Housing/taxes

AN ACT Relating to increasing the supply of affordable and 1
workforce housing by increasing state and local taxes on the transfer 2
of real estate; amending RCW 82.45.060, 82.46.010, and 82.46.035; 3
adding new sections to chapter 82.45 RCW; adding new sections to 4
chapter 82.46 RCW; creating new sections; and providing an effective 5
date. 6
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:7
NEW SECTION. Sec. 1. The legislature finds that the lack of 8
housing affordability and related instances of homelessness are 9
issues that affect every community in Washington. The legislature 10
also finds that increased homelessness is overwhelmingly caused by 11
rising rents, which push people living at the margins into 12
homelessness, erode public confidence, and undermine the shared 13
values that have driven our state's prosperity. The legislature 14
further finds that problems caused by rent increases are exacerbated 15
by the associated issue of very low vacancy rates, which make it 16
difficult for people to find a unit even when they have sufficient 17
income or rental assistance to pay market rates. The legislature 18
finds that low housing vacancy rates, the growth in population, and a 19
limited housing supply have created a housing shortage in which 20
existing inventory is priced at a premium. The legislature also finds 21
H-0446.3
HOUSE BILL 2027
State of Washington 69th Legislature 2025 Regular Session
By Representatives Berg, Macri, Kloba, Parshley, Gregerson, Pollet,
and Scott
Read first time 02/27/25. Referred to Committee on Finance.
p. 1 HB 2027
that although household incomes have grown along with the economy, 1
increases in income for those with moderate and lower incomes have 2
not kept pace with rent and purchase price increases. This problem is 3
especially impacting lower and fixed income households, including 4
people with disabilities, seniors, veterans, and farmworkers. 5
Indeed, these trends, in combination with other market factors, 6
have created a deficit of housing that is affordable and available, 7
particularly for Washingtonians within the low to middle income range 8
who are increasingly more vulnerable to homelessness. Moreover, the 9
legislature finds that these households have the fewest options 10
available in the private housing market to find and retain a unit. In 11
strong housing markets, builders seek the highest achievable price to 12
offset higher development costs, which means new production does not 13
create more housing that is affordable. 14
The legislature finds that to meet the housing needs of all 15
Washingtonians over the next 20 years, we need to build more than 16
500,000 new homes affordable to very and extremely low-income people, 17
those making less than 50 percent of area median income. Furthermore, 18
the legislature finds that having a home is a basic need and 19
fundamental for Washington residents, and that all Washingtonians 20
should be able to afford safe and dependable housing with access to 21
opportunities such as education, employment, transit, and amenities.22
The legislature finds that housing that is affordable is an 23
essential part of every community's infrastructure, serving as a 24
platform for individuals and families to stabilize, build their 25
economic futures, and thrive. Housing serves as a platform for better 26
health and creates jobs and attracts investment, making it a 27
prerequisite to economic growth and stronger communities. In 28
addition, the legislature finds that a variety of housing types is 29
needed to provide affordable options for families of all sizes and 30
stages of life. Furthermore, the legislature finds that increasing 31
the supply of permanently affordable housing, getting residents back 32
into housing, and reducing homelessness is a priority of the people 33
of Washington state, and that reducing homelessness lessens the 34
fiscal impact to the state and improves the economic vitality of our 35
businesses. 36
Moreover, the legislature finds that the private real estate 37
market does not provide adequate housing options affordable for all 38
economic segments, and thus government assistance is needed to offer 39
the full range of affordable housing options. 40
p. 2 HB 2027
Therefore, it is the intent of the legislature to increase the 1
supply of housing that is affordable and to stabilize and get people 2
back into housing through permanent, dedicated investment in state 3
housing programs for Washington residents in the low to middle income 4
range. 5
Sec. 2. RCW 82.45.060 and 2019 c 424 s 1 are each amended to 6
read as follows: 7
(1) There is imposed an excise tax upon each sale of real 8
property. 9
(a) Through December 31, 2019, the rate of the tax imposed under 10
this section is 1.28 percent of the selling price.11
(b) Beginning January 1, 2020, except as provided in (c) of this 12
subsection, the rate of the tax imposed under this section is as 13
