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HB 2711 - Transportation resources ¶

Section 101 ¶

There is levied and imposed upon fuel licensees a tax at the rate of 23 cents per gallon of fuel.
Beginning July 1, 2003, an additional and cumulative tax rate of five cents per gallon of fuel is imposed on fuel licensees. This subsection (2) expires when the bonds issued for transportation 2003 projects are retired.
Beginning July 1, 2005, an additional and cumulative tax rate of three cents per gallon of fuel is imposed on fuel licensees.
Beginning July 1, 2006, an additional and cumulative tax rate of three cents per gallon of fuel is imposed on fuel licensees.
Beginning July 1, 2007, an additional and cumulative tax rate of two cents per gallon of fuel is imposed on fuel licensees.
Beginning July 1, 2008, an additional and cumulative tax rate of one and one-half cents per gallon of fuel is imposed on fuel licensees.
Beginning August 1, 2015, an additional and cumulative tax rate of seven cents per gallon of fuel is imposed on fuel licensees.
Beginning July 1, 2016, an additional and cumulative tax rate of four and nine-tenths cents per gallon of fuel is imposed on fuel licensees.
Beginning July 1, 2025, an additional and cumulative tax rate of six cents per gallon of fuel is imposed on fuel licensees.
Beginning July 1, 2025, an additional and cumulative tax rate of three cents per gallon of special fuel is imposed on fuel licensees.
Beginning July 1, 2027, an additional and cumulative tax rate of three cents per gallon of special fuel is imposed on fuel licensees.
Beginning July 1, 2026,

an additional and cumulative tax rate per gallon of fuel is imposed on fuel licensees. The tax rate imposed under this subsection is calculated each July 1st by:

a. Increasing by two percent the sum of:

    i. The fuel tax rates imposed under subsections (1) through (9) of this section as of the current July 1st; and

    ii. The fuel tax rate imposed under this subsection (12) for the prior 12 months;

b. Subtracting the sum of the fuel tax rates imposed under subsections (1) through (9) of this section as of the current July 1st; and

c. Rounding the result to the nearest one-thousandth of $1.

Beginning July 1, 2028,

an additional and cumulative tax rate per gallon of special fuel is imposed on fuel licensees. The tax rate imposed under this subsection is calculated each July 1st by:

a. Increasing by two percent the sum of:

    i. The fuel tax rates imposed under subsections (1) through (11) of this section as of the current July 1st; and

    ii. The fuel tax rates imposed, for the prior 12 months, under both subsection (12) of this section and this subsection (13);

b. Subtracting the sum of the fuel tax rates imposed under subsections (1) through (12) of this section as of the current July 1st; and

c. Rounding the result to the nearest one-thousandth of $1.

Taxes are imposed when:
1. Fuel is removed in this state from a terminal if the fuel is removed at the rack unless the removal is by a licensed supplier or distributor for direct delivery to a destination outside of the state, or the removal is by a fuel supplier for direct delivery to an international fuel tax agreement licensee under RCW 82.38.320;
2. Fuel is removed in this state from a refinery if either of the following applies:
  1. The removal is by bulk transfer and the refiner or the owner of the fuel immediately before the removal is not a licensed supplier; or
  2. The removal is at the refinery rack unless the removal is to a licensed supplier or distributor for direct delivery to a destination outside of the state, or the removal is to a licensed supplier for direct delivery to an international fuel tax agreement licensee under RCW 82.38.320;
3. Fuel enters into this state for sale, consumption, use, or storage, unless the fuel enters this state for direct delivery to an international fuel tax agreement licensee under RCW 82.38.320, if either of the following applies:
  1. The entry is by bulk transfer and the importer is not a licensed supplier; or
  2. The entry is not by bulk transfer;
4. Fuel enters this state by means outside the bulk transfer-terminal system and is delivered directly to a licensed terminal unless the owner is a licensed distributor or supplier;
5. Fuel is sold or removed in this state to an unlicensed entity unless there was a prior taxable removal, entry, or sale of the fuel;
6. Blended fuel is removed or sold in this state by the blender of the fuel. The number of gallons of blended fuel subject to tax is the difference between the total number of gallons of blended fuel removed or sold and the number of gallons of previously taxed fuel used to produce the blended fuel;
7. Dyed special fuel is used on a highway, as authorized by the internal revenue code, unless the use is exempt from the fuel tax;
8. Dyed special fuel is held for sale, sold, used, or is intended to be used in violation of this chapter;
  1. Special fuel purchased by an international fuel tax agreement licensee under RCW 82.38.320 is used on a highway; and
9. Fuel is sold by a licensed fuel supplier to a fuel distributor or fuel blender and the fuel is not removed from the bulk transfer-terminal system.

