The Senate is set to hear a bill that would allow all cities to enact a tax exemption tool to promote living-wage jobs in their communities.

The Targeted Urban Area (TUA) property tax exemption is a 10-year local property tax exemption for new industrial or manufacturing facilities within a designated city area. A key eligibility requirement means the facility must create at least 25 family living wage jobs with an average pay of at least $18 per hour. After contracting with a city, the tax exemption is provided on the value of eligible improvements and applies only to the city portion of the collected property tax. Counties, by resolution, may also exempt eligible improvements from county property taxes.

HB 1386, sponsored by Rep. Emily Wicks (D–Everett), makes the TUA tax exemption available to all cities no matter their size or location, and extends the deadline for companies to apply for tax exemption to December 31, 2030.

Additionally, the bill updates the criteria and requirements of the TUA tax to include:

• Requiring business to provide a family living wage of $23 per hour and to offer health care benefits.
• Allowing eligibility for the exemption to facilities classified as Division E: Transportation by the US Department of Labor. Cities maintain the ability to exclude or limit these facilities from the tax exemption.
• Requiring cities to give priority to applicants that:
  • Provide prevailing wage jobs.
  • Procure from and contract with women-, minority-, or veteran-owned businesses.
  • Procure from and contract with businesses that have a history of compliance with wage and hour regulations.
  • Use apprenticeships from state-registered apprenticeship programs.
  • Give preferred hiring to workers living in the vicinity of the project.
  • Maintain labor standards for workers employed at the facility.

AWC applauds the efforts of the bill’s authors to spur living-wage job growth and economic development all around the state.

Dates to remember

HB 1386 is scheduled for a public hearing in the Senate Ways & Means Committee on Monday, March 15 at 4 pm. The bill is scheduled for executive session in the same committee on Thursday, March 18 at 4 pm.