The big news in 2022 was the state revenue forecast. The February forecast showed that the state had $5 billion more in revenue for the 2021-23 biennium than when the Legislature adopted the original biennial budget in April 2021. In addition, the Legislature
still had $1.3 billion in federal ARPA funds to allocate as well as increased formula-based funds for transportation and other infrastructure from the recently passed federal Bipartisan Infrastructure Law (BIL).
The result was robust investment in some of the programs that are key to cities. AWC shared several city budget priorities with legislators, and we are pleased to report that most of them were funded. You can find a full rundown of areas of interest to
cities in our budget matrix.
Beyond the budget, it was a relatively quiet session for municipal finance. There was a proposal (HB 2018)
to provide a sales tax holiday and it included funds to make sure revenue losses for cities were mitigated; however, the bill didn’t pass.
One of the bills we were particularly excited about was HB 1811. It would have provided cities
with authority to use a fire benefit charge similar to fire districts and regional fire authorities. Unfortunately, the bill ran into opposition from the Washington State Council of Fire Fighters and didn’t advance this session.
We expect a little more action on finance and tax legislation in 2023 thanks to the expected work of the state Tax Structure Work Group. The work group has been tasked with
making recommendations later this year about changes to the state’s tax structure, which will likely result in legislative proposals for consideration in 2023. However, what those proposals will be is far from clear at this point.
Bill # | Description | Status |
|---|
SB 5002 | Addressing the State Auditor’s duties and procedures. | Law; effective June 9, 2022. |
SB 5505 | Reinstating a property tax exemption for property owned by certain nonprofit organizations where a portion of the property is used for the purpose of a farmers market. | Law; effective June 9, 2022, retroactive to 2021 taxes. |
SB 5651 | Supplemental capital budget. | Law; effective March 31, 2022. |
SB 5693 | Supplemental operating budget. | Gov. signed with partial veto. Law; effective March 31, 2022. |
SB 5796 | Restructuring cannabis revenue appropriations. | Law; effective June 9, 2022. |
SB 5800 | Modifying tax and revenue laws in a manner that is estimated to not affect state or local tax collections by easing compliance burdens for taxpayers, clarifying ambiguities, making technical corrections, and providing administrative efficiencies.
| Law; effective June 9, 2022. |
HB 1025 | Local parks funding options. | Did not pass. |
HB 1333 | Extension of the local (0.09) sales and use tax credit for public facilities in rural counties. | Did not pass. |
HB 1811 | Fire benefit charges imposed by cities and towns. | Did not pass. |
HB 1929 | Capital projects for the provision of fire protection services. | Did not pass. |
HB 1933 | Authorizing smaller local governments with a scarcity of manufacturing and industrial lands to establish a tax on cannabis producers and processors. | Did not pass. |
HB 1967 | Property tax exemptions for nonprofits for farmers markets. | Did not pass. (see SB 5505) |
HB 2018 | Creating a three-day sales and use tax holiday to benefit all Washington families for certain items $1,000 or less during the month of September. | Did not pass. |
SB 5341 | Increasing permissible uses of existing public safety local sales tax authority to EMS. | Did not pass. |
SB 5426 | Improving the equity of Washington state's tax code by creating the Washington state wealth tax and taxing extraordinary financial intangible assets. | Did not pass. |
SB 5463 | Exempting a portion of the valuation of residential property from property taxation (homestead exemption). | Did not pass. |
SB 5712 | Transparency of local taxes on utilities. | Did not pass. |
SB 5769 | Reforming the state tax system by providing tax relief to residents, employees, and employers. | Did not pass. |
SJR 8206 | Amending the state Constitution to provide a homestead property tax exemption. | Did not pass. |