HOUSE BILL REPORT

HB 2475

As Amended by the Senate

BYRepresentatives Ferguson, Haugen, Horn and Nutley

Limiting license fees and taxes that impact certain convention and trade facilities.

House Committe on Local Government

Majority Report:  Do pass.  (14)

      Signed by Representatives Haugen, Chair; Cooper, Vice Chair; Ferguson, Ranking Republican Member; Kirby, Horn, Nealey, Nelson, Nutley, Phillips, Raiter, Rayburn, Wolfe, Wood and Zellinsky.

House Staff:Steve Lundin (786-7127)

Rereferred House Committee on Revenue

Majority Report:  Do pass.  (14)

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

Minority Report:  Do not pass.  (1)

      Signed by Representative Silver.

AS PASSED HOUSE FEBRUARY 9, 1990

BACKGROUND:

Over the years, various statutes have authorized all or certain categories of counties, cities and towns to impose a variety of excise taxes on hotel/motel room rental charges.

One of these statutes permits such a special excise tax of up to three percent to be imposed by a city incorporated before January 1, 1982, with a population of over 60,000, that is located in a county with a population of over one million, other than the city of Seattle, i.e., Bellevue.  The proceeds from this excise tax only may be used for the acquisition, design, and construction of convention and trade facilities, or the retirement of debt issued for such facilities.

SUMMARY:

The permissible uses of the proceeds from the three percent special excise tax that Bellevue is authorized to impose on hotel/motel room rental charges are expanded to include maintenance and operation of convention and trade facilities.

The authority to use these tax receipts for the expanded purposes applies regardless of when the taxes were levied or collected.

EFFECT OF SENATE AMENDMENTS:  The amendment permits the tax receipts to be used for marketing a convention center facility, and in addition may be used for maintenance and operation of such facilities if done as a part of a budget for debt service and marketing.

Fiscal Note:      Requested January 25, 1990.

House Committee ‑ Testified For:    (Local Government)  Chuck Mize, City of Bellevue.

(Revenue)  Chuck Mize, City of Bellevue.

House Committee - Testified Against:      (Local Government)  Becky Bogard and Cliff Webster, Washington State Hotel and Motel Association.

(Revenue)  Becky Bogard, Washington State Hotel and Motel Association.

House Committee - Testimony For:    (Local Government) This bill only applies to Bellevue.  Most other local hotel/motel taxes can be used for maintenance and operation of facilities.  The 15 hotels in the Bellevue region support the bill.

(Revenue)  The authority for the city of Bellevue to use their three percent hotel/motel tax for maintenance and operation of their convention center is needed by the city to expend moneys for these purposes after design and construction is completed

House Committee - Testimony Against:      (Local Government)  There is some concern over the precedent of expanding the potential use of these tax receipts for maintenance and operation.

(Revenue)  This additional authority to spend receipts from the city of Bellevue's three percent hotel/motel tax for maintenance and operation of their convention center creates a precedent.

VOTE ON FINAL PASSAGE:

      Yeas 88; Nays 3, Absent 2; Excused 5

Voting Nay: Representatives Heavey, Rust, Silver

Absent:     Representatives Cantwell, McLean

Excused:    Representatives Ballard, Basich, Chandler, Gallagher, Sommers D