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WashingtonSB 51382025-2026 Regular SessionSenateWALLET

Concerning public facilities districts.

Sponsored By: Rebecca Saldaña (Democratic)

Became Law

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Bill Overview

Analyzed Economic Effects

5 provisions identified: 2 benefits, 1 costs, 2 mixed.

City and county shares for housing

If a city had a short‑term rental operator tax by December 31, 2017 and later repeals it, the district pays that city each quarter. The payment equals the lodging tax share from short‑term rentals in that city and is due within 30 days after each quarter. Payments stop if the city later taxes short‑term rental business again. The county also gets 50% of the specified district tax revenue, after deducting any qualifying city payments. Cities and the county must use this money for community‑led equitable development and affordable housing.

New lodging taxes in big counties

In counties with 1,500,000+ people, the convention center district now charges a lodging tax, including on short‑term rentals. The rate is up to 7% inside the largest city and up to 2.8% in the rest of the district. The district can also add up to 2% more in the largest city, and that extra amount is credited against state sales tax. Some lodging is exempt, including hostels, places with fewer than 60 units in towns under 300 people, units already taxed by a city’s short‑term rental operator tax, and university health‑system family lodging. The tax cannot start before the statutory transfer date. The law defines key terms like “short‑term rental” and “hostel” so operators and guests know what is covered.

State payments and loan backstop for districts

If the district charges the extra 2% tax, it must send the state an annual payment each June 30. The payment equals that year’s extra‑tax revenue plus interest on half the payment at the prior year’s state investment pool rate. If the district cannot pay, the unpaid amount becomes a state loan at the 20‑bond index plus 1%. The district may pledge these tax revenues to its debts. While pledged, the legislature cannot cut the district’s tax authority or raise the required state payment.

Limits on local lodging taxes

Public facilities districts can set a lodging tax up to 2%. They cannot tax places with fewer than 40 units. They cannot start the tax until they approve the facility project, and voters must approve if no tax was in place before December 31, 1995 (not for the large‑county taxes). Total state and local lodging taxes cannot exceed 11.5%, and the RCW 82.14.530 tax is not counted in that limit. Sales of temporary medical housing are exempt. The state collects these taxes at no cost to the district, sends funds monthly, and applies standard state sales‑tax rules.

Key dates and sunsets for taxes

The extra 2% lodging‑tax authority ends by July 1, 2029, or earlier if the related debt is fully resolved. For legal treatment under RCW 82.14.410, certain taxes are treated as if imposed on December 1, 2000. The entire act expires July 1, 2035 unless renewed.

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Sponsors & Cosponsors

Sponsor

  • Rebecca Saldaña

    Democratic • Senate

Cosponsors

  • Bob Hasegawa

    Democratic • Senate

  • Manka Dhingra

    Democratic • Senate

  • T'wina Nobles

    Democratic • Senate

Roll Call Votes

All Roll Calls

Yes: 141 • No: 51

Senate vote • 4/17/2025

Final Passage as Amended by the House

Yes: 31 • No: 18

House vote • 4/12/2025

Final Passage as Amended by the House

Yes: 62 • No: 32 • Other: 4

Senate vote • 2/12/2025

3rd Reading & Final Passage

Yes: 48 • No: 1

Actions Timeline

  1. Effective date 7/27/2025.

    5/20/2025Senate

  2. Chapter 376, 2025 Laws.

    5/20/2025Senate

  3. Governor signed.

    5/20/2025legislature

  4. Delivered to Governor.

    4/23/2025legislature

  5. Speaker signed.

    4/22/2025legislature

  6. President signed.

    4/19/2025legislature

  7. Passed final passage; yeas, 31; nays, 18; absent, 0; excused, 0.

    4/17/2025Senate

  8. Senate concurred in House amendments.

    4/17/2025House

  9. Third reading, passed; yeas, 62; nays, 32; absent, 0; excused, 4.

    4/12/2025Senate

  10. Rules suspended. Placed on Third Reading.

    4/12/2025Senate

  11. Floor amendment(s) adopted.

    4/12/2025Senate

  12. Rules Committee relieved of further consideration. Placed on second reading.

    4/8/2025Senate

  13. Referred to Rules 2 Review.

    3/31/2025Senate

  14. Minority; do not pass.

    3/27/2025Senate

  15. FIN - Majority; do pass.

    3/27/2025Senate

  16. FIN - Executive action taken by committee.

    3/27/2025Senate

  17. First reading, referred to Finance.

    2/17/2025Senate

  18. Third reading, passed; yeas, 48; nays, 1; absent, 0; excused, 0.

    2/12/2025Senate

  19. Rules suspended. Placed on Third Reading.

    2/12/2025Senate

  20. Placed on second reading consent calendar.

    2/5/2025Senate

  21. Passed to Rules Committee for second reading.

    1/31/2025Senate

  22. LGV - Majority; do pass.

    1/30/2025Senate

  23. First reading, referred to Local Government.

    1/13/2025Senate

  24. Prefiled for introduction.

    1/6/2025Senate

Bill Text

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