follows: 14
(i) 1.1 percent of the portion of the selling price that is less 15
than or equal to ((five hundred thousand dollars)) $500,000;16
(ii) 1.28 percent of the portion of the selling price that is 17
greater than ((five hundred thousand dollars )) $500,000 and equal to 18
or less than ((one million five hundred thousand dollars )) 19
$1,500,000; 20
(iii) 2.75 percent of the portion of the selling price that is 21
greater than ((one million five hundred thousand dollars )) $1,500,000 22
and equal to or less than ((three million dollars)) $3,000,000; and23
(iv) Three percent of the portion of the selling price that is 24
greater than ((three million dollars)) $3,000,000.25
(c) The sale of real property that is classified as timberland or 26
agricultural land is subject to the tax imposed under this section at 27
a rate of 1.28 percent of the selling price. 28
(2) Beginning July 1, 2022, and every fourth year thereafter:29
(a) The department must adjust the applicable selling price 30
threshold in subsection (1)(b)(i) of this section to reflect the 31
lesser of the growth of the consumer price index for shelter or five 32
percent. If the growth is equal to or less than zero percent, the 33
current selling price threshold continues to apply.34
(b) The department must adjust the applicable selling price 35
thresholds in subsection (1)(b)(ii) through (iv) of this section and 36
section 3(1) of this act by the dollar amount of any increase in the 37
applicable selling price threshold in subsection (1)(b)(i) of this 38
section. 39
p. 3 HB 2027
(c) The department must publish updated selling price thresholds 1
by September 1, 2022, and September 1st of every fourth year 2
thereafter. Updated selling price thresholds ((will)) apply beginning 3
January 1, 2023, and January 1st every fourth year thereafter. 4
Adjusted selling price thresholds must be rounded to the nearest 5
((one thousand dollars )) $1,000. No changes may be made to adjusted 6
selling price thresholds once such adjustments take effect.7
(d) The most recent selling price threshold becomes the base for 8
subsequent adjustments. 9
(e) The department must report adjustments to the selling price 10
thresholds to the fiscal committees of the legislature, beginning 11
December 1, 2022, and December 1st every fourth year thereafter.12
(3)(a) The department must publish guidance to assist sellers in 13
properly classifying real property on the real estate excise tax 14
affidavit for purposes of determining the proper amount of tax due 15
under this section. Real property with multiple uses must be 16
classified according to the property's predominant use. The 17
department's guidance must include factors for use in determining the 18
predominant use of real property. 19
(b) County treasurers are not responsible for verifying that the 20
seller has properly classified real property reported on a real 21
estate excise tax affidavit. The department is solely responsible for 22
such verification as part of its audit responsibilities under RCW 23
82.45.150. 24
(4)(a) Beginning July 1, 2013, and ending December 31, 2019, an 25
amount equal to two percent of the proceeds of this tax must be 26
deposited in the public works assistance account created in RCW 27
43.155.050, an amount equal to ((four and one-tenth )) 4.1 percent 28
must be deposited in the education legacy trust account created in 29
RCW 83.100.230, an amount equal to ((one and six-tenths)) 1.6 percent 30
must be deposited in the city-county assistance account created in 31
RCW 43.08.290, and the remainder must be deposited in the general 32
fund. 33
(b) Beginning January 1, 2020, amounts collected from the tax 34
imposed under this section must be deposited as provided in RCW 35
82.45.230. 36
(5) The definitions in this subsection apply throughout this 37
section unless the context clearly requires otherwise.38
p. 4 HB 2027
(a) "Agricultural land" means farm and agricultural land and farm 1
and agricultural conservation land, as those terms are defined in RCW 2
84.34.020, including any structures on such land. 3
(b) "Consumer price index for shelter" means the most current 4
seasonally adjusted index for the shelter expenditure category of the 5
consumer price index for all urban consumers (CPI-U) as published by 6
July 31st by the bureau of labor statistics of the United States 7
department of labor. 8
(c) "Growth of the consumer price index for shelter" means the 9
percentage increase in the consumer price index for shelter as 10
measured from data published by the bureau of labor statistics of the 11
United States department of labor by July 31st for the most recent 12
three-year period for the selling price threshold adjustment in 2022, 13
and the most recent four-year period for subsequent selling price 14
threshold adjustments. 15
(d) "Timberland" means land classified under chapter 84.34 RCW or 16
