Bill > SB5553

This bill amends existing law to expand a sales and use tax deferral program for multifamily affordable housing, with the goal of encouraging redevelopment of underutilized commercial property and stimulating construction of new affordable housing in areas with insufficient housing supply. The bill modifies the requirements for cities to create tax deferral programs, allowing for both conversion of existing commercial buildings and new multifamily housing construction. Property owners can apply for the tax deferral if they commit to making at least 10% of units affordable to low-income households, with mixed-use projects limited to commercial use on the ground floor. The bill requires applicants to also apply for a multiple-unit housing property tax exemption and provides a process for cities to approve and monitor these projects. If a recipient maintains the property for qualifying purposes for at least 10 years, the deferred sales and use taxes do not need to be repaid. The legislation includes a performance evaluation provision, with the Joint Legislative Audit and Review Committee required to assess the effectiveness of the program by December 31, 2032, by measuring the increase in affordable housing units. If the review finds no significant increase in affordable housing, the legislature intends to repeal the tax preference.

Budget and Finance

https://app.leg.wa.gov/billsummary?BillNumber=5553&Year=2025&Initiative=false