Unoccupied housing/tax

AN ACT Relating to tax exemptions for unoccupied property used 1
for affordable housing that is owned by a nonprofit entity; amending 2
RCW 84.36.560; and creating a new section. 3
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:4
Sec. 1. RCW 84.36.560 and 2024 c 113 s 1 are each amended to 5
read as follows: 6
(1) The real and personal property owned or used by a nonprofit 7
entity in providing rental housing for qualifying households or used 8
to provide space for the placement of a mobile home for a qualifying 9
household within a mobile home park is exempt from taxation if:10
(a) The benefit of the exemption inures to the nonprofit entity;11
(b) At least 75 percent of the occupied dwelling units in the 12
rental housing or lots in a mobile home park are occupied by a 13
qualifying household; and 14
(c) The rental housing or lots in a mobile home park were 15
insured, financed, or assisted in whole or in part through one or 16
more of the following sources: 17
(i) A federal or state housing program administered by the 18
department of commerce; 19
(ii) A federal housing program administered by a city or county 20
government; 21
S-4044.1
SENATE BILL 6256
State of Washington 69th Legislature 2026 Regular Session
By Senators Slatter, Nobles, Saldaña, and Shewmake
Read first time 01/21/26. Referred to Committee on Ways & Means.
p. 1 SB 6256
(iii) An affordable housing levy authorized under RCW 84.52.105 1
or 84.55.050; 2
(iv) The surcharges authorized by RCW 36.22.250 and any of the 3
surcharges authorized in chapter 43.185C RCW; 4
(v) The Washington state housing finance commission, provided 5
that the financing is for a mobile home park cooperative or a 6
manufactured housing cooperative, as defined in RCW 59.20.030, or a 7
nonprofit entity; or 8
(vi) City or county funds designated for affordable housing.9
(2) If less than 75 percent of the occupied dwelling units within 10
the rental housing or lots in the mobile home park are occupied by 11
qualifying households, the rental housing or mobile home park is 12
eligible for a partial exemption on the real property and a total 13
exemption of the housing's or park's personal property as follows:14
(a) A partial exemption is allowed for each dwelling unit in the 15
rental housing or for each lot in a mobile home park occupied by a 16
qualifying household. 17
(b) The amount of exemption must be calculated by multiplying the 18
assessed value of the property reasonably necessary to provide the 19
rental housing or to operate the mobile home park by a fraction. The 20
numerator of the fraction is the number of dwelling units or lots 21
occupied by qualifying households as of December 31st of the first 22
assessment year in which the rental housing or mobile home park 23
becomes operational or on January 1st of each subsequent assessment 24
year for which the exemption is claimed. The denominator of the 25
fraction is the total number of dwelling units or lots occupied as of 26
December 31st of the first assessment year the rental housing or 27
mobile home park becomes operational and January 1st of each 28
subsequent assessment year for which exemption is claimed.29
(3) If a currently exempt rental housing unit or mobile home lot 30
in a mobile home park was occupied by a qualifying household at the 31
time the exemption was granted and the income of the household 32
subsequently rises above the threshold set in subsection (7)(e) of 33
this section but remains at or below 80 percent of the median income, 34
the exemption will continue as long as the housing continues to meet 35
the certification requirements listed in subsection (1) of this 36
section. For purposes of this section, median income, as most 37
recently determined by the federal department of housing and urban 38
development for the county in which the rental housing or mobile home 39
park is located, shall be adjusted for family size. However, if a 40
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dwelling unit or a lot becomes vacant and is subsequently rerented, 1
the income of the new household must be at or below the threshold set 2
in subsection (7)(e) of this section to remain exempt from property 3
tax. 4
(4)(a) If at the time of initial application the property is 5
unoccupied, or subsequent to the initial application the property is 6
unoccupied because of renovations, and the property is not currently 7
being used for the exempt purpose authorized by this section but will 8
be used for the exempt purpose within ((two)) three assessment years, 9
the property shall be eligible for a property tax exemption for the 10
assessment year in which the claim for exemption is submitted under 11
the following conditions: 12
(((a))) (i) A commitment for financing to acquire, construct, 13
renovate, or otherwise convert the property to provide housing for 14
qualifying households has been obtained, in whole or in part, by the 15
nonprofit entity claiming the exemption from one or more of the 16
sources listed in subsection (1)(c) of this section;17
(((b))) (ii) The nonprofit entity has manifested its intent in 18
writing to construct, remodel, or otherwise convert the property to 19
housing for qualifying households; and 20
(((c))) (iii) Only the portion of property that will be used to 21
provide housing or lots for qualifying households shall be exempt 22
under this section. 23
(b) Any portion of the property that would qualify for the 24
exemption under RCW 84.36.030 or 84.36.040 upon completion of 25
renovations is exempt as provided in (a) of this subsection.26
(5) To be exempt under this section, the property must be used 27
exclusively for the purposes for which the exemption is granted, 28
except as provided in RCW 84.36.805. 29
(6) The nonprofit entity qualifying for a property tax exemption 30
under this section may agree to make payments to the city, county, or 31
other political subdivision for improvements, services, and 32
facilities furnished by the city, county, or political subdivision 33
for the benefit of the rental housing. However, these payments shall 34
not exceed the amount last levied as the annual tax of the city, 35
county, or political subdivision upon the property prior to 36
exemption. 37
(7) The definitions in this subsection apply throughout this 38
section unless the context clearly requires otherwise.39
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(a) "Group home" means a single-family dwelling financed, in 1
whole or in part, by one or more of the sources listed in subsection 2
(1)(c) of this section. The residents of a group home shall not be 3
considered to jointly constitute a household, but each resident shall 4
be considered to be a separate household occupying a separate 5
dwelling unit. The individual incomes of the residents shall not be 6
aggregated for purposes of this exemption; 7
(b) "Mobile home lot" or "mobile home park" means the same as 8
these terms are defined in RCW 59.20.030; 9
(c) "Occupied dwelling unit" means a living unit that is occupied 10
by an individual or household as of December 31st of the first 11
assessment year the rental housing becomes operational or is occupied 12
by an individual or household on January 1st of each subsequent 13
assessment year in which the claim for exemption is submitted. If the 14
housing facility is comprised of three or fewer dwelling units and 15
there are any unoccupied units on January 1st, the department shall 16
base the amount of the exemption upon the number of occupied dwelling 17
units as of December 31st of the first assessment year the rental 18
housing becomes operational and on May 1st of each subsequent 19
assessment year in which the claim for exemption is submitted;20
(d) "Rental housing" means a residential housing facility or 21
group home that is occupied but not owned by qualifying households;22
(e)(i) "Qualifying household" means a single person, family, or 23
unrelated persons living together whose income is at or below 50 24
percent of the median income adjusted for family size as most 25
recently determined by the federal department of housing and urban 26
development for the county in which the rental housing or mobile home 27
park is located and in effect as of January 1st of the year the 28
application for exemption is submitted; 29
(ii) Beginning July 1, 2021, "qualifying household" means a 30
single person, family, or unrelated persons living together whose 31
income is at or below 60 percent of the median income adjusted for 32
family size as most recently determined by the federal department of 33
housing and urban development for the county in which the rental 34
housing or mobile home park is located and in effect as of January 35
1st of the year the application for exemption is submitted; and36
(f) "Nonprofit entity" means a: 37
(i) Nonprofit as defined in RCW 84.36.800 that is exempt from 38
income tax under section 501(c) of the federal internal revenue code;39
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(ii) Limited partnership where a nonprofit as defined in RCW 1
84.36.800 that is exempt from income tax under section 501 (c) of the 2
federal internal revenue code, a public corporation established under 3
RCW 35.21.660, 35.21.670, or 35.21.730, a housing authority created 4
under RCW 35.82.030 or 35.82.300, or a housing authority meeting the 5
definition in RCW 35.82.210(2)(a) is a general partner;6
(iii) Limited liability company where a nonprofit as defined in 7
RCW 84.36.800 that is exempt from income tax under section 501 (c) of 8
the federal internal revenue code, a public corporation established 9
under RCW 35.21.660, 35.21.670, or 35.21.730, a housing authority 10
established under RCW 35.82.030 or 35.82.300, or a housing authority 11
meeting the definition in RCW 35.82.210(2)(a) is a managing member; 12
or 13
(iv) Mobile home park cooperative or a manufactured housing 14
cooperative, as defined in RCW 59.20.030. 15
NEW SECTION. Sec. 2. RCW 82.32.805 and 82.32.808 do not apply 16
to this act.17
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