HB 1128 — Concerning housing benefit districts.

NEW SECTION.

Sec.

5.

The title of each ballot measure must clearly state the purposes for which the proposed sales and use tax will be used and the time period for the sales tax, which may notbe exceedpermanent. 20 years.

Except as provided in subsection (2) of this section, the rate of tax p.under this section may not exceed .2 percent of the selling price in the case of a sales tax, or value of the article used, in the case of a use tax.

7 SHB 1128 under this section may be one-tenth or two-tenths of one percent of the selling price in the case of a sales tax, or value of the article used, in the case of a use tax.

(2) For districts consisting of a single participating jurisdiction with a population greater than 750,000 or consisting of at least two participating jurisdictions with a combined population greater than 250,000, the rate of tax authorized under subsection (1) ofp. this section may be one-tenth, two-tenths, or three-tenths of one percent of the selling price in the case of a sales tax, or value of the article used, in the case of a use tax.

(3)6 InHB addition1128 to and independent of thethis authoritysection providedmay innot subsectionsexceed (1).5 andpercent (2) of thisthe section,selling aprice districtin maythe impose,case withoutof a propositionsales approvedtax, byor avalue majority of personsthe voting,article aused, one-time sales and use tax in accordance with the termscase of thisa chapter.use tax.

(3) In addition to the authority provided in subsections (1) and (2) of this section, a district may impose, without a proposition approved by a majority of persons voting, a sales and use tax in accordance with the terms of this chapter.

Any(4) subsequentFor salespurposes andof use tax imposed under this subsectionsection, mustthe bedefinitions approvedin bysection a2 majority of voters.this act apply.

(4) The taxes imposed under this section may not exceed a duration of 20 years.

(5) For purposes of this section, the definitions in section 2 of this act apply.

6.5.

(1) Beginning with taxes levied for collection in calendar year 2022, the legislative authority of a district may impose a regular property tax levy, not to exceed $1 per $1,000 of the assessed value of property in the district, for the exclusive purpose of providing funding for the purposes described in sections 3 and 76 of this act.

The tax may be imposed for each year for six consecutive years when specifically authorized by a majority p.of the registered voters in the district voting on a proposition under this subsection.

8 SHB 1128 of the registered voters in the district voting on a proposition under this subsection.

(2) A district may provide for the retirement of voter-approved general obligation bonds, issued for capital purposes only, by levying bond retirement ad valorem property tax levies in excess of the one percent limitation whenever authorized by the voters of the district pursuant to Article VII, section 22(b) (b) of the Washington state Constitution and RCW 84.52.056.

(3) To carry out the purposes of this act and notwithstanding RCW 39.36.020(1), a district may issue general obligation bonds without voter approval, not to exceed an amount, together with any other outstanding nonvoter-approved general obligation indebtedness of the district, equal to 1.5 percent of the value of taxable property within the district, as the term "value of the taxable property" is definedp. in RCW 39.36.015.

7 HB 1128 defined in RCW 39.36.015.

p.(7) For purposes of this section, "regular property tax levy" means a levy subject to the limitations provided for in Article VII, section 2 of the Washington state Constitution or by statute.

9The SHBlimitations 1128in (7)RCW For84.52.043 purposesshall ofnot thisapply section,to "regularthe property tax levy" means a levy subjectauthorized to the limitations provided for in Articlethis VII,section. section 2 of the Washington state Constitution or by statute.

7.6.

