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Ideas for changes
• A House Republican proposal to give $400 rebates to all homeowners.
• A Senate Republican proposal to phase out the state's share of property taxes.
• A variety of Democratic plans, including Sen. Mary Margaret Haugen's homestead exemption, which would shield the first $75,000 of property tax valuation on a primary residence from any tax. This would shift the burden to higher-value properties, particularly businesses.
• A proposal by Sen. Tim Sheldon, D-Potlatch, for a constitutional amendment that would limit annual increases in property valuation to 1 percent until a home is sold, similar to what California has done. Rep. Lynn Kessler, D-Hoquiam, has a similar value-freeze concept in mind.
• A proposal from the Association of Washington Business for yearly assessments to smooth out spikes that distort valuations and for reducing the burden of proof for homeowners who challenge their assessments.
• A suggestion favored by cities and counties to let local governments raise taxes by more than the 1 percent cap without asking voters to approve. One idea is to tie yearly tax-collection growth to inflation, which is frequently higher than 1 percent — or find some way for the state to help with services in criminal justice or other areas that are costly for locals.
• A proposal to give homeowners a rebate when their property tax bills exceed 5 percent of their income. The Washington State Budget and Policy Center says rebates of up to $1,000 could cut taxes for the lower 40 percent of income earners, effectively giving a 12 percent to 15 percent tax cut.
The Olympian
Want more tax relief? Legislators will get back to you on that in 2008 ... or 2009
By Brad Shannon | The Olympian
Property-tax relief is headed back to the Capitol in January. The question is what brand of tax relief.
One thing is clear for 2008 after Thursday's special session: Legislators who broke camp after a one-day blitz have a raft of leftover ideas that go well beyond the two property-tax measures that won passage and that Gov. Chris Gregoire signed into law.
Many lawmakers, just like activists and interest groups, are far from content with what they accomplished: reinstating a 1 percent property-tax cap and creating a tax deferral program.
"We've got some work to do to figure out what we can get a majority around" for the next step, Senate Majority Leader Lisa Brown said late Thursday as the House voted on the property-tax deferral bill. "Everyone wants to provide relief to low- and middle-income citizens."
Indeed, Brown's caucus of 32 members is far from agreement on any one idea — whether it might be a homestead exemption shielding the first $75,000 of home value from taxes or a "circuit breaker" that gives tax rebates to lower income homeowners when their tax bills hit 5 percent of income.
One Democrat, Sen. Tim Sheldon of Potlatch, wants a constitutional amendment to limit yearly valuation increases to 1 percent. House Majority Leader Lynn Kessler of Hoquiam wants to renew her proposal for a California-style freeze on property valuations as long as a buyer keeps a home.
Republicans have different ideas. In the House, the GOP leader, Rep. Richard DeBolt of Chehalis, wants to hand out $400 rebates to all homeowners. Some Senate Republicans want to slash or eliminate the state's share of the property tax.
Other Republicans, joined by initiative promoter Tim Eyman, want to get rid of local governments' ability to tap into unused tax capacity that was left over from the years before 2002.
That's the year Initiative 747's 1 percent property tax cap went into law. It was reinstated by lawmakers Thursday in response to a court ruling striking it down.
Tax experts call that leftover taxing authority "banking," and Republican lawmakers and Eyman say it is a huge problem.
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