BILL REQ. #: H-1657.1
State of Washington | 63rd Legislature | 2013 Regular Session |
Read first time 02/26/13. Referred to Committee on Finance.
AN ACT Relating to community redevelopment financing in apportionment districts; amending RCW 39.88.030, 39.88.040, 39.88.070, 39.88.080, 39.88.100, 84.52.043, 84.52.043, and 84.52.050; reenacting and amending RCW 39.88.020; adding a new section to chapter 39.88 RCW; repealing RCW 39.88.060 and 39.88.090; providing an effective date; and providing an expiration date.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec. 1 RCW 39.88.020 and 2011 c 336 s 815 are each reenacted and
amended to read as follows:
((As used in this chapter the following terms have the following
meanings unless a different meaning is clearly indicated by the
context:)) The definitions in this section apply throughout this
chapter unless the context clearly requires otherwise.
(1) "Apportionment district" means the geographic area, within an
urban area, from which ((regular property taxes are to be apportioned
to finance a public improvement contained therein.)) special property taxes are to be levied and
collected to finance a public improvement contained therein.
(2) "Assessed value of real property" means the valuation of real
property as placed on the last completed assessment roll of the county.
(3) "City" means any city or town.
(4) "Ordinance" means any appropriate method of taking a
legislative action by a county or city, whether known as a statute,
resolution, ordinance, or otherwise.
(5) "Public improvement" means an undertaking to provide public
facilities in an urban area which the sponsor has authority to provide.
(6) "Public improvement costs" means the costs of design, planning,
acquisition, site preparation, construction, reconstruction,
rehabilitation, improvement, and installation of the public
improvement; costs of relocation, maintenance, and operation of
property pending construction of the public improvement; costs of
utilities relocated as a result of the public improvement; costs of
financing, including interest during construction, legal and other
professional services, taxes, and insurance; costs incurred by the
assessor to revalue real property for the purpose of determining the
tax allocation base value that are in excess of costs incurred by the
assessor in accordance with his or her revaluation plan under chapter
84.41 RCW, and the costs of apportioning the taxes and complying with
this chapter and other applicable law; and administrative costs
reasonably necessary and related to these costs. These costs may
include costs incurred prior to the adoption of the public improvement
ordinance, but subsequent to July 10, 1982.
(7) "Public improvement ordinance" means the ordinance passed under
RCW 39.88.040(4).
(8) "Regular property taxes" means regular property taxes as now or
hereafter defined in RCW 84.04.140, except regular property taxes
levied by port districts or public utility districts specifically for
the purpose of making required payments of principal and interest on
general indebtedness.
(9) "Sponsor" means any county or city initiating and undertaking
a public improvement.
(10) "Tax allocation base value of real property" means the true
and fair value of real property within an apportionment district for
the year in which the apportionment district was established.
(11) "Tax allocation bonds" means any bonds, notes, or other
obligations issued by a sponsor pursuant to section 10 of this act.
(12) "Tax allocation revenues" means those tax revenues allocated
to a sponsor under RCW 39.88.070(1)(b).
(13) "Taxing districts" means any governmental entity which levies
or has levied for it regular property taxes upon real property located
within a proposed or approved apportionment district.
(14) "Urban area" means an area in a city or located outside of a
city that is characterized by intensive use of the land for the
location of structures and receiving such urban services as sewers,
water, and other public utilities and services normally associated with
urbanized areas. Not more than twenty-five percent of the area within
the urban area proposed apportionment district may be vacant land.
(15) "Value of taxable property" means value of taxable property as
defined in RCW 39.36.015
(2) "City" means any city or town.
(3) "Community benefit activities" means activities undertaken to
meet the affordable housing, conservation, social equity, and other
public goals as described in section 2 of this act.
(4) "County" means any county of the state of Washington.
(5) "Ordinance" means an ordinance, resolution, or any other
appropriate method of taking a legislative action by the legislative
authority of a county or city, whether known as a statute, resolution,
ordinance, or otherwise.
(6) "Public improvement costs" means capital expenditures with
respect to public improvements, including without limitation the costs
of design, planning, acquisition, site preparation, construction,
reconstruction, rehabilitation, improvement, and installation of the
public improvement; costs of relocation, maintenance, and operation of
property pending construction of the public improvement; costs of
relocating utilities in connection with undertaking the public
improvement; costs of financing, including interest during and for a
reasonable period after construction, legal and other professional
services, taxes, and insurance; costs of levying and collecting the
special property taxes and complying with this chapter and other
applicable law; costs of operating and maintaining the public
improvement; and administrative costs reasonably necessary and related
to these costs. These costs may include costs incurred prior to the
adoption of the public improvement ordinance but may not include costs
that are satisfied by revenues from impact fees or other development
fees.
(7) "Public improvement ordinance" means an ordinance passed under
RCW 39.88.040(4).
(8) "Public improvements" means:
(a) Public infrastructure improvements, including acquisition,
construction, improvement, expansion, extension, or maintenance of the
following:
(i) Street, road, bridge, and rail improvements;
(ii) Water and sewer systems;
(iii) Sidewalks, streetlights, landscaping, and streetscaping;
(iv) Parking, terminal, and dock facilities;
(v) Park and ride facilities;
(vi) Park facilities, recreational areas, and environmental
remediation activities;
(vii) Storm water and drainage management systems; and
(viii) Electric, gas, fiber, and other utility infrastructure; and
(b) Expenditures for any of the following purposes:
(i) Providing maintenance and security for public improvements or
for common or public areas in the apportionment district;
(ii) Historic preservation assets and activities authorized under
RCW 35.21.395; or
(iii) Costs of establishing and administering the apportionment
district, including without limitation the costs of data collection,
reporting, and accountability activities.