designated under chapter 84.33 RCW, including any structures and 17
standing timber on such land, and standing timber sold apart from the 18
land upon which it sits. 19
NEW SECTION. Sec. 3. A new section is added to chapter 82.45 20
RCW to read as follows: 21
(1)(a) Beginning January 1, 2027, and in addition to the tax 22
imposed in RCW 82.45.060, a real estate transfer tax is imposed on 23
the sale of real property in which the seller is required to pay real 24
estate excise tax under RCW 82.45.060(1)(b)(iv) for the sale of 25
residential property. This tax must be paid by the seller and imposed 26
and collected in the same manner as the real estate excise tax 27
imposed under this chapter. 28
(b) The real estate transfer tax is imposed on the sale of 29
residential property as follows: 30
(i) One percent of the portion of the selling price that is equal 31
to or greater than $3,051,000, but less than $5,026,000;32
(ii) Two percent of the portion of the selling price that is 33
equal to or greater than $5,026,000, but less than $10,026,000; and34
(iii) Three percent of the portion of the selling price that is 35
equal to or greater than $10,026,000. 36
(2) The selling price threshold in subsection (1) of this section 37
must be adjusted by the department in accordance with RCW 38
82.45.060(2). 39
p. 5 HB 2027
(3) The amounts collected from the tax imposed under this section 1
must be deposited as follows: 2
(a) 40 percent must be deposited into the developmental 3
disabilities housing and services account created in section 4 of 4
this act; 5
(b) 40 percent must be deposited into the affordable housing for 6
all account created in RCW 43.185C.190 for operations, maintenance, 7
and service costs for permanent supportive housing as defined in RCW 8
36.70A.030; 9
(c) 10 percent must be deposited into the housing stability 10
account created in section 5 of this act; and 11
(d) 10 percent must be deposited into the Washington housing 12
trust fund created in RCW 43.185A.130 solely for farmworker housing.13
(4) For the purposes of this section, "residential property" 14
means a single-family dwelling unit whether such unit be separate or 15
part of a multiunit dwelling. 16
NEW SECTION. Sec. 4. A new section is added to chapter 82.45 17
RCW to read as follows: 18
(1) The developmental disabilities housing and services account 19
is created in the state treasury. Receipts from the real estate 20
transfer tax directed to this account pursuant to RCW 82.45.230 must 21
be deposited into the account. Moneys in the account may only be 22
spent after appropriation. 23
(2) Expenditures from the account may be used only for:24
(a)(i) Housing to support people with developmental disabilities, 25
including acquisition, development, or construction of permanent 26
housing, housing developments, or units, including new units in 27
existing structures; 28
(ii) Up to 15 percent of the total cost of a housing project that 29
qualifies under (a) of this subsection may include acquisition, 30
development, or construction of nonresident spaces that are integral 31
to the overall design and support successful community living;32
(b) Preservation, operations, and maintenance costs of housing 33
for people with developmental disabilities; 34
(c) Housing-related services for individuals with developmental 35
disabilities; 36
(d) Rental subsidies; and 37
(e) Technical assistance to support nonprofit organizations in 38
applying for this funding through the account in order to expand the 39
p. 6 HB 2027
pool of eligible developers for construction and long-term 1
sustainable maintenance for housing that meets the needs of people 2
with developmental disabilities. 3
(3) Expenditures from the account must be grants or forgivable 4
loans. For applications under this section, the department of 5
commerce must use an application form and evaluation criteria 6
separate from the application form and criteria for the Washington 7
housing trust fund created in RCW 43.185A.130. The department of 8
commerce must coordinate with the department of social and health 9
services regarding any needed supportive services and make efforts to 10
enact the recommendations of the housing needs study for individuals 11
with intellectual and developmental disabilities, as provided in 12
section 1068(6), chapter 332, Laws of 2021. 13
(4) For the purposes of this section, the following definitions 14
apply unless the context clearly requires otherwise.15
(a) "Forgivable loans" means a noninterest-bearing financial 16
award that is forgiven in its entirety provided the borrower project 17
continues to serve the original target group as described in 18
subsection (2)(a) of this section for a period of at least 25 years.19
(b) "Grants" means a financial award that does not require 20
payback, provided the grantee project continues to serve the original 21
target group as described in subsection (2)(a) of this section for a 22
period of at least 25 years. 23
