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Bill #:  2971

Other significant issue  Support

Clarifying conditions for use of REET funds for maintenance purposes

Companion bill #: No Companion Bill.



House - LAW


Summary/AWC comments


Bill summary

Provisions requiring cities, counties, and the MRSC to electronically post information on the MRSC website concerning locally adopted ordinances, resolutions, or policies that impose specific requirements on landlords or sellers of real property are modified. Instead of being required to post the ordinance, resolution, or policy, cities and counties are required to post: a summary of, and an Internet link to the ordinance, resolution, or policy, or the relevant portion of the actual language of the ordinance, resolution, or policy.

 

Provisions disqualifying a city or county from using REET revenues for maintenance of capital projects, are modified. Instead of disqualifying a city or county that enacts any new requirement on the leasing of real property, a city or county is disqualified if it enacts any new requirement on landlords, at the time of executing a lease, to perform or provide physical improvements or modifications to real property or fixtures. A city or county is not disqualified, though, if the requirement is: (1) necessary to address an immediate threat to health or safety; (2) specifically authorized by certain statutes, including statutes relating to the regulation of nuisances and building codes; (3) specifically authorized by other state or federal law; or (4) a seller or landlord disclosure requirement posted electronically in accordance with statute.

 

Background:

In 2011 cities were authorized to expend some of their Real Estate Excise Tax revenues for operations and maintenance of certain facilities (rather than just capital).  That authority was scheduled to sunset on December 31 2016. In 2015, the legislature passed HB 2122 that eliminated the sunset date but added new conditions in order to expend REET funds for maintenance purposes. Specifically, to qualify under this additional authority to use funds from the REET I or REET II for maintenance a city must prepare a written report demonstrating that it has or will have adequate funding to pay for all of its capital projects identified in a capital facilities plan or other document for the succeeding two-year period. The report must be prepared and adopted as part of the county or city's regular, public budget process and must provide specific information, including how revenues collected under the REET I or REET II were used in the preceding two years and how the funds will be used during the succeeding two-years.

 

The bill also specified that a county or city that enacts after September 26, 2015, any new requirement on the listing, leasing, or sale of real property may be disqualified from using the REET revenues for maintenance of its capital projects.

 

In addition counties and cities must post on the MRSC website any ordinance, resolution, or policy adopted by the county or city that imposes a requirement on landlords or sellers of real property to provide information to a buyer or tenant pertaining to subject property or the surrounding area. The ordinance, resolution, or policy is not effective until posted in accordance with this requirement. If a local ordinance, resolution, or policy was adopted prior to September 26, 2015, the ordinance, resolution, or policy must be posted within 90 days or it will cease to be in effect.

 

Some of the requirements and vague language around “listing, leasing, or sale of real property” and “requirement on landlords or sellers of real property to provide information to a buyer or tenant pertaining to subject property or the surrounding area” left many people confused, and was interpreted by some to mean that imposing any new tenant protection ordinances would disqualify them from using REET for maintenance purposes.  HB 2971 is aimed at clearing up some of this confusion.


Latest version of bill:

Link to WA Legislative bill page

Official title:

AN ACT Relating to real estate as it concerns the local government authority in the use of real estate excise tax revenues and regulating real estate transactions;

Sponsors:

McBride, Nealey

Go To Bill #

 

AWC Contacts

Analyst:  Dave Catterson
Lobbyist:  Carl Schroeder

Issue Area

Infrastructure, Economic Development, & Transportation

Additional Info:


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