(9) "Regular property taxes" means regular property taxes as now or
hereafter defined in RCW 84.04.140.
(10) "Special property taxes" means the special property taxes
authorized to be levied and collected within an apportionment district
under RCW 39.88.070. Special property taxes are not regular property
taxes for any purpose under this chapter or under any other provision
of law, but special property taxes are "excess real property taxes" for
purposes of RCW 84.36.381 through 84.36.389, are "real property taxes"
for purposes of chapters 84.37 and 84.38 RCW, are "property taxes" for
purposes of chapter 84.39 RCW, and also constitute "ad valorem
taxation" as that term is used in RCW 84.33.040.
(11) "Sponsor" means any county or city forming an apportionment
district under this chapter.
(12) "Tax allocation base value" means the value of taxable
property within an apportionment district for the year in which the
public improvement ordinance is passed.
(13) "Tax allocation bonds" means any bonds, notes, or other
obligations issued or incurred by a sponsor pursuant to RCW 39.88.100.
(14) "Tax allocation increment value" means, as of any time of
calculation, the value of taxable property in an apportionment district
in excess of the tax allocation base value within that apportionment
district.
(15) "Tax allocation revenues" means those special property tax
revenues levied and collected by a sponsor under RCW 39.88.070(1).
(16) "Taxing districts" means any governmental entity which levies
or has levied for it regular property taxes upon real property located
within a proposed or approved apportionment district.
(17) "Urban area" means an area (a) in a city or (b) located
outside of a city within an urban eligible area.
(18) "Urban eligible area" means an area inside an urban growth
area as defined in RCW 36.70A.030 that is a growth center, a
transportation center, or a local center. For purposes of this
subsection:
(a) "Growth center" means an area that is designated as a mixed-use, manufacturing, or urban center in a land use or transportation
plan adopted by a regional transportation planning organization or an
adopted multicounty or countywide planning policy.
(b) "Transportation center" means an area that is within one-half
mile walking distance of:
(i) A station where passengers can access a high capacity
transportation system such as a ferry system, airport, fixed guideway
rail system, or designated bus rapid transit line; or
(ii) A stop for a bus or other transit mode providing fixed route
service in intervals of at least every thirty minutes during peak
morning commute hours of six to nine.
(c) "Local center" means an area that is:
(i) Designated as a center in the local comprehensive plan;
(ii) Zoned to provide for medium or high-density mixed-use or
industrial development; and
(iii) Not zoned to permit low-density commercial development with
a floor area ratio of one or less.
(19) "Value of taxable property" means value of taxable property as
defined in RCW 39.36.015.
NEW SECTION. Sec. 2 A new section is added to chapter 39.88 RCW
to read as follows:
(1) Prior to imposing the special tax authorized in RCW 39.88.070,
a sponsor must adopt an ordinance in accordance with subsection (3) of
this section, dedicating to the funding of community benefit activities
an amount equal to twenty percent of the maximum stated principal
amount of tax allocation bonds expected to be issued as set forth in
the public improvement ordinance. Amounts dedicated to community
benefit activities must be in addition to those treated as having been
expended on public improvement costs under this chapter. The community
benefit funding requirement must be satisfied in accordance with the
periodic goals set forth in that ordinance.
(2)(a) For purposes of this chapter, community benefit activities
include:
(i) Activities supporting development of low and moderate-income
housing within walking or transit-connected distance of the
apportionment district;
(ii) The conservation of open space, forest lands, and farmlands
including, but not limited to, the transfer of development rights or
the acquisition for conservation purposes of lands or conservation
interests therein, which bear a nexus to the location of the
apportionment district. Such a nexus may include without limitation,
location within the same watershed, designation as corresponding
sending and receiving sites for transfer of development rights under
chapter 39.108 RCW, or other similar environmental nexus. Any city
that is a receiving city in an eligible county, as those terms are
defined in RCW 39.108.010, must comply with subsection (8) of this
section;
(iii) Other similar activities that further the sponsor's
affordable housing, environmental and other social equity, and other
public goals described in an ordinance passed pursuant to subsection
(3) of this section. Such goals may include, without limitation:
Retaining small businesses within the apportionment district; workforce
development and supporting fair labor practices within the
apportionment district; increasing the energy efficiency and efficiency
of use of water, wastewater, and other natural resources within the
apportionment district; and other activities intended to increase
social equity.
(b) The aggregate community benefit funding requirement must be
allocated among these purposes in the following proportions:
(i) At least fifty percent of the total amount must be dedicated to
the purposes under subsection (2)(a)(i) of this section;
(ii) At least twenty percent of the total amount must be dedicated
to the purposes under subsection (2)(a)(ii) of this section; and
(iii) The remaining thirty percent must be dedicated to a
combination of one or more of the purposes described in subsection
(2)(a)(i), (ii), and (iii) of this section.
(3) The sponsor's legislative authority must adopt an ordinance
after opportunity for public comment, which sets periodic goals for the
timing of funding community benefit activities during successive
reporting periods of up to five calendar years each:
(a) The first such reporting period must begin with the calendar
year during which the special property tax under RCW 39.88.070 is first
collected. The last such required reporting period ends with the
earlier of:
(i) The last calendar year during which the special property tax
authorized in RCW 39.88.070 is collected; or
(ii) The total community benefit funding requirement has been
satisfied.