(c) "Housing-related services" means services that are provided 24
to eligible households as described in subsection (2)(c) of this 25
section, which have the purpose of helping the household gain, 26
maintain, or increase housing stability. Housing-related services may 27
include, but are not limited to: Case management; tenant education 28
and supports; financial assistance for essential costs of housing; 29
services to identify, locate, and secure housing; landlord 30
mitigation; landlord or tenant dispute mediation; services to prevent 31
eviction or loss of housing; assistance securing financial housing 32
assistance, such as a voucher or subsidy; or assistance with tenant 33
applications. 34
(d) "Nonresidential spaces" means any space used to provide a 35
service that benefits affordable housing development tenants as 36
described in subsection (2)(a)(i) of this section, or the public 37
including, but not limited to, health clinics, food banks, community 38
centers, and early learning facilities. 39
p. 7 HB 2027
NEW SECTION. Sec. 5. A new section is added to chapter 82.45 1
RCW to read as follows: 2
(1) The housing stability account is created in the state 3
treasury. Receipts from the real estate transfer tax directed to this 4
account pursuant to RCW 82.45.230 must be deposited into the account. 5
Moneys in the account may only be spent after appropriation.6
(2) Expenditures from the account may be used only for housing 7
operations, maintenance, and service costs for low-income households 8
or extremely low-income households where a supplement to rent income 9
is required to cover ongoing operating expenses. 10
(3) For the purposes of this section, "operations, maintenance, 11
and service costs" means grants for building operations, maintenance, 12
or supportive service costs for housing projects that have received 13
or will receive funding from the state housing trust fund, or other 14
public capital funding programs, are affordable to low-income 15
households or extremely low-income households with incomes at or 16
below 60 percent of the area median income, and require a supplement 17
to rent income to cover ongoing operating expenses.18
(4)(a) Grants provided under this section must fund overall 19
developments and may be used to fund new or existing housing 20
projects. Priority for use must be given to projects intended to 21
house seniors, individuals with disabilities, or populations with 22
prior experience of homelessness, including families with children.23
(b) Grantees may use these funds in partnership with permanent 24
supportive housing programs administered by the office of apple 25
health and homes created in RCW 43.330.181. 26
Sec. 6. RCW 82.46.010 and 2021 c 296 s 10 are each amended to 27
read as follows: 28
(1) The legislative authority of any county or city must identify 29
in the adopted budget the capital projects funded in whole or in part 30
from the proceeds of the tax authorized in this section, and must 31
indicate that such tax is intended to be in addition to other funds 32
that may be reasonably available for such capital projects.33
(2)(a) ((The)) Except where a county has imposed a tax pursuant 34
to section 7 of this act, the legislative authority of any county or 35
any city may impose an excise tax on each sale of real property in 36
the unincorporated areas of the county for the county tax and in the 37
corporate limits of the city for the city tax at a rate not exceeding 38
one-quarter of one percent of the selling price. Except as provided 39
p. 8 HB 2027
in subsection (8) of this section, the revenues from this tax must be 1
used by any city or county with a population of 5,000 or less and any 2
city or county that does not plan under RCW 36.70A.040 for any 3
capital purpose identified in a capital improvements plan and local 4
capital improvements, including those listed in RCW 35.43.040.5
(b) Except as provided in subsection (8) of this section, after 6
April 30, 1992, revenues generated from the tax imposed under this 7
subsection (2) in counties over 5,000 population and cities over 8
5,000 population that are required or choose to plan under RCW 9
36.70A.040 must be used solely for financing capital projects 10
specified in a capital facilities plan element of a comprehensive 11
plan and housing relocation assistance under RCW 59.18.440 and 12
59.18.450. However, revenues (i) pledged by such counties and cities 13
to debt retirement prior to April 30, 1992, may continue to be used 14
for that purpose until the original debt for which the revenues were 15
pledged is retired, or (ii) committed prior to April 30, 1992, by 16
such counties or cities to a project may continue to be used for that 17
purpose until the project is completed. 18
(3) In lieu of imposing the tax authorized in RCW 82.14.030(2), 19
the legislative authority of any county or any city may impose an 20
