Committee adopts substitute clarifying assessor rules for affordable rental housing; short form and attorney-fee remedy included

Madam Chair: the committee considered House Bill 2245, a measure addressing how local assessors determine fair market value for properties operated in whole or in part as affordable rental housing. The measure, as introduced by Delegate Colson, directs assessors to use the income approach for such properties, requires localities to reimburse owners for reasonable attorney fees and costs if an assessment failed to comply and the owner wins an appeal, directs the Department of Taxation to develop a short form for assessors to use, and states that the bill’s provisions apply to assessments completed on or after July 1, 2026.

The committee considered and adopted a substitute that clarified several administrative and compliance points. Counsel explained the substitute does the following: it clarifies that an assessor need not use the income approach if the relevant information is not provided; it clarifies that responses to the Department of Taxation short form do not need to be made directly on the form; it creates a presumption of compliance if all required information is provided on the form; and it narrows the stakeholder work group in the enactment clause so that only one representative of each listed entity must participate.

The motion before the committee was to adopt the substitute and to report the bill with the substitute. The committee adopted the substitute and proceeded to report the bill. The full-committee roll call for the substituted measure was unclear in the audio transcript; the subcommittee had reported the bill to the full committee on a 5–3 vote.

What the substitute changes: By removing a strict requirement that the income approach always be used, the substitute makes the use of the income approach conditional on the availability of necessary information. It also clarifies how the Department of Taxation’s short form will operate as administrative evidence for compliance and narrows the stakeholder participation requirement to one representative per listed entity.

Context and next steps: The bill’s assessment provisions apply only to assessments completed on or after July 1, 2026. The Department of Taxation must develop the short form “in consultation with the stakeholder group,” according to the bill language discussed on the floor. The committee’s reporting of the substituted bill moves it to the next stage of legislative consideration; the transcript indicates committee members asked to hear the differences embodied in the substitute prior to final action.

Quotes from the hearing (attributed to committee participants): "The new substitute clarifies that the assessment of affordable rental housing doesn't need to do use the income approach if the relevant information is not provided," Counsel explained during the committee meeting.

Ending: Because the final roll-call tally for the substituted bill was not clearly audible in the committee transcript, the full-committee vote is recorded here as not specified; the subcommittee recommended reporting on a vote of 5 to 3. The measure, as substituted, was reported by the committee for further consideration.