(1)(a)(1) Any moneys received from the taxes imposed or bonds issued under this chapter must be spent to implement or reimburse jurisdictions for implementing the purposes of this chapter, including the following:

(i)(a) Station area planning strategies, including creating new or updating existing plans, identifying a community vision, assessing the current regulatory environment and identify possible barriers to affordable housing development, assessing displacement risk for current low-income residents and underrepresented racial and ethnic minorities, creating a displacement mitigation plan, promoting equitable homeownership opportunities for underrepresented racial and ethnicp. minorities, and assessing alternate pathways to ownership models such as community land trusts and limited or shared equity cooperatives;

(ii)8 InfrastructureHB development,1128 ethnic minorities, and assessing alternate pathways to ownership models such as area-widecommunity environmentalland plans,trusts sewers, and sidewalks;limited or shared equity cooperatives;

and(b) (iii) Land acquisition, based on station area plans and working with local jurisdictions and both nonprofit and for-profit developers to acquire, assemble, lease, land bank parcels, or sell, in cases where the station area plan clearly demonstrates that it is not financially feasible to lease all development parcels, with the net proceeds directed to subsidies for affordable housing and to promote community land trusts and infrastructure costs.costs;

Whereand leasing(c) aInfrastructure developmentdevelopment, parcelsuch isas financiallyarea-wide feasible,environmental theplans, housingsewers, benefitand districtsidewalks. may also choose to retain the underlying ownership of the parcel.

The housing benefit district shall include in station area plans specific enforceable commitments to include in deed restrictions, covenants, contracts, and leases which ensure that the plan does not reduce the housing units available in the station area for extremely low, very low, and low-income residents;

and, which establish a plan to meet the affordable housing population goals in section 3 (5) of this act, including minimum expectations for owners and managers of all properties which it has purchased.

The housing benefit district shall provide ongoing funding for the jurisdiction or jurisdictions within which the properties purchased by the p.

10 SHB 1128 district lie which is adequate for the jurisdiction to perform the auditing function required pursuant to section 4 of this act.

(b) For purposes of (a)(iii) of this subsection, land may not be leased or sold at a discounted rate unless affordable housing comprises more than 40 percent of the units.

(a) Cover the actual costs incurred by the advisory board created in section 87 of this act in the performance of its oversight and technical assistance duties;

8.7.

(2)(a) The governor shall appoint nineseven members of the advisory board, one of whom shall be appointed by the governor as chair.

and (vii) One member with economic development experience;experience.

(viii)(b) OneIn memberappointing representingpersons advocatesto forserve affordableon housingthe foradvisory marginalizedboard, communities;the governor shall strive to reflect the racial and ethnic makeup of state residents overall to ensure the inclusion of members of racial p.

9 HB 1128 and (ix)ethnic Onegroups memberdisproportionately representingexperiencing nonprofitsevere and moderate housing developers.cost-burden.

(b) In appointing persons to serve on the advisory board, the governor shall strive to reflect the racial and ethnic makeup of state residents overall to ensure the inclusion of members of racial and ethnic groups disproportionately experiencing severe and moderate housing cost-burden.

p.(3) The advisory board must review and approve the station area plans submitted by the districts pursuant to section 3 (6) of this act to confirm compliance with regional growth strategies.

11(4) SHBStaff 1128to (3)the Thehousing advisoryfinance boardcommission mustunder reviewchapter and43.180 approveRCW themust stationprovide areaadministrative plansand submittedstaff bysupport to the districtsadvisory pursuantboard toand sectionmust 3(6)be ofcompensated thisfor actits toservices confirmas complianceprescribed withunder regionalsection growth6(2) strategies.of this act.

(4) Staff to the housing finance commission under chapter 43.180 RCW must provide administrative and staff support to the advisory board and must be compensated for its services as prescribed under section 7(3) of this act.

9.8.

