SENATE BILL REPORT

SB 6243

BYSenators Warnke, Smitherman and Rasmussen

Clarifying the tax exemption for property owned by veterans' organizations.

Senate Committee on Ways & Means

Senate Hearing Date(s):January 30, 1990; February 1, 1990

Majority Report:  That Substitute Senate Bill No. 6243 be substituted therefor, and the substitute bill do pass.

      Signed by Senators McDonald, Chairman; Craswell, Vice Chairman; Amondson, Bailey, Bauer, Bluechel, Cantu, Fleming, Gaspard, Hayner, Johnson, Lee, Matson, Moore, Newhouse, Niemi, Owen, Saling, Smith, Talmadge, Warnke, Williams, Wojahn.

Senate Staff:Terry Wilson (786-7715)

                  February 2, 1990

AS REPORTED BY COMMITTEE ON WAYS & MEANS, FEBRUARY 1, 1990

BACKGROUND:

Property of nationally chartered veterans organizations, recognized by the United States Department of Defense, are exempt from property tax.  The property must be used for the purposes and objects of the organization.

The loan or rental of the property does not subject the property to tax if (1) the amounts received for the use are reasonable and do not exceed the maintenance and operation expenses attributable to the portion loaned or rented, and (2) the property would be exempt from tax if owned by the organization to which it is loaned or rented.

SUMMARY:

The original bill was not considered.

EFFECT OF PROPOSED SUBSTITUTE:

The requirement that the organization to which the property is loaned or rented be eligible for tax-exempt status is removed for veterans organizations, but the use of the property for pecuniary gain is prohibited except for fund-raising activities by nonprofit organizations.

Appropriation:    none

Revenue:    none

Fiscal Note:      available

Senate Committee - Testified: No one