Washington State
House of Representatives
Office of Program Research
BILL
ANALYSIS
Finance Committee
HB 1094
Brief Description: Providing a property tax exemption for property owned by a qualifying nonprofit organization and loaned, leased, or rented to and used by any government entity to provide character-building, benevolent, protective, or rehabilitative social services.
Sponsors: Representatives Walen, Ryu, Shavers, Lekanoff, Reeves and Donaghy.
Brief Summary of Bill
  • Exempts property owned by a nonsectarian nonprofit organization from property taxes if the organization loans, leases, or rents the property to any government entity, a federally recognized Indian tribe located in Washington, or another nonprofit organization using the property to provide character-building, benevolent, protective, or rehabilitative social services.
Hearing Date: 1/23/25
Staff: Rachelle Harris (786-7137).
Background:

All real and personal property is subject to a tax each year based on the highest and best use, unless a specific exemption is provided by law.? The annual growth of all regular property tax levy revenue is limited as follows:

  • For jurisdictions with a population of less than 10,000, revenue growth is limited to 1 percent.
  • For jurisdictions with a population of 10,000 or more, revenue growth is limited to the lesser of inflation or 1 percent plus the value of new construction.

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The state collects two regular property tax levies for common schools.? The revenue growth limit applies to both levies.?

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The Washington Constitution also limits regular levies to a maximum of 1 percent of the property's value ($10 per $1,000 of assessed value).? There are individual district rate maximums and aggregate rate maximums to keep the total tax rate for regular property taxes within the constitutional limit.

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Some real and personal property is specifically exempt from taxation, which is generally determined by the use of said property.

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Property owned by a nonsectarian nonprofit organization that is used for character-building, benevolent, protective, or rehabilitative social services is exempt from property tax.
Summary of Bill:

Property owned by a nonsectarian nonprofit organization is exempt from property taxes if the organization loans, leases, or rents the property to any government entity, a federally recognized Indian tribe located in Washington, or another nonprofit organization using the property to provide character-building, benevolent, protective, or rehabilitative social services.
Appropriation: None.
Fiscal Note: Available.
Effective Date: The bill takes effect 90 days after adjournment of the session in which the bill is passed.