2021 was a huge year for economic development with the passage of tax increment financing authority, so it isn’t that surprising that 2022 was relatively quiet.
Two bills that garnered the most attention were HB 1333 and SB 5849, both were revisions to existing economic development programs. Unfortunately, only SB 5849 passed.
SB 5849 makes updates to the Targeted Urban Area Property Tax Exemption for industrial and manufacturing facilities. This is a program available to cities, but could only be used on land that was vacant and zoned for industrial or manufacturing
as of December 31, 2014. The bill removes that time restriction. It also provides an extension of a B&O tax rate reduction for solar energy and silicon product manufacturers.
HB 1333 was a priority for counties and the Washington Economic Development Association as well as some cities. The bill would have extended the authority for the rural county sales tax for public facilities and economic development –
commonly referred to as the .09 sales tax – beyond the current 25 years limit. Unfortunately, some legislators expressed concerns about accountability around the use of the funds and stopped the bill from advancing. That was disappointing as
these funds are well documented and used to support a wide variety of economic development initiatives. We fully expect the coalition supporting this bill to bring back a new proposal in 2023.
Bill # | Description | Status |
|---|
SB 5849 | Addresses existing tax exemptions including the targeted urban area property tax exemption, the sales and use tax deferral for certain businesses in distressed areas, and a reduced business and occupation tax for certain solar energy systems. | Law; effective July 1, 2022. |
HB 1333 | Extends the authority for the rural county sales tax for public facilities and economic development until 2054. | Did not pass. |