(b) In setting the funding goals, the sponsor may take into account
projected revenues of the special property tax, projected debt service
coverage ratios set forth in covenants made or entered into in
connection with the issuance of tax allocation bonds, and other
relevant factors. For the purposes of this subsection, "debt service
coverage ratio" means the ratio of projected tax allocation revenues to
the expected aggregate annual debt service on tax allocation bonds.
(c) At a minimum, the funding goals must provide that within the
first year of the first reporting period, an amount equal to five
percent of the maximum stated principal amount of tax allocation bonds
expected to be issued, as set forth in the public improvement
ordinance, must be dedicated to the acquisition of real property, or an
interest therein, to be made available for the development of low and
moderate-income housing within walking or transit-connected distance of
the apportionment district. A sponsor may meet this goal by depositing
such amount with the Washington state housing finance commission,
created under chapter 43.180 RCW, with a public housing authority, or
by acquiring the real property directly. This amount is deemed a
portion of the allocation dedicated to the purposes under subsection
(2)(b)(i) of this section.
(d) The ordinance may be combined with the public improvement
ordinance or may be a separate ordinance.
(4) A sponsor is held accountable for meeting its periodic
community benefit funding goals as follows:
(a) As soon as practicable after the June 1st that follows the end
of each reporting period, the finance officer or other administrative
officer of the sponsor must report to the legislative authority of the
sponsor at a regular meeting on the amount dedicated by the sponsor to
community benefit activities under this section on an annual basis and
in total over the preceding reporting period. The report must also
include a description of the sponsor's goals for timing of dedication
of community benefit funding over the preceding reporting period and
the total goals set forth in the ordinance adopted pursuant to
subsection (3) of this section. After receiving the report, the
legislative body must make a determination as to whether the sponsor
has met its goals over that reporting period.
(b) If a sponsor determines that it has not met its goals for
funding community benefit activities over the reporting period, or if
a taxpayer challenge under (c) of this subsection is upheld, then on or
before the next January 1st, the sponsor must pay the amount by which
the sponsor fell short of its goal for that period, in accordance with
the proportional allocation established under subsection (3)(b) of this
section, for the purposes of furthering the community benefit
activities described in the ordinance adopted under subsection (3) of
this section, as follows for the purposes of:
(i) Meeting any obligation to fund the activities under subsection
(2)(a)(i) of this section, to the housing trust fund created pursuant
to chapter 43.185 RCW, to the housing finance commission created
pursuant to chapter 43.180 RCW, or to a local housing authority;
(ii) Meeting obligations pursuant to subsection (2)(a)(ii) of this
section, to a rural conservation fund established by the sponsor or to
a qualified county agency or accredited land trust; and
(iii) Furthering the social equity and other public goals described
in subsection (2)(a)(iii) of this section and the ordinance adopted
under subsection (3) of this section, to a loan fund operated by the
department of commerce or the department of ecology for purposes of
funding toxics cleanup or energy efficiency improvements, to the
sustainable energy trust program created pursuant to RCW 43.180.260, or
to an instrumentality or fund established by the state or a local
government.
(c) Any person who pays the special property tax levied within the
apportionment district may challenge the sponsor's determination that
it has met its community benefit activity funding goals during the
preceding reporting period by filing an objection with the clerk of the
sponsor's legislative body within thirty days after the date of the
sponsor's determination. Upon receipt of such an objection, the clerk
must forward such objection to the chair of the legislative body who
must schedule, at the next practicable opportunity, a public hearing at
which the matter of the community benefit funding goals must be heard.
Notice of the public hearing must be mailed to the taxpayer submitting
the objection and must be given in accordance with the requirements for
giving notice of a special meeting under RCW 42.30.080. If, after due
consideration, the legislative body determines that the sponsor has not
met the community benefit funding goals, the remedy in (b) of this
subsection applies. If the legislative body determines that the
sponsor has met the community benefit funding goals, the taxpayer has
the right to bring action in superior court to compel payment of the
amounts required under (b) of this subsection.
(5) The legislative authority of a sponsor may periodically amend
the community benefit funding goals after opportunity for public
comment, so long as the overall goals remain consistent with the
allocation requirements of subsection (2) of this section. If a
sponsor has not issued the maximum amount of tax allocation bonds set
forth in the public improvement ordinance by the date that is five
years after that ordinance was passed, the legislative body may by
ordinance revise downward the maximum expected amount of such bonds and
the amounts required to be dedicated to the community benefit funding
goals must be adjusted accordingly.
(6) The community benefit funding requirement expires at the
earlier of thirty years after the special property tax under RCW
39.88.070 is first collected or when the total community benefit
funding requirement has been satisfied. A sponsor may at any time
satisfy all or a portion of its community benefit funding requirement
by contributing money, in accordance with the allocations pursuant to
subsection (2) of this section to one or more of the entities listed in
subsection (4)(b) of this section.
(7) Nothing in this section may permit expenditures of public funds
prohibited by Article VIII, section 5 or 7 of the state Constitution.
Nothing in this section may be interpreted to grant to any sponsor the
authority to engage in any community benefit activities that are not
otherwise authorized to be undertaken by the sponsor.
(8)(a) If the sponsor is a city that is a receiving city, as
defined in RCW 39.108.010, then in the ordinance adopted under this
section, the city must:
(i) Determine the number of transferable development rights that
could be acquired, at the time that the special tax under this section
is first imposed, by the use of the amount of money to be dedicated to
the conservation purposes described under subsection (2)(b)(ii) of this
section; and
(ii) Set periodic goals for use by landowners or for purchase by
the city of the number of transferable development rights within the
city in accordance with subsection (3) of this section.
