For second time, Senate Democrats reject $1B property tax cut

  • Ericksen proposal provides full relief from this year’s property-tax spike
  • Dem plan provides only partial relief next year, when crisis has passed
  • State has $2.3B in unexpected collections – more than enough for $1B cut

OLYMPIA – For the second time in as many weeks, majority Democrats in the state shot down a Republican plan that would offer full relief from this year’s dramatic property tax increases.

During debate on a supplemental operating budget Friday afternoon, members of the Senate Democratic Caucus locked up against a Republican proposal that contained a $1 billion property tax cut. The amendment was defeated 25-23.

“Once again, our Democratic colleagues said no to a full property tax solution,” Ericksen said. “We’re sitting on a pile of money this year, all of it generated by the people of the state of Washington. As property taxes skyrocket, we owe it to the people to provide meaningful relief.

“The Senate Democrats were able to find plenty of money to spend on new programs, but no money to reduce property taxes in 2018.”

Washington residents this year are seeing big increases in their property taxes – as much as 31 percent in some King County communities. The increases come largely because of a new school-financing system adopted by the Legislature last session. The new system replaces local school levies for basic education with a flat-rate state levy. When it is fully implemented in 2019, 73 percent of Washington residents will see lower taxes. But local school levies were allowed to continue this year while the state levy is increased, causing a temporary increase in property tax bills.

Since last session, new tax-collection projections have put another $2.3 billion into state coffers — more than enough to eliminate this year’s $1 billion property-tax spike. But the Senate Democrats’ budget proposal cuts taxes only by $403 million, and the relief does not take effect until next year.

Ericksen’s proposal, also filed as SB 6439, provides relief this year because it allows homeowners and property owners to defer a portion of their 2018 property taxes, and reduces next year’s levy by the same amount. The deferral mechanism is required because of prohibitions against retroactive tax changes.