Housing shortage/local share

AN ACT Relating to eliminating each local government's 1
proportional share of Washington's housing shortage; amending RCW 2
82.45.180; and adding a new title to the Revised Code of Washington.3
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:4
NEW SECTION. Sec. 1. (1) The legislature finds that Washington 5
has a severe homelessness crisis and housing shortage. By some 6
estimates, our state needs more than 1,000,000 new homes. While many 7
policy proposals have been offered in good faith as solutions to the 8
housing shortage, the stubborn truth is that Washington simply needs 9
to build more housing.10
(2) Local governments will play a key role in eliminating 11
Washington's housing shortage because local governments usually 12
exercise approval authority over new home construction. Additionally, 13
the legislature recognizes that some state laws may constrain local 14
governments' ability to approve construction of new housing. Both 15
levels of government should work together to create public policies 16
that help build more homes in Washington. 17
(3) The legislature intends to encourage local and state 18
government to promote the construction of new homes and end the 19
housing shortage over the next 10 years. 20
S-0167.3
SENATE BILL 5659
State of Washington 69th Legislature 2025 Regular Session
By Senators Goehner, Boehnke, and Dozier
Read first time 02/04/25. Referred to Committee on Housing.
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NEW SECTION. Sec. 2. (1) Every county, city, and town, that has 1
authority to approve or deny permits or other similar approvals 2
necessary for the construction of new homes shall approve the 3
construction of enough new homes to eliminate the county, city, or 4
town's proportional share of Washington's total housing shortage, as 5
calculated under subsection (2) of this section, through 2035.6
(2) The department of commerce shall establish each county, city, 7
and town's proportional share of Washington's total housing shortage 8
using the best available data. Best available data may include 9
analyses and projections produced by private sector sources with 10
expertise in housing supply trends, and may include data collected 11
under other programs, such as data collected under chapter 36.70A 12
RCW. The department shall complete its calculation no later than 13
April 1, 2026, and shall report the number of new homes that must be 14
created in each county, city, and town through 2035 in order to 15
eliminate Washington's total housing shortage. The department shall 16
also post the same information to the department's public website no 17
later than May 1, 2026. 18
(3) Beginning May 1, 2026, a county, city, or town, that is 19
subject to the requirements of this section shall regularly evaluate 20
its locally enacted codes, ordinances, plans, and regulations to 21
determine whether its locally enacted requirements are impeding the 22
county, city, or town's ability to approve enough construction to 23
eliminate its proportional share of Washington's total housing 24
shortage by 2035. Where a county, city, or town determines that its 25
locally enacted requirements impair the construction of more housing, 26
the county, city, or town is encouraged to amend its locally enacted 27
requirements. 28
(4) Beginning May 1, 2026, a county, city, or town, that is 29
subject to the requirements of this section must record the total 30
number of building permit applications it has received and the number 31
of building permit applications it has denied. If more than 33 32
percent of the applications are being denied, the county, city, or 33
town is encouraged to evaluate and address the factors that lead to 34
denial and increase the number of permit applications it approves.35
(5) Nothing in this section shall be construed to abrogate or 36
supersede any other provision of the Revised Code of Washington; 37
however, when a county, city, or town identifies a state-enacted 38
requirement that will impede the county, city, or town's ability to 39
approve the construction of a sufficient number of new homes to 40
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eliminate the county, city, or town's proportional share of 1
Washington's total housing shortage by 2035, the county, city, or 2
town shall report its findings to the department of commerce. The 3
department shall promptly forward such reports to the governor, 4
lieutenant governor, chief clerk of the house of representatives, and 5
secretary of the senate. 6
(6) The legislature intends to review the reports received under 7
subsection (5) of this section and take appropriate action to amend 8
state-enacted requirements for the purpose of ensuring that counties, 9
cities, and towns subject to this section will be able to eliminate 10
their proportional share of Washington's total housing shortage by 11
2035. 12
Sec. 3. RCW 82.45.180 and 2013 c 251 s 11 are each amended to 13
read as follows: 14
(1)(a) For taxes collected by the county under this chapter, the 15
county treasurer shall collect a ((five dollar )) $5 fee on all 16
transactions required by this chapter where the transaction does not 17
require the payment of tax. A total of five dollars shall be 18
collected in the form of a tax and fee, where the calculated tax 19
payment is less than ((five dollars)) $5. Through June 30, 2006, the 20
county treasurer shall place one percent of the taxes collected by 21
the county under this chapter and the treasurer's fee in the county 22
current expense fund to defray costs of collection. After June 30, 23
2006, the county treasurer shall place one and three-tenths percent 24
of the taxes collected by the county under this chapter and the 25
treasurer's fee in the county current expense fund to defray costs of 26
collection. For taxes collected by the county under this chapter 27
before July 1, 2006, the county treasurer shall pay over to the state 28
treasurer and account to the department of revenue for the proceeds 29
at the same time the county treasurer remits funds to the state under 30
RCW 84.56.280. For taxes collected by the county under this chapter 31
after June 30, 2006, on a monthly basis the county treasurer shall 32
pay over to the state treasurer the month's transmittal. The month's 33
transmittal must be received by the state treasurer by 12:00 p.m. on 34
the last working day of each month. The county treasurer shall 35
account to the department for the month's transmittal by the 36
((twentieth)) 20th day of the month following the month in which the 37
month's transmittal was paid over to the state treasurer. The state 38
treasurer shall deposit the proceeds in the general fund.39
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(b) For purposes of this subsection, the definitions in this 1
subsection apply. 2
(i) "Close of business" means the time when the county treasurer 3
makes his or her daily deposit of proceeds. 4