(b) Actual use by a landowner, or by purchase by the city, of such
transferable development rights is an alternative method of meeting the
conservation funding goal described under subsection (2)(b)(ii) of this
section.
(c) Nothing in this section may require a sponsor to dedicate money
to the purchase of transferable development rights in excess of the
dollar amount that would otherwise be required to be dedicated to
conservation purposes under subsection (2)(b)(ii) of this section.
Sec. 3 RCW 39.88.030 and 1982 1st ex.s. c 42 s 4 are each amended
to read as follows:
(1) Only public improvements which are determined by the
legislative authority of the sponsor to meet the following criteria are
eligible to be financed under this chapter:
(a) The public improvement is located within an urban area;
(b) The public improvement will encourage private development
within the apportionment district;
(c) The public improvement will increase the ((fair market))
assessed value of the real property located within the apportionment
district;
(d) The private development which is anticipated to occur within
the apportionment district as a result of the public improvement is
consistent with an existing comprehensive land use plan and approved
growth policies of the jurisdiction within which it is located;
(e) A public improvement located within a city has been approved by
the legislative authority of such city; and
(f) A public improvement located ((within an urban area)) in an
unincorporated area has been approved by the legislative authority of
the county within whose boundaries the ((area lies.)) apportionment district lies and by the
legislative authority of a city having a nexus to the urban growth area
in which the apportionment district lies, if any.
(2) Apportionment of regular property tax revenues to finance the
public improvements is subject to the following limitations:
(a) No apportionment of regular property tax revenues may take
place within a previously established apportionment district where
regular property taxes are still apportioned to finance public
improvements without the concurrence of the sponsor which established
the district;
(b) No apportionment district may be established which includes any
geographic area included within a previously established apportionment
district which has outstanding bonds payable in whole or in part from
tax allocation revenues;
(c) The total amount of outstanding bonds payable in whole or in
part from tax allocation revenues arising from property located within
a city shall not exceed two percent of the value of taxable property
within the city, and the total amount of outstanding bonds payable in
whole or in part from tax allocation revenues arising from property
located within the unincorporated areas of a county shall not exceed
two percent of the value of taxable property within the entire
unincorporated area of the county; and
(d) No taxes other than regular property taxes may be apportioned
under this chapter.
(3) Public improvements
(2) The levying and collection of special property tax revenues to
finance the public improvements may take place within a previously
established apportionment district where special property taxes are
still levied and collected to finance public improvements without the
concurrence of the sponsor which established the previously established
district.
(3) Public improvements and community benefit activities may be
undertaken and coordinated with other programs or efforts undertaken by
the sponsor or others and may be funded in whole or in part from
sources other than those provided by this chapter.
Sec. 4 RCW 39.88.040 and 1982 1st ex.s. c 42 s 5 are each amended
to read as follows:
(1) Public improvements funded by tax allocation revenues may only
be located within ((an urban area. In order to secure an allocation of
regular property taxes to finance a public improvement, a sponsor
shall:)) or
serve an apportionment district. In order to levy and collect special
property taxes to finance a public improvement, a sponsor must:
(1) Propose by ordinance a plan for the public improvement which
includes a description of the contemplated public improvement, the
estimated cost thereof, the boundaries of the apportionment district,
the estimated period during which tax revenue apportionment is
contemplated, and the ways in which the sponsor plans to use tax
allocation revenues to finance the public improvement, and which sets
at least three public hearings thereon before the legislative authority
of the sponsor or a committee thereof: PROVIDED, That public hearings
for the public improvement that is undertaken in combination or
coordination by two or more sponsors may be held jointly; and public
hearings, held before the legislative authority or a committee of a
majority thereof may be combined with public hearings held for other
purposes;
(2) At least fifteen days in advance of the hearing:
(a) Deliver notice of the hearing to all taxing districts, the
county treasurer, and the county assessor, which notice includes a map
or drawing showing the location of the contemplated public improvement
and the boundaries of the proposed apportionment district, a brief
description of the public improvement, the estimated cost thereof, the
anticipated increase in property values within the apportionment
district, the location of the sponsor's principal business office where
it will maintain information concerning the public improvement
(a)(i) Propose by ordinance a plan for the public improvements that
includes: A description of the contemplated public improvements and
the estimated costs thereof; the boundaries of the apportionment
district; the maximum period (not to exceed thirty years), during which
the special property tax is to be levied and collected; the maximum
aggregate stated principal amount of tax allocation bonds expected to
be issued, not including accreted value of capital appreciation bonds;
the anticipated level of funding for community benefit activities under
section 2 of this act; and the ways in which the sponsor plans to use
special property tax revenues to finance the public improvements.
(i) The public improvement ordinance must also include the
following findings:
(A) The public improvements proposed to be financed in whole or in
part using apportionment district financing that are expected to:
Encourage private development within the apportionment district and to
increase the assessed value of real property within the apportionment
district; improve the viability of existing business entities; or
increase employment or affordable housing availability proximate to the
apportionment district;
(B) Private development that is anticipated to occur within the
apportionment district as a result of the public improvements is
consistent with:
(I) The countywide planning policy adopted by the county under RCW
36.70A.210;
(II) The sponsor's comprehensive plan; and
(III) Development regulations adopted under chapter 36.70A RCW;
(C) The use of the financing tool under this chapter must promote
economic development or redevelopment within the apportionment district
and the sponsor must meet the requirements for funding community
benefit activities under section 2 of this act; and
(D) The proposed apportionment district may not be used for the
purpose of encouraging the relocation of a business from outside the
apportionment district, but within the state, into the apportionment
district, unless the governing body of the sponsor finds, based on
evidence provided to the apportionment district, that the firm being
relocated would otherwise be likely to leave the state.
