Pandemic Darlings The pandemic economy, in original documents
Home Source documents Senate Bill Report SB 6137, Business and Occupation Tax Deduction for Cooperative Finance Organizations (2020)

Senate Bill Report SB 6137, Business and Occupation Tax Deduction for Cooperative Finance Organizations (2020)

Summary

Senate Bill Report on SB 6137, as of January 21, 2020, for the Senate Committee on Financial Institutions, Economic Development & Trade, which lists committee activity on 1/21/20. The bill reauthorizes the business and occupation tax deduction for cooperative finance organizations, with Senators Mullet, Becker and Conway among the sponsors. The summary of the bill states that the deduction for loan repayments received by cooperative finance organizations from rural electric cooperatives or other utility nonprofit or governmental utility providers is reauthorized and that the deduction expires on January 1, 2030. The report records PRO testimony from Senator Mark Mullet, Grant Nelson and Susan Cutrell, and states that the bill takes effect on July 1, 2020.

Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used

Issuer
Congressional materials
Document type
Report
Date
2020-01-23
Case
2020 01 23 A26306 D210062 Bill Report 6137 Sba Fiet 20 Ta

Cite this document

“Senate Bill Report SB 6137, Business and Occupation Tax Deduction for Cooperative Finance Organizations (2020).” Original at app.leg.wa.gov, dated 2020-01-23. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2020-01-23-2020-01-23-a26306-d210062-bill-report-6137-sba-fiet-20-ta/, SHA-256 ae919fb61ac0ee83cd0374d9fa828ab49d2de6ddd1e96cbd48f69ec531daa1b2.

Full text

                             SENATE BILL REPORT
                                   SB 6137

                                      As of January 21, 2020

Title: An act relating to reauthorizing the business and occupation tax deduction for cooperative
    finance organizations.

Brief Description: Reauthorizing the business and occupation tax deduction for cooperative
   finance organizations.

Sponsors: Senators Mullet, Becker, Conway, Warnick, King, Brown, Padden, Schoesler, Short
   and Zeiger.

Brief History:
   Committee Activity: Financial Institutions, Economic Development & Trade: 1/21/20.

                                      Brief Summary of Bill
          Ÿ Reauthorizes a business and occupation tax deduction for loan repayments
            received by cooperative finance organizations from rural electric
            cooperatives or governmental utility providers.


SENATE  COMMITTEE                  ON      FINANCIAL          INSTITUTIONS,           ECONOMIC
DEVELOPMENT & TRADE

    Staff: Clint McCarthy (786-7319)

    Background: Business and Occupation Tax. Washington's major business tax is the
    business and occupation (B&O) tax. The B&O tax is imposed on the gross receipts of
    business activities conducted within the state, without any deduction for the costs of doing
    business. Businesses must pay the B&O tax even though they may not have any profits or
    may be operating at a loss.

    A taxpayer may have more than one B&O tax rate, depending on the types of activities
    conducted. Major B&O tax rates are 0.471 percent for retailing; 0.484 percent for
    manufacturing, wholesaling, and extracting; and 1.5 percent for services and for activities not
    classified elsewhere. Several preferential rates also apply to specific business activities. In
    addition, a taxpayer may be eligible to utilize other tax preferences, including credits and
    deductions, to reduce their tax liability.
––––––––––––––––––––––
    This analysis was prepared by non-partisan legislative staff for the use of legislative
    members in their deliberations. This analysis is not a part of the legislation nor does it
    constitute a statement of legislative intent.

Senate Bill Report                              -1-                                          SB 6137
    Rural Electric Cooperatives. A rural electric cooperative is a nonprofit, customer-owned
    organization providing utility services to rural areas. The Washington Rural Electric
    Cooperative Association identifies 15 rural electric cooperatives in Washington. The
    cooperatives serve over 280,000 customers and offer electric service at cost. The rates and
    policies are set by locally elected boards of directors.

    Nonprofit Cooperative Finance Organizations. A cooperative finance organization is a
    nonprofit organization with the primary purpose to secure, provide, and arrange financing for
    rural electric cooperatives.

    Business and Occupation Tax Deduction. In 2013, the Legislature granted a B&O tax
    deduction to nonprofit cooperative finance organizations for the proceeds of loans to rural
    electric cooperatives or other nonprofit or governmental providers of utility services. The
    deduction expired on July 1, 2017.

    Summary of Bill: The B&O tax deduction for loan repayments received by cooperative
    finance organizations from rural electric cooperatives or other utility nonprofit or
    governmental utility providers is reauthorized.

    A tax preference performance statement is included, stating the Legislature intends to extend
    the expiration date of the deduction if at least one nonprofit cooperative financing
    organization takes advantage of the preference.

    The deduction expires on January 1, 2030.

    Appropriation: None.

    Fiscal Note: Available.

    Creates Committee/Commission/Task Force that includes Legislative members: No.

    Effective Date: The bill takes effect on July 1, 2020.

    Staff Summary of Public Testimony: PRO: The the nonprofit National Rural Utilities
    Cooperative Finance Corporation (CFC) provides loans to members. It is 100 percent owned
    by its members and funds go to improvements, rehabilitation and refinancing costs.
    Washington is the only state that does not recognize their non-profit status at the state level.
    These smaller utilities do not have access to municipal bonds and other debt instruments a
    utility would normally have access to. They rely on the CFC for access to capital.

    Persons Testifying: PRO: Senator Mark Mullet, Prime Sponsor; Grant Nelson, Washington
    Rural Electric Cooperative Association; Susan Cutrell, Parkland Light & Water Company.

    Persons Signed In To Testify But Not Testifying: No one.




Senate Bill Report                              -2-                                         SB 6137

File and source

File
2020-01-23_a26306_d210062_bill-report-6137-sba-fiet-20-ta.pdf
Size
86,356 bytes
SHA-256
ae919fb61ac0ee83cd0374d9fa828ab49d2de6ddd1e96cbd48f69ec531daa1b2
Our copy
2020-01-23_a26306_d210062_bill-report-6137-sba-fiet-20-ta.pdf
Original
app.leg.wa.gov
Back to top