additional excise tax on each sale of real property in the 21
unincorporated areas of the county for the county tax and in the 22
corporate limits of the city for the city tax at a rate not exceeding 23
one-half of one percent of the selling price. 24
(4) Taxes imposed under this section must be collected from 25
persons who are taxable by the state under chapter 82.45 RCW upon the 26
occurrence of any taxable event within the unincorporated areas of 27
the county or within the corporate limits of the city, as the case 28
may be. 29
(5) Taxes imposed under this section must comply with all 30
applicable rules, regulations, laws, and court decisions regarding 31
real estate excise taxes as imposed by the state under chapter 82.45 32
RCW. 33
(6) The definitions in this subsection (6) apply throughout this 34
section unless the context clearly requires otherwise.35
(a) "City" means any city or town. 36
(b) "Capital project" means those public works projects of a 37
local government for planning, acquisition, construction, 38
reconstruction, repair, replacement, rehabilitation, or improvement 39
of streets; roads; highways; sidewalks; street and road lighting 40
p. 9 HB 2027
systems; traffic signals; bridges; domestic water systems; storm and 1
sanitary sewer systems; parks; recreational facilities; law 2
enforcement facilities; fire protection facilities; trails; 3
libraries; administrative facilities; judicial facilities; river 4
flood control projects; waterway flood control projects by those 5
jurisdictions that, prior to June 11, 1992, have expended funds 6
derived from the tax authorized by this section for such purposes; 7
until December 31, 1995, housing projects for those jurisdictions 8
that, prior to June 11, 1992, have expended or committed to expend 9
funds derived from the tax authorized by this section or the tax 10
authorized by RCW 82.46.035 for such purposes; and technology 11
infrastructure that is integral to the capital project.12
(7) From July 22, 2011, until December 31, 2016, a city or county 13
may use the greater of $100,000 or 35 percent of available funds 14
under this section, but not to exceed $1,000,000 per year, for the 15
operations and maintenance of existing capital projects as defined in 16
subsection (6) of this section. 17
(8) After May 13, 2021, through December 31, 2023, a city or 18
county may use the greater of $100,000 or 35 percent of available 19
funds under this section for the operation of, maintenance of, and 20
service support for, existing capital projects, including the 21
provision of services to residents of affordable housing or shelter 22
units. 23
NEW SECTION. Sec. 7. A new section is added to chapter 82.46 24
RCW to read as follows: 25
(1)(a) Beginning July 1, 2025, instead of imposing the tax 26
authorized in RCW 82.45.010(2), the legislative authority of any 27
county may impose an excise tax on each sale of real property in the 28
unincorporated areas of the county as follows: 29
(i) Up to 0.20 percent of the portion of the selling price that 30
is less than or equal to $500,000, except that a rural county may 31
impose an excise tax of up to 0.25 percent of the portion of the 32
selling price that is less than or equal to $500,000;33
(ii) Up to 0.25 percent of the portion of the selling price that 34
is greater than $500,000 and equal to or less than $1,500,000;35
(iii) Up to 0.55 percent of the portion of the selling price that 36
is greater than $1,500,000 and equal to or less than $3,000,000;37
(iv) Up to 0.60 percent of the portion of the selling price that 38
is greater than $3,000,000. 39
p. 10 HB 2027
(b) The sale of real property that is classified as timberland or 1
agricultural land is subject to the tax imposed under this section at 2
a rate of 0.25 percent of the selling price. 3
(2) Revenues generated from the tax imposed under this section 4
must be used solely for: 5
(a) Financing capital projects; 6
(b) Housing relocation assistance under RCW 59.18.440 and 7
59.18.450; and 8
(c) The operation of, maintenance of, and service support for, 9
existing capital projects, including the provision of services to 10
residents of affordable housing or shelter units. 11
(3) The legislative authority of any county or city must identify 12
in the adopted budget the capital projects funded in whole or in part 13
from the proceeds of the tax authorized in this section, and must 14
indicate that such tax is intended to be in addition to other funds 15
that may be reasonably available for such capital projects.16
(4) County treasurers are not responsible for verifying that the 17
seller has properly classified real property reported on a real 18
estate excise tax affidavit. The department is solely responsible for 19
such verification as part of its audit responsibilities under RCW 20
82.45.150. 21
(5) If a county has already implemented the tax authorized in RCW 22
82.45.010(2), the legislative authority may replace that excise tax 23
