BILL REQ. #:  S-4261.1 

Read first time 01/18/08.   Referred to Committee on Ways & Means.

     AN ACT Relating to exempting a portion of the valuation of residential property from property taxation; amending RCW 84.48.010; adding new sections to chapter 84.36 RCW; and providing a contingent effective date.

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) As used in this section, "homestead exemption" means an exemption under this section.
     (2) Subject to the conditions in subsection (6) of this section, a portion of the assessed value of a residence is exempt from property taxes imposed for state purposes. The exemption from property taxation is equal to:
     (a) For taxes levied for collection in 2010:
     (i) The first fifty thousand dollars of valuation of each residential tax parcel consisting of fewer than three dwelling units; and
     (ii) The first fifty thousand dollars of valuation of each residential unit in a multiunit residential dwelling wherein each unit is owned and taxed separately;
     (b) For taxes levied for collection in 2011:
     (i) The first seventy-five thousand dollars of valuation of each residential tax parcel consisting of fewer than three dwelling units; and
     (ii) The first seventy-five thousand dollars of valuation of each residential unit in a multiunit residential dwelling wherein each unit is owned and taxed separately;
     (c) For taxes levied for collection in 2012:
     (i) The first one hundred thousand dollars of valuation of each residential tax parcel consisting of fewer than three dwelling units; and
     (ii) The first one hundred thousand dollars of valuation of each residential unit in a multiunit residential dwelling wherein each unit is owned and taxed separately;
     (d) Each subsequent year, the assessed valuation of a residence exempt from taxation imposed for state purposes shall be increased by an amount equal to the percentage growth in the state levy collections for the prior calendar year. The department may round the dollar amount to the nearest thousand dollars.
     (3) The term "residence" means a single-family dwelling unit whether such unit is separate or part of a multiunit dwelling, including the land on which such dwelling stands. The term also includes a single-family dwelling situated upon lands the fee of which is vested in the United States, any instrumentality thereof including an Indian tribe, or in the state of Washington, and notwithstanding the provisions of RCW 84.04.080 and 84.04.090, such a residence shall be deemed real property.
     (4) The term "residence" also includes a mobile home which has substantially lost its identity as a mobile unit by virtue of its being fixed in location upon land owned or leased by the owner of the mobile home and placed on a foundation (posts or blocks) with fixed pipe, and connections with sewer, water, or other utilities.
     (5) Each county assessor shall send a declaration form for the owner to sign under penalty of perjury, as provided in RCW 9A.72.085, that the property is the principal residence of the owner within the meaning of subsection (6)(a) and (b) of this section. The declaration form may be included with the valuation notice required by RCW 84.40.045.
     (6) The following conditions apply to homestead exemptions:
     (a) The residence must be occupied by the person claiming the exemption as the principal place of residence as of the date of the signed declaration under subsection (5) of this section. A person who sells, transfers, or is displaced from his or her residence may transfer his or her exemption status to a replacement residence, but no claimant shall receive an exemption on more than one residence in any year. However, the confinement of the person to a hospital, nursing home, boarding home, or adult family home may not disqualify the claim of exemption if:
     (i) The residence is temporarily unoccupied;
     (ii) The residence is occupied by either a spouse or a person financially dependent on the claimant for support, or both; or
     (iii) The residence is rented for the purpose of paying nursing home, hospital, boarding home, or adult family home costs.
     (b) The person claiming the exemption must have owned, at the time of declaration, in fee, as a life estate, or by contract purchase, the residence on which the property taxes have been imposed or if the person claiming the exemption lives in a cooperative housing association, corporation, or partnership, such person must own a share therein representing the unit or portion of the structure in which he or she resides. For purposes of this subsection, a residence owned by a marital community or owned by cotenants is deemed to be owned by each spouse or cotenant, and any lease for life is deemed a life estate.
     (c) The declaration form identified in subsection (5) of this section must be signed and returned to the county assessor not later than November 30th for exemption from taxes payable the following year.
     (7) If the assessor finds that the residence does not meet the qualifications for a homestead exemption, the exemption shall be denied but such denial is subject to appeal under the provisions of RCW 84.48.010 and in accordance with the provisions of RCW 84.40.038.
     (8) The director of the department of revenue shall adopt such rules and prescribe such forms as may be necessary and appropriate to implement and administer this act subject to chapter 34.05 RCW, the administrative procedure act.