Section 102 ¶

(1) All moneys that have accrued or may accrue to the motor vehicle fund from the fuel tax must be first expended for purposes enumerated in (a) and (b) of this subsection. The remaining net tax amount must be distributed monthly by the state treasurer in accordance with subsections (2) through (9) of this section.

Section 201 ¶

(1) There is levied and collected a tax equal to six and five-tenths percent of the selling price on each retail sale in this state of:

Section 202 ¶

(1) There is levied and collected from every person in this state a tax or excise for the privilege of using within this state as a consumer any:

Section 203 ¶

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1. Except as provided in subsection (3) of this section, in addition to the taxes imposed under RCW 82.08.020, there is levied and collected an additional tax of eight percent on the sale of a motor vehicle if:
  1. The selling price of the motor vehicle plus trade-in property of like kind for purchased vehicles exceeds $100,000; or
  2. In the case of a lease requiring periodic payments, the value of the motor vehicle exceeds $100,000 at the inception of the lease.
2. The additional tax imposed in this subsection (1):
  1. Is equal to the portion of the selling price plus trade-in property of like kind for purchased vehicles in excess of the deduction amount specified in subsection (2) of this section, multiplied by eight percent; or
  2. In the case of a lease requiring periodic payments, is the value of the motor vehicle in excess of the deduction amount specified in subsection (2) of this section, at the inception of the lease, multiplied by eight percent, and may be remitted in equal periodic payments over the term of the lease.
The deduction amount is $100,000 for fiscal year 2026. The deduction amount must be annually adjusted on July 1st of each year by increasing the amount by two percent and rounding the result to the nearest whole dollar.
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1. The taxes imposed under this section do not apply to the sale or lease of:
  1. A commercial motor vehicle, as defined in RCW 46.25.010;
  2. A motor vehicle that has a gross vehicle weight rating of greater than 10,000 pounds other than motor homes, as defined in RCW 46.04.305; or
  3. Through December 31, 2026, a motor home, as defined in RCW 46.04.305.
2. The exemptions available for the sale of motor vehicles under RCW 82.08.0317 and 82.08.0264 also apply to the tax under this section.
The revenue collected under this section must be deposited in the multimodal transportation account created in RCW 47.66.070.
For the purposes of this section and RCW 82.12.818, the following definitions apply:
1. "Fair market value" has the same meaning as "value of the article used" in RCW 82.12.010.
2. "Motor vehicle" has the same meaning as in RCW 46.04.320, but does not include:
  1. Farm tractors or farm vehicles as defined in RCW 46.04.180 and 46.04.181, unless the farm tractor or farm vehicle is for use in the production of cannabis;
  2. Off-road vehicles as defined in RCW 46.04.365;
  3. Nonhighway vehicles as defined in RCW 46.09.310; and
  4. Snowmobiles as defined in RCW 46.04.546.
3. "Value of the motor vehicle" means the fair market value of the motor vehicleplus the value of trade-in property of like kind.

