Washington Legislative Update 2021

Washington 2021 Legislative Session Begins

The WA REALTORS® team is currently tracking over 200 bills this legislative session. The next key cutoff is March 9th when all bills must pass their house of origin or else they are dead for this session.

Key issues this session for REALTORS® are: Capital Gains Tax, a .25% Payroll Tax on anyone making over $150k annually, Housing Density, Racial Covenants, Landlord/Tenant Regulations, Climate Change Regulations for Housing, a Digital Ad Tax and a large increase in the Unemployment Tax.

Key Bills to Watch

Wa REALTOR Priorities

  • Capital Gain TaxesSB 5096 – Concerning an excise tax on gains from the sale or exchange of certain capital assets. HB 1496 – Creating a more progressive tax system in Washington by enacting an excise tax on sales and extraordinary profits of high valued assets. Negotiations with the upcoming House version appear to have removed the sale of property from the capital gain tax. More on this issue to come.
  • Removing Racial CovenantsHB 1335 – Concerning review and property owner notification of recorded documents with unlawful racial restrictions. This bill has passed the House, but is now shaped as a program that will be done by universities in a more targeted approach.
  • Condo ReformSB 5024 Spokane Valley Senator Mike Padden’s bill – Reducing barriers to condominium construction. This bill has passed the Senate and is now in the House for consideration. 
  • GMA/Density – SHB 1157 Increasing housing supply through the growth management act and housing density tax incentives for local governments. This bill has now passed the House and is headed to the Senate for consideration.
  • Accessory Dwelling Units in Rural AreasHB 1298/SB 5221 Concerning regulation of accessory dwelling units located outside of urban growth areas. Both bills are considered dead this session.
  • Protecting taxpayers from home foreclosure HB1410 – Sponsored by local Rep. Mike Volz, this bill addresses the penalties and interest payments on property taxes. This bill has passed the House, and is now being considered by the Senate.
  • Fair Housing Training for REALTORS®SB5378 Would require additional clock hours for Fair Housing Training. Has passed the Senate and is now under consideration in the House.

Additional Housing Related Bills

Landlord Tenant

SB 5160 – Landlord Tenant Rule Changes – Addressing landlord-tenant relations by providing certain tenant protections during and after public health emergencies, providing for legal representation in eviction cases, and authorizing landlord access to state rental assistance programs. Has passed the Senate and is being considered in the House. WA REALTORS® reports having success in removing the 2-year extension of the eviction moratorium clause.

HB 1236 – Just Cause Evictions – Protecting residential tenants from the beginning to end of their tenancies by penalizing the inclusion of unlawful lease provisions and limiting the reasons for eviction, refusal to continue, and termination. This bill is up for a vote in the House. The list of just cause categories is now 16.

SB 5139 – Limiting rent increases after expiration of the governor’s eviction moratorium.. This bill is still in committee.

HB 1236 – Just Cause Evictions. Protecting residential tenants from the beginning to end of their tenancies by penalizing the inclusion of unlawful lease provisions and limiting the reasons for eviction, refusal to continue, and termination. This bill is set for a vote in the House.

HB 1228 – Addressing residential landlord-tenant requirements in response to the COVID-19 public health emergency. This bill is still in committee.

HB 1189/SB5211 – Authorizing tax increment financing for local governments. The House bill has passed and is now in the Senate.

HB 1300 – Addressing documentation and processes governing landlords’ claims for damage to residential premise. This bill is still in committee.

Climate Change – Greenhouse Gas

HB 1099 – Improving the state’s climate response through updates to the state’s comprehensive planning framework. A new version of this bill has been added. This bill is set for a vote in the House.

HB 1084/SB 5093 – Reducing statewide greenhouse gas emissions by achieving greater de-carbonization of residential and commercial buildings. These bills are still in committee.

HB 1125 – Incentivizing investment in energy conservation and efficiency measures and expanding opportunities for energy rate discounts to, among other objectives, reduce the energy burden of low-income customers and vulnerable populations. This bill is still in committee.

SB 5312 – Facilitating transit-oriented development and increasing housing inventory. This bill has passed the Senate and is now in the House.

HB 1117 – Promoting salmon recovery through revisions to the state’s comprehensive planning framework. This bill has changed dramatically since its introduction and has passed the House.

Taxes and Exemptions

SB 5096 – Concerning an excise tax on gains from the sale or exchange of certain capital assets. So far, Real Estate remains exempt. This bill passed the Senate with a late inclusion of Commercial Real Estate, and any Residential Real Estate held as an LLC. Negotiations continue.

HB 1496 – Creating a more progressive tax system in Washington by enacting an excise tax on sales and extraordinary profits of high valued assets. This bill remains in committee.

SB 5601 – Concerning unemployment insurance. This bill has passed both the House and the Senate, and has been signed by the Governor into law.

SB 5171 – Providing unemployment insurance relief. This bill remains in committee.

SB 5211 – Authorizing tax increment financing for local governments. This bill remains in committee.

HB1189/SB 5033 – Limiting the property tax exemption for improvements to single-family dwellings to the construction of accessory dwelling units. The House version has passed and is being considered by the Senate.

SB 5138 – Eliminating a business and occupation tax deduction for financial institutions to fund affordable housing. This bill remains in committee.

HB 1070 – Modifying allowed uses of local tax revenue for affordable housing and related services to include the acquisition and construction of affordable housing and facilities.

HB 1277/SB5279 – $100 doc recording fee increase to provide for an additional revenue source for eviction prevention and housing stability services. Both bills remain in committee, but the House version is expected to move forward.

Affordable Housing

SB 5012 – Providing a local government option for the funding of essential affordable housing program. This bill remains in committee.

SB 5138 – Eliminating a business and occupation tax deduction for financial institutions to fund affordable housing. This bill remains in committee.

Growth Management Act

SB 5042 – Concerning the effective date of certain actions taken under the growth management act. This bill has become somewhat controversial and has undergone several amendments. It has been set for a vote in the House.

HB 1099 – Improving the state’s climate response through updates to the state’s comprehensive planning framework.  New language has been added that sets greenhouse gas and vehicle mileage reduction standards for the top 10 counties in the state. This bill has passed the House and is now in the Senate for consideration.

HB 1117 – Promoting salmon recovery through revisions to the state’s comprehensive planning framework. This bill has passed the House and is now under consideration in the Senate.

HB1232 – Planning for affordable housing under the growth management act – This would add provisions for the “missing middle housing types” under the GMA. Has passed the house and is now in the Senate for consideration.

HB 1241 – Planning under the growth management act has passed the House as is being considered by the Senate.

How to Testify

The good news for those interested in testifying on legislation is that both houses of the legislature now allow for Universal remote testimony – so people can testify on any bill from anywhere up to an hour prior to a committee meeting.