with the excise tax set forth in this section. 24
(6) The following definitions apply throughout this section 25
unless the context clearly requires otherwise. 26
(a) "Agricultural land" means farm and agricultural land and farm 27
and agricultural conservation land, as those terms are defined in RCW 28
84.34.020, including any structures on such land. 29
(b) "Capital project" means those public works projects of a 30
local government for planning, acquisition, construction, 31
reconstruction, repair, replacement, rehabilitation, or improvement 32
of streets; roads; highways; sidewalks; street and road lighting 33
systems; traffic signals; bridges; domestic water systems; storm and 34
sanitary sewer systems; parks; recreational facilities; law 35
enforcement facilities; fire protection facilities; trails; 36
libraries; administrative facilities; judicial facilities; river 37
flood control projects; waterway flood control projects; and 38
technology infrastructure that is integral to the capital project.39
p. 11 HB 2027
(c) "Rural county" means a county with a population density of 1
less than 100 persons per square mile or a county smaller than 225 2
square miles as determined by the office of financial management 3
pursuant to RCW 43.62.035. 4
(d) "Timberland" means land classified under chapter 84.34 RCW or 5
designated under chapter 84.33 RCW, including any structures and 6
standing timber on such land, and standing timber sold apart from the 7
land upon which it sits. 8
Sec. 8. RCW 82.46.035 and 2021 c 296 s 12 are each amended to 9
read as follows: 10
(1) Except for revenues used after May 13, 2021, through December 11
31, 2023, as provided in subsection (3) of this section, the 12
legislative authority of any county or city must identify in the 13
adopted budget the capital projects funded in whole or in part from 14
the proceeds of the tax authorized in this section, and must indicate 15
that such tax is intended to be in addition to other funds that may 16
be reasonably available for such capital projects.17
(2) ((The)) Except where a county has imposed a tax pursuant to 18
section 9 of this act, the legislative authority of any county or any 19
city that plans under RCW 36.70A.040(1) may impose an additional 20
excise tax on each sale of real property in the unincorporated areas 21
of the county for the county tax and in the corporate limits of the 22
city for the city tax at a rate not exceeding one-quarter of one 23
percent of the selling price. Any county choosing to plan under RCW 24
36.70A.040(2) and any city within such a county may only adopt an 25
ordinance imposing the excise tax authorized by this section if the 26
ordinance is first authorized by a proposition approved by a majority 27
of the voters of the taxing district voting on the proposition at a 28
general election held within the district or at a special election 29
within the taxing district called by the district for the purpose of 30
submitting such proposition to the voters. 31
(3) Revenues generated from the tax imposed under subsection (2) 32
of this section must be used by such counties and cities solely for 33
financing capital projects specified in a capital facilities plan 34
element of a comprehensive plan, except that the greater of $100,000 35
or 35 percent of revenues may additionally be used for the operation 36
of, maintenance of, and service support for, existing capital 37
projects after May 13, 2021, through December 31, 2023. However, 38
revenues (a) pledged by such counties and cities to debt retirement 39
p. 12 HB 2027
prior to March 1, 1992, may continue to be used for that purpose 1
until the original debt for which the revenues were pledged is 2
retired, or (b) committed prior to March 1, 1992, by such counties or 3
cities to a project may continue to be used for that purpose until 4
the project is completed. 5
(4) Revenues generated by the tax imposed by this section must be 6
deposited in a separate account after December 31, 2023.7
(5) As used in this section, "city" means any city or town and 8
"capital project" means those public works projects of a local 9
government for: 10
(a) Planning, acquisition, construction, reconstruction, repair, 11
replacement, rehabilitation, or improvement of streets, roads, 12
highways, sidewalks, street and road lighting systems, traffic 13
signals, bridges, domestic water systems, storm and sanitary sewer 14
systems; 15
(b) Planning, construction, reconstruction, repair, 16
rehabilitation, or improvement of parks; and 17
(c) Until January 1, 2026, planning, acquisition, construction, 18
reconstruction, repair, replacement, rehabilitation, or improvement 19
of facilities for those experiencing homelessness and affordable 20
housing projects. 21
(6) A county or city may use the greater of $100,000 or 25 22
percent of available funds, but not to exceed $1,000,000, for capital 23
projects as defined in subsection (5)(c) of this section. The limits 24
