HOUSE BILL 1163
State of Washington | 68th Legislature | 2023 Regular Session |
ByRepresentative Fey
Prefiled 01/06/23.Read first time 01/09/23.Referred to Committee on Finance.
AN ACT Relating to exempting certain leasehold interests in arenas with a seating capacity of more than 2,000 from the leasehold excise tax; amending RCW
82.29A.130 and
82.29A.130; creating a new section; providing effective dates; and providing an expiration date.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec. 1. RCW
82.29A.130 and 2022 c 147 s 1 are each amended to read as follows:
The following leasehold interests are exempt from taxes imposed pursuant to RCW
82.29A.030 and
82.29A.040:
(1) All leasehold interests constituting a part of the operating properties of any public utility that is assessed and taxed as a public utility pursuant to chapter
84.12 RCW.
(2) All leasehold interests in facilities owned or used by a school, college or university which leasehold provides housing for students and which is otherwise exempt from taxation under provisions of RCW
84.36.010 and
84.36.050.
(3) All leasehold interests of subsidized housing where the fee ownership of such property is vested in the government of the United States, or the state of Washington or any political subdivision thereof but only if income qualification exists for such housing.
(4) All leasehold interests used for fair purposes of a nonprofit fair association that sponsors or conducts a fair or fairs which receive support from revenues collected pursuant to RCW
67.16.100 and allocated by the director of the department of agriculture where the fee ownership of such property is vested in the government of the United States, the state of Washington or any of its political subdivisions. However, this exemption does not apply to the leasehold interest of any sublessee of such nonprofit fair association if such leasehold interest would be taxable if it were the primary lease.
(5) All leasehold interests in any property of any public entity used as a residence by an employee of that public entity who is required as a condition of employment to live in the publicly owned property.
(6) All leasehold interests held by enrolled Indians of lands owned or held by any Indian or Indian tribe where the fee ownership of such property is vested in or held in trust by the United States and which are not subleased to other than to a lessee which would qualify pursuant to this chapter, RCW
84.36.451 and
84.40.175.
(7) All leasehold interests in any real property of any Indian or Indian tribe, band, or community that is held in trust by the United States or is subject to a restriction against alienation imposed by the United States. However, this exemption applies only where it is determined that contract rent paid is greater than or equal to ((
ninety))
90 percent of fair market rental, to be determined by the department of revenue using the same criteria used to establish taxable rent in RCW
82.29A.020(2)(g).
(8) All leasehold interests for which annual taxable rent is less than ((two hundred fifty dollars))$250 per year. For purposes of this subsection leasehold interests held by the same lessee in contiguous properties owned by the same lessor are deemed a single leasehold interest.
(9) All leasehold interests which give use or possession of the leased property for a continuous period of less than ((thirty))30 days: PROVIDED, That for purposes of this subsection, successive leases or lease renewals giving substantially continuous use of possession of the same property to the same lessee are deemed a single leasehold interest: PROVIDED FURTHER, That no leasehold interest is deemed to give use or possession for a period of less than ((thirty))30 days solely by virtue of the reservation by the public lessor of the right to use the property or to allow third parties to use the property on an occasional, temporary basis.
(10) All leasehold interests under month-to-month leases in residential units rented for residential purposes of the lessee pending destruction or removal for the purpose of constructing a public highway or building.
(11) All leasehold interests in any publicly owned real or personal property to the extent such leasehold interests arises solely by virtue of a contract for public improvements or work executed under the public works statutes of this state or of the United States between the public owner of the property and a contractor.
(12) All leasehold interests that give use or possession of state adult correctional facilities for the purposes of operating correctional industries under RCW
72.09.100.
(13) All leasehold interests used to provide organized and supervised recreational activities for persons with disabilities of all ages in a camp facility and for public recreational purposes by a nonprofit organization, association, or corporation that would be exempt from property tax under RCW
84.36.030(1) if it owned the property. If the publicly owned property is used for any taxable purpose, the leasehold excise taxes set forth in RCW
82.29A.030 and
82.29A.040 must be imposed and must be apportioned accordingly.
