Notice of Public Hearing of Engrossed Substitute Senate Bill 5228

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ESSB 5228, titled AN ACT Relating to the authorization to impose special excise taxes on the sale of lodging, has been scheduled for a public hearing by the House Committee on Local Government.

Date and Time: 03/26/2019 10:00AM (Subject to change by the Legislature.)
Location: John L. O'Brien Building, House Hearing Rm D, Olympia, WA

The Office of Financial Management has identified this bill as requiring a ten-year projection of increased cost to the taxpayers or affected fee payers.

Ten-year projection:

Under current law the special hotel/motel tax is levied to fund tourism promotion.  The rate is two percent for most jurisdictions.  

Exceptions include: 

- For municipalities authorized to impose the tax where the total rate exceeded 4% before July 27, 1997, the rate may not exceed the rate actually imposed on January 31, 1999. 

- If a county imposed the tax with a rate of 4% or more on January 1, 1997, no city within that county may impose this tax, unless imposed by a municipality described in the prior bullet point.

- For a city with a population greater than 400,000 that is located in a county with a population greater than 1 million, the rate cannot exceed the lesser of:  

   - 4%, or

   - A rate that when combined with all other taxes on lodging sales under chapters 36.100, 82.08 and 82.14, equals 15.2% 

- For municipalities authorized to impose the tax where the rate exceeded 6% before January 1, 1998, the rate may not exceed the rate that was imposed on January 1, 1998 

Beginning July 1, 2020, this legislation allows cities or towns in a county with a population under 400,000 and the county imposes a 4% or higher tax under RCW 67.28 to impose the special hotel motel tax at 2%.  These cities or towns are not limited by the 12% cap on lodging. 

July 1, 2020 effective date.

ASSUMPTIONS

- This legislation effects Cowlitz and Grays Harbor counties. 

     - Cowlitz County receives the lodging taxes from the unincorporated county and the cities.  

     - In Grays Harbor County, Ocean Shores and Westport keep the hotel/motel tax and the rest of the cities' tax is distributed to the County.

- Clark, Pierce, King, Snohomish and Spokane counties have populations over 400,000.

- The following jurisdictions have rates higher than 2%:  Bellevue, Cowlitz County, Grays Harbor County, Winthrop, Long Beach, Pierce County, Airway Heights, Yakima, Seattle, Wenatchee and East Wenatchee.

REVENUE ESTIMATES 

This legislation results in no state revenue impact. This legislation would increase lodging revenues in some jurisdictions within Cowlitz and Grays Harbor counties while reducing revenues to the jurisdiction's county. 

TOTAL REVENUE IMPACT: 

      State Government (cash basis, $000): None.

      Local Government, if applicable (cash basis, $000): Unknown.

This engrossed bill is proposed by the Senate.

The substitute bill was proposed by:

Senate Committee on Local Government
(360) 786-7467



The original bill sponsors and contact information are:

Senator Dean Takko, Prime Sponsor
Democrat
(360) 786-7636
Dean.Takko@leg.wa.gov

Senator Rebecca Saldaña
Democrat
(360) 786-7688
Rebecca.Saldana@leg.wa.gov


House Committee on Local Government members and contact information:

Representative Sherry Appleton
Democrat
(360) 786-7934
Sherry.Appleton@leg.wa.gov

Representative Keith Goehner
Republican
(360) 786-7954
GOEHNER_KE@leg.wa.gov

Representative Mia Gregerson
Democrat
(360) 786-7868
Mia.Gregerson@leg.wa.gov

Representative Dan Griffey
Republican
(360) 786-7966
Dan.Griffey@leg.wa.gov

Representative Vicki Kraft
Republican
(360) 786-7994
Vicki.Kraft@leg.wa.gov

Representative Strom Peterson
Democrat
(360) 786-7950
Strom.Peterson@leg.wa.gov

Representative Gerry Pollet
Democrat
(360) 786-7886
Gerry.Pollet@leg.wa.gov

Representative Tana Senn
Democrat
(360) 786-7894
Tana.Senn@leg.wa.gov



Legislative Bill Information Website: http://apps.leg.wa.gov/billinfo/

Initiative 960 Website: http://www.ofm.wa.gov/tax/default.asp