Current through Register Vol. 24-06, March 15, 2024
(1)
Introduction. This rule
explains the procedures for implementing a lid lift ballot measure when a
taxing district wants to ask its voters for the authority to exceed the levy
limit.
(2)
Definitions. The definitions in WAC
458-19-005 apply to
this rule.
(3)
Lid lift -
Purpose. The purpose of a lid lift is to allow additional property taxes
to be collected at a time when the levy limit in chapter 84.55 RCW is the
effective legal constraint to increasing property taxes. A levy limit may be
exceeded when authorized by a majority of the voters voting on a proposition to
"lift the lid" of the levy limit as described in
RCW
84.55.050. This "lid lift" is intended to
allow the levy limit to be exceeded for the levy made immediately following the
vote on the proposition. Lid lifts may result in increasing the limit factor,
as defined in WAC
458-19-005, for one
year or up to six consecutive years. The result of the limit factor increase
can temporarily or permanently impact subsequent levy limit
calculations.
(4)
Election
for approval of lid lift proposition -When held. The election to approve
a lid lift proposition must be held within the taxing district and may be held
at the time of a general election, or at a special election called by the
governing body of the taxing district for that purpose. The election must not
be held more than twelve months prior to the date the proposed levy is to be
made. For purposes of this rule, a levy is "made" when the taxing district's
budget is certified. The ballot title and measure proposing the lid lift are
prepared by the county prosecutor or city attorney, as applicable, in
accordance with
RCW
29A.36.071.
RCW
29A.36.071 requires a ballot title to include
a concise description of the measure, not to exceed 75 words. The requirements
for the text of a ballot title and measure differ depending on whether the levy
limit will be exceeded for a single year or multiple years, up to six
consecutive years. A simple majority vote is required for approval of a lid
lift.
(5)
Single year lid
lift. A single year lid lift allows a taxing district to increase its
levy by more than one percent over its highest lawful levy since 1985 for 1986
collection, for one year.
(6)
Ballot title and measure - Single year lid lift. The text of a
ballot title and measure for a single year lid lift must contain the following:
(a) The dollar rate of the proposed levy so
that it reflects the total dollar rate for the taxing district, which may be
less than the maximum statutory dollar rate allowed for the particular class of
taxing district; and
(b) Any of the
following conditions that are applicable:
(i)
The number of years the increased levy is to be made by the taxing district;
however, if one of the purposes of the increased levy is to make redemption
payments on bonds of the taxing district, the duration of the increased levy
cannot exceed nine years, except for taxes levied for collection in 2018 and
thereafter in Thurston County, the period for which the increased levies are
made may not exceed 25 years;
(ii)
The purpose or purposes of the increased levy;
(iii) Whether the dollar amount of the
increased levy will be used for the purpose of computing the limitations for
subsequent levies and thereby permanently increase the taxing district's levy
base; and
(iv) Whether the increase
in regular property taxes by a county or city resulting from the approval of
the lid lift will not apply to property exempt under the senior citizens and
disabled persons property tax exemption in
RCW
84.36.381.
(7)
Multiple year lid lift. A
multiple year lid lift allows a taxing district to increase its levy by more
than one percent over its highest lawful levy since 1985 for 1986 collection,
for up to six consecutive years.
(a) Ballot
title and measure. The text of a ballot title and measure for a multiple year
lid lift must contain the following:
(i) The
dollar rate of the first year's proposed levy so that it reflects the total
dollar rate for the taxing district, which may be less than the maximum
statutory dollar rate allowed for the particular class of taxing
district;
(ii) The limit factor, or
specific index used to determine the limit factor (such as the consumer price
index), which is not required to be the same for all years, by which the
regular tax levy for the district may be increased in each of the subsequent
consecutive years;
(iii) The
limited purposes for which the proposed annual increases will be used;
and
(iv) Any of the following
conditions that are applicable:
(A) The number
of years the increased levy is to be made by the taxing district; however, if
one of the purposes of the increased levy is to make redemption payments on
bonds of the taxing district, the duration of the increased levy cannot exceed
nine years, except for taxes levied for collection in 2018 and thereafter in
Thurston County, the period for which the increased levies are made may not
exceed 25 years;
(B) The purpose or
purposes of the increased levy;
(C)
Whether the dollar amount of the increased levy will be used for the purpose of
computing the limitations for subsequent levies and thereby permanently
increase the taxing district's levy base; and
(D) Whether the increase in regular property
taxes by a county or city resulting from the approval of the lid lift will not
apply to property exempt under the senior citizens and disabled persons
property tax exemption in
RCW
84.36.381.