(14) All leasehold interests in the public or entertainment areas of a baseball stadium with natural turf and a retractable roof or canopy that is in a county with a population of over ((one million))1,000,000, that has a seating capacity of over ((forty thousand))40,000, and that is constructed on or after January 1, 1995. "Public or entertainment areas" include ticket sales areas, ramps and stairs, lobbies and concourses, parking areas, concession areas, restaurants, hospitality and stadium club areas, kitchens or other work areas primarily servicing other public or entertainment areas, public rest room areas, press and media areas, control booths, broadcast and production areas, retail sales areas, museum and exhibit areas, scoreboards or other public displays, storage areas, loading, staging, and servicing areas, seating areas and suites, the playing field, and any other areas to which the public has access or which are used for the production of the entertainment event or other public usage, and any other personal property used for these purposes. "Public or entertainment areas" does not include locker rooms or private offices exclusively used by the lessee.
(15) All leasehold interests in the public or entertainment areas of a stadium and exhibition center, as defined in RCW
36.102.010, that is constructed on or after January 1, 1998. For the purposes of this subsection, "public or entertainment areas" has the same meaning as in subsection (14) of this section, and includes exhibition areas.
(16) All leasehold interests in public facilities districts, as provided in chapter
36.100 or
35.57 RCW.
(17) All leasehold interests in property that is: (a) Owned by the United States government or a municipal corporation; (b) listed on any federal or state register of historical sites; and (c) wholly contained within a designated national historic reserve under 16 U.S.C. Sec. 461.
(18) All leasehold interests in the public or entertainment areas of an amphitheater if a private entity is responsible for ((one hundred))100 percent of the cost of constructing the amphitheater which is not reimbursed by the public owner, both the public owner and the private lessee sponsor events at the facility on a regular basis, the lessee is responsible under the lease or agreement to operate and maintain the facility, and the amphitheater has a seating capacity of over ((seventeen thousand))17,000 reserved and general admission seats and is in a county that had a population of over ((three hundred fifty thousand))350,000, but less than ((four hundred twenty-five thousand))425,000 when the amphitheater first opened to the public.
For the purposes of this subsection, "public or entertainment areas" include box offices or other ticket sales areas, entrance gates, ramps and stairs, lobbies and concourses, parking areas, concession areas, restaurants, hospitality areas, kitchens or other work areas primarily servicing other public or entertainment areas, public rest room areas, press and media areas, control booths, broadcast and production areas, retail sales areas, museum and exhibit areas, scoreboards or other public displays, storage areas, loading, staging, and servicing areas, seating areas including lawn seating areas and suites, stages, and any other areas to which the public has access or which are used for the production of the entertainment event or other public usage, and any other personal property used for these purposes. "Public or entertainment areas" does not include office areas used predominately by the lessee.
(19) All leasehold interests in real property used for the placement of military housing meeting the requirements of RCW
84.36.665.
(20) All leasehold interests in facilities owned or used by a community college or technical college, which leasehold interest provides:
(a) Food services for students, faculty, and staff;
(b) The operation of a bookstore on campus; or
(c) Maintenance, operational, or administrative services to the community college or technical college.
(21)(a) All leasehold interests in the public or entertainment areas of an arena if it:
(i) Has a seating capacity of more than ((two thousand))2,000;
(ii) Is located on city-owned land; and
(iii) Is owned by a city with a population over ((two hundred thousand))200,000 within a county with a population of less than ((one million five hundred thousand))1,500,000.
(b) For the purposes of this subsection (21), "public or entertainment areas" has the same meaning as provided in subsection (18) of this section.
(22) All leasehold interests in facilities owned by the state parks and recreation commission that are listed on the national register of historic places or the Washington heritage register.
(23)(a) All leasehold interests in the public or entertainment areas of an arena if:
(i) The arena has a seating capacity of more than 4,000;
(ii) The arena is located on city-owned land;
(iii) The arena is located within a city with a population over 100,000; and
(iv) Private entities were responsible for 100 percent of the cost of constructing improvements to the arena, which were not reimbursed by the public owner.
(b) For the purposes of this subsection (23), "public or entertainment areas" has the same meaning as provided in subsection (18) of this section; except that it also includes office areas used predominately by the lessee.