NEW SECTION.  Sec. 2   A new section is added to chapter 84.36 RCW to read as follows:
     Pursuant to the provisions of Article VII, section . . . (Senate Joint Resolution No. …), the state levy shall be reduced as necessary to prevent the value exempted under the homestead exemption in section 1 of this act from resulting in a higher tax rate than would have occurred in the absence of the homestead exemption.

Sec. 3   RCW 84.48.010 and 2001 c 187 s 22 are each amended to read as follows:
     Prior to July 15th, the county legislative authority shall form a board for the equalization of the assessment of the property of the county. The members of said board shall receive a per diem amount as set by the county legislative authority for each day of actual attendance of the meeting of the board of equalization to be paid out of the current expense fund of the county: PROVIDED, That when the county legislative authority constitute the board they shall only receive their compensation as members of the county legislative authority. The board of equalization shall meet in open session for this purpose annually on the 15th day of July and, having each taken an oath fairly and impartially to perform their duties as members of such board, they shall examine and compare the returns of the assessment of the property of the county and proceed to equalize the same, so that each tract or lot of real property and each article or class of personal property shall be entered on the assessment list at its true and fair value, according to the measure of value used by the county assessor in such assessment year, which is presumed to be correct under RCW 84.40.0301, and subject to the following rules:
     First. They shall raise the valuation of each tract or lot or item of real property which is returned below its true and fair value to such price or sum as to be the true and fair value thereof, after at least five days' notice shall have been given in writing to the owner or agent.
     Second. They shall reduce the valuation of each tract or lot or item which is returned above its true and fair value to such price or sum as to be the true and fair value thereof.
     Third. They shall raise the valuation of each class of personal property which is returned below its true and fair value to such price or sum as to be the true and fair value thereof, and they shall raise the aggregate value of the personal property of each individual whenever the aggregate value is less than the true valuation of the taxable personal property possessed by such individual, to such sum or amount as to be the true value thereof, after at least five days' notice shall have been given in writing to the owner or agent thereof.
     Fourth. They shall reduce the valuation of each class of personal property enumerated on the detail and assessment list of the current year, which is returned above its true and fair value, to such price or sum as to be the true and fair value thereof; and they shall reduce the aggregate valuation of the personal property of such individual who has been assessed at too large a sum to such sum or amount as was the true and fair value of the personal property.
     Fifth. The board may review all claims for either real or personal property tax exemption, or homestead exemptions under section 1 of this act, as determined by the county assessor, and shall consider any taxpayer appeals from the decision of the assessor thereon to determine (1) if the taxpayer is entitled to an exemption, and (2) if so, the amount thereof.
     The clerk of the board shall keep an accurate journal or record of the proceedings and orders of said board showing the facts and evidence upon which their action is based, and the said record shall be published the same as other proceedings of county legislative authority, and shall make a true record of the changes of the descriptions and assessed values ordered by the county board of equalization. The assessor shall correct the real and personal assessment rolls in accordance with the changes made by the said county board of equalization, and the assessor shall make duplicate abstracts of such corrected values, one copy of which shall be retained in the office, and one copy forwarded to the department of revenue on or before the eighteenth day of August next following the meeting of the county board of equalization.
     The county board of equalization shall meet on the 15th day of July and may continue in session and adjourn from time to time during a period not to exceed four weeks, but shall remain in session not less than three days: PROVIDED, That the county board of equalization with the approval of the county legislative authority may convene at any time when petitions filed exceed twenty-five, or ten percent of the number of appeals filed in the preceding year, whichever is greater.
     No taxes, except special taxes, shall be extended upon the tax rolls until the property valuations are equalized by the department of revenue for the purpose of raising the state revenue.
     County legislative authorities as such shall at no time have any authority to change the valuation of the property of any person or to release or commute in whole or in part the taxes due on the property of any person.

NEW SECTION.  Sec. 4   This act takes effect if the proposed amendment to Article VII of the state Constitution (Senate Joint Resolution No. …), providing for a homestead exemption, is validly submitted to and is approved and ratified by the voters at the next general election. If the proposed amendment is not approved and ratified, this act is void in its entirety.