(b) Supplanting of existing funds.
(i) Except as otherwise provided in (b) of
this subsection, funds raised by a levy under this rule may not supplant
existing funds used for the limited purpose specified in the ballot title. For
purposes of (b) of this subsection, existing funds means the actual operating
expenditures for the calendar year in which the ballot measure is approved by
voters. Actual operating expenditures excludes:
(A) Lost federal funds;
(B) Lost or expired state grants or
loans;
(C) Extraordinary events not
likely to reoccur;
(D) Changes in
contract provisions beyond the control of the taxing district receiving the
services; and
(E) Major
nonrecurring capital expenditures.
(ii) In counties with a population of less
than $1,500,000, funds raised through a lid lift can be used to supplant
existing funds beginning with levies submitted and approved by the voters after
July 26, 2009.
(iii) In counties
with a population of 1,500,000 or more, funds raised through a lid lift can be
used to supplant existing funds if the levy was approved by the voters after
July 26, 2009, and in one of the following calendar years; 2009, 2010, 2011,
2015, 2016, 2017, 2018, 2019, 2020, 2021, and 2022.
(8)
Permanent lid
lift. A permanent lid lift occurs when the ballot title and measure
expressly state that the levy will be used for the purpose of computing the
limitations for subsequent levies as provided in subsections (6)(b)(iii) and
(7)(a)(iv)(C) of this rule. Approval of a permanent lid lift permanently
increases the base used to calculate the levy limit.
(a) First levy after voter approval. The
first regular levy of a taxing district made after voter approval of a
permanent lid lift proposition is calculated on the basis of the dollar rate
stated in the ballot title. The dollar rate is subject to the constitutional
one percent limit, the statutory aggregate dollar rate limit, and any
applicable prorationing.
(b)
Subsequent levies. The levy limit on regular levies of a taxing district made
subsequent to the first regular levy made after voter approval of a permanent
lid lift proposition is calculated by multiplying the highest amount that could
have been lawfully levied since 1985 for 1986 collection, including the dollar
amount of the regular levy calculated in (a) of this subsection, by the limit
factor.
(9)
Temporary lid lift. If the ballot title and measure do not
expressly indicate that the final levy will be used for the purpose of
computing subsequent levies, the levy increase is temporary.
(a) First levy after voter approval. The
first regular levy of a taxing district made after voter approval of a
temporary lid lift proposition is calculated on the basis of the dollar rate
stated in the ballot title. The dollar rate is subject to the constitutional
one percent limit, the statutory aggregate dollar rate limit, and any
applicable prorationing.
(b)
Subsequent levies. The levy limit on regular levies of a taxing district made
subsequent to the first regular levy made after voter approval of a temporary
lid lift proposition is calculated by multiplying the highest amount that could
have been lawfully levied since 1985 for 1986 collection, including the dollar
amount of the regular levy calculated in (a) of this subsection, by the limit
factor.
Statutory Authority:
RCW
84.08.010,
84.08.070,
84.48.080,
84.55.060,
84.52.0502,
chapters
84.52 and 84.55 RCW, and
RCW
34.05.230(1). 02-24-015,
§ 458-19-045, filed 11/25/02, effective 12/26/02. Statutory Authority:
RCW
84.55.060 and
84.08.070. 94-07-066, §
458-19-045, filed 3/14/94, effective
4/14/94.