Bill Summary – FastDemocracy

S-3474.3
                               SENATE BILL 6317
     State of Washington       68th Legislature       2024 Regular Session
     By Senator Fortunato
     AN   ACT  Relating  to  a  new   proposal  to  promote  housing
 affordability by incentivizing the construction of American dream
 homes; adding a new section to chapter 36.70A RCW; adding a new
 section to chapter 82.08 RCW; adding a new section to chapter 82.04
 RCW; adding a new section to chapter 84.36 RCW; creating new
 sections; providing an effective date; and providing expiration
 dates.
 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
     NEW SECTION. Sec. 1. A new section is added to chapter 36.70A
 RCW to read as follows:
     (1) Until December 31, 2034, a person may request a permit for an
 American dream home in order to encourage the development of
 residential housing for low-income households.
     (2) A permit for a new American dream home must be approved in a
 city or county according to the following criteria:
     (a) Each American dream home is eligible to have impact fees
 imposed under RCW 82.02.050 offset by payments made to the city or
 county from the department pursuant to section 5 of this act;
     (b) The city or county may not charge cumulative permitting fees
 for each American dream home that exceed $1,250, which must be offset
                                     p. 1                           SB 6317
 by the distribution received by the city or county under section 2 of
 this act;
     (c) Provisions, such as covenants or other restrictions, are
 applied to ensure that each American dream home remains reserved for
 low-income households for a period of seven years from the date of
 the first sale of the home to an owner who will occupy the home. The
 covenant or restriction must provide that the American dream home is
 occupied by the owner that is qualified under this section. If an
 American dream home is resold any time within seven years after
 purchase of the home by the first owner-occupier, the price must be
 affordable for low-income households; however, this resale price
 requirement does not apply in the case of foreclosure if all permit
 fees, impact fees, and taxes, related to the American dream home have
 been paid in full to the appropriate authority;
     (d) An American dream home must conform to the applicable
 building codes in effect in the jurisdiction where the home is built;
     (e) A city or county may not impose stormwater conditions that
 exceed the stringency of the department of ecology's construction
 stormwater general permit in effect on the date a complete
 application is received for the construction of an American dream
 home.
     (3)(a) This section does not prohibit a county planning under RCW
 36.70A.040 from authorizing the extension of public facilities and
 utilities to serve residential building sites for an American dream
 home.
     (b) A city or county may authorize the siting of an American
 dream home outside of the urban growth area, even where otherwise
 prohibited by a multicounty planning policy. If the city or county
 authorized the siting of a school outside of the urban growth area
 under this chapter, the city or county may determine that an American
 dream home must be connected to utilities or other similar
 infrastructure that was installed to serve the school.
     (4) A city or county must annually report to the department until
 March 1, 2034, regarding the number of American dream home permits
 issued in its jurisdiction. The department must compile the data and
 report to the appropriate committees of the legislature regarding the
 participation by jurisdiction in the program.
     (5) For the purposes of this section:
     (a) "Affordable" means residential housing which, as long as the
 same is occupied by low-income households, requires payment of
                                     p. 2                          SB 6317
 monthly housing costs, including utilities other than telephone, of
 no more than 30 percent of the family's income, for a family earning
 80 percent of the area median income.
     (b) "American dream home" means an owner-occupied single-family
 residential detached dwelling of 1,500 square feet or less serving
 low-income households.
     (c) "Low-income household" means a single person, family, or
 unrelated persons living together whose adjusted income is less than
 70 percent of the median family income adjusted for household size,
 for the city or county where the project is located.
     NEW SECTION.   Sec. 2.   A new section is added to chapter 82.08
 RCW to read as follows:
     (1) A city or county must receive a distribution equal to the
 state portion of the tax levied by RCW 82.08.020 in respect to:
     (a) Charges for labor and services rendered in respect to the
 constructing of dwellings designated American dream homes, as
 provided in section 1 of this act;
     (b) Sales of tangible personal property that will be incorporated
 as a component of dwellings designated as American dream homes,
 during the course of construction; and
     (c) Charges made for labor and services rendered in respect to
 installing, during the course of constructing such dwellings,
 fixtures not otherwise eligible for the exemption under RCW
 82.08.02565.
