BILL REQ. #:  S-0263.1 

Read first time 01/15/13.   Referred to Committee on Ways & Means.

     AN ACT Relating to narrowing the property tax exemption for intangibles; amending RCW 84.36.070; and creating a new section.

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

Sec. 1   RCW 84.36.070 and 1997 c 181 s 1 are each amended to read as follows:
     (1)(a) Except as provided in (b) of this subsection, intangible personal property is exempt from ad valorem taxation.
     (b) Notwithstanding (a) of this subsection, the first million dollars of assessed value of certificates of deposit; state, county, and municipal bonds and warrants and bonds and warrants of other taxing districts; bonds of the United States and of foreign countries or political subdivisions thereof; and the bonds, stocks, or shares of private corporations is exempt from ad valorem taxation.
     (2) "Intangible personal property" means:
     (a) All moneys and credits including mortgages, notes, accounts, certificates of deposit, tax certificates, judgments, state, county and municipal bonds and warrants and bonds and warrants of other taxing districts, bonds of the United States and of foreign countries or political subdivisions thereof and the bonds, stocks, or shares of private corporations;
     (b) Private nongovernmental personal service contracts, private nongovernmental athletic or sports franchises, or private nongovernmental athletic or sports agreements provided that the contracts, franchises, or agreements do not pertain to the use or possession of tangible personal or real property or to any interest in tangible personal or real property; and
     (c) Other intangible personal property such as trademarks, trade names, brand names, patents, copyrights, trade secrets, franchise agreements, licenses, permits, core deposits of financial institutions, noncompete agreements, customer lists, patient lists, favorable contracts, favorable financing agreements, reputation, exceptional management, prestige, good name, or integrity of a business.
     (3) "Intangible personal property" does not include zoning, location, view, geographic features, easements, covenants, proximity to raw materials, condition of surrounding property, proximity to markets, the availability of a skilled workforce, and other characteristics or attributes of property.
     (4) This section does not preclude the use of, or permit a departure from, generally accepted appraisal practices and the appropriate application thereof in the valuation of real and tangible personal property, including the appropriate consideration of licenses, permits, and franchises granted by a government agency that affect the use of the property.

NEW SECTION.  Sec. 2   This act applies to taxes levied for collection in 2014 and thereafter.