to an authority or to contract for their joint use on such terms as may be fixed by agreement between the agency and the authority.
     The facilities and properties of an authority whose vehicles will operate primarily within the rights-of-way of public streets, roads, or highways, may be acquired, developed, and operated without the corridor and design hearings that are required by RCW 35.58.273 for mass transit facilities operating on a separate right-of-way;
     (3) To dispose of any real or personal property acquired in connection with any authority function and that is no longer required for the purposes of the authority, in the same manner as provided for cities of the first class. When an authority determines that a facility or any part thereof that has been acquired from any public agency without compensation is no longer required for authority purposes, but is required by the agency from which it was acquired, the authority shall by resolution transfer it to such agency;
     (4) To sell, lease, exchange, or donate surplus property to an eligible organization for the purpose of affordable housing as specified in chapter 39.-- RCW (the new chapter created in section 19 of this act);
     (5) To fix rates, tolls, fares, and charges for the use of such facilities and to establish various routes and classes of service. Fares or charges may be adjusted or eliminated for any distinguishable class of users.

Sec. 16   RCW 36.34.135 and 1993 c 461 s 6 are each amended to read as follows:
     If a county owns property that is located anywhere within the county, including within the limits of a city or town, and that is suitable for affordable housing, the legislative authority of the county may, by negotiation, lease the property for affordable housing for a term not to exceed seventy-five years to any public housing authority or nonprofit organization that has demonstrated its ability to construct or operate housing for very low-income, low-income, or moderate-income households as defined in ((RCW 43.63A.510)) section 2 of this act and special needs populations. Leases for housing for very low-income, low-income, or moderate-income households and special needs populations shall not be subject to any requirement of periodic rental adjustments, as provided in RCW 36.34.180, but shall provide for such fixed annual rents as appear reasonable considering the public, social, and health benefits to be derived by providing an adequate supply of safe and sanitary housing for very low-income, low-income, or moderate-income households and special needs populations.

Sec. 17   RCW 39.102.020 and 2010 c 164 s 11 are each amended to read as follows:
     The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
     (1) "Annual state contribution limit" means seven million five hundred thousand dollars statewide per fiscal year.
     (2) "Assessed value" means the valuation of taxable real property as placed on the last completed assessment roll.
     (3) "Board" means the community economic revitalization board under chapter 43.160 RCW.
     (4) "Demonstration project" means one of the following projects:
     (a) Bellingham waterfront redevelopment project;
     (b) Spokane river district project at Liberty Lake; and
     (c) Vancouver riverwest project.
     (5) "Department" means the department of revenue.
     (6) "Fiscal year" means the twelve-month period beginning July 1st and ending the following June 30th.
     (7) "Local excise tax allocation revenue" means an amount of local excise taxes equal to some or all of the sponsoring local government's local excise tax increment, amounts of local excise taxes equal to some or all of any participating local government's excise tax increment as agreed upon in the written agreement under RCW 39.102.080(1), or both, and dedicated to local infrastructure financing.
     (8) "Local excise tax increment" means an amount equal to the estimated annual increase in local excise taxes in each calendar year following the approval of the revenue development area by the board from taxable activity within the revenue development area, as set forth in the application provided to the board under RCW 39.102.040, and updated in accordance with RCW 39.102.140(1)(f).
     (9) "Local excise taxes" means local revenues derived from the imposition of sales and use taxes authorized in RCW 82.14.030.
     (10) "Local government" means any city, town, county, port district, and any federally recognized Indian tribe.
     (11) "Local infrastructure financing" means the use of revenues received from local excise tax allocation revenues, local property tax allocation revenues, other revenues from local public sources, and revenues received from the local option sales and use tax authorized in RCW 82.14.475, dedicated to pay either the principal and interest on bonds authorized under RCW 39.102.150 or to pay public improvement costs on a pay-as-you-go basis subject to RCW 39.102.195, or both.
     (12) "Local property tax allocation revenue" means those tax revenues derived from the receipt of regular property taxes levied on the property tax allocation revenue value and used for local infrastructure financing.
     (13) "Low-income housing" means residential housing for low-income persons or families who lack the means which is necessary to enable them, without financial assistance, to live in decent, safe, and sanitary dwellings, without overcrowding. For the purposes of this subsection, "low income" means income that does not exceed eighty percent of the median family income for the standard metropolitan statistical area in which the revenue development area is located.
     (14) "Ordinance" means any appropriate method of taking legislative action by a local government.
     (15) "Participating local government" means a local government having a revenue development area within its geographic boundaries that has entered into a written agreement with a sponsoring local government as provided in RCW 39.102.080 to allow the use of all or some of its local excise tax allocation revenues or other revenues from local public sources dedicated for local infrastructure financing.
