SPOKANE — A Spokane city law granting a local property tax exemption to senior citizens and disabled veterans is unconstitutional, the state Supreme Court ruled Thursday.
The state Constitution requires all taxes to be uniform for the same class of property, the high court said.
Spokane city officials in 2015 created the local property tax exemption but the Spokane County assessor and treasurer refused to enact the ordinance and continued sending tax bills to senior citizens and the disabled veterans.
The high court’s vote was 7-2 to keep in place a state Court of Appeals ruling that had reversed an initial court decision in favor of the exemptions.
Local Angle
Clark County officials praised the Washington Supreme Court’s ruling that prevents cities from enacting property tax exemptions and said that it won’t change anything locally.
Clark County Assessor Peter Van Nortwick said that the county administers a state program that provides an exemption for senior citizens and disabled people. That program won’t be affected by the ruling.
Positive decision
He said the ruling is positive because the work of assessing properties and collecting taxes on them would be greatly complicated if cities were allowed to add their own exemptions.
“If they had ruled the other way, it would send shock waves through property taxes,” he said.
County Treasurer Doug Lasher also welcomed the ruling, saying that it clarifies the role of the state and county.
“It would add to our costs of doing our business if (city) exemptions came into play,” he said.
-- Jake Thomas
The issue began in 2004, when the city of Spokane got voter approval for a bond to pay for street repairs that would be paid off over 20 years.
In 2014, the city proposed a new strategy to pay off the bonds, swapping out the money imposed under the bond levy with an equivalent increase in the city’s regular property tax rate.
Later that year, voters approved the property tax increase. The city told voters that people who qualify for a state tax exemption would continue to be exempted from a portion of the new levy.
To make the local tax increase more politically palatable, the city officials put in place the tax hike exemption for senior citizens and disabled veterans.
City officials filed the original lawsuit when the county officials refused to enact the exemptions.
The court’s two dissenters said the state’s cities have the power to enact property tax exemptions.
The majority opinion said allowing the exemptions could usher in a patchwork system of property tax rules that would defeat the principle of uniformity of property taxes.
