HOUSE BILL REPORT

HB 1275

BYRepresentatives Haugen, Winsley, Appelwick, Ferguson, Cooper and Wang

Changing provisions relating to property taxes.

House Committe on Revenue

Majority Report:  Do pass with amendment. (17)

      Signed by Representatives Wang, Chair; Pruitt, Vice Chair; Holland, Ranking Republican Member; Horn, Assistant Ranking Republican Member; Appelwick, Basich, Brumsickle, Fraser, Fuhrman, Grant, Haugen, Morris, Phillips, Rust, Silver, H. Sommers and Van Luven.

House Staff:Rick Wickman and Bob Longman (786-7136)

AS REPORTED BY COMMITTEE ON REVENUE MARCH 1, 1989

BACKGROUND:

Taxing districts, other than school districts, may impose excess or special levies for general purposes for a one-year period if authorized by the voters of the district.  School districts may impose excess or special levies, if authorized by the voters as follows: 1) for one or two years for any purpose; and 2) for up to a six-year period for the purposes of construction, modernization, or remodeling school facilities.

Districts seeking voter approval of such propositions are subject to the 60 percent/40 percent voter approval requirement (60 percent favorable vote of at least 40 percent of those voting in the last general election).  In seeking voter approval, taxing districts must describe levies in terms of a dollar amount for ballot purposes.  In cases of general obligation indebtedness levies, it is often impossible for a district to know precisely the actual dollar amount required until the bonds are sold and the interest rate or rates, terms, and bond retirement provisions are evident.

Some taxing district levies are unique.  For example, emergency medical service districts (EMS) levies are authorized for six years up to $.25 per $1,000 of assessed valuation with a 60 percent/40 percent voter approval requirement.  Park and Recreation Districts, Park and Recreation Service areas, Cultural Arts, Stadium, and Convention Center Districts possess levy authority of up to $.15 per $1,000 of assessed value by a 60 percent/40 percent vote of the people for up to either a five or six-year period.

The state does not possess authority to impose single year excess levies under existing constitutional provisions.  Additionally, the constitution limits excess levies.

SUMMARY:

BILL AS AMENDED:  Taxing districts may impose excess or special levies for general purposes that are not associated with voter-approved general indebtedness over a period of up to six consecutive years.  The state may levy excess property taxes for up to six consecutive years if authorized by the voters.

Ballot propositions authorizing excess levies may state a maximum levy rate, instead of a dollar amount and an estimate of a levy rate.  Where more than one year is involved, the ballot proposition must provide a maximum levy rate for each year, or a maximum levy in dollars for each year and an estimate of the levy rate for each year.

A ballot proposition authorizing tax levies to retire voter- approved general obligation (G.O.) bonds may state that authorization is being sought for excess levies sufficient to retire the bonds, rather than stating a maximum dollar amount.

The authority of three taxing districts (park and recreation districts, park and recreation services areas, and cultural arts, stadium, and convention center districts) to impose voter- approved regular property taxes is deleted, because these requirements are the same as for excess levies as proposed in the legislation. 

The authority of various taxing districts to impose voter approved regular property taxes for emergency services (EMS) is deleted, because existing requirements are the same as for excess levies as proposed in the legislation.

The proposed legislation is contingent upon a proposed constitutional amendment being approved by the voters in November, 1989.

Emergency medical service levies, approved by the voters of the district, may continue to be levied for the period of time so authorized, however, these levies are still subject to pro- rationing in the event that the statutory maximum is exceeded.

AMENDED BILL COMPARED TO ORIGINAL:  The relationship between current EMS levies authorized by the voters and new 6-year levies authorized under the proposed legislation was clarified.

Fiscal Note:      Requested February 15, 1989.

House Committee ‑ Testified For:    Mark Allen, WLA; Mike Lynch, North Central Regional Library; Lon Dickerson, Timberland Regional Library; Carolyn Else, Pierce County Library; Nancy Pearson, Pierce County Library;  Les Eldridge, Thurston County; Jim Metcalf, Washington State Association of Counties; Councilman Brian Corcran, Snohomish County; Val Loveland, Franklin County; Tom Falquist, Spokane County; Chuck Gordon, Pierce County; Karen Davis, Washington Education Association; Pete Spiller, Washington Fire Commissioners; Seth Dawson, WAPA; Howard Vietzke, Firefighters; Pat Berndt, City of Yakima; Dick Zais, City of Yakima; Kent Swisher, Association of Washington Cities; Jack Hebner, City of Spokane; Jim Salatino, Metro Park District; and Bruce Holloway, Grant County Fire District 5.

House Committee - Testified Against:      None Presented.

House Committee - Testimony For:    State and local taxing districts need the authority to levy six-year levies to provide for a stable, predictable revenue source for funding local services and programs.

House Committee - Testimony Against:      None Presented.