Section 204 ¶

Except as provided in subsection (3) of this section, in addition to the tax imposed under RCW 82.12.020, there is levied and collected from every person in this state a tax for the privilege of using within this state as a consumer any motor vehicle if the value of the motor vehicle exceeds $100,000.
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1. Except as provided in (b) of this subsection, the tax is levied and must be collected in an amount equal to the value of the motor vehicle that exceeds the deduction amount specified in (c) of this subsection, multiplied by eight percent.
2. In the case of a seller required to collect use tax under this section from the purchaser, the tax must be collected in an amount equal to eight percent of the remainder that results when the amount specified in (c) of this subsectionis deducted from the sum of the selling price and the value of trade-in property of like kind.
3. The deduction amount is $100,000 for fiscal year 2026. The deduction amount must be annually adjusted on July 1st of each year by increasing the amount by two percent and rounding the result to the nearest whole dollar.
The taxes imposed under this section do not apply to the use of:
1. A commercial motor vehicle, as defined in RCW 46.25.010;
2. A motor vehicle that has a gross vehicle weight rating of greater than 10,000 pounds other than motor homes, as defined in RCW 46.04.305; or
3. Through December 31, 2026, a motor home, as defined in RCW 46.04.305.
The revenue collected under this section must be deposited in the multimodal transportation account created in RCW 47.66.070.
For the purposes of this section, "value of the motor vehicle" means the same as in RCW 82.08.817.

Section 205 ¶

Except as otherwise provided in subsections (2) through (4) of this section, the department shall waive penalties and interest otherwise due under this chapter if all of the following conditions are met:
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  1. The penalties and interest are imposed with respect to additional motor vehicle taxes imposed under RCW 82.12.818 and 82.08.817; and (ii) the tax liability is directly attributable to a failure to collect additional motor vehicle taxes as provided in sections 203 and 204, chapter 417, Laws of 2025 for tax reporting periods through June 30, 2026;
2. The taxpayer files with the department any amended or outstanding returns covering tax liabilities with respect to which a penalty and interest waiver under this section is requested;
3. The taxpayer remits full payment to the department of the balance due on all tax liabilities for which a penalty and interest waiver under this section is requested or enters into a payment agreement with the department as provided in RCW 82.32.080 for such liabilities;
4. The taxpayer has timely filed returns and remitted payment on all taxes due for a period of 24 months immediately preceding the period covered by the return for which the waiver is being requested; and
5. The taxpayer must never have had an evasion penalty assessed against the taxpayer by the department under RCW 82.32.090 or a penalty assessed against the taxpayer by the department under RCW 82.32.291 for misusing a reseller permit or resale certificate.
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1. The taxpayer must submit a completed application for a penalty and interest waiver under this section in a form and manner prescribed by the department.
2. Applications for a penalty and interest waiver under this section must be submitted to the department on or before September 30, 2027.
All tax liability reported and paid as required in subsection (1) of this section is subject to verification by the department as provided in RCW 82.32.050. This section does not preclude the assessment of taxes, penalties, and interest with respect to any amounts determined by the department to have been underpaid for any tax period for which the taxpayer previously received penalty relief under this section.
This section does not apply to tax liabilities associated with additional motor vehicle taxes imposed under RCW 82.12.818 and 82.08.817 for tax reporting periods beginning on or after July 1, 2026.
This section expires January 1, 2029.

Section 206 ¶

Beginning August 1, 2019, with sales made or lease agreements signed on or after the qualification period start date:
1. The tax levied by RCW 82.08.020 does not apply as provided in (b) of this subsection to sales or leases of new or used passenger cars, light duty trucks, and medium duty passenger vehicles that:
  1. Are exclusively powered by a clean alternative fuel; or
  2. Use at least one method of propulsion that is capable of being reenergized by an external source of electricity and are capable of traveling at least 30 miles using only battery power; and
  iii.(A) Have a vehicle selling price plus trade-in property of like kind for purchased vehicles that:

(I) For a vehicle that is a new vehicle at the time of the purchase date or the date the lease agreement was signed, does not exceed $45,000; or

(II) For a vehicle that is a used vehicle at the time of the purchase date or the date the lease agreement was signed, does not exceed $30,000; or

(B) Have a fair market value at the inception of the lease for leased vehicles that:

