Manweller’s bill to reestablish a Rural County Sales and Use Tax Deferral Program receives public hearing

Manweller’s bill to reestablish a Rural County Sales and Use Tax Deferral Program receives public hearing

Local residents tell lawmakers how program would improve economies of smaller counties

Rep. Matt Manweller has introduced legislation that would help the economies of small counties across the state. House Bill 2204, which received a public hearing today, would reestablish the Rural County Sales and Use Tax Deferral Program – a program that proved very successful from 1994 to 2009.

Ron Cridlebaugh, Director of Economic Development for the Kittitas County Chamber of Commerce, testified in favor of the legislation in front of the House Finance Committee today.

“We have used this sales and use tax deferral program in the past and we have seen firsthand how it works,” said Cridlebaugh. “This program is important to our rural communities to diversify their economies and provide local job opportunities in the rural areas.”

The Rural County Sales and Use Tax Deferral Program would grant a deferral of sales and use taxes on the purchase of qualified machinery, equipment and construction to approved businesses that locate in rural counties and engage in manufacturing, research and development, commercial testing, or vegetable seed conditioning. Businesses would have to file an annual tax incentive survey, have all purchases verified by the state Department of Revenue, and meet employment requirements.

“The economies of many small and rural counties are hurting and this tax incentive legislation will provide an opportunity to attract business and diversify their economies,” said Manweller, R-Ellensburg. “We helped Boeing a couple months ago and now it is time to provide some assistance to the little guy. What’s good for the large companies should also be good for our smaller employers.”

From 1994 to 2009, the Rural County Sales and Use Tax Deferral Program was responsible for 1,057 approved projects by 802 firms, resulting in $3.2 billion in investment. In 2010, the Legislature allowed the program to expire and cut off applications at the end of fiscal year 2010.

In 2010, state lawmakers created the Qualifying County Program. The program, which is scheduled to run through July 1, 2020, is based on average county unemployment rates rather than the populations of counties. House Bill 2204 would change eligibility back to the rural county sales and use tax deferral program – based on population density only. Thirty-two counties with less than 100 residents per square mile would qualify.

“If you look at the unemployment rates in our state, counties around the I-5 corridor are doing much better than our rural, smaller counties. Reestablishing the rural county sales and use tax deferral program would allow us to see more growth in business and employment opportunities in the areas where we have higher unemployment. It gives employers incentive to invest in regions of our state where we desperately need to put people back to work,” said Manweller, ranking Republican on the House Labor Workforce and Development Committee. 

Also testifying in support of the legislation was Moses Lake BMW SGL Plant Manager Steve Swanson, Joseph Akers of Chemi-Con, also in Moses Lake, and Jonathan Smith of the Grant County Economic Development Council.

For an analysis of the Rural County Sales and Use Tax Deferral Program, click here.

For more information about Rep. Manweller, visit: www.representativemattmanweller.com.

PHOTO CAPTION: Ron Cridlebaugh, Director of Economic Development for the Kittitas County Chamber of Commerce; Jonathan Smith, of the Grant County Economic Development Council; Steve Swanson, BMW SGL;  Joseph Akers of Chemi-Con; and Amber Carter, Association of Washington Business, testify in favor of House Bill 2204.

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