Committee unanimously passes Rep. Klicker’s bipartisan bill that would help local governments share tax revenue

A bipartisan bill from Rep. Mark Klicker that would allow cities to share certain sales and use tax revenue received unanimous approval in the Local Government Committee on Wednesday.

House Bill 2428 would allow cities and towns to voluntarily enter interlocal agreements to share a portion of general-purpose local government sales and use tax revenue.

“This is a simple bill on paper, but it would be a big deal for our cities, towns and communities,” said Klicker, R-Walla Walla. “It’s an important bill because it would allow local government entities to utilize and share their revenue from sales and use taxes. By allowing cities the option to voluntarily enter interlocal agreements, it would eliminate the competition between these cities for the coveted sales tax revenue.”

An interlocal agreement is formed between local governments or other public agencies to cooperatively conduct government activities or provide services. The agreement must include certain terms, such as the duration of the agreement, the precise organization of any entity created, the purpose of the agreement, how the undertaking will be financed, and how the agreement can be terminated.

In addition to the terms required to be included in any interlocal agreement, an agreement to share sales and use tax revenue must include:

  • The area or areas in which the agreement applies, if it is only applicable to revenue collected in certain areas.
  • The amount or proportion of revenue to be shared.
  • The mechanism for sharing the revenue.

“This legislation would be very applicable to two cities in my district: Walla Walla and College Place,” said Klicker. “They work together on just about everything, primarily within infrastructure, including efforts to recruit larger scale retail to the area, for example. Many times, even though they are using their sales or use tax, they dovetail together, so this bill would be a win-win for cities and towns like this all over the state.”

The 2024 legislative session is scheduled to conclude on March 7.

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Washington State House Republican Communications
houserepublicans.wa.gov