(I) For a vehicle that is a new vehicle at the time of the purchase date or the date the lease agreement was signed, does not exceed $45,000; or

(II) For a vehicle that is a used vehicle at the time of the purchase date or the date the lease agreement was signed, does not exceed $30,000;

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    i. The exemption in this section is applicable for up to the amounts specified in (b)(ii) or (iii) of this subsection of:

(A) The total amount of the vehicle's selling price, for sales made; or

(B) The total lease payments made plus any additional selling price of the leased vehicle if the original lessee purchases the leased vehicle before the qualification period end date, for lease agreements signed.

    ii. Based on the purchase date or the date the lease agreement was signed of the vehicle if the vehicle is a new vehicle at the time of the purchase date or the date the lease agreement was signed:

(A) From the qualification period start date until July 31, 2021, the maximum amount eligible under (b)(i) of this subsection is $25,000;

(B) From August 1, 2021, until July 31, 2023, the maximum amount eligible under (b)(i) of this subsection is $20,000;

    iii. If the vehicle is a used vehicle at the time of the purchase date or the date the lease agreement was signed, the maximum amount eligible under (b)(i) of this subsection is $16,000.

The seller must keep records necessary for the department to verify eligibility under this section. A person claiming the exemption must also submit itemized information to the department for all vehicles for which an exemption is claimed that must include the following: Vehicle make; vehicle model; model year; whether the vehicle has been sold or leased; date of sale or start date of lease; length of lease; sales price for purchased vehicles and fair market value at the inception of the lease for leased vehicles; and the total amount qualifying for the incentive claimed for each vehicle, in addition to the future monthly amount to be claimed for each leased vehicle. This information must be provided in a form and manner prescribed by the department.
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1. The department of licensing must maintain and publish a list of all vehicle models qualifying for the tax exemptions under this section or RCW 82.12.9999 until the expiration date of this section, and is authorized to issue final rulings on vehicle model qualification for these criteria. A seller is not responsible for repayment of the tax exemption under this section and RCW 82.12.9999 for a vehicle if the department of licensing's published list of qualifying vehicle models on the purchase date or the date the lease agreement was signed includes the vehicle model and the department of licensing subsequently removes the vehicle model from the published list, and, if applicable, the vehicle meets the qualifying criterion under subsection (1)(a)(iii)(B) of this section and RCW 82.12.9999(1)(a)(iii)(B).
2. The department of revenue retains responsibility for determining whether a vehicle meets the applicable qualifying criterion under subsection (1)(a)(iii)(B) of this section and RCW 82.12.9999(1)(a)(iii)(B).
By the last day of October 2019, and every six months thereafter until October 31, 2025, based on the best available data, the department must report the following information to the transportation committees of the legislature: The cumulative number of vehicles that qualified for the exemption under this section and RCW 82.12.9999 by month of purchase or lease start and vehicle make and model; the dollar amount of all state retail sales and use taxes exempted on or after the qualification period start date, under this section and RCW 82.12.9999; and estimates of the future costs of leased vehicles that qualified for the exemption under this section and RCW 82.12.9999.
The definitions in this subsection apply throughout this section unless the context clearly requires otherwise.
1. "Clean alternative fuel" means natural gas, propane, hydrogen, or electricity, when used as a fuel in a motor vehicle that meets the California motor vehicle emission standards in Title 13 of the California Code of Regulations, effective January 1, 2019, and the rules of the Washington state department of ecology.
2. "Fair market value" has the same meaning as "value of the article used" in RCW 82.12.010.
3. "New vehicle" has the same meaning as "new motor vehicle" in RCW 46.04.358.
4. "Qualification period end date" means August 1, 2025.
5. "Qualification period start date" means August 1, 2019.
6. "Used vehicle" has the same meaning as in RCW 46.04.660.
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1. Sales of vehicles delivered to the buyer or leased vehicles for which the lease agreement was signed after the qualification period end date do not qualify for the exemption under this section.
2. All leased vehicles that qualified for the exemption under this section before the qualification period end date must continue to receive the exemption as described under subsection (1)(b) of this section on any lease payments due through the remainder of the lease before August 1, 2028.
This section expires August 1, 2028.
This section is supported by the revenues generated in RCW 46.17.324, and therefore takes effect only if RCW 46.17.324 is enacted by June 30, 2019.