(c) Authorize at least one duplex, triplex, quadplex, sixplex, stacked flat, townhouse, or courtyard apartment on each parcel in one or more zoning districts that permit single-family residences unless a city documents a specific infrastructure of physical constraint that would make this requirement unfeasible for a particular parcel;

1210 SHBHB 1128 (d)(c) Authorize aat least one duplex, triplex, quadplex, sixplex, stacked flat, townhouse, or courtyard apartment on each parcel in one or more parcelszoning fordistricts whichthat theypermit aresingle-family notresidences currentlyunless authorized;a city documents a specific infrastructure of physical constraint that would make this requirement unfeasible for a particular parcel;

(d) Authorize a duplex, triplex, quadplex, sixplex, stacked flat, townhouse, or courtyard apartment on one or more parcels for which they are not currently authorized;

(p) Remove owner occupancy requirements related to accessory dwelling units;

(q) Adopt new square footage requirements related to accessory dwelling units that are less restrictive than existing square footage requirements related to accessory dwelling units;

1311 SHBHB 1128 (r)(p) AdoptRemove maximumowner allowableoccupancy exemptionrequirements levelsrelated into WACaccessory 197-11-800(1)dwelling asunits; it existed on June 11, 2020, or such subsequent date as may be provided by the department of ecology by rule, consistent with the purposes of this section;

(q) Adopt new square footage requirements related to accessory dwelling units that are less restrictive than existing square footage requirements related to accessory dwelling units;

(r) Adopt maximum allowable exemption levels in WAC 197-11-800(1) as it existed on June 11, 2020, or such subsequent date as may be provided by the department of ecology by rule, consistent with the purposes of this section;

and (y)p. Develop a local program that offers homeowners a combination of financing, design, permitting, or construction support to convert a single-family home into a duplex, triplex, or quadplex where those housing types are authorized.

A12 localHB government1128 may(y) conditionDevelop thisa local program onthat offers homeowners a requirementcombination toof providefinancing, adesign, certainpermitting, numberor ofconstruction unitssupport forto affordableconvert a single-family home ownershipinto ora toduplex, renttriplex, aor certainquadplex numberwhere ofthose thehousing newlytypes p.are authorized.

14A SHBlocal 1128government may condition this program on a requirement to provide a certain number of units for affordable home ownership or to rent a certain number of the newly created units for a defined period of time to either tenants in a housing subsidy program as defined in RCW 43.31.605(14) or to tenants whose income is less than eighty percent of the city or county median family income.

(d) Consider strategies to minimize displacement of low-income residents and underrepresented racial and ethnic minorities resulting from redevelopment;

(f) Provide for participation and input from community members, community groups, local builders, local realtors, nonprofit housing advocates, and local religious groups;

and (g) Include a schedule of programs and actions to implement the recommendations of the housing action plan.

1513 SHBHB 1128 (3)(f) IfProvide adoptedfor byparticipation April 1, 2023, ordinances, amendments to development regulations, and otherinput nonprojectfrom actionscommunity takenmembers, bycommunity agroups, citylocal tobuilders, implementlocal therealtors, actionsnonprofit specifiedhousing inadvocates, subsectionand (1)local ofreligious thisgroups; section, with the exception of the action specified in subsection (1)(f) of this section, are not subject to administrative or judicial appeal under chapter 43.21C RCW.

and (g) Include a schedule of programs and actions to implement the recommendations of the housing action plan.

(3) If adopted by April 1, 2023, ordinances, amendments to development regulations, and other nonproject actions taken by a city to implement the actions specified in subsection (1) of this section, with the exception of the action specified in subsection (1)(f) of this section, are not subject to administrative or judicial appeal under chapter 43.21C RCW.

(6) A city that is planning to take at least two actions under subsection (1) of this section((,section, and that action will occur between July 28, 2019, and April 1, 2021,))2021, is eligible to apply to the department for planning grant assistance of up to one hundred thousand dollars, subject to the availability of funds appropriated for that purpose.

(8)p. The department shall establish grant award amounts under subsections (6) and (7) of this section based on the expected number of cities or participating jurisdictions that will seek grant assistance, to ensure that all cities and participating jurisdictions can receive some level of grant support.

If14 fundingHB capacity1128 allows,(8) theThe department mayshall considerestablish acceptinggrant award amounts under subsections (6) and funding(7) applicationsof fromthis p.section based on the expected number of cities or participating jurisdictions that will seek grant assistance, to ensure that all cities and participating jurisdictions can receive some level of grant support.

