HB-2230 makes permanent a tax exemption for tribally-owned land within the state
OLYMPIA – The Washington legislative session officially began Jan. 14 and will run until March 12 in this non-budget year.
As a result, the Colville Tribes have begun lobbying work at the state capital.
Colville Business Council Chair Rodney Cawston testified Jan. 16 during a legislative hearing in the House Finance Committee expressing the tribes’ support of HB-2230, a bill that would extend and expand a tax exemption for some tribally-owned land within the state.
“The tribal property tax equity bill before you today can complete what was started in 2004, placing federal recognized tribal Indian governments on the same level as state and local governments when it comes to property taxes and the essential governmental service of economic development,” said Cawston in testifying to the committee. “The economic challenges are well-documented in eastern Washington, most notably in Ferry and Okanogan counties where the Colville Reservation resides. Those challenges have contributed to increasing numbers of Colville tribal members moving away from the reservation. Without economies that support employment that trend is likely to continue.”
According to committee staff, HB-2230 would provide state law to exempt tribally-owned land from taxation if the property is used exclusively for essential governmental services, such as tribal administration, public facilities, public utilities, transportation, fire and police as well as for economic development.
During their summary in the work session, committee staff further noted the bill builds on legislation passed in 2014 that allows a tax exemption for property owned by tribes and not held in federal trust that is used for economic development purposes.
That bill expires in 2022, but HB-2230 would make permanent the tax exemption and remove a requirement that the land must have been owned prior to March 2014. Under the bill, tribally owned land that is occupied by non-tribal business owners would see a payment in lieu of taxes from the business owner to the county.
According to the Muckleshoot Tribes’ Dylan Doty, who testified alongside Cawston, only three tribes have been able to utilize the exemption from the 2014 legislature due to the March 2014 stipulation. Those tribes include the Muckleshoot tribe, who worked with King County, the Puyallup Tribe, who worked with Pierce County, and the Suquamish Tribe, who worked with Kitsap County.
Doty and Cawston both noted other tribes have been discouraged from using the legislation due to the 2022 expiration.
“Currently the [Colville] tribe has three pending applications under review with the Department of Revenue,” said Cawston. “Removing the January 2022 expiration now would eliminate uncertainty and allow the tribe to plan for future investments.”
The fiscal impact of the bill is undetermined, according to committee staff.
“Washington State has tried to make our tax system more fair for our federally recognized tribal governments since 2004, which is 16 years ago, and in 2014 we made a major, significant change, but it had an expiration date,” said the bill’s primary sponsor, Rep. Mia Gregerson (D-33rd). “This gets rid of the expiration date. We’ve had 8 years to see what would happen. The fiscal impact is indeterminate, but I think it is pretty safe to say that the three counties that negotiated the PILT with the tribal government came out with a positive. There are no complaints, and it feels like it is the right thing to do. This is a tax equity issue.”
Cawston testified alongside Anita Mitchell and Doty of the Muckleshoot Tribe. Dawn Vyvyan, Sauk-Suiattle Tribe, Leonard Forsman, Suquamish Tribe, also testified in support of the bill.