SENATE BILL REPORT
SB 5329
As of February 1, 2021
Title: An act relating to the distribution of aircraft fuel tax revenue.
Brief Description: Concerning the distribution of aircraft fuel tax revenue.
Sponsors: Senators Honeyford and Holy.
Brief History:
Committee Activity: Transportation: 2/01/21.
Brief Summary of Bill
  • Changes the distribution of state revenues collected from the sales and use tax for aircraft fuel.
  • Requires reporting of grant funds awarded for airport projects and estimated funds returned to the general fund from sales and business and occupation taxes generated as a result of the funded airport projects.
SENATE COMMITTEE ON TRANSPORTATION
Staff: Daniel Masterson (786-7454)
Background:

Aircraft fuel is gasoline or any other inflammable liquid that is chiefly used as a fuel for the propulsion of aircraft.  An excise tax and a sales and use tax are collected on aircraft fuel used in Washington.
 
An excise tax of $0.11 is levied on distributors for each gallon of aircraft fuel sold, delivered, or used in Washington, with some exceptions.  This excise tax is collected by the Department of Licensing and remitted to the State Treasurer (treasurer) for deposit into the Aeronautics Account.
 
A sales or use tax of 6.5 percent of the selling price of aircraft fuel is collected from purchasers and users of aircraft fuel in Washington.  The sales and use tax is collected by a seller of aircraft fuel.  The seller of aircraft fuel then remits the collected sales and use tax amount to the Department of Revenue (DOR), and DOR remits the moneys to the treasurer for deposit into the state general fund.
Summary of Bill:

The sales and use tax collected from purchasers and users of aircraft fuel in Washington is distributed as follows:

  • between July 1, 2021, and June 30, 2023, an amount equivalent to imposing a 0.5 percent tax must be credited to the aeronautics account;
  • beginning July 1, 2023, an amount equivalent to imposing a 1 percent tax must be credited to the aeronautics account; and
  • the remaining revenues collected from the sales or use tax are deposited into the state general fund.

 

Beginning July 1, 2021, the Aviation Division of the Department of Transportation (division) must track the amount of additional funds awarded for airport projects through the airport aid grant program.  The division must report annually to the Transportation committees of the Legislature for the years 2021 to 2027, and thereafter as needed.  The report must include, but is not limited to:

  • a short description of each airport project funded;
  • the state grant amount from the aeronautics account contributed to each project;
  • the amount of federal matching funds contributed to the project; and
  • the amount of local airport sponsor matching funds contributed to the project.

 

At the end of each fiscal biennium, beginning June 30, 2022, the division must report to the Senate Ways and Means, House Appropriations, and the Transportation committees of the Legislature the estimated amount of funds returned to the general fund giving consideration of sales and business and occupation taxes generated as a result of the funded airport projects.
Appropriation: None.
Fiscal Note: Available.
Creates Committee/Commission/Task Force that includes Legislative members: No.
Effective Date: The bill takes effect on July 1, 2021.