(iii) The public improvement ordinance must provide for one or more
public hearings on the question of forming the apportionment district,
which must be held before the legislative authority of the sponsor or
a committee thereof. However, public hearings for formation of an
apportionment district that is undertaken in combination or
coordination by two or more sponsors may be held jointly. Public
hearings held before the legislative authority or a committee of a
majority thereof may be combined with public hearings held for other
purposes;
(b) At least fifteen days in advance of the hearing:
(i) Deliver notice of the hearing to: All taxing districts; the
county treasurer; the county assessor; and the owners or reputed owners
of all lots, tracts, and parcels of land within the proposed
apportionment district, as shown on the rolls of the county assessor
and directed to the address shown thereon. The notice must include:
A map or drawing showing the approximate locations of the contemplated
public improvements and the boundaries of the proposed apportionment
district; a brief description of the proposed public improvements and
the estimated cost thereof; the anticipated level of funding for
community benefit activities under section 2 of this act; the maximum
aggregate stated principal amount of tax allocation bonds expected to
be issued, not including accreted value of capital appreciation bonds;
the maximum period during which the special property tax is to be
levied and collected; the anticipated increase in assessed values
within the apportionment district; the location of the sponsor's
principal business office, where it will maintain information
concerning the public improvements for public inspection((,)); and the
date and place of hearing; and
(((b))) (ii) Post notice in at least ((six)) three public places
located in the proposed apportionment district and publish notice in a
legal newspaper of general circulation within the sponsor's
jurisdiction briefly describing the public improvement, the proposed
((apportionment)) special property taxes, the boundaries of the
proposed apportionment district, the location where additional
information concerning the public improvement may be inspected, and the
date and place of hearing;
(((3))) (c) At the time and place fixed for the hearing under
((subsection (1))) (a) of this ((section)) subsection, and at such
times to which the hearing may be adjourned, receive and consider all
statements and materials as may be submitted, and objections and
letters filed before or within ten days thereafter;
(((4) Within)) (d) Not earlier than ten days and not more than one
hundred twenty days after completion of the public ((hearings, pass an
ordinance establishing the apportionment district and authorizing the
proposed public improvement, including any modifications which in the
sponsor's opinion the hearings indicated should be made, which includes
the boundaries of the apportionment district, a description of the
public improvement, the estimated cost thereof, the portion of the
estimated cost thereof to be reimbursed from tax allocation revenues,
the estimated time during which regular property taxes are to be
apportioned, the date upon which apportionment of the regular property
taxes will commence, and a finding that the public improvement meets
the conditions of RCW 39.88.030)) hearing or hearings, pass the public
improvement ordinance establishing the apportionment district and
authorizing the proposed public improvements, including any
modifications that the legislative authority of the sponsor deems
appropriate, which includes: The boundaries of the apportionment
district; a description of the public improvements and the estimated
cost thereof; the maximum aggregate stated principal amount of tax
allocation bonds expected to be issued, not including accreted value of
capital appreciation bonds; the date upon which the levying and
collection of the special property taxes will commence; the maximum
period during which the special property tax is to be levied and
collected; and a finding that the formation of the apportionment
district meets the conditions of RCW 39.88.030 and section 2 of this
act.
(2) The authority of the sponsor to proceed with the levying and
collection of special property taxes within an apportionment district
is divested by a protest, filed with the legislative authority of the
sponsor within thirty days after the date of passage of the public
improvement ordinance, and signed by either:
(a) The owners of the property within the apportionment district
representing more than fifty percent of the value of taxable property
within that apportionment district as reflected on rolls of the county
assessor for the year in which the ordinance is passed; or
(b) The owners of sixty-five percent of the parcels comprising the
apportionment district as reflected on rolls of the county assessor for
the year in which the ordinance is passed.
Sec. 5 RCW 39.88.070 and 1982 1st ex.s. c 42 s 8 are each amended
to read as follows:
(1) Upon the date established in the public improvement ordinance,
but not ((sooner)) earlier than the first day of the calendar year
following the passage of the ordinance((, the regular property taxes
levied upon the assessed value of real property within the
apportionment district shall be divided as follows:)) and no earlier than would be permitted under
RCW 84.09.030:
(a) That portion of the regular property taxes produced by the rate
of tax levied each year by or for each of the taxing districts upon the
tax allocation base value of real property, or upon the assessed value
of real property in each year, whichever is smaller, shall be allocated
to and paid to the respective taxing districts; and
(b) That portion of the regular property taxes levied each year by
or for each of the taxing districts upon the assessed value of real
property within an apportionment district which is in excess of the tax
allocation base value of real property shall be allocated and paid to
the sponsor, or the sponsor's designated agent, until all public
improvement costs to be paid from the tax allocation revenues have been
paid, except that the sponsor may agree to receive less than the full
amount of such portion as long as bond debt service, reserve, and other
bond covenant requirements are satisfied, in which case the balance of
the taxes shall be allocated to the respective taxing districts as the
sponsor and the taxing districts may agree.
