The Joint Legislative Audit and Review Committee received a consolidated preliminary briefing July 16, 2025 on multiple tax‑preference performance reviews that JLARC will continue to develop before issuing final recommendations. Staff described the scope, beneficiary estimates and preliminary conclusions for nine reviews covering 14 tax preferences.

Highlights of staff findings and recommendations presented by Pete Van Moorsel, Aline Mizona and Eric Whitaker included:

- Natural gas used for transportation: JLARC concluded three preferences reduce the cost of using compressed or liquefied natural gas (CNG/LNG) but did not meet emissions reduction targets because fewer ships and vehicles converted than anticipated. Staff recommended continuing the public utility and brokered natural gas exemptions to maintain uniform taxation and modifying the public utility exemption to require beneficiaries to report volumes sold so future reviews can better estimate fiscal impacts and emissions. The marine LNG sales tax exemption was recommended for continuation with the Legislature to consider the Department of Revenue’s work‑group recommendations due Dec. 1, 2025.

- Travel agents and tour operators (preferential B&O rates): Preferences reduce tax rates for small and large beneficiaries; staff recommended continuing the 0.275% rate for small beneficiaries and adding performance metrics, and that the Legislature review the 0.9% rate for higher earners and add objectives if continued. Staff noted industry composition in Washington includes higher‑paid tech occupations that raise average wages for the industry.

- Nonprofit low‑income housing property tax exemption: Enacted in 2016 (expires 2037; DOR may stop accepting new applications after 2027), beneficiaries have used the exemption and nonprofits have sold homes to qualifying low‑income households, but JLARC said the legislatively directed performance metric (share of revenue dedicated to affordable housing) did not show the majority of beneficiaries meeting the target. Staff recommended the Legislature decide whether to continue the preference and, if so, consider modifying reporting, performance metrics, and possibly require annual renewal to improve oversight.

- Multipurpose senior citizen centers (property tax exemption): JLARC concluded the preference provides tax relief and brings nonprofit centers’ treatment closer to government‑owned centers; staff recommended continuation and suggested the Legislature consider making the exemption permanent to remove annual renewal disparities.

- Disabled veteran adapted housing (state sales & use tax remittance): Few eligible veterans have claimed the preference (fewer than three since enactment), and JLARC recommended continuation and that the Legislature consider modifications to improve take‑up while consulting Washington Department of Veterans Affairs; staff noted the program is capped at $125,000 per year and remits up to $2,500 per project.

- Trade convention attendance nexus preference: The preference (expires Jan. 2027) protects against establishing physical presence nexus for businesses attending one trade convention without sales; staff found similar exemptions exist in other states and recommended continuation.

- Agricultural fertilizer/pesticide/seed wholesaling and hazardous substance exemption for pesticide storage: Staff recommended continuation for the wholesaling exemption (use and savings not publicly disclosed due to small beneficiary counts) and recommended extending the pesticide storage exemption but suggested new metrics tailored to the preference’s usage.

- Energy for silicon smelter preferences: Enacted to incentivize a silicon smelter project that ultimately located out of state and were unused; staff recommended allowing those preferences to expire in 2027.

Committee members asked about data redaction limits, whether beneficiaries could sign waivers to disclose employment and wage data, and whether performance metrics capture timing and project accounting practices. JLARC staff explained federal privacy limits prevent disclosure of employment security data for fewer than three entities and that reporting timing can skew percentage‑of‑revenue metrics.