Property Tax Reduction Bill Could Get Locke’s Ok
The Republican-led House passed a broad property tax cut measure Monday amid new signs Gov. Gary Locke will sign the bill when it reaches his desk.
Locke’s legislative lobbyist, Marty Brown, said in an interview that the governor may sign the bill despite some misgivings about its cost and impact on local governments.
Combined with an earlier tax reduction bill signed by Locke, the savings to the owner of a $110,000 home would come to an estimated $46 next year and $135 by 2001. The cost of the two measures would be about $220 million in the coming two-year budget cycle, more than half the $300 million to $400 million in surplus state revenues that have been earmarked for tax cuts.
“We’re very hopeful,” Locke will sign the bill, House Speaker Clyde Ballard, R-East Wenatchee, said before debate began. Legislative leaders have threatened to send the measure straight to voters in a referendum if Locke vetoed it.
The House, in a 63-34 vote, sent the bill back to the GOP-led Senate for concurrence on a last-minute amendment sought by county governments. The Senate is expected to agree and send the bill to Locke on Wednesday The House initially had planned to send the bill, SB5212, straight to Locke. But county government lobbyists persuaded leaders to amend the measure to make sure that three-member county commissions are not subject to tougher requirements than other local government bodies when raising taxes.
The way the bill was initially written, three-member commissioners would have needed a unanimous vote to raise taxes beyond the rate of inflation, while other governing bodies would need only a super-majority.
The amended bill would:
Require the governing bodies of all taxing entities with more than 10,000 people to vote by a simple majority if they wish to raise the property tax rate by anything up to the annual inflation rate, now running about 3 percent. A super-majority vote would be needed to raise the rate beyond the inflation rate, up to a maximum of 6 percent. For three-member county commissions, two commissioners would be considered a super-majority.
As is the case now, a vote of the people would be required to raise the rate above 6 percent. Current law allows taxing districts to automatically collect 6 percent more in taxes than the year before.
Create a procedure called “valuation smoothing” in which a taxing entity would be required to gradually phase-in tax increases for people whose assessed valuations go up 15 percent or more in a given year.