For decades, rural counties in Washington have used a special sales & use tax to help fund public facilities and economic development. A bill up for a hearing in the Senate would extend the expiration date of the tax to December 31, 2054.

HB 1333, sponsored by Rep. Steve Tharinger (D–Port Townsend), would allow counties that imposed the local sales and use tax for public facilities in rural counties prior to August 1, 2009 to continue collecting the tax until the end of 2054. Previously, the tax expired 25 years after the tax was first imposed in the county.

The rural facility sales & use tax is credited against the state tax rate and is meant to fund public facility projects and economic development activities. Financing public facilities is one of the biggest challenges for rural counties to meet the requirements of the Growth Management Act. The tax and the ability to bond against the revenues have allowed rural communities to fund projects supporting new housing and businesses. Counties collecting the tax are required to consult with cities, towns, and port districts within the county to ensure that expenditures meet the goals of the rural public facility tax.

Under the bill, a rural county is defined as a county with a population density of fewer than 100 people per square mile or a county smaller than 225 square miles. Population density is based on annual reporting by the Office of Financial Management. Counties that imposed the tax prior to August 1, 2009 but have since surpassed the population limits will still be able to collect the tax.

AWC supports the expansion to the tax expiration date; such funds are often used in collaboration with cities on economic development projects.

Dates to remember

HB 1333 is scheduled for a public hearing in the Senate Ways & Means Committee on Tuesday, March 16 at 4 pm.