HOUSE BILL REPORT

HB 2053

As Amended by the Senate

BYRepresentatives Silver, Locke, May, H. Sommers, Ferguson, Horn and Wood

Providing a seven-year limitation for regular property tax levies involving redemption payments on bonds.

House Committe on Revenue

Majority Report:  Do pass. (15)

      Signed by Representatives Wang, Chair; Pruitt, Vice Chair; Holland, Ranking Republican Member; Appelwick, Basich, Brumsickle, Fraser, Grant, Haugen, Morris, Phillips, Rust, Silver, H. Sommers and Van Luven.

House Staff:Rick Wickman and Bob Longman (786-7136)

AS PASSED HOUSE MARCH 15, 1989

BACKGROUND:

Property taxing districts may ask voters to lift the 106 percent property tax limit, with the following options: 1) limit the period for which the increased levy is to be made; 2) limit the purpose for which the increased levy is to be made; 3) set the levy at a rate less than the maximum rate allowed for the district; or 4) include any combination of the conditions listed above.

Increases in the 106 percent limit must be approved by a majority of the voters of the district at a general election or special election held for that purpose.

SUMMARY:

Ballot propositions shall clearly state any conditions that are applicable when voters are asked to increase the 106 percent property tax limit.

If a taxing district asks its voters to raise the 106 percent property tax limit for the purpose of redemption payments on bonds, the increased levy shall not exceed seven years in duration.

EFFECT OF SENATE AMENDMENTS:  A taxing district requesting voter approval to raise the 106 percent property tax limit for purposes of bond redemption payments may not exceed nine years instead of seven years.

Revenue:    The bill has a revenue impact.

Fiscal Note:      Not Requested.

House Committee ‑ Testified For:    Representative Locke.

House Committee - Testified Against:      Stan Finkelstein, Association of Washington Cities.

House Committee - Testimony For:    Waivers of the 106 percent property tax lid law were not intended to be unlimited for purposes of bonds or bond redemption.  Unlimited bond redemption authority runs contrary to the philosophy of pay-as-you-go for bonds involving capital purposes.

House Committee - Testimony Against:      Limiting waivers of the 106 percent property tax lid law to seven years for bond redemption takes away local options for reasonable planning and financing of capital programs.  It was never the intent to limit these waivers for bond redemption.

VOTE ON FINAL PASSAGE:

      Yeas 98