MOSES LAKE — It makes sense that King County — home to roughly $2.2 million people and the state’s economic powerhouse — would also have a complex property tax structure.
It makes a lot less sense that Grant County, home to barely 100,000 people, also has one of the state’s most complex property tax structures.
But it does.
“It’s not unusual for states and cities to be pretty reliant on property taxes,” said Andy Nicholas, associate director of fiscal policy for the Washington State Budget and Policy Center in Seattle. “They are a primary instrument for funding local government.”
Being one of seven U.S. states without an income tax (along with Alaska, Florida, Nevada, South Dakota, Texas and Wyoming), Washington is particularly reliant on property taxes to fund everything from the public schools to local mosquito control.
“There’s a proliferation of special property taxing districts baked in structurally to our tax code,” Nicholas said. “One thing that locals have done to provide services to communities is to create special taxing districts.”
King County is as complicated as you would expect. The county has 163 different entities — from cities and school districts to county government to EMS district and cemetery districts — that, mixed and matched, create 560 different levy rates across the county called “tax codes.”
While Pierce County is half as complex as King, it turns out Grant County is fairly complex, even more so than Spokane County, a place with nearly five times the population.
According to Grant County Assessor Melissa McKnight, Grant County has 64 taxing entities resulting in 148 tax codes, more than Spokane County’s 56 entities and 114 tax codes.
In fact, every year, McKnight releases a single-page document outlining all 148 Grant County levy rates — something she calls “the cheat sheet” which tracks levy rates as low as $10.25 per $1,000 of assessed value (not far from Hartline) to $14.88 in Moses Lake.
It’s all the result of having 10 port districts, seven hospital districts, 15 fire districts, and 15 cities (ranging in size from tiny Krupp to Moses Lake), and they way they criss-cross, interlock and overlap.
“With local control, you have local taxing authority,” said Jason Mercier, director of the Washington Policy Center’s Center for Government Reform.
Mercier says the proliferation of taxing entities is the result of state government mandating things but refusing to pay for them.
“These are unfunded mandates,” Mercier said. “Rather than pay for it, the legislature says that locals can pay for it.”
With 1,800 entities statewide that can levy property taxes, Mercier said it’s hard to know when property taxes go up or sometimes who is even responsible for the increase.
Which is why he has been pushing for legislation that would mandate the creation of a tax transparency website, which would allow Washingtonians to type in their address and find out which districts tax them and by how much.
It would be similar to the fiscal.wa.gov website the Washington Policy Center pushed for in 2008.
“You can now see the entire budget,” Mercier said. “Why not do the same thing for taxes?”
The proposal passed as part of the budget measure, but that section of the bill was vetoed by Gov. Jay Inslee, Mercier said.
“That took us by surprise,” he said. “There were no records or memos on why, although the governor said there wasn’t enough money to implement it.”
“We hope to redo and pass next year, and hope that the governor will include enough funding,” Mercier said.