HOUSE BILL REPORT

HB 3036

BYRepresentatives Haugen, Wang and Holland

Enlarging the scope of use of revenues from the additional tax on real estate.

AS PASSED HOUSE MARCH 28, 1990

BACKGROUND:

Cities, towns, and counties are authorized to impose one- quarter of one percent real estate excise tax for purposes of funding capital improvements.  The tax is not subject to voter approval or referendum.

In addition, cities, towns, and counties are authorized to impose one-half of one percent real estate excise tax only if the jurisdiction is not imposing the local option one-half of one percent sales tax.  This one-half of one percent real estate excise tax is subject to referendum.

For 1989, a one-quarter of one percent real estate excise tax imposed by all cities, towns, and counties would generate approximately $41.5 million on a calendar year basis.  For 1989, one-half of one percent real estate excise tax imposed by all cities, towns, and counties would generate approximately $83 million on a calendar year basis.

Of a total of 39 counties, 27 impose the one-quarter of one percent rate and no counties impose the one-half percent rate.  Of a total of 268 cities and towns, 200 are imposing the one-quarter of one percent rate and no cities or towns impose the one-half of one percent rate.

Substitute Senate Bill 6639 authorizes all counties to impose a real estate excise tax of up to 1 percent, subject to voter approval.  The tax is authorized to be imposed by any county on a countywide basis.  The revenues from the tax shall be used for acquiring and maintaining conservation lands. Counties must consult with cities to approve an expenditure plan for the use of the revenues.

Revenues from a maximum 1 percent tax would generate approximately $166 million on a calendar year basis.

SUMMARY:

The 1 percent real estate excise tax authorized in Substitute Senate Bill 6639 for counties to impose on a countywide basis to acquire conservation lands is reduced to three-quarters of one percent.

The three quarters of one percent tax may be imposed by all cities, towns, and counties within the individual boundaries of the respective jurisdictions.  Revenues from the tax may be used for criminal justice activities, impacts associated with growth infrastructure, or conservation lands acquisition and maintenance.

The voter approval requirement adds duration of time in addition to purpose and rate as ballot requirements.  Counties and cities are not required to consult on expenditures because the incidence of the tax is changed from countywide to individual jurisdiction boundaries.