     (16) "Participating taxing district" means a local government having a revenue development area within its geographic boundaries that has entered into a written agreement with a sponsoring local government as provided in RCW 39.102.080 to allow the use of some or all of its local property tax allocation revenues or other revenues from local public sources dedicated for local infrastructure financing.
     (17) "Property tax allocation revenue base value" means the assessed value of real property located within a revenue development area less the property tax allocation revenue value.
     (18)(a)(i) "Property tax allocation revenue value" means seventy-five percent of any increase in the assessed value of real property in a revenue development area resulting from:
     (A) The placement of new construction, improvements to property, or both, on the assessment roll, where the new construction and improvements are initiated after the revenue development area is approved by the board;
     (B) The cost of new housing construction, conversion, and rehabilitation improvements, when such cost is treated as new construction for purposes of chapter 84.55 RCW as provided in RCW 84.14.020, and the new housing construction, conversion, and rehabilitation improvements are initiated after the revenue development area is approved by the board;
     (C) The cost of rehabilitation of historic property, when such cost is treated as new construction for purposes of chapter 84.55 RCW as provided in RCW 84.26.070, and the rehabilitation is initiated after the revenue development area is approved by the board.
     (ii) Increases in the assessed value of real property in a revenue development area resulting from (a)(i)(A) through (C) of this subsection are included in the property tax allocation revenue value in the initial year. These same amounts are also included in the property tax allocation revenue value in subsequent years unless the property becomes exempt from property taxation.
     (b) "Property tax allocation revenue value" includes seventy-five percent of any increase in the assessed value of new construction consisting of an entire building in the years following the initial year, unless the building becomes exempt from property taxation.
     (c) Except as provided in (b) of this subsection, "property tax allocation revenue value" does not include any increase in the assessed value of real property after the initial year.
     (d) There is no property tax allocation revenue value if the assessed value of real property in a revenue development area has not increased as a result of any of the reasons specified in (a)(i)(A) through (C) of this subsection.
     (e) For purposes of this subsection, "initial year" means:
     (i) For new construction and improvements to property added to the assessment roll, the year during which the new construction and improvements are initially placed on the assessment roll;
     (ii) For the cost of new housing construction, conversion, and rehabilitation improvements, when such cost is treated as new construction for purposes of chapter 84.55 RCW, the year when such cost is treated as new construction for purposes of levying taxes for collection in the following year; and
     (iii) For the cost of rehabilitation of historic property, when such cost is treated as new construction for purposes of chapter 84.55 RCW, the year when such cost is treated as new construction for purposes of levying taxes for collection in the following year.
     (19) "Public improvement costs" means the cost of: (a) Design, planning, acquisition including land acquisition, site preparation including land clearing, construction, reconstruction, rehabilitation, improvement, and installation of public improvements; (b) demolishing, relocating, maintaining, and operating property pending construction of public improvements; (c) the local government's portion of relocating utilities as a result of public improvements; (d) financing public improvements, including interest during construction, legal and other professional services, taxes, insurance, principal and interest costs on general indebtedness issued to finance public improvements, and any necessary reserves for general indebtedness; (e) assessments incurred in revaluing real property for the purpose of determining the property tax allocation revenue base value that are in excess of costs incurred by the assessor in accordance with the revaluation plan under chapter 84.41 RCW, and the costs of apportioning the taxes and complying with this chapter and other applicable law; (f) administrative expenses and feasibility studies reasonably necessary and related to these costs; and (g) any of the above-described costs that may have been incurred before adoption of the ordinance authorizing the public improvements and the use of local infrastructure financing to fund the costs of the public improvements.
     (20) "Public improvements" means:
     (a) Infrastructure improvements within the revenue development area that include:
     (i) Street, bridge, and road construction and maintenance, including highway interchange construction;
     (ii) Water and sewer system construction and improvements, including wastewater reuse facilities;
     (iii) Sidewalks, traffic controls, and streetlights;
     (iv) Parking, terminal, and dock facilities;
     (v) Park and ride facilities of a transit authority;
     (vi) Park facilities and recreational areas, including trails; and
     (vii) Storm water and drainage management systems;
     (b) Expenditures for facilities and improvements that support affordable housing as defined in ((RCW 43.63A.510)) section 2 of this act.
     (21) "Real property" has the same meaning as in RCW 84.04.090 and also includes any privately owned improvements located on publicly owned land that are subject to property taxation.
     (22) "Regular property taxes" means regular property taxes as defined in RCW 84.04.140, except: (a) Regular property taxes levied by public utility districts specifically for the purpose of making required payments of principal and interest on general indebtedness; (b) regular property taxes levied by the state for the support of the common schools under RCW 84.52.065; and (c) regular property taxes authorized by RCW 84.55.050 that are limited to a specific purpose. "Regular property taxes" do not include excess property tax levies that are exempt from the aggregate limits for junior and senior taxing districts as provided in RCW 84.52.043.
