WSR 02-08-067



[ Filed April 2, 2002, 10:49 a.m. ]

Subject of Possible Rule Making: WAC 458-29A-400 Leasehold excise tax -- Exemptions.

Statutes Authorizing the Agency to Adopt Rules on this Subject: RCW 82.29A.140.

Reasons Why Rules on this Subject may be Needed and What They Might Accomplish: WAC 458-29A-400 provides information about exemptions from the leasehold excise tax. This rule needs to be revised to incorporate the leasehold excise tax exemption provided by RCW 82.29A.136 (chapter 26, Laws of 2001) for interests consisting of 3,000 or more residential and recreational lots that are or may be subleased for residential and recreational purposes. The exemption pertaining to sales/leasebacks by regional transit authorities provided by RCW 82.29A.134 (chapter 4, Laws of 2000 2nd sp.s.) also needs to be added to the rule. Additionally, the information contained in Excise Tax Advisory 552.99.29A (Leasehold excise tax -- Exemption for public employees -- Condition of employment) should be incorporated into this rule. The language explaining the exemption for leasehold interests in student housing at public or nonprofit schools or colleges should be revised to more closely track the language of the statute. Also, the exemption for leasehold interests in properties rented for residential purposes on a month-to-month basis pending destruction or removal for construction of a public highway or public building contains language that should be clarified to make clear that the exemption only applies when the residential unit will be destroyed or removed pending construction of a public highway or public building.

Other Federal and State Agencies that Regulate this Subject and the Process Coordinating the Rule with These Agencies: None.

Process for Developing New Rule: Modified negotiated rule making.

Interested parties can participate in the decision to adopt the new rule and formulation of the proposed rule before publication. Written comments may be submitted by mail, fax, or at the public meeting. Oral comments will be accepted at the public meeting. A preliminary draft of the proposed changes is available upon request. Written comments on and/or requests for copies of the rule may be directed to Mark Mullin, Tax Policy Specialist, Legislation and Policy Division, State of Washington Department of Revenue, P.O. Box 47467, Olympia, WA 98504-7467, phone (360) 570-6112, fax (360) 664-0693, e-mail

Location and Date of Public Meeting: Capital Plaza Building, 4th Floor Large Conference Room, 1025 Union Avenue S.E., Olympia, WA, on Tuesday, May 7, 2002, at 9:30 a.m.

Assistance for Persons with Disabilities: Contact Sandy Davis no later than ten days before the hearing date, TTY 1-800-451-7985, or (360) 570-6175.

April 2, 2002

Claire Hesselholt, Rules Manager

Legislation and Policy Division

Washington State Code Reviser's Office