(2) The county assessor shall revalue the real property within the
apportionment district
(a) Regular property taxes levied upon the property within the
apportionment district by taxing districts must continue to be
collected in accordance with applicable law, without regard to the
existence of the apportionment district or the special property taxes
levied or collected therein; and
(b)(i) The sponsor may levy upon the value of taxable property
within the apportionment district, and collect special property taxes
in amounts not in excess of the amounts the legislative authority of
the sponsor deems necessary to provide for the purposes set forth in
RCW 39.88.080, but in annual amounts not in excess of one percent of
the tax allocation increment value within the apportionment district.
(ii) Special property taxes collected within an apportionment
district must be paid to the sponsor, or the sponsor's designated
agent, until all public improvement costs and tax allocation bonds
issued or incurred to be paid from the tax allocation revenues have
been paid and the community benefit funding goals have been met, but in
no event may special property taxes be collected longer than the
maximum period set forth in the public improvement ordinance.
(iii) Special property taxes are not regular property taxes and are
not subject to the limitations imposed by Article VII, section 2 of the
state Constitution and are in excess of all statutory and charter
limitations otherwise applicable to property taxes.
(2) The county assessor must determine the value of the taxable
property within the apportionment district according to the final
assessment roll established for the calendar year in which the public
improvement ordinance is enacted for the purpose of determining the tax
allocation base value for the apportionment district and ((shall)) must
certify to the sponsor the tax allocation base value as soon as
practicable after the assessor receives notice of the public
improvement ordinance and ((shall)) must certify to the sponsor the
total ((assessed)) value of ((real)) taxable property within thirty
days after the property values for each succeeding year have been
established, except that the assessed value of state-assessed real
property within the apportionment district ((shall)) must be certified
as soon as the values are provided to the assessor by the department of
revenue. Nothing in this section authorizes revaluations of real
property by the assessor for property taxation that are not made in
accordance with the assessor's revaluation plan under chapter 84.41
RCW.
(3) The date upon which the apportionment district was established
((shall be)) is considered the date upon which the public improvement
ordinance was enacted by the sponsor.
(4) ((The apportionment of regular property taxes under this
section shall cease when tax allocation revenues are no longer
necessary or obligated to pay public improvement costs or to pay
principal of and interest on bonds issued to finance public improvement
costs and payable in whole or in part from tax allocation revenues. At
the time of termination of the apportionment, any excess money and any
earnings thereon held by the sponsor shall be returned to the county
treasurer and distributed to the taxing districts which were subject to
the allocation in proportion to their regular property tax levies due
for the year in which the funds are returned)) The collection of
special property taxes within an apportionment district under this
section must cease when tax allocation revenues are no longer necessary
or obligated to pay public improvement costs, to satisfy community
benefit funding goals, or to pay tax allocation bonds, but in no event
may special property taxes be collected longer than the maximum period
set forth in the public improvement ordinance. At the time of
termination of the collection of those special property taxes, any
excess money and any earnings thereon held by the sponsor must be spent
on costs of public improvements or on funding for community benefit
activities.
(5) For purposes of Title 84 RCW, an apportionment district is
deemed a taxing district and any special property tax levy is deemed a
levy of the apportionment district, separate from any other tax levy of
the sponsor.
Sec. 6 RCW 39.88.080 and 1982 1st ex.s. c 42 s 9 are each amended
to read as follows:
(1) Tax allocation revenues may be applied ((as follows:)) in no particular
order, as follows, to:
(1) To pay public improvement costs;
(2) To pay principal of and interest on, and to fund any necessary
reserves for, tax allocation bonds;
(3) To pay into bond funds established to pay the principal of and
interest on general obligation bonds issued pursuant to law to finance
public facilities that are specified in the public improvement
ordinance and constructed following the establishment of and within the
apportionment district; or
(4) To pay any combination of the foregoing
(a) Pay for public improvements including public improvement costs;
(b) Provide for payments with respect to principal of and interest
on, and to fund any necessary reserves for, tax allocation bonds;
(c) Fund community benefit activities in accordance with section 2
of this act; or
(d) Pay any combination of the foregoing.
(2)(a) In the event that the legislative authority of a sponsor
determines that public improvements specified in the public improvement
ordinance are impracticable to carry out, or if unspent tax allocation
bond proceeds or tax allocation revenues remain after the completion of
the public improvements specified in the public improvement ordinance,
the legislative authority may by ordinance authorize expenditure of the
remaining bond proceeds and tax allocation revenues to retire or
defease those bonds or on other costs of public improvements, after
holding a hearing with public notice given substantially in accordance
with the procedure described in RCW 39.88.040(2). No such change of
use of tax allocation revenues or the proceeds of tax allocation bonds
may permit an increase in the maximum period of time during which the
special property tax is to be levied and collected, or permit an
increase in the total amount of the estimated cost to be paid from
special property taxes or from tax allocation bonds as set forth in the
public improvement ordinance.
(b) Upon the retirement or defeasance of all tax allocation bonds
secured by special property taxes levied and collected within an
apportionment district, any remaining tax allocation revenues must be
spent to fund public improvement costs or community benefit activities
specified in accordance with section 2 of this act.
Sec. 7 RCW 39.88.100 and 1982 1st ex.s. c 42 s 11 are each
amended to read as follows:
(1) A sponsor may issue such tax allocation bonds as it may deem
appropriate for the financing of public improvement costs and a
reasonable bond reserve and for the refunding of any outstanding tax
allocation bonds.
