Frequently Asked Questions and Answers

Pierce County

Assessor-Treasurer

QUESTION: WHAT DOES THE 1% LEVY LIMIT MEAN?

ANSWER: In 2007 the Governor and Legislature resinstated the 1% levy limit in HB 2416 after the Supreme Court ruled that Initiative 747 was unconstitutional. Today, the 1% levy limit continues to apply to all regular levies the State of Washington allows taxing districts to collect, limiting the increase on the amount collected to 1% of the highest lawful levy since 1985. The 1% levy limit has no bearing on the annual valuation of your property.

QUESTION: COULD LEVIES OF JUNIOR TAXING DISTRICTS HAVE AN INCREASE IN LEVY CAPACITY AS A RESULT OF THE 1% LEVY LIMIT?

ANSWER: It is possible some junior districts (Fire, Hospital, Library, EMS, Park & Recreation, Metropolitan Park, Cemetery) could realize additional levy capacity under the 1% levy limit. With levy increases limited to the lesser of one percent or the rate of inflation, some senior districts (State, County Current Expense, County Road, City) may have lower levy rates than without the 1% levy limit. Lower levy rates would result in additional capacity under the one-percent constitutional limit and the $5.90 aggregate limit. The additional capacity could lessen or eliminate the need for prorating junior taxing districts? levy rates. In this manner, some junior taxing districts could realize higher levy rates.

QUESTION: IS THE BASE USED IN CALCULATING A TAXING DISTRICT?S LEVY THE AMOUNT LEVIED LAST YEAR?

ANSWER: Not always, RCW 84.55.092, allows local taxing districts to calculate levies based on the maximum lawful levy since 1985. The 1% levy limit does not affect the provisions of this statute. So, if a taxing district voluntarily levied less than its maximum levy amount last year (the district has 'banked' levy capacity), the base for calculating its levy would be something other than the amount levied last year.

QUESTION: WOULD TAXING DISTRICTS STILL BE REQUIRED TO ADOPT RESOLUTIONS OR ORDINANCES IN ORDER TO INCREASE THEIR LEVIES?

ANSWER: Yes. The 1% levy limit does not change any of the requirements imposed by Referendum 47 with respect to the need for passage of resolutions or ordinances in order for taxing districts to increase their levies. There are different requirements for taxing districts based on the population of the district.

A district with a population below 10,000 would need to adopt a resolution/ordinance by a simple majority vote of its governing body to increase its levy by up to one percent.

A district with a population over 10,000 could increase their levies by the lesser of the one percent or the rate of inflation, with adoption of a resolution/ordinance by a simple majority of the governing body. If the rate of inflation is less than one percent, the taxing district could increase its levy up to one percent with a finding of substantial need and passage of a second resolution/ordinance by a supermajority vote of the governing body.

QUESTION: DOES THE 1% LEVY LIMIT APPLY TO ALL LEVIES?

ANSWER: The 1% levy limit applies to all regular levies, including voter-approved regular levies such as Emergency Medical Services after the first year. For example, a six-year voter approved Emergency Medical Service levy would be subject to the 1% levy limit in the second through sixth years of the levy. The 1% levy limit does not apply to voter?approved excess or 'special' levies.

QUESTION: CAN A TAXING DISTRICT ASK VOTERS TO APPROVE AN INCREASE OF MORE THAN ONE PERCENT FOR MULTIPLE YEARS AT A SINGLE ELECTION?

ANSWER: Yes, based on the provisions of RCW 84.55.050, taxing districts may levy an amount in excess of the levy limit (one percent) with approval of a majority of the voters of the district for up to six years with voter approval. Any election held for this reason shall not occur more than 12 months prior to the date the levy is to be made.

QUESTION: HOW DO THE PEOPLE IN A TAXING DISTRICT KNOW HOW FUNDS WILL BE DISTRIBUTED?

ANSWER: By law, all taxing districts are required to hold public meetings before passing their annual budgets. Interested parties should attend such meetings or talk to the taxing district directly to understand how tax money is being distributed.

QUESTION: 'IF THE VALUE OF YOUR PROPERTY INCREASES, STATE LAW REQUIRES THAT YOUR PROPERTY TAXES FOLLOW SUIT.' WHAT DOES THIS MEAN?

ANSWER: State law requires property to be assessed at 100% of its true and fair market value. That value multiplied by the tax rate will determine the amount of tax due. Even if tax rates drop, a significant increase in value can result in a tax increase on individual parcels.

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Tacoma, WA 98409
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