Bill would let public facilities districts extend state sales‑tax credit window to 65 years

House Bill 1109 would extend the maximum period that a state‑shared sales tax credit may be levied by public facilities districts (PFDs) for financing construction or improvement of qualifying public facilities from a current statutory maximum of 40 years to 65 years.

Committee staff explained that PFDs are municipal corporations with independent taxing authority that may impose a local sales‑and‑use tax credit shared with the state to finance regional centers, theaters and certain event venues. Staff said two statutes authorize PFD sales‑tax credits (one authorizes a 0.33% rate for regional centers and another authorizes 0.02% or 0.025% for regional theaters), and that PFDs in the state collect about $43 million per fiscal year under current authorizations. The staff briefing noted the sales‑tax credit expires when bonds used to finance facilities are retired but may not be levied longer than 40 years under current law; the bill would extend that statutory cap to 65 years.

Representative Cindy Ryu, the bill sponsor, told the committee the bill does not change tax rates but lengthens the period PFDs may finance bonds and argued that extending the window helps communities finance expensive capital projects and deferred maintenance. PFD representatives and local officials testified in support, saying the longer financing horizon would increase bonding capacity, help refinance deferred maintenance, enable new construction without reliance on the state capital budget, and support local economic and cultural projects. Jim Hedrick of the Washington State Public Facilities Districts Association explained how an extended authorization could materially increase bond proceeds for some districts; Lynnwood and Tacoma witnesses described aging facilities and projects modeled to generate substantially more economic activity with renovation.

Speakers emphasized PFDs cannot bond against property and rely on revenue streams like the sales‑tax credit for underwriting; several PFDs said their current bonding capacity is constrained by the 40‑year cap. Speakers requested the committee advance the bill to preserve the ability of PFDs across the state to finance large capital projects and maintenance. No formal votes were taken during the hearing.

Ending: Advocates said extending the statutory timeframe is a financing tool that can reduce pressure on the capital budget and support local economic development; the committee left the bill in committee for further work and did not take a vote.