(2) The principal and interest of tax allocation bonds may be made
payable from:
(a) Tax allocation revenues;
(b) Project revenues ((which)) that may include:
(i) Nontax income, revenues, fees, and rents from the public
improvement financed with the proceeds of the bonds, or portions
thereof((,)); and
(ii) Contributions, grants, and nontax money available to the
sponsor for payment of costs of the public improvement or the debt
service of the bonds issued therefor;
(c) Proceeds of tax allocation bonds, if needed to capitalize
interest for up to thirty-six months following completion of
construction, or as necessary to accomplish a refunding or refinancing
of a prior issue of tax allocation bonds, consistent with applicable
federal tax regulations;
(d) Annual ad valorem taxes to be levied within the constitutional
and statutory tax limitations provided by law without a vote of the
electors of the sponsor or other taxing district on all of the taxable
property within the boundaries of that sponsor or other taxing district
that are from the full faith and credit of the sponsor or of any other
taxing district (the provision of which credit is declared to be a
proper purpose for any such taxing district);
(e) Any combination of the foregoing.
(3) Except and to the extent that a sponsor or other taxing
district has expressly pledged its full faith and credit to the payment
of tax allocation bonds, tax allocation bonds ((shall)) may not be the
general obligation of or guaranteed by all or any part of the full
faith and credit of the sponsor or any other state or local government,
or any tax revenues other than tax allocation revenues, and ((shall))
are not ((be)) considered a debt of the sponsor or other state or local
government for general indebtedness limitation purposes.
(4) The terms and conditions of tax allocation bonds may include
provisions for the following matters, among others:
(a) The date of issuance, maturity date or dates, denominations,
form, series, negotiability, registration, rank or priority, place of
payment, interest rate or rates which may be fixed or may vary over the
life of the tax allocation bonds, bond reserve, coverage, and such
other terms related to repayment of the tax allocation bonds;
(b) The application of tax allocation bond proceeds; the use, sale,
or disposition of property acquired; consideration or rents and fees to
be charged in the sale or lease of property acquired; consideration or
rents and fees to be charged in the sale or lease of property within a
public improvement; the application of rents, fees, and revenues within
a public improvement; the maintenance, insurance, and replacement of
property within a public improvement; other encumbrances, if any, upon
all or part of property within a public improvement, then existing or
thereafter acquired; and the type of debts that may be incurred;
(c) The creation of special funds; the money to be so applied; and
the use and disposition of the money;
(d) The securing of the tax allocation bonds by a pledge of
property and property rights, by assignment of income generated by the
public improvement, or by pledging such additional specifically
described resources other than tax revenues as are available to the
sponsor;
(e) The terms and conditions for redemption;
(f) The replacement of lost and destroyed bond instruments;
(g) Procedures for amendment of the terms and conditions of the tax
allocation bonds;
(h) The powers of a trustee to enforce covenants and take other
actions in event of default; the rights, liabilities, powers, and
duties arising upon the breach of any covenant, condition, or
obligation; and
(i) When consistent with the terms of this chapter, such other
terms, conditions, and provisions which may make the tax allocation
bonds more marketable and further the purposes of this chapter.
(5) Tax allocation bonds may be issued and sold in such manner as
the legislative authority of the sponsor ((shall)) determines.
Notwithstanding subsection (4) of this section, tax allocation bonds
may be issued and sold in accordance with chapter 39.46 RCW.
(6) The sponsor may also issue or incur obligations in anticipation
of the receipt of tax allocation bond proceeds or other money available
to pay public improvement costs.
(7) Nothing in this section grants a sponsor authority to issue tax
allocation bonds payable solely from revenues of a project constituting
a community benefit activity involving the provision of housing or
nonprofit facilities in duplication of the authority of the Washington
state housing finance commission under chapter 43.180 RCW.
Sec. 8 RCW 84.52.043 and 2011 c 275 s 2 are each amended to read
as follows:
Within and subject to the limitations imposed by RCW 84.52.050 as
amended, the regular ad valorem tax levies upon real and personal
property by the taxing districts hereafter named are as follows:
(1) Levies of the senior taxing districts are as follows: (a) The
levy by the state may not exceed three dollars and sixty cents per
thousand dollars of assessed value adjusted to the state equalized
value in accordance with the indicated ratio fixed by the state
department of revenue to be used exclusively for the support of the
common schools; (b) the levy by any county may not exceed one dollar
and eighty cents per thousand dollars of assessed value; (c) the levy
by any road district may not exceed two dollars and twenty-five cents
per thousand dollars of assessed value; and (d) the levy by any city or
town may not exceed three dollars and thirty-seven and one-half cents
per thousand dollars of assessed value. However any county is hereby
authorized to increase its levy from one dollar and eighty cents to a
rate not to exceed two dollars and forty-seven and one-half cents per
thousand dollars of assessed value for general county purposes if the
total levies for both the county and any road district within the
county do not exceed four dollars and five cents per thousand dollars
of assessed value, and no other taxing district has its levy reduced as
a result of the increased county levy.