(ii) "Month's transmittal" means all proceeds deposited by the 5
county through the close of business of the day that is two working 6
days before the last working day of the month. This definition of 7
"month's transmittal" shall not be construed as requiring any change 8
in a county's practices regarding the timing of its daily deposits of 9
proceeds. 10
(iii) "Proceeds" means moneys collected and receipted by the 11
county from the taxes imposed by this chapter, less the county's 12
share of the proceeds used to defray the county's costs of collection 13
allowable in (a) of this subsection. 14
(iv) "Working day" means a calendar day, except Saturdays, 15
Sundays, and all legal holidays as provided in RCW 1.16.050.16
(2)(a) For taxes collected by the department of revenue under 17
this chapter, the department shall remit the tax to the state 18
treasurer who shall deposit the proceeds of any state tax in the 19
general fund. The state treasurer shall deposit the proceeds of any 20
local taxes imposed under chapter 82.46 RCW in the local real estate 21
excise tax account hereby created in the state treasury. Moneys in 22
the local real estate excise tax account may be spent only for 23
distribution to counties, cities, and towns imposing a tax under 24
chapter 82.46 RCW. Except as provided in RCW 43.08.190 and (b) of 25
this subsection, all earnings of investments of balances in the local 26
real estate excise tax account shall be credited to the local real 27
estate excise tax account and distributed to the counties, cities, 28
and towns monthly. Monthly the state treasurer shall make 29
distribution from the local real estate excise tax account to the 30
counties, cities, and towns the amount of tax collected on behalf of 31
each taxing authority. The state treasurer shall make the 32
distribution under this subsection without appropriation.33
(b) No earnings of investments of balances in the local real 34
estate excise tax account may be distributed to a county, city, or 35
town that does not comply with the conditions and requirements under 36
section 2 of this act.37
(3)(a) Through June 30, 2010, the county treasurer shall collect 38
an additional five dollar fee on all transactions required by this 39
chapter, regardless of whether the transaction requires the payment 40
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of tax. The county treasurer shall remit this fee to the state 1
treasurer at the same time the county treasurer remits funds to the 2
state under subsection (1) of this section. The state treasurer shall 3
place money from this fee in the general fund. By the ((twentieth)) 4
20th day of the subsequent month, the state treasurer shall 5
distribute to each county treasurer according to the following 6
formula: Three-quarters of the funds available shall be equally 7
distributed among the ((thirty-nine)) 39 counties; and the balance 8
shall be ratably distributed among the counties in direct proportion 9
to their population as it relates to the total state's population 10
based on most recent statistics by the office of financial 11
management. 12
(b) When received by the county treasurer, the funds shall be 13
placed in a special real estate excise tax electronic technology fund 14
held by the county treasurer to be used exclusively for the 15
development, implementation, and maintenance of an electronic 16
processing and reporting system for real estate excise tax 17
affidavits. Funds may be expended to make the system compatible with 18
the automated real estate excise tax system developed by the 19
department and compatible with the processes used in the offices of 20
the county assessor and county auditor. Any funds held in the account 21
that are not expended by the earlier of: July 1, 2015, or at such 22
time that the county treasurer is utilizing an electronic processing 23
and reporting system for real estate excise tax affidavits compatible 24
with the department and compatible with the processes used in the 25
offices of the county assessor and county auditor, revert to the 26
special real estate and property tax administration assistance 27
account in accordance with subsection (5)(c) of this section.28
(4) Beginning July 1, 2010, through December 31, 2013, the county 29
treasurer shall continue to collect the additional ((five dollar)) $5 30
fee in subsection (3) of this section on all transactions required by 31
this chapter, regardless of whether the transaction requires the 32
payment of tax. During this period, the county treasurer shall remit 33
this fee to the state treasurer at the same time the county treasurer 34
remits funds to the state under subsection (1) of this section. The 35
state treasurer shall place money from this fee in the annual 36
property revaluation grant account created in RCW 84.41.170.37
(5)(a) The real estate and property tax administration assistance 38
account is created in the custody of the state treasurer. An 39
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appropriation is not required for expenditures and the account is not 1
subject to allotment procedures under chapter 43.88 RCW.2
(b) Beginning January 1, 2014, the county treasurer must continue 3
to collect the additional ((five dollar)) $5 fee in subsection (3) of 4
this section on all transactions required by this chapter, regardless 5
of whether the transaction requires the payment of tax. The county 6
treasurer shall deposit one-half of this fee in the special real 7
estate and property tax administration assistance account in 8
accordance with (c) of this subsection and remit the balance to the 9
state treasurer at the same time the county treasurer remits funds to 10
the state under subsection (1) of this section. The state treasurer 11
must place money from this fee in the real estate and property tax 12
administration assistance account. By the twentieth day of the 13
subsequent month, the state treasurer must distribute the funds to 14
each county treasurer according to the following formula: One-half of 15
the funds available must be equally distributed among the ((thirty-16
nine)) 39 counties; and the balance must be ratably distributed among 17
the counties in direct proportion to their population as it relates 18
to the total state's population based on most recent statistics by 19
the office of financial management. 20
(c) When received by the county treasurer, the funds must be 21
placed in a special real estate and property tax administration 22
assistance account held by the county treasurer to be used for:23
(i) Maintenance and operation of an annual revaluation system for 24
property tax valuation; and 25
(ii) Maintenance and operation of an electronic processing and 26
reporting system for real estate excise tax affidavits.27
NEW SECTION. Sec. 4. Sections 1 and 2 of this act constitute a 28
new chapter in a new title in the Revised Code of Washington.29
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