     (23) "Relocating a business" means the closing of a business and the reopening of that business, or the opening of a new business that engages in the same activities as the previous business, in a different location within a one-year period, when an individual or entity has an ownership interest in the business at the time of closure and at the time of opening or reopening. "Relocating a business" does not include the closing and reopening of a business in a new location where the business has been acquired and is under entirely new ownership at the new location, or the closing and reopening of a business in a new location as a result of the exercise of the power of eminent domain.
     (24) "Revenue development area" means the geographic area adopted by a sponsoring local government and approved by the board, from which local excise and property tax allocation revenues are derived for local infrastructure financing.
     (25)(a) "Revenues from local public sources" means:
     (i) Amounts of local excise tax allocation revenues and local property tax allocation revenues, dedicated by sponsoring local governments, participating local governments, and participating taxing districts, for local infrastructure financing; and
     (ii) Any other local revenues, except as provided in (b) of this subsection, including revenues derived from federal and private sources.
     (b) Revenues from local public sources do not include any local funds derived from state grants, state loans, or any other state moneys including any local sales and use taxes credited against the state sales and use taxes imposed under chapter 82.08 or 82.12 RCW.
     (26) "Small business" has the same meaning as provided in RCW 19.85.020.
     (27) "Sponsoring local government" means a city, town, or county, and for the purpose of this chapter a federally recognized Indian tribe or any combination thereof, that adopts a revenue development area and applies to the board to use local infrastructure financing.
     (28) "State contribution" means the lesser of:
     (a) One million dollars;
     (b) The total amount of local excise tax allocation revenues, local property tax allocation revenues, and other revenues from local public sources, that are dedicated by a sponsoring local government, any participating local governments, and participating taxing districts, in the preceding calendar year to the payment of principal and interest on bonds issued under RCW 39.102.150 or to pay public improvement costs on a pay-as-you-go basis subject to RCW 39.102.195, or both;
     (c) The amount of project award granted by the board in the notice of approval to use local infrastructure financing under RCW 39.102.040; or
     (d) The highest amount of state excise tax allocation revenues and state property tax allocation revenues for any one calendar year as determined by the sponsoring local government and reported to the board and the department as required by RCW 39.102.140.
     (29) "State excise tax allocation revenue" means an amount equal to the annual increase in state excise taxes estimated to be received by the state in each calendar year following the approval of the revenue development area by the board, from taxable activity within the revenue development area as set forth in the application provided to the board under RCW 39.102.040 and periodically updated and reported as required in RCW 39.102.140(1)(f).
     (30) "State excise taxes" means revenues derived from state retail sales and use taxes under RCW 82.08.020(1) and 82.12.020 at the rate provided in RCW 82.08.020(1), less the amount of tax distributions from all local retail sales and use taxes, other than the local sales and use taxes authorized by RCW 82.14.475 for the applicable revenue development area, imposed on the same taxable events that are credited against the state retail sales and use taxes under chapters 82.08 and 82.12 RCW.
     (31) "State property tax allocation revenue" means an amount equal to the estimated tax revenues derived from the imposition of property taxes levied by the state for the support of common schools under RCW 84.52.065 on the property tax allocation revenue value, as set forth in the application submitted to the board under RCW 39.102.040 and updated annually in the report required under RCW 39.102.140(1)(f).
     (32) "Taxing district" means a government entity that levies or has levied for it regular property taxes upon real property located within a proposed or approved revenue development area.

NEW SECTION.  Sec. 18   The following acts or parts of acts are each repealed:
     (1) RCW 43.19.19201 (Affordable housing -- Inventory of suitable property) and 2011 1st sp.s. c 43 s 218, 1995 c 399 s 64, & 1993 c 461 s 7;
     (2) RCW 43.20A.037 (Affordable housing -- Inventory of suitable housing) and 1995 c 399 s 65 & 1993 c 461 s 8;
     (3) RCW 43.63A.510 (Affordable housing -- Inventory of state-owned land) and 1993 c 461 s 2 & 1990 c 253 s 6;
     (4) RCW 47.12.064 (Affordable housing -- Inventory of suitable property) and 1995 c 399 s 121 & 1993 c 461 s 10; and
     (5) RCW 72.09.055 (Affordable housing--Inventory of suitable property) and 1995 c 399 s 202 & 1993 c 461 s 12.

NEW SECTION.  Sec. 19   Sections 1 and 2 of this act constitute a new chapter in Title 39 RCW.