     (2) This section applies only to American dream homes meeting the
 requirements and conditions described in section 1 of this act.
     (3)(a) The department must at least once annually remit to the
 city or county an estimated amount, as determined by the department,
 of state taxes collected during the prior calendar year with respect
 to subsection (1) of this section.
     (b) The department must determine eligibility under this section
 based on information provided by the city or county and through audit
 and other administrative records.
     (c) The city or county must, on an annual basis, submit an
 application, in a form and manner as required by the department by
 rule, containing any information the department deems necessary in
 determining remittance amounts under this section.
     (4) The legislature intends for the distribution authorized under
 this section to be applied to the permitting costs incurred by the
                                     p. 3                          SB 6317
  city or county related to the permitting of American dream homes, as
  defined in section 1 of this act.
      (5) This section expires July 1, 2035.
     NEW SECTION.   Sec. 3.   A new section is added to chapter 82.04
 RCW to read as follows:
     (1)(a) The builder of an American dream home is allowed an annual
 credit against the tax due under this chapter as provided in this
 section. The credit equals four percent of the gross selling price of
 the American dream home.
     (b) Credits under this section may only be earned on the sale of
 American dream homes meeting the requirements and conditions
 described in section 1 of this act.
     (2) The credit may be used against any tax due under this
 chapter, and may be carried over until used, except as provided in
 subsection (4) of this section. No refund may be granted for credits
 under this section.
     (3) Credits earned under this section may be claimed only on
 returns   filed  electronically   with   the  department using   the
 department's online tax filing service or other method of electronic
 reporting as the department may authorize. The taxpayer must keep
 records necessary for the department to determine eligibility under
 this section including records establishing the sale of an American
 dream home.
     (4) Credits allowed under this section can be earned for tax
 reporting periods through June 30, 2035. No credits can be claimed
 after June 30, 2036.
     (5) For the purposes of this section, "American dream home" has
 the same meaning as in section 1 of this act.
     (6) This section expires July 1, 2037.
     NEW SECTION.   Sec. 4.   A new section is added to chapter 84.36
 RCW to read as follows:
     (1)(a) The value of an American dream home is exempt from
 property taxation for a period of seven years beginning January 1st
 of the year immediately following the calendar year in which
 construction of the American dream home is completed.
     (b) The exemption under this section applies only to American
 dream homes meeting the requirements and conditions described in
 section 1 of this act.
                                     p. 4                          SB 6317
     (c) An American dream home receiving an exemption under this
 section is immediately subject to property taxation if at any point
 during the exemption period the home no longer meets the requirements
 and conditions in section 1 of this act.
     (2) Claims for an exemption under this section must be filed with
 the county assessor on forms provided by the department and furnished
 by the county assessor.
     (3) The department may promulgate such rules, pursuant to chapter
 34.05 RCW, as necessary to properly administer this section.
     (4) At the conclusion of the exemption period, the value of the
 new housing must be considered as new construction for the purposes
 of chapters 84.55 and 36.21 RCW as though the property was not exempt
 under this section.
     (5) For the purposes of this section, "American dream home" has
 the same meaning as in section 1 of this act.
     NEW   SECTION.   Sec. 5.    The legislature intends to appropriate
 amounts    to the department of commerce sufficient to provide down
 payment   assistance to buyers of American dream homes as defined in
 section    1 of this act and to reimburse cities and counties for
 revenue   forgone under section 1 of this act.
     NEW SECTION.    Sec. 6.    RCW 82.32.805 and 82.32.808 do not apply
 to this act.
     NEW SECTION.   Sec. 7.    This act applies for taxes levied for
 collection in 2025 and thereafter.
    NEW SECTION.    Sec. 8.    This act takes effect July 1, 2024.
                                     --- END ---
                                        p. 5                             SB 6317