This bill creates a new state law, codified as a new chapter 82.16A RCW, that authorizes a county legislative authority to impose an excise tax on the privilege of engaging in business as a utility. The tax base is the utility’s gross income from providing service to consumers within the county, the rate is the county’s imposed rate but may not exceed 3 percent, and utilities must add the tax