This bill creates a new chapter in Title 82 RCW that imposes a six percent special excise tax on each retail sale of the furnishing of lodging for short-term rentals facilitated through a short-term rental platform, effective January 1, 2026. Receipts from the tax are deposited into a newly created Essential Affordable Housing Local Assistance Account in the state treasury, which the state treasurer must distribute monthly to the county for short-term rentals in unincorporated areas and to the city or town for those in incorporated areas. The bill limits how jurisdictions may spend the funds: they may be used only for operating and capital costs of affordable housing programs (including homeless housing assistance, shelters, and related services) or for housing infrastructure projects. Housing infrastructure is defined to include utilities and transportation improvements and similar services needed to support new housing. Conditions on infrastructure projects include designing to the parcel’s maximum allowed density, proportional reductions of impact fees when applicable, prohibition on locating projects exclusively in single-family-only zones, limiting any single-family unit constructed as part of a served project to 2,000 square feet or less, and a requirement that a city agree to annex the project area if it lies within the city’s 20-year urban growth area. Jurisdictions may retain up to 20 percent of received moneys each calendar year for direct and indirect administrative costs. The act also amends existing law: it modifies RCW 67.28.181 (municipal lodging excise tax limits) and RCW 82.14.410 (local sales and use tax treatment for lodging thresholds) to exclude this new tax and the tax under RCW 82.14.530 from certain combined rate or “total sales tax” calculations. It amends RCW 82.32.145 and related provisions concerning collection of unpaid trust fund taxes from limited liability business entities and identifies and defines “responsible individuals,” chief executive, chief financial officer, and related terms; collection authority and procedures in the new chapter apply. The text provided omits the exact statutory text defining “short-term rental” and “short-term rental platform” (referenced to RCW 64.37.010), and a sentence in the amended collection provisions is incomplete in the available excerpt, so the full scope of some liability and procedural details and the specific identification of “the department” are not shown.

Starting January 1, 2026, short-term rentals booked through platforms will face a new 6% excise tax that is likely to raise the price of those rentals (or reduce host/net revenues if platforms or owners absorb it) and will create a dedicated monthly-funded account administered by the state treasurer. Counties, cities, and towns where the taxed rentals are located will receive the money to spend only on affordable housing operations, shelters, related services, or housing infrastructure projects; they may keep up to 20% each year for administrative costs but must meet conditions on where and how infrastructure funds are used (density requirements, no single-family-only siting, 2,000 sq. ft. cap on single-family units in served areas, proportional reduction of impact fees when these funds pay infrastructure, and annexation obligations when projects sit in a city’s 20-year urban growth area). This will give local governments new revenue targeted to housing but constrain eligible projects and may require local fee adjustments or annexation commitments. The bill also expands who can be treated as a “responsible individual” for unpaid trust fund taxes to include current and former officers, managers, members, partners, trustees, and certain employees, and it defines chief executive and chief financial officer roles, making it more likely that corporate leaders could face personal collection actions if a business has unpaid lodging-related trust taxes; collection procedures in the new chapter apply to these cases. Key details are missing from the provided text—most notably the exact statutory definitions of “short-term rental” and “short-term rental platform” (referenced elsewhere) and the remainder of the provision limiting liability—so the full scope of who will ultimately bear personal liability and how enforcement will operate is unclear.