(c) A taxpayer claiming an exemption under this subsection (23) must file a tax performance report as provided in RCW 82.32.534. (d) This subsection (23) does not apply to leasehold interests arising on or after October 1, 2033.
Sec. 2. RCW
82.29A.130 and 2019 c 335 s 1 are each amended to read as follows:
The following leasehold interests are exempt from taxes imposed pursuant to RCW
82.29A.030 and
82.29A.040:
(1) All leasehold interests constituting a part of the operating properties of any public utility that is assessed and taxed as a public utility pursuant to chapter
84.12 RCW.
(2) All leasehold interests in facilities owned or used by a school, college or university which leasehold provides housing for students and which is otherwise exempt from taxation under provisions of RCW
84.36.010 and
84.36.050.
(3) All leasehold interests of subsidized housing where the fee ownership of such property is vested in the government of the United States, or the state of Washington or any political subdivision thereof but only if income qualification exists for such housing.
(4) All leasehold interests used for fair purposes of a nonprofit fair association that sponsors or conducts a fair or fairs which receive support from revenues collected pursuant to RCW
67.16.100 and allocated by the director of the department of agriculture where the fee ownership of such property is vested in the government of the United States, the state of Washington or any of its political subdivisions. However, this exemption does not apply to the leasehold interest of any sublessee of such nonprofit fair association if such leasehold interest would be taxable if it were the primary lease.
(5) All leasehold interests in any property of any public entity used as a residence by an employee of that public entity who is required as a condition of employment to live in the publicly owned property.
(6) All leasehold interests held by enrolled Indians of lands owned or held by any Indian or Indian tribe where the fee ownership of such property is vested in or held in trust by the United States and which are not subleased to other than to a lessee which would qualify pursuant to this chapter, RCW
84.36.451 and
84.40.175.
(7) All leasehold interests in any real property of any Indian or Indian tribe, band, or community that is held in trust by the United States or is subject to a restriction against alienation imposed by the United States. However, this exemption applies only where it is determined that contract rent paid is greater than or equal to ((
ninety))
90 percent of fair market rental, to be determined by the department of revenue using the same criteria used to establish taxable rent in RCW
82.29A.020(2)(g).
(8) All leasehold interests for which annual taxable rent is less than ((two hundred fifty dollars))$250 per year. For purposes of this subsection leasehold interests held by the same lessee in contiguous properties owned by the same lessor are deemed a single leasehold interest.
(9) All leasehold interests which give use or possession of the leased property for a continuous period of less than ((thirty))30 days: PROVIDED, That for purposes of this subsection, successive leases or lease renewals giving substantially continuous use of possession of the same property to the same lessee are deemed a single leasehold interest: PROVIDED FURTHER, That no leasehold interest is deemed to give use or possession for a period of less than ((thirty))30 days solely by virtue of the reservation by the public lessor of the right to use the property or to allow third parties to use the property on an occasional, temporary basis.
(10) All leasehold interests under month-to-month leases in residential units rented for residential purposes of the lessee pending destruction or removal for the purpose of constructing a public highway or building.
(11) All leasehold interests in any publicly owned real or personal property to the extent such leasehold interests arises solely by virtue of a contract for public improvements or work executed under the public works statutes of this state or of the United States between the public owner of the property and a contractor.
(12) All leasehold interests that give use or possession of state adult correctional facilities for the purposes of operating correctional industries under RCW
72.09.100.
(13) All leasehold interests used to provide organized and supervised recreational activities for persons with disabilities of all ages in a camp facility and for public recreational purposes by a nonprofit organization, association, or corporation that would be exempt from property tax under RCW
84.36.030(1) if it owned the property. If the publicly owned property is used for any taxable purpose, the leasehold excise taxes set forth in RCW
82.29A.030 and
82.29A.040 must be imposed and must be apportioned accordingly.
