AN
ACT Relating to exemption of property taxes for assisted housing; reenacting
and amending RCW 84.36.805 and 84.36.810; 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 or used by a nonprofit in providing rental
housing for very low-income households is exempt from taxation if:
(a)
The benefit of the exemption inures to the nonprofit organization, association,
or corporation;
(b)
At least seventy-five percent of the occupied dwelling units in the rental
housing are occupied by very low-income households; and
(c)
The rental housing was insured, financed, or assisted in whole or in part
through:
(i)
A federal or state housing program administered by the department of community,
trade, and economic development; or
(ii)
An affordable housing levy authorized under RCW 84.52.105.
(2)
If less than seventy-five percent of the dwelling units are occupied by very
low-income households, the rental housing used to provide housing for very
low-income households is eligible for a partial exemption on the real property
and a total exemption of the housing's personal property as follows:
(a)
The partial exemption shall be allowed for each dwelling unit in the rental
housing occupied by very low-income households.
(b)
The amount of 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 exemption is
claimed.
(3)
Rental housing for very low-income households is exempt from property taxation
only if the nonprofit operating the housing is exempt from income tax under
section 501(c) of the federal internal revenue code.
(4)
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.
(5)
The nonprofit 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.
(6)
As used in this section:
(a)
"Occupied dwelling unit" means a living unit that is occupied on
January 1st of the year in which the claim for exemption is submitted;
(b)
"Rental housing" means residential housing that is occupied but not
owned by very low-income households;
(c)
"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; and
(d)
"Nonprofit" means a nonprofit as defined in RCW 84.36.800 and
includes a limited partnership where the nonprofit or a public corporation
established under RCW 35.21.660, 35.21.670, and 35.21.730 is a general partner,
or a limited liability company where the nonprofit or the public corporation is
a managing member.
Sec.
2. RCW
84.36.805 and 1998 c 311 s 25, 1998 c 202 s 3, and 1998 c 184 s 2 are each
reenacted and amended to read as follows:
In
order to be exempt pursuant to RCW 84.36.030, 84.36.035, 84.36.037, 84.36.040,
84.36.041, 84.36.043, 84.36.045, 84.36.046, 84.36.047, 84.36.050, 84.36.060,
84.36.350, 84.36.480, 84.36.550, ((and)) 84.36.042, and section 1 of
this act, the nonprofit organizations, associations, or corporations
shall satisfy the following conditions:
(1)
The property is used exclusively for the actual operation of the activity for
which exemption is granted, unless otherwise provided, and does not exceed an
amount reasonably necessary for that purpose, except:
(a)
The loan or rental of the property does not subject the property to tax if:
(i)
The rents and donations received for the use of the portion of the property are
reasonable and do not exceed the maintenance and operation expenses
attributable to the portion of the property loaned or rented; and
(ii)
Except for the exemptions under RCW 84.36.030(4) and 84.36.037, the property
would be exempt from tax if owned by the organization to which it is loaned or
rented;
(b)
The use of the property for fund-raising activities does not subject the
property to tax if the fund-raising activities are consistent with the purposes
for which the exemption is granted;
(2)
The property is irrevocably dedicated to the purpose for which exemption has
been granted, and on the liquidation, dissolution, or abandonment by said
organization, association, or corporation, said property will not inure
directly or indirectly to the benefit of any shareholder or individual, except
a nonprofit organization, association, or corporation which too would be
entitled to property tax exemption. This property need not be irrevocably
dedicated if it is leased or rented to those qualified for exemption pursuant
to RCW 84.36.035, 84.36.040, 84.36.041, 84.36.043, 84.36.045, 84.36.046, ((or))
84.36.042, or section 1 of this act, or those qualified for exemption as
an association engaged in the production or performance of musical, dance,
artistic, dramatic, or literary works pursuant to RCW 84.36.060, but only if
under the terms of the lease or rental agreement the nonprofit organization,
association, or corporation receives the benefit of the exemption;
(3)
The facilities and services are available to all regardless of race, color,
national origin or ancestry;
(4)
The organization, association, or corporation is duly licensed or certified
where such licensing or certification is required by law or regulation;
(5)
Property sold to organizations, associations, or corporations with an option to
be repurchased by the seller shall not qualify for exempt status;
(6)
The director of the department of revenue shall have access to its books in
order to determine whether such organization, association, or corporation is
exempt from taxes within the intent of RCW 84.36.030, 84.36.035, 84.36.037,
84.36.040, 84.36.041, 84.36.043, 84.36.045, 84.36.046, 84.36.047, 84.36.050,
84.36.060, 84.36.350, 84.36.480, ((and)) 84.36.042, and section 1 of
this act.
Sec.
3. RCW
84.36.810 and 1998 c 311 s 26 and 1998 c 202 s 4 are each reenacted and amended
to read as follows:
(1)
Upon cessation of a use under which an exemption has been granted pursuant to
RCW 84.36.030, 84.36.037, 84.36.040, 84.36.041, 84.36.043, 84.36.046,
84.36.050, 84.36.060, 84.36.550, ((and)) 84.36.042, and section 1 of
this act, the county treasurer shall collect all taxes which would have
been paid had the property not been exempt during the three years preceding, or
the life of such exemption, if such be less, together with the interest at the
same rate and computed in the same way as that upon delinquent property taxes.
Where the property has been granted an exemption for more than ten years, taxes
and interest shall not be assessed under this section.
(2)
Subsection (1) of this section applies only when ownership of the property is
transferred or when fifty-one percent or more of the area of the property has
lost its exempt status. The additional tax under subsection (1) of this
section shall not be imposed if the cessation of use resulted solely from:
(a)
Transfer to a nonprofit organization, association, or corporation for a use
which also qualifies and is granted exemption under the provisions of chapter
84.36 RCW;
(b)
A taking through the exercise of the power of eminent domain, or sale or
transfer to an entity having the power of eminent domain in anticipation of the
exercise of such power;
(c)
Official action by an agency of the state of Washington or by the county or
city within which the property is located which disallows the present use of
such property;
(d)
A natural disaster such as a flood, windstorm, earthquake, or other such calamity
rather than by virtue of the act of the organization, association, or
corporation changing the use of such property;
(e)
Relocation of the activity and use of another location or site except for
undeveloped properties of camp facilities exempted under RCW 84.36.030;
(f)
Cancellation of a lease on property that had been exempt under RCW 84.36.040,
84.36.041, 84.36.043, 84.36.046, 84.36.060, ((or)) 84.36.042, or
section 1 of this act;
(g)
A change in the exempt portion of a home for the aging under RCW 84.36.041(3),
as long as some portion of the home remains exempt((;
(h)
The conversion of a full exemption of a home for the aging to a partial
exemption or taxable status or the conversion of a partial exemption to taxable
status under RCW 84.36.041(8))).
NEW SECTION. Sec. 4. This
act applies to taxes levied in 1999 for collection in 2000 and thereafter.
