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SB 5983

Exempting land classified under current use that is sold or transferred to a governmental entity from additional tax in certain circumstances.

2025-2026 Regular Session Introduced by Keith Goehner and 2 co-sponsors

SB 5983 narrows or exempts additional tax when current-use land is removed, especially for transfers to government entities with conditions like ongoing forest/timber management pl

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Bill Summary · SB 5983

Summary of Substitute Senate Bill 5983 (2025-2026, Washington)

Purpose and Intent

  • The bill aims to modify when land that is classified under current use (such as open space, farm and agricultural land, or timberland) can be removed from current-use classification without incurring additional tax, interest, and penalties.
  • It adds new circumstances under which removal from current use is exempt from additional tax, or alternatively narrows or expands existing triggers for additional tax when land is transferred or removed.

Key Provisions and Changes

  • Section 1: Amendments to RCW 84.34.108 (and related 2025 law)

    • Annual notation and continuing classification: Land classified under current use remains noted on assessment rolls and valued under existing statute until removal.
    • Removal triggers (owner action, sale/transfer, or new ownership) remain, but certain transfers to government entities have nuanced treatment (see below).
    • Specific removal triggers:
    • (a) Owner’s notice to remove
    • (b) Sale/transfer to ownership that may exempt land from ad valorem tax if associated with a loan default and government resale for the same use
    • (c) Sale/transfer to a new owner, with conditions around a “notice of classification continuance” signed by the new owner; failure to sign can trigger additional tax, interest, and penalty payable by the seller
    • (d) Assessor-determined loss of eligibility for current-use classification after owner’s notice and hearing
    • Appeals: Owners can appeal assessment/valuation changes or removals to the county board of equalization under existing procedures.
    • Additional tax calculation and payment (subsection (4)):
    • If land is removed from classification, the assessor must revalue on January 1 of the removal year.
    • Generally, an additional tax, interest, and penalty are due 30 days after notice of the amount.
    • Additional tax calculation (simplified):
      • If not a removal under special cases, the extra tax equals the difference between the taxes paid under current-use classification over the seven prior years and the taxes that would have been paid without current-use classification.
      • For removals after Sep 1, 2025, the period used for calculation is the prior four years.
    • Interest accrues on unpaid additional tax; penalties follow RCW 84.34.080 rules.
    • Lien: Additional tax and penalties become a lien with priority over other liens.
    • Exceptions to the additional tax (subsection (6)):
    • (a)–(l): Numerous exemptions where removal does not trigger the additional tax, including:
      • Transfers to government entities in certain contexts
      • Eminent domain actions or anticipated eminent domain transfers
      • Natural disasters
      • Official action disallowing present use by a state, county, or city
      • Transfers to churches (where exemption would apply)
      • Acquisitions by state agencies or entities qualified under related statutes (with post-use compliance)
      • Removal of farm/agricultural land under specific conditions
      • Certain removals after enactment of exemptions
      • Forestry riparian easements or conservation easements on private forestlands within specified zones
      • Death-related transfers within 2 years for land previously classified as forestland or timberland
      • Discovery that land was classed in error through no fault of the owner (with caveats about existing independent removal bases)
    • (m) Sale or transfer to a governmental entity where the entity manages land as designated forestland or timberland and provides a timber/forest management plan to the county assessor; continued management required, with updates at least once per revaluation cycle; failure to manage as required or sale/transfer triggers the additional tax, unless another exception applies
    • (n) Sale or transfer to a governmental entity if:
      • The purpose is to meet conditions that enable development for a use eligible for current-use classification, and
      • The combined acreage removed from classification for development and transfer does not exceed 20% of the total classified acres immediately before removals

  • Section 2: New Section – Tax-related provisions

    • RCW 82.32.805 and 82.32.808 do not apply to this act (i.e., these tax provision references are expressly excluded from applicability).

Who Would Be Affected

  • Landowners with properties currently classified under RCW 84.34 (current use) who are:
    • Transferring land to government entities
    • Undergoing ownership transfers that might affect classification status
    • Receiving removals due to changes in use or other permissible events
  • Government entities receiving classified land, particularly where continued management as forestland or timberland is proposed
  • County assessors and boards of equalization, as they would apply removal determinations, manage notices, calculate additional tax, and adjudicate appeals
  • Taxpayers who would face potential additional tax, interest, and penalties unless a specified exemption applies

Procedural and Timeline Aspects

  • Removal determinations can be appealed to the county board of equalization, following RCW 84.40.038 processes.
  • Revaluation timing: If land is removed, the valuation is updated as of January 1 of the removal year; tax allocation follows the portion of the year each valuation covers.
  • Notice requirements:
    • The assessor must notify owners of removals and provide reasons.
    • Owners may appeal removal with guidance on filing deadlines and forms.
  • Timelines for payment:
    • Additional tax, interest, and penalty are due 30 days after notice of the amount.
    • Notices must be mailed as soon as possible after calculation.
  • New requirements for government-management plans (for exemptions under (m)):
    • Governmental entities must provide an updated timberland/forestland management plan at least once per revaluation cycle.
    • Counties may require and collect a fee for filing management plans.
    • If the land is not managed as required or is sold/transferred, the additional tax becomes due from the current government owner, unless another exemption applies.

Practical Implications

  • The bill broadens or clarifies exemptions to avoid penalizing landowners when current-use land is transferred to government entities under certain conditions.
  • It introduces detailed conditions for government-managed land to qualify for exemptions, including ongoing management plans and acreage limitations (20% cap in certain development-related transfers).
  • It creates a structured framework for assessing, notifying, appealing, and enforcing additional tax when removals occur, with several carve-outs intended to protect various government-related transfers and emergency scenarios.

If you’d like, I can provide a side-by-side comparison of current law vs. SB 5983’s changes, or draft a one-page briefing for policymakers.

Compiled from official sources — confirm details with the bill’s official record.

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