(14) All leasehold interests in the public or entertainment areas of a baseball stadium with natural turf and a retractable roof or canopy that is in a county with a population of over ((one million))1,000,000, that has a seating capacity of over ((forty thousand))40,000, and that is constructed on or after January 1, 1995. "Public or entertainment areas" include ticket sales areas, ramps and stairs, lobbies and concourses, parking areas, concession areas, restaurants, hospitality and stadium club areas, kitchens or other work areas primarily servicing other public or entertainment areas, public rest room areas, press and media areas, control booths, broadcast and production areas, retail sales areas, museum and exhibit areas, scoreboards or other public displays, storage areas, loading, staging, and servicing areas, seating areas and suites, the playing field, and any other areas to which the public has access or which are used for the production of the entertainment event or other public usage, and any other personal property used for these purposes. "Public or entertainment areas" does not include locker rooms or private offices exclusively used by the lessee.
(15) All leasehold interests in the public or entertainment areas of a stadium and exhibition center, as defined in RCW
36.102.010, that is constructed on or after January 1, 1998. For the purposes of this subsection, "public or entertainment areas" has the same meaning as in subsection (14) of this section, and includes exhibition areas.
(16) All leasehold interests in public facilities districts, as provided in chapter
36.100 or
35.57 RCW.
(17) All leasehold interests in property that is: (a) Owned by the United States government or a municipal corporation; (b) listed on any federal or state register of historical sites; and (c) wholly contained within a designated national historic reserve under 16 U.S.C. Sec. 461.
(18) All leasehold interests in the public or entertainment areas of an amphitheater if a private entity is responsible for ((one hundred))100 percent of the cost of constructing the amphitheater which is not reimbursed by the public owner, both the public owner and the private lessee sponsor events at the facility on a regular basis, the lessee is responsible under the lease or agreement to operate and maintain the facility, and the amphitheater has a seating capacity of over ((seventeen thousand))17,000 reserved and general admission seats and is in a county that had a population of over ((three hundred fifty thousand))350,000, but less than ((four hundred twenty-five thousand))425,000 when the amphitheater first opened to the public.
For the purposes of this subsection, "public or entertainment areas" include box offices or other ticket sales areas, entrance gates, ramps and stairs, lobbies and concourses, parking areas, concession areas, restaurants, hospitality areas, kitchens or other work areas primarily servicing other public or entertainment areas, public rest room areas, press and media areas, control booths, broadcast and production areas, retail sales areas, museum and exhibit areas, scoreboards or other public displays, storage areas, loading, staging, and servicing areas, seating areas including lawn seating areas and suites, stages, and any other areas to which the public has access or which are used for the production of the entertainment event or other public usage, and any other personal property used for these purposes. "Public or entertainment areas" does not include office areas used predominately by the lessee.
(19) All leasehold interests in real property used for the placement of military housing meeting the requirements of RCW
84.36.665.
(20) All leasehold interests in facilities owned or used by a community college or technical college, which leasehold interest provides:
(a) Food services for students, faculty, and staff;
(b) The operation of a bookstore on campus; or
(c) Maintenance, operational, or administrative services to the community college or technical college.
(21)(a) All leasehold interests in the public or entertainment areas of an arena if it:
(i) Has a seating capacity of more than ((two thousand))2,000;
(ii) Is located on city-owned land; and
(iii) Is owned by a city with a population over ((two hundred thousand))200,000 within a county with a population of less than ((one million five hundred thousand))1,500,000.
(b) For the purposes of this subsection (21), "public or entertainment areas" has the same meaning as provided in subsection (18) of this section.
(22)(a) All leasehold interests in the public or entertainment areas of an arena if:
(i) The arena has a seating capacity of more than 4,000;
(ii) The arena is located on city-owned land;
(iii) The arena is located within a city with a population over 100,000; and
(iv) Private entities were responsible for 100 percent of the cost of constructing improvements to the arena, which were not reimbursed by the public owner.
(b) For the purposes of this subsection (22), "public or entertainment areas" has the same meaning as provided in subsection (18) of this section; except that it also includes office areas used predominately by the lessee.
(c) A taxpayer claiming an exemption under this subsection (22) must file a tax performance report as provided in RCW 82.32.534. (d) This subsection (22) does not apply to leasehold interests arising on or after October 1, 2033.
NEW SECTION. Sec. 4. Section 1 of this act takes effect October 1, 2023.
NEW SECTION. Sec. 5. Section 1 of this act expires January 1, 2034.
NEW SECTION. Sec. 6. Section 2 of this act takes effect January 1, 2034.
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