(2) The aggregate levies of junior taxing districts and senior
taxing districts, other than the state, may not exceed five dollars and
ninety cents per thousand dollars of assessed valuation. The term
"junior taxing districts" includes all taxing districts other than the
state, counties, road districts, cities, towns, apportionment districts
established under chapter 39.88 RCW, port districts, and public utility
districts. The limitations provided in this subsection do not apply
to: (a) Levies at the rates provided by existing law by or for any
port or public utility district; (b) excess property tax levies
authorized in Article VII, section 2 of the state Constitution; (c)
levies for acquiring conservation futures as authorized under RCW
84.34.230; (d) levies for emergency medical care or emergency medical
services imposed under RCW 84.52.069; (e) levies to finance affordable
housing for very low-income housing imposed under RCW 84.52.105; (f)
the portions of levies by metropolitan park districts that are
protected under RCW 84.52.120; (g) levies imposed by ferry districts
under RCW 36.54.130; (h) levies for criminal justice purposes under RCW
84.52.135; (i) the portions of levies by fire protection districts that
are protected under RCW 84.52.125; (j) levies by counties for transit-related purposes under RCW 84.52.140; ((and)) (k) the protected portion
of the levies imposed under RCW 86.15.160 by flood control zone
districts in a county with a population of seven hundred seventy-five
thousand or more that are coextensive with a county; and (l) levies by
or for apportionment districts established under chapter 39.88 RCW.
Sec. 9 RCW 84.52.043 and 2009 c 551 s 6 are each amended to read
as follows:
Within and subject to the limitations imposed by RCW 84.52.050 as
amended, the regular ad valorem tax levies upon real and personal
property by the taxing districts hereafter named ((shall be)) are as
follows:
(1) Levies of the senior taxing districts ((shall be)) are as
follows: (a) The levy by the state ((shall)) may not exceed three
dollars and sixty cents per thousand dollars of assessed value adjusted
to the state equalized value in accordance with the indicated ratio
fixed by the state department of revenue to be used exclusively for the
support of the common schools; (b) the levy by any county ((shall)) may
not exceed one dollar and eighty cents per thousand dollars of assessed
value; (c) the levy by any road district ((shall)) may not exceed two
dollars and twenty-five cents per thousand dollars of assessed value;
and (d) the levy by any city or town ((shall)) may not exceed three
dollars and thirty-seven and one-half cents per thousand dollars of
assessed value. However any county is hereby authorized to increase
its levy from one dollar and eighty cents to a rate not to exceed two
dollars and forty-seven and one-half cents per thousand dollars of
assessed value for general county purposes if the total levies for both
the county and any road district within the county do not exceed four
dollars and five cents per thousand dollars of assessed value, and no
other taxing district has its levy reduced as a result of the increased
county levy.
(2) The aggregate levies of junior taxing districts and senior
taxing districts, other than the state, ((shall)) may not exceed five
dollars and ninety cents per thousand dollars of assessed valuation.
The term "junior taxing districts" includes all taxing districts other
than the state, counties, road districts, cities, towns, apportionment
districts established under chapter 39.88 RCW, port districts, and
public utility districts. The limitations provided in this subsection
((shall)) do not apply to: (a) Levies at the rates provided by
existing law by or for any port or public utility district; (b) excess
property tax levies authorized in Article VII, section 2 of the state
Constitution; (c) levies for acquiring conservation futures as
authorized under RCW 84.34.230; (d) levies for emergency medical care
or emergency medical services imposed under RCW 84.52.069; (e) levies
to finance affordable housing for very low-income housing imposed under
RCW 84.52.105; (f) the portions of levies by metropolitan park
districts that are protected under RCW 84.52.120; (g) levies imposed by
ferry districts under RCW 36.54.130; (h) levies for criminal justice
purposes under RCW 84.52.135; (i) the portions of levies by fire
protection districts that are protected under RCW 84.52.125; ((and))
(j) levies by counties for transit-related purposes under RCW
84.52.140; and (k) levies by or for apportionment districts established
under chapter 39.88 RCW.
Sec. 10 RCW 84.52.050 and 1973 1st ex.s. c 194 s 1 are each
amended to read as follows:
(1) Except as ((hereinafter)) provided otherwise in this section,
the aggregate of all tax levies upon real and personal property by the
state and all taxing districts, now existing or hereafter created,
((shall)) may not in any year exceed one percentum of the true and fair
value of such property in money((: PROVIDED, HOWEVER, That nothing
herein shall prevent)). Nothing in this section prevents levies at the
rates now provided by law by or for any port or public utility district
or any apportionment district established under chapter 39.88 RCW. The
term "taxing district" for the purposes of this section ((shall)) means
any political subdivision, municipal corporation, district, or other
governmental agency authorized by law to levy, or have levied for it,
ad valorem taxes on property, other than a port or public utility
district or any apportionment district established under chapter 39.88
RCW. Such aggregate limitation or any specific limitation imposed by
law in conformity therewith may be exceeded only as authorized by law
and in conformity with the provisions of Article VII, section 2(a),
(b), or (c) of the state Constitution ((of the state of Washington.)), or in conformity with
any other provision of Article VII of the state Constitution.
Nothing herein contained shall prohibit
(2) Nothing in this section prohibits the legislature from
allocating or reallocating the authority to levy taxes between the
taxing districts of the state and its political subdivisions in a
manner which complies with the aggregate tax limitation set forth in
this section.
NEW SECTION. Sec. 11 The following acts or parts of acts are
each repealed:
(1) RCW 39.88.060 (Disagreements between taxing districts) and 1989
c 378 s 1 & 1982 1st ex.s. c 42 s 7; and
(2) RCW 39.88.090 (General obligation bonds) and 1982 1st ex.s. c
42 s 10.
NEW SECTION. Sec. 12 If any provision of this act or its
application to any person or circumstance is held invalid, the
remainder of the act or the application of the provision to other
persons or circumstances is not affected.
NEW SECTION. Sec. 13 Section 8 of this act expires January 1,
2018.
NEW SECTION. Sec. 14 Section 9 of this act takes effect January
1, 2018.