16If SHBfunding 1128capacity allows, the department may consider accepting and funding applications from cities with a population of less than twenty thousand if the actions proposed in the application will create a significant amount of housing capacity or regulatory streamlining and are consistent with the actions in this section.

10.9.

(c) "Total sales tax rate" means the combined rates of all state and local taxes imposed under this chapter and chapters 36.100, 67.28, 67.40, and 82.08 RCW, and any other tax authorized after March 29, 2001, if the tax is in the nature of a sales tax collected from the buyer, but excluding taxes imposed under RCW 81.104.170 before December 1, 2000, and taxes imposed under RCW 82.14.530 and section 54 of this act.

Sec.

11.

RCW 84.52.010 and 2017 c 196 s 10 are each amended to read as follows:

(1) Except as is permitted under RCW 84.55.050, all taxes must be levied or voted in specific amounts.

(2) The rate percent of all taxes for state and county purposes, and purposes of taxing districts coextensive with the county, must be p.

17 SHB 1128 determined, calculated and fixed by the county assessors of the respective counties, within the limitations provided by law, upon the assessed valuation of the property of the county, as shown by the completed tax rolls of the county, and the rate percent of all taxes levied for purposes of taxing districts within any county must be determined, calculated and fixed by the county assessors of the respective counties, within the limitations provided by law, upon the assessed valuation of the property of the taxing districts respectively.

(3) When a county assessor finds that the aggregate rate of tax levy on any property, that is subject to the limitations set forth in RCW 84.52.043 or 84.52.050, exceeds the limitations provided in either of these sections, the assessor must recompute and establish a consolidated levy in the following manner:

(a) The full certified rates of tax levy for state, county, county road district, regional transit authority, and city or town purposes must be extended on the tax rolls in amounts not exceeding the limitations established by law;

however any state levy takes precedence over all other levies and may not be reduced for any purpose other than that required by RCW 84.55.010.

If, as a result of the levies imposed under RCW 36.54.130, 84.34.230, 84.52.069, 84.52.105, the portion of the levy by a metropolitan park district that was protected under RCW 84.52.120, 84.52.125, 84.52.135, and 84.52.140, and the portion of the levy by a flood control zone district that was protected under RCW 84.52.816, the combined rate of regular property tax levies that are subject to the one percent limitation exceeds one percent of the true and fair value of any property, then these levies must be reduced as follows:

(i) The portion of the levy by a flood control zone district that was protected under RCW 84.52.816 must be reduced until the combined rate no longer exceeds one percent of the true and fair value of any property or must be eliminated;

(ii) If the combined rate of regular property tax levies that are subject to the one percent limitation still exceeds one percent of the true and fair value of any property, the levy imposed by a county under RCW 84.52.140 must be reduced until the combined rate no longer exceeds one percent of the true and fair value of any property or must be eliminated;

(iii) If the combined rate of regular property tax levies that are subject to the one percent limitation still exceeds one percent p.

18 SHB 1128 of the true and fair value of any property, the portion of the levy by a fire protection district or regional fire protection service authority that is protected under RCW 84.52.125 must be reduced until the combined rate no longer exceeds one percent of the true and fair value of any property or must be eliminated;

(iv) If the combined rate of regular property tax levies that are subject to the one percent limitation still exceeds one percent of the true and fair value of any property, the levy imposed by a county under RCW 84.52.135 must be reduced until the combined rate no longer exceeds one percent of the true and fair value of any property or must be eliminated;

(v) If the combined rate of regular property tax levies that are subject to the one percent limitation still exceeds one percent of the true and fair value of any property, the levy imposed by a ferry district under RCW 36.54.130 must be reduced until the combined rate no longer exceeds one percent of the true and fair value of any property or must be eliminated;