in this subsection do not apply to any county or city that used 25
revenue under this section for the acquisition, construction, 26
improvement, or rehabilitation of facilities to provide housing for 27
the homeless prior to June 30, 2019. 28
(7) A county or city using funds for uses in subsection (5)(c) of 29
this section must document in its plan under RCW 36.70A.070(3) that 30
it has funds during the next two years for capital projects in 31
subsection (5)(a) of this section. 32
(8) When the governor files a notice of noncompliance under RCW 33
36.70A.340 with the secretary of state and the appropriate county or 34
city, the county or city's authority to impose the additional excise 35
tax under this section is temporarily rescinded until the governor 36
files a subsequent notice rescinding the notice of noncompliance.37
NEW SECTION. Sec. 9. A new section is added to chapter 82.46 38
RCW to read as follows: 39
p. 13 HB 2027
(1)(a) Beginning July 1, 2025, instead of imposing the tax 1
authorized in RCW 82.46.035(2), the legislative authority of any 2
county may impose an excise tax on each sale of real property in the 3
unincorporated areas of the county as follows: 4
(i) Up to 0.20 percent of the portion of the selling price that 5
is less than or equal to $500,000, except that a rural county may 6
impose an excise tax of up to 0.25 percent of the portion of the 7
selling price that is less than or equal to $500,000;8
(ii) Up to 0.25 percent of the portion of the selling price that 9
is greater than $500,000 and equal to or less than $1,500,000;10
(iii) Up to 0.55 percent of the portion of the selling price that 11
is greater than $1,500,000 and equal to or less than $3,000,000;12
(iv) Up to 0.60 percent of the portion of the selling price that 13
is greater than $3,000,000. 14
(b) The sale of real property that is classified as timberland or 15
agricultural land is subject to the tax imposed under this section at 16
a rate of 0.25 percent of the selling price. 17
(2) Revenues generated from the tax imposed under this section 18
must be used solely for: 19
(a) Financing capital projects; 20
(b) Housing relocation assistance under RCW 59.18.440 and 21
59.18.450; and 22
(c) The operation of, maintenance of, and service support for, 23
existing capital projects, including the provision of services to 24
residents of affordable housing or shelter units. 25
(3) The legislative authority of any county or city must identify 26
in the adopted budget the capital projects funded in whole or in part 27
from the proceeds of the tax authorized in this section, and must 28
indicate that such tax is intended to be in addition to other funds 29
that may be reasonably available for such capital projects.30
(4) County treasurers are not responsible for verifying that the 31
seller has properly classified real property reported on a real 32
estate excise tax affidavit. The department is solely responsible for 33
such verification as part of its audit responsibilities under RCW 34
82.45.150. 35
(5) If a county has already implemented the tax authorized in RCW 36
82.46.035(2), the legislative authority may replace that excise tax 37
with the excise tax set forth in this section. 38
(6) The following definitions apply throughout this section 39
unless the context clearly requires otherwise. 40
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(a) "Agricultural land" means farm and agricultural land and farm 1
and agricultural conservation land, as those terms are defined in RCW 2
84.34.020, including any structures on such land. 3
(b) "Capital project" means those public works projects of a 4
local government for planning, acquisition, construction, 5
reconstruction, repair, replacement, rehabilitation, or improvement 6
of streets; roads; highways; sidewalks; street and road lighting 7
systems; traffic signals; bridges; domestic water systems; storm and 8
sanitary sewer systems; parks; recreational facilities; law 9
enforcement facilities; fire protection facilities; trails; 10
libraries; administrative facilities; judicial facilities; river 11
flood control projects; waterway flood control projects; and 12
technology infrastructure that is integral to the capital project.13
(c) "Rural county" means a county with a population density of 14
less than 100 persons per square mile or a county smaller than 225 15
square miles as determined by the office of financial management 16
pursuant to RCW 43.62.035. 17
(d) "Timberland" means land classified under chapter 84.34 RCW or 18
designated under chapter 84.33 RCW, including any structures and 19
standing timber on such land, and standing timber sold apart from the 20
land upon which it sits. 21
NEW SECTION. Sec. 10. This act may be known and cited as the 22
affordable homes act.23
NEW SECTION. Sec. 11. This act takes effect January 1, 2026.24
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p. 15 HB 2027