WA HB1791

Counties and cities may now use local real estate excise tax (REET) revenues for any capital purpose identified in a capital improvements plan, removing prior restrictions that limited larger jurisdictions to projects specified in comprehensive plan capital facilities elements

Beginning January 1, 2026, sales of qualified space in affordable housing developments to nonprofits, housing authorities, or public corporations for exempt community purposes (health clinics, food banks, community centers, early learning facilities) are exempt from real estate excise tax

Local governments may permanently use up to 35% of REET revenues (or $100,000 minimum) for maintenance, operation, and service support of existing capital projects, making temporary COVID-era flexibility permanent

The definition of eligible capital projects under REET is expanded to include public safety facilities (law enforcement and fire protection), affordable housing projects, and homeless facilities without the previous January 1, 2026 sunset date

Removes prior requirements that cities and counties prepare written reports demonstrating adequate capital project funding before using REET revenues for maintenance purposes