(vi) If the combined rate of regular property tax levies that are subject to the one percent limitation still exceeds one percent of the true and fair value of any property, the portion of the levy by a metropolitan park district that is protected under RCW 84.52.120 must be reduced until the combined rate no longer exceeds one percent of the true and fair value of any property or must be eliminated;

(vii) If the combined rate of regular property tax levies that are subject to the one percent limitation still exceeds one percent of the true and fair value of any property, then the levies imposed under RCW 84.34.230, 84.52.105, section 5 of this act, and any portion of the levy imposed under RCW 84.52.069 that is in excess of thirty cents per thousand dollars of assessed value, must be reduced on a pro rata basis until the combined rate no longer exceeds one percent of the true and fair value of any property or must be eliminated;

and (viii) If the combined rate of regular property tax levies that are subject to the one percent limitation still exceeds one percent of the true and fair value of any property, then the thirty cents per thousand dollars of assessed value of tax levy imposed under RCW 84.52.069 must be reduced until the combined rate no longer exceeds one percent of the true and fair value of any property or eliminated.

(b) The certified rates of tax levy subject to these limitations by all junior taxing districts imposing taxes on such property must p.

19 SHB 1128 be reduced or eliminated as follows to bring the consolidated levy of taxes on such property within the provisions of these limitations:

(i) First, the certified property tax levy authorized under RCW 84.52.821 must be reduced on a pro rata basis or eliminated;

(ii) Second, if the consolidated tax levy rate still exceeds these limitations, the certified property tax levy rates of those junior taxing districts authorized under RCW 36.68.525, 36.69.145, 35.95A.100, and 67.38.130 must be reduced on a pro rata basis or eliminated;

(iii) Third, if the consolidated tax levy rate still exceeds these limitations, the certified property tax levy rates of flood control zone districts other than the portion of a levy protected under RCW 84.52.816 must be reduced on a pro rata basis or eliminated;

(iv) Fourth, if the consolidated tax levy rate still exceeds these limitations, the certified property tax levy rates of all other junior taxing districts, other than fire protection districts, regional fire protection service authorities, library districts, the first fifty cent per thousand dollars of assessed valuation levies for metropolitan park districts, and the first fifty cent per thousand dollars of assessed valuation levies for public hospital districts, must be reduced on a pro rata basis or eliminated;

(v) Fifth, if the consolidated tax levy rate still exceeds these limitations, the first fifty cent per thousand dollars of assessed valuation levies for metropolitan park districts created on or after January 1, 2002, must be reduced on a pro rata basis or eliminated;

(vi) Sixth, if the consolidated tax levy rate still exceeds these limitations, the certified property tax levy rates authorized to fire protection districts under RCW 52.16.140 and 52.16.160 and regional fire protection service authorities under RCW 52.26.140(1) (b) and (c) must be reduced on a pro rata basis or eliminated;

and (vii) Seventh, if the consolidated tax levy rate still exceeds these limitations, the certified property tax levy rates authorized for fire protection districts under RCW 52.16.130, regional fire protection service authorities under RCW 52.26.140(1)(a), library districts, metropolitan park districts created before January 1, 2002, under their first fifty cent per thousand dollars of assessed valuation levy, and public hospital districts under their first fifty cent per thousand dollars of assessed valuation levy, must be reduced on a pro rata basis or eliminated.

2015 SHBHB 1128 Sec.

12.10.

2116 SHBHB 1128 districts and regional fire protection service authorities that are protected under RCW 84.52.125;

and (m) levies imposed by housing benefit districts under section 65 of this act.

13.11.

(1) The ballot proposition authorizing a taxing district to impose the regular property tax levies authorized in RCW 36.68.525, 36.69.145, 67.38.130, 84.52.069, section 65 of this act, or 84.52.135 must contain in substance the following:

14.12.

Sections 1 through 43 and 65 through 87 of this act constitute a new chapter in Title 36 RCW.

2217 SHBHB 1128