HOUSE BILL REPORT

EHB 2777

BYRepresentatives Haugen, Wang, Zellinsky, Horn, Raiter, Nealey, Cooper, Ferguson, Nelson, Nutley, Wood, Rayburn, Phillips, Baugher, Kremen, May and Todd

Modifying provisions regarding local government tax levies.

House Committe on Revenue

Majority Report:  Do pass.  (16)

      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 and H. Sommers.

Minority Report:  Do not pass. (1)

      Signed by Representative Van Luven.

House Staff:Rick Wickman (786-7150)

AS PASSED HOUSE FEBRUARY 9, 1990

BACKGROUND:

Taxing districts, other than school districts, may impose excess or special levies for a one-year period if authorized by the voters.

Taxing 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 levy approval, taxing districts must describe levies in terms of a dollar amount for ballot purposes.

In cases of general obligation bonded indebtedness levies, it is often impossible for a taxing 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 services levies (up to $.25 per $1,000 of assessed value) for periods of six years are required to be voter approved on a 60 percent/40 percent basis.  Yet, the $.25 is considered a regular levy under the $10.00 or 1 percent constitutional limitation.

Additionally, park and recreation districts, park and recreation services areas, cultural arts, stadium and convention center districts may levy up to $.15 when approved by the voters on a 60 percent/40 percent basis for up to either a five or six year period.

SUMMARY:

Taxing districts, except the state, may impose excess or special levies for general purposes for periods up to six years.

Ballot propositions authorizing excess or special 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 bonds may state that authorization is being sought for excess or special levies sufficient to retire the bonds, rather than stating the maximum dollar amount.

The authority for emergency medical services 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 eliminated, because these requirements are the same as for excess or special levies.

Emergency medical services property tax levies of $.25 per $1,000 of assessed valuation may continue in force during the time they were authorized by voters.

Six year levies for taxing districts are contingent upon approval by the voters of a constitutional amendment in November 1990.

Revenue:    The bill has a revenue impact.

Fiscal Note:      Requested January 22, 1990.

Effective Date:The act shall take effect January 1, 1991, if a proposed amendment to Article VII, Section 2 is approved by the voters.

House Committee ‑ Testified For:    Fred Saeger, WA Association of County Officials;  and Lon Dickerson; Timberland Library.

House Committee - Testified Against:      No one.

House Committee - Testimony For:    The ability to impose up to six year, voter approved property tax levies will reduce the cost of local levy elections, allow taxing districts to request voter approval of levies for periods longer than one year and provide another financing tool for taxing to meet local service demands.

House Committee - Testimony Against:      None.