[atlas:bill]

AN ACT Relating to exemption of property taxes for federally assisted housing; adding a new section to chapter 84.36 RCW; and creating a new section.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. A new section is added to chapter 84.36 RCW to read as follows:

(1) The real and personal property owned by a for-profit organization, association, or corporation in providing rental housing that is occupied by very low-income households is exempt from taxation if:

(a) The rental housing is considered federally assisted housing under RCW 59.28.020;

(b) The federally assisted housing is subject to a rental subsidy contract or use restrictions that will expire within two years of application for the exemption under this section;

(c) The owner or owners of the federally assisted housing agrees to renew the rental subsidy contract or extend the use restrictions for the term of the exemption under this section;

(d) The owner or owners is in compliance with all federal or state regulatory agreements regarding the use of the property;

(e) The owner or owners enters into a contractual agreement with the United States department of housing and urban development to not reduce the subsidy level to the federally assisted housing; and

(f) The owner or owners commit to give the right of first refusal to purchase the property to a nonprofit organization, association, or corporation that will maintain the housing for very low-income households.

(2) If less than seventy-five percent of the dwelling units are occupied by very low-income households, the federally assisted housing is eligible for a partial exemption on the real property and a total exemption of the federally assisted housing's personal property as follows:

(a) The partial exemption shall be allowed for each dwelling unit in the federally assisted housing that is occupied by very low-income households.

(b) The amount of the exemption shall be calculated by multiplying the assessed value of the property reasonably necessary to provide the rental housing by a fraction. The numerator of the fraction is the number of dwelling units occupied by very low-income households as of January 1st of the year for which the exemption is claimed. The denominator of the fraction is the total number of occupied dwelling units as of January 1st of the year for which the exemption is claimed.

(3) To be exempt under this section, the property must be used exclusively for the purposes for which exemption is granted, except as provided in RCW 84.36.805.

(4) The for-profit organization, association, or corporation qualifying for the exemption under this section by providing rental housing for very low-income households may agree to make payments to the city, county, or other political subdivision for improvements, services, and facilities furnished by the city, county, or political subdivision for the benefit of the rental housing. However, these payments shall not exceed the amount last levied as the annual tax of the city, county, or political subdivision upon the property prior to exemption.

(5) As used in this section:

(a) "Federally assisted housing" has the same meaning as in RCW 59.28.020;

(b) "Occupied dwelling unit" means a living unit that is occupied on January 1st of the year in which the claim for exemption is submitted;

(d) "Very low-income households" means a single person, family, or unrelated persons living together whose income is at or below fifty percent of the median income adjusted for family size as most recently determined by the federal department of housing and urban development for the county in which the rental housing is located and in effect as of January 1st of the year the application for exemption is submitted.

NEW SECTION. Sec. 2. This act applies to taxes levied in 1999 for collection in 2000 and thereafter.