SENATE BILL REPORT

SJR 8212

BYSenators Lee, Williams and Fleming

Amending the Constitution to allow property devoted to low-income housing to be taxed based on its current use value.

Senate Committee on Economic Development & Labor

Senate Hearing Date(s):January 24, 1990; January 29, 1990

Majority Report:     That Substitute Senate Joint Resolution No. 8212 be substituted therefor, and the substitute joint resolution do pass.

     Signed by Senators Lee, Chairman; Anderson, Vice Chairman; Murray, Smitherman, Warnke, Williams.

Senate Staff:Dave Cheal (786-7576)

                February 2, 1990

Senate Committee on Ways & Means

Senate Hearing Date(s):February 5, 1990; February 6, 1990

Majority Report:     That Second Substitute Senate Joint Resolution No. 8212 be substituted therefor, and the second substitute joint resolution do pass.

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

Senate Staff:Terry Wilson (786-7715)

                February 7, 1990

AS REPORTED BY COMMITTEE ON WAYS & MEANS, FEBRUARY 6,  1990

BACKGROUND:

Under the state Constitution, real property must be taxed according to the valuation of its highest and best use.  Exceptions to this rule are listed in Article VII, Section 11 and include farm and agricultural land, standing timber and timberlands, and open space lands. 

Taxing residential real estate at highest and best use, particularly innercity multi-family housing, encourages owners to redevelop their property to secure the highest possible revenue in order to cover the tax burden.  This rule discourages owners of low-income housing from maintaining their property for that use.

SUMMARY:

Property devoted primarily to low-income housing, containing five or more low-income dwelling units, and that complies with health and safety standards is added to the list of properties in Article VII, Section 11 of the state Constitution that may be assessed at an amount based on their current use.

EFFECT OF PROPOSED SUBSTITUTE:

Historic properties are added to the list of properties that can be valued at current use.

EFFECT OF PROPOSED SECOND SUBSTITUTE:

The property must be totally devoted to low-income housing.  Historic properties are removed from the list of properties that can be valued at current use.

Appropriation:  none

Revenue:   none

Fiscal Note:    available

Senate Committee - Testified:   ECONOMIC DEVELOPMENT & LABOR:  Mike Ryherd (pro); Karen Gordon (pro)

Senate Committee - Testified:   WAYS & MEANS:  Mike Ryherd (pro)