Notice of Introduction for House Bill 2713 - Update: 10 Year Analysis Complete

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UPDATE: The 10 year analysis for HB 2713, titled AN ACT Relating to imposing a business and occupation tax surcharge on the operators of private detention facilities, has been completed. 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:

Department of Revenue:

CURRENT LAW:

Service and other activities business and occupation (B&O) tax applies to taxable income derived from operating a private detention center. No additional surcharges are incurred.

PROPOSAL:

Businesses pay a 1% surcharge on taxable income arising from operating a private detention facility if the annual Washington gross receipts exceed $1 million.

Private detention facility means a detention facility operated by a private, nongovernmental entity and operating pursuant to a contract or agreement with a federal, state, or local governmental entity.

EFFECTIVE DATE:

This bill takes effect on July 1, 2026. However, due to the time it will take to program this bill's changes, the department cannot implement the bill until January 1, 2027.

The Department of Revenue (department) cannot disclose the impacts of legislation affecting fewer than three taxpayers. The department is seeking authorization from the affected taxpayers and will revise the fiscal note once authorization is received.

Ten-year projection prepared in consultation with the following agencies:

Department of Revenue


Bill sponsors and contact information:

Representative Sharon Tomiko Santos, Prime Sponsor
Democrat
(360) 786-7944
sharontomiko.santos@leg.wa.gov

Representative Sharlett Mena
Democrat
(360) 786-7996
sharlett.mena@leg.wa.gov

Representative Alex Ramel
Democrat
(360) 786-7970
alex.ramel@leg.wa.gov

Representative Lauren Davis
Democrat
(360) 786-7910
lauren.davis@leg.wa.gov

Representative Cindy Ryu
Democrat
(360) 786-7880
cindy.ryu@leg.wa.gov

Representative Timm Ormsby
Democrat
(360) 786-7946
timm.ormsby@leg.wa.gov

Representative Lisa Parshley
Democrat
(360) 786-7992
Lisa.Parshley@leg.wa.gov

Representative Nicole Macri
Democrat
(360) 786-7826
nicole.macri@leg.wa.gov

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

Representative Edwin Obras
Democrat
(360) 786-7834
Edwin.Obras@leg.wa.gov

Representative Shaun Scott
Democrat
(360) 786-7920
Shaun.Scott@leg.wa.gov

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

Representative Mary Fosse
Democrat
(360) 786-7864
Mary.Fosse@leg.wa.gov




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

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