BILL REQ. #:  H-4310.4 

Read first time 01/22/08.   Referred to Committee on Finance.

     AN ACT Relating to a sales and use tax exemption for environmentally certified residential and commercial construction; adding a new section to chapter 82.08 RCW; adding a new section to chapter 82.12 RCW; creating a new section; providing an effective date; and providing an expiration date.

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

NEW SECTION.  Sec. 1   A new section is added to chapter 82.08 RCW to read as follows:
     (1) Subject to the conditions and requirements of this section, the tax levied by RCW 82.08.020 does not apply to the sale of qualifying property and services. The exemption is in the form of a remittance and applies to part of the state portion of the sales tax.
     (2) The exemption only applies to construction performed in cities, towns, or counties that have adopted: (a) An expedited permitting process for the construction of environmentally certified buildings; and (b) low-impact development regulations, as determined by the department of ecology. For residential construction, the exemption only applies if the selling price is less than the median price in the local jurisdiction for the type of home, as reflected in a recognized real estate listing service for the month prior to the sale of the home. For residential construction not within the boundary of a city or town, "local jurisdiction" means the unincorporated area of the county.
     (3) A person claiming an exemption from state sales tax must pay the tax imposed by RCW 82.08.020. The buyer may then apply to the department for remittance for part of the tax paid under RCW 82.08.020. For the sale of qualifying property and services used in the construction of a building with a gold or platinum rating under the leadership in energy and environmental design green building rating system or a five-star rating under the Washington built green program, the remittance equals the following percentage of sales tax paid: Fifty percent for the fiscal year ending July 1, 2011; forty percent for the fiscal year ending July 1, 2012; thirty percent for the fiscal year ending July 1, 2013; twenty percent for the fiscal year ending July 1, 2014; and ten percent for the fiscal year ending July 1, 2015.
     (4) The definitions in this subsection apply throughout this section.
     (a) "Construction" means the construction, repair, decoration, or improvement of new or existing buildings.
     (b) "Environmentally certified building" means a commercial or residential building: (i) With a silver, gold, or platinum rating under the leadership in energy and environmental design green building rating system; (ii) with a four or five-star rating under the Washington built green program; or (iii) with a rating for sustainable building that is equivalent to (b)(i) or (ii) of this subsection, verifiable, and approved by the department in rule.
     (c) "Qualifying property and services" means tangible personal property and labor and services used, or to be used, in the construction of environmentally certified buildings.
     (d) "Type of home" means single family or multifamily, as appropriate.

NEW SECTION.  Sec. 2   A new section is added to chapter 82.12 RCW to read as follows:
     (1) Subject to the conditions and requirements of this section, the provisions of this chapter do not apply to the use of qualifying property and services. The exemption is in the form of a remittance and applies to part of the state portion of the use tax.
     (2) A person claiming an exemption from state use tax must pay the tax imposed under this chapter. The person may then apply to the department for remittance of all, or part of, the tax paid under this chapter. For the use of qualifying property and services used in the construction of a building with a gold or platinum rating under the leadership in energy and environmental design green building rating system, a five-star rating under the Washington built green program, or an equivalent rating as provided in section 1(4)(b)(iii) of this act, the remittance equals the following percentage of sales tax paid: Fifty percent for the fiscal year ending July 1, 2011; forty percent for the fiscal year ending July 1, 2012; thirty percent for the fiscal year ending July 1, 2013; twenty percent for the fiscal year ending July 1, 2014; and ten percent for the fiscal year ending July 1, 2015.
     (3) The conditions, requirements, and definitions in section 1 of this act apply to this section.

NEW SECTION.  Sec. 3   By December 1, 2012, and by December 1st of the two following years, the department of revenue shall submit a report to the legislature. The report must: (1) Provide the amount of sales and use tax exempted under this act; (2) describe the commercial or residential character of tax exempt construction; (3) identify the geographic location of tax exempt construction; and (4) estimate cost savings and emission reductions for homes and buildings subject to the exemptions under this act. The department may include any other information in the report that it deems necessary for the legislative evaluation of the sales and use tax exemption authorized in this act.

NEW SECTION.  Sec. 4   This act takes effect July 1, 2010.

NEW SECTION.  Sec. 5   This act expires July 1, 2015.