The bill seeks to eliminate tax exemptions for the replacement of equipment in data centers as part of a broader initiative to modernize Washington's tax code and enhance revenue for essential state services. Key amendments include the stipulation that no new exemption certificates will be issued for refurbished data centers after July 1, 2026, and that existing exemptions will also expire on that date. The bill introduces a new section that mandates periodic reviews of tax policies to ensure they remain relevant to the current economic landscape. It also establishes limits on the number of exemption certificates issued annually and requires qualifying businesses to maintain a minimum number of family wage employment positions.

Additionally, the bill clarifies definitions related to eligible computer data centers and their associated equipment, removing the provision for "replacement server equipment" for certain categories of data centers. It sets forth requirements for businesses to comply with sustainable design standards and outlines penalties for non-compliance. The bill emphasizes environmental responsibility by encouraging the use of renewable energy and energy-efficient practices. It also specifies that movable or fixed stand-alone units do not qualify as eligible data centers and that refurbishments after July 1, 2026, will not be eligible for exemptions. The provisions related to these tax exemptions will expire on July 1, 2038, while the new requirements will take effect on July 1, 2026.

Statutes affected:
Original bill: 82.08.986, 82.08.9861