HOUSE BILL REPORT

HJR 4214

BYRepresentatives Haugen, Ferguson, Cooper, Winsley, Appelwick, Morris and Wang

Submitting to the people an amendment to the state Constitution regarding the levy limitation.

House Committe on Revenue

Majority Report:  Do pass.  (13)

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

Minority Report:  Do not pass.  (3)

      Signed by Representatives Brumsickle, Fuhrman and Van Luven.

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

AS REPORTED BY COMMITTEE ON REVENUE MARCH 1, 1989

BACKGROUND:

Property tax levies are limited to specified rates per $1,000 of assessed value.  Article VII, section 2, of the constitution limits all regular levies to 1 percent of value.  Only regular levies of the Port and Public Utility Districts are currently outside the 1 percent limitation.  Statutorily, regular levies for all other districts except the state are limited to $5.55 per $1,000 of assessed value.  Before 1988, the statutory limitation was $9.15 per $1,000 of assessed value.  In 1988, the Legislature removed the state levy for common schools ($3.60) from this limit, thereby reducing the $9.15 limit to $5.55.

Taxing districts, other than school districts, may impose excess or special levies for general purposes for a one-year period if authorized by the voters of the district.  School districts may impose excess or special levies, if authorized by the voters as follows: 1) for one or two years for any purpose; and 2) for up to a six-year period for the purposes of construction, modernization, or remodeling of school facilities.

Districts seeking voter approval of such propositions are subject to the 60 percent/40 percent voter approval requirement (60 percent favorable vote of at least 40 percent of those voting in the last general election).  In seeking voter approval, taxing districts must describe levies in terms of a dollar amount for ballot purposes.  In cases of general obligation indebtedness levies, it is often impossible for a district to know precisely the actual dollar amount required until the bonds are sold and the interest rate or rates, terms, and bond retirement provisions are evident. 

Some taxing district levies are unique.  For example, emergency medical service districts levies are authorized for six years up to $.25 per $1,000 of assessed valuation with a 60 percent/40 percent voter approval requirement.  Park and Recreation Districts, Park and Recreation Service areas, Cultural Arts, Stadium, and Convention Center Districts possess levy authority of up to $.15 per $1,000 of assessed value by a 60 percent/40 percent vote of the people for up to either a five or six-year period. 

The state does not possess authority to impose single year excess levies under existing constitutional provisions.  Additionally, the constitution limits excess levies.

SUMMARY:

Library district regular property tax levies of $.50 per $1,000 of assessed value are placed outside the constitutional 1 percent limitation.  Six year levies are authorized for all property taxing districts, including the state.

The proposed constitutional amendment is to be placed before the voters for their approval or rejection in November, 1989.

Fiscal Note:      Not Requested.

House Committee ‑ Testified For:    None Presented.

House Committee - Testified Against:      None Presented.

House Committee - Testimony For:    None Presented.

House Committee - Testimony Against:      None Presented.