Municipal Finance & Economic Development

ACTION ITEM: Local Infrastructure Finance Tools (SB 6700, SHB 2673)

These bills would provide a mechanism to fund infrastructure for economic development projects using the additional state and local sales tax generated by the project. SB 6700 passed out of the Senate International Trade & Economic Development Committee on February 2. SHB 2673, which would finance six demonstration projects and allows the development authority to use incremental increases in local property tax, passed out of the House Economic Development, Agriculture & Trade Committee on January 27 and was heard by the House Finance Committee on February 2.

AWC supports these proposals for additional tools to help fund infrastructure related to economic development. Please contact members of the House Finance Committee and ask them to pass SHB 2673.

ACTION ITEM: Multi-Family Housing Property Tax Exemption (SB 6588, SB 6626, HB 1742)

The Senate Financial Institutions, Housing & Consumer Protection Committee passed SB 6588 out of committee on February 1. SB 6588, which would expand this existing property tax exemption authority to cities 5,000 and fewer in population, is now in the Senate Ways & Means Committee, along with SB 6626, which would set the eligibility threshold at cities with a population greater than 17,000.

Please contact your Senator, especially if he or she serves on the Ways & Means Committee, and express support for the expansion of this exemption that some cities have used to help revitalize their downtown urban centers. Tell them you support all of the bills but that you prefer SB 6588 and HB 1742, which would extend the tool to cities greater than 5,000 in population. Remind them that protections regarding uses are contained in the underlying statutes, which were outlined in last week’s Bulletin. Members of Ways & Means must hear from you – some have expressed concerns with these proposals.

Streamlined Sales Tax (SSB 6594/HB 2806)

No further action has taken place on this issue, and we do not expect the House Finance Committee to schedule a hearing on SSB 6594 until after the House finishes action on House bills on February 14.

In the meantime, we encourage cities to contact their House members to remind them about the need to pass legislation with full mitigation this year to bring Washington in full compliance with the streamlined sales tax agreement and to level the playing field for Washington businesses.

Sales Tax (0.3%) & Levy Lid Lift Flexibility (HB 2988/SB 6789, 2SSB 5333)

The Legislature has advanced these AWC priority bills for flexibility with the sales tax and six-year voter approved property tax lid lift authority granted in 2003. Some legislators remain opposed, and we have more work to do.

HB 2988, which would eliminate the non-supplanting language and the requirement that one-third of the new sales tax proceeds be spent on criminal justice purposes, passed out of the House Finance Committee on January 30 and is in the Rules Committee awaiting further action. Its Senate companion, SB 6789, was heard by the Senate Ways & Means Committee on February 1. There is legislative opposition to these bills, and they are unlikely to pass in their current form. Some legislators are opposed to relaxing the requirement to spend a third of the proceeds on criminal justice expenses. Others oppose elimination of the supplanting language. We will continue to work with those concerned in an attempt to produce a compromise proposal.

2SSB 5333, which would repeal the non-supplanting requirements in the six-year voter approved property tax levy lid lift and allow additional local taxing districts to use the six-year authority, passed out of the Senate Government Operations & Elections Committee on February 1 and was heard by the Senate Ways & Means Committee on February 2. This legislation has drawn less criticism than the two aforementioned sales tax proposals.

Social Card Room Freeze (SSB 6615)

The Senate Ways & Means Committee passed a substitute version of SB 6615 on February 1. The bill would freeze the number of card rooms in the state. The bill was amended in Committee to prohibit a city from rescinding a ban. The original bill would have allowed a city to rescind a ban after a supermajority vote by the council and voters.

Shopping Carts (SHB 2813)

On February 1, the House Judiciary Committee passed a substitute version of this bill to place restrictions on local ordinances addressing abandoned shopping carts. The substitute version is still too restrictive, and AWC opposes the bill as it left the Committee. We are working, along with city representatives, with the proponents in an effort to reach a compromise.

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