Washington SB 5539: Making technical corrections to the local tax increment financing program.

Bill Text

AN ACT Relating to making technical corrections to the local tax 1
increment financing program under chapter 39.114 RCW by applying the 2
definition  of  real  property  to  ensure  private  investments  made  on 3
state  and  local  government-owned  land  are  included  in  the  increment 4
value, ensuring that the relocation and construction of a government-5
owned  facility  is  included  as  an  eligible  project,  ensuring  that 6
acquisition costs include appurtenant rights, providing clarification 7
to definitions of increment value and tax allocation base value for 8
consistency with current law, clarifying notice requirements for the 9
creation  of  a  tax  increment  area,  and  creating  consistency  with 10
current law for add-on levies codified in RCW 84.55.010; amending RCW 11
39.114.010, 39.114.020, 39.114.040, 39.114.050, 84.55.015, 84.55.020, 12
and 84.55.030; and declaring an emergency.13
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:14
Sec. 1.  RCW 39.114.010 and 2021 c 207 s 1 are each amended to 15
read as follows:16
The  definitions  in  this  section  apply  throughout  this  chapter 17
unless the context clearly requires otherwise.18
(1)  "Assessed  value  of  real  property"  means  the  valuation  of 19
taxable real property as placed on the last completed assessment roll 20
prepared pursuant to Title 84 RCW.21
Z-0328.1
SENATE BILL 5539
State of Washington68th Legislature2023 Regular Session
By Senators  Cleveland,  L.  Wilson,  Mullet,  Boehnke,  King,  Liias, 
Frame, and Wellman; by request of State Treasurer
Read  first  time  01/23/23.      Referred  to  Committee  on  Business, 
Financial Services, Gaming & Trade.
p. 1SB 5539

(2)  "Increment  area"  means  the  geographic  area  within  which 1
regular  property  tax  revenues  are  to  be  apportioned  to  pay  public 2
improvement costs, as authorized under this chapter.3
(3)  "Increment  value"  means  100  percent  of  any  increase  in  the 4
true  and  fair  value  of  real  property  in  an  increment  area  that  is 5
placed on the tax rolls after the increment area ((is created)) takes 6
effect. The increment value shall not be less than zero.7
(4)  "Local  government"  means  any  city,  town,  county,  port 8
district, or any combination thereof.9
(5)   "Ordinance"   means   any   appropriate   method   of   taking 10
legislative  action  by  a  local  government,  including  a  resolution 11
adopted by a port district organized under Title 53 RCW.12
(6) "Public improvement costs" means the costs of:13
(a)  Design,  planning,  acquisition,  required  permitting,  required 14
environmental  studies  and  mitigation,  seismic  studies  or  surveys, 15
archaeological studies or surveys, land surveying, 
site acquisition, 16
including  appurtenant  rights  and  site  preparation,  construction, 17
reconstruction,    rehabilitation,    improvement, expansion,    and 18
installation  of  public  improvements,  and  other  directly  related 19
costs;20
(b)  Relocating,  maintaining,  and  operating  property  pending 21
construction of public improvements;22
(c) Relocating utilities as a result of public improvements;23
(d) Financing public improvements, including capitalized interest 24
for up to six months following completion of construction, legal and 25
other professional services, taxes, insurance, principal and interest 26
costs on general indebtedness issued to finance public improvements, 27
and any necessary debt service reserves;28
(e) Expenses incurred in revaluing real property for the purpose 29
of  determining  the  tax  allocation  base  value  by  a  county  assessor 30
under chapter 84.41 RCW and expenses incurred by a county treasurer 31
under chapter 84.56 RCW in apportioning the taxes and complying with 32
this  chapter  and  other  applicable  law.  For  purposes  of  this 33
subsection (6)(e),  "expenses  incurred"  means  actual  staff  and 34
software  costs  directly  related  to  the  implementation  and  ongoing 35
administration of increment areas under this chapter; and36
(f)  Administrative  expenses  and  feasibility  studies  reasonably 37
necessary  and  related  to  these  costs,  including  related  costs  that 38
may  have  been  incurred  before  adoption  of  the  ordinance  authorizing 39
p. 2SB 5539

the  public  improvements  and  the  use  of  tax  increment  financing  to 1
fund the costs of the public improvements.2
(7) "Public improvements" means:3
(a)  Infrastructure  improvements  owned  by  a state  or  local 4
government within or outside of and serving the increment area ((that 5
include)) and real property owned or acquired by a local government 6
within the increment area including:7
(i) Street and road construction;8
(ii)  Water  and  sewer  system  construction,  expansion,  and 9
improvements;10
(iii)    Sidewalks    and    other    nonmotorized    transportation 11
improvements and streetlights;12
(iv) Parking, terminal, and dock facilities;13
(v) Par