Section 301 ¶

Sections 1307 through 1309 of this act take effect February 1, 2026 July 1, 2027.

Section 302 ¶

There is levied a $5 per tire fee on the retail sale of new replacement vehicle tires. The fee imposed in this section must be paid by the buyer to the seller, and each seller shall collect from the buyer the full amount of the fee. The fee collected from the buyer by the seller less the amount retained by the seller as provided in RCW 70A.205.430(1) must be paid to the department of revenue in accordance with RCW 82.32.045.
The department of revenue shall incorporate into the agency's regular audit cycle a reconciliation of the number of tires sold and the amount of revenue collected by the businesses selling new replacement vehicle tires at retail. The department of revenue shall collect on the business excise tax return from the businesses selling new replacement vehicle tires at retail:
1. The number of tires sold; and
2. The fee levied in this section.
All other applicable provisions of chapter 82.32 RCW have full force and application with respect to the fee imposed under this section. The department of revenue shall administer this section.
For the purposes of this section, "new replacement vehicle tires" means tires that are newly manufactured for vehicle purposes and does not include retreaded vehicle tires.

Section 303 ¶

(1) The public works assistance account is hereby established in the state treasury. Money may be placed in the public works assistance account from the proceeds of bonds when authorized by the legislature or from any other lawful source. Money in the public works assistance account shall be used to make loans and grants and to give financial guarantees to local governments for public works projects. Moneys in the account may also be appropriated or transferred to the water pollution control revolving fund and the drinking water assistance account to provide for state match requirements under federal law. Moneys in the account may be transferred to the move ahead WA account to provide support of public works projects funded in the move ahead WA program. Not more than 20 percent of the biennial capital budget appropriation to the public works board from this account may be expended or obligated for preconstruction loans and grants, emergency loans and grants, or loans and grants for capital facility planning under this chapter. Not more than 10 percent of the biennial capital budget appropriation to the public works board from this account may be expended or obligated as grants for preconstruction, emergency, capital facility planning, and construction projects. During the 2017-2019 and 2019-2021 fiscal biennia, the legislature may appropriate moneys from the account for activities related to rural economic development, the growth management act, the aviation revitalization loan program, the community economic revitalization board broadband program, and the voluntary stewardship program. During the 2021-2023 and 2023-2025 fiscal biennia, the legislature may appropriate moneys from the account for activities related to the community aviation revitalization board. During the 2019-2021 fiscal biennia, the legislature may direct the state treasurer to make transfers of moneys in the public works assistance account to the education legacy trust account. During the 2019-2021 and 2021-2023 fiscal biennia, the legislature may direct the state treasurer to make transfers of moneys in the public works assistance account to the statewide broadband account. The legislature may appropriate moneys from the public works assistance account for activities related to the voluntary stewardship program, rural economic development, and the growth management act. During the 2021-2023 biennium, the legislature may appropriate moneys from the account for projects identified in section 1033, chapter 296, Laws of 2022. During the 2023-2025 fiscal biennium, the legislature may appropriate moneys from the public works assistance account for an evaluation of the costs of relocating public utilities related to fish barrier removal projects. During the 2023-2025 fiscal biennium, the legislature may appropriate moneys from the account for activities related to developing a data dashboard to map investments made by the public works board, the department of commerce, the department of health, the department of ecology, the department of transportation, the transportation improvement board, and by board partners to the system improvement team created in RCW 43.155.150.

Section 304 ¶

The preserve Washington account is created in the motor vehicle fund. Moneys in the account may be spent only after appropriation. Expenditures from the account may be used only for the purposes specified in RCW 46.68.070 that are also highway preservation and maintenance purposes.