Citizen discusses tax levies and RCWs

To the Eagle:

There are several RCWs regulating the amount of taxes which can be levied against properties by the various taxing districts. At the July 21, 2015 meeting of the Board of County Commissioners, two different levy limits were being discussed. I was discussing the 1% increase the county may add each year to the prior year’s levy amount. Assessor Bill Coons was discussing the maximum levy rate the county can have.

Commissioner Backman was proposing a “levy lid lift” which is actually a lifting of the “1% lid” otherwise imposed by RCW 84.55.005(2)(a). I asked if the county had any “banked” levy capacity. This is created when a taxing district does not increase its levy by 1% each year. (This banked capacity is recalculated each year and is available to add to any future year’s levy.) The response was “yes” and I stated that the county must use its banked capacity first before it can have a levy lid lift. The county cannot save banked capacity for a future date while utilizing a levy lid lift. The commissioners’ discussions then expanded to the topic of the maximum levy rate that the county may impose. Following is a brief recap of the relevant RCWs. Other RCWs impose other limitations on the maximum allowable levies.

RCW 84.55.050 titled “Election to authorize increase in regular property tax levy – Limited propositions – Procedure.” This RCW allows a taxing district to levy “… an amount exceeding the limitations provided for in this chapter…” However, the taxing district is “Subject to any otherwise applicable statutory dollar rate limitations…”

RCW 84.55.005(2)(a) defines a 101% limit factor for districts under 10,000 population.

RCW 84.52.043 titled “Limitations upon regular property tax levies. (effective until January 1, 2018.)” This RCW limits the county levy rate to $1.80 per $1,000 assessed value or $2.475 per $1,000 assessed value if the county and road district levy rate does not exceed $4.05.

As is the case with many RCWs, these regulations are not written in a straightforward, easy to understand manner. The Department of Revenue has a “Property Tax Levies” online manual which provides explanations of the above topics in sections 4.3 through 4.4.3. (www.dor.wa.gov/docs/pubs/prop_tax/levymanual.doc)

Sylvia Costich

Cathlamet