In the current real estate market in the Puget Sound, we’re seeing property values climb to new heights. With that comes higher property taxes — taxes that are pricing many seniors out of the homes in which they’ve raised their families.
Our homelessness situation is bad enough. We don’t need to be punishing people who have contributed to our communities for decades by forcing them into economic crisis. We need to be thanking them for their lifelong contribution to Washington state and making it easier for them to stay in their homes.
I am sponsoring a bill in the 2019 legislative session that would do just that by providing more property tax relief for older or disabled people to make it possible for them to remain in their homes. The bill would provide that same relief to veterans and disabled homeowners as well.
What is the current law?
Right now, qualifying senior citizens, people who are retired due to disability and veterans entitled to and receiving compensation from the United States Department of Veterans Affairs at a total disability rating for a service-connected disability are entitled to property tax relief on their primary residence.
To qualify, a person must be 61 years old in the year of the application or retired from employment because of disability, own his or her primary residence and have a combined disposable income of less than $40,000 a year.
Those who qualify are exempt from all local school district levies and a portion of the state property tax. Their residential property value is also frozen. Under this program, those who are eligible may receive additional property tax relief depending on the degree to which their income is below the $40,000 threshold.
What is different about my bill?
If my bill becomes law, it would create an additional property tax relief program for senior citizens (65 years of age or older), persons retired due to disability and veterans with a total disability rating, who have a combined household income of less than $100,000 per year OR a home value below the median value for their county.
A person who qualifies for the program on the basis of age would also have to show that they have been a Washington state resident for the last 15 years.
Property owners who qualify are exempt from the portion of the state property tax (about a $1.80 per thousand) that pre-dates the recent state property tax increase for public schools.
The new program would be closed to new applicants after 10 years pending a state study examining its effectiveness. Property owners already in the program at that time will continue to be eligible.
If this program proves to be effective at keeping people at home verses having to move to assisted living or something similar, the Legislature can vote to extend it. My hope is that so many people around the state will be able to budget based on current valuations of their property that they can continue to live out their lives in their homes.
Where would the money come from to pay for this tax relief?
My bill would pay for this additional property tax relief through the sales tax that Washington is now allowed to collect on internet sales. This revenue became available to us after a United States Supreme Court decision that ruled a state could collect internet sales tax on purchases made by in-state customers from out-of-state businesses.
Until now, that revenue was lost to the state as online shopping grew exponentially and out-of-state retailers didn’t have to collect sales tax. It also put traditional brick-and-mortar stores at a disadvantage.
What happens next?
The 2019 Legislative Session begins January 28, 2019. I will do everything I can to see that the Senate Ways & Means Committee, which handles the writing of the state budget, gives my bill a hearing. This means the public can come and testify in favor of, or in opposition to, the bill.
I will also work hard to move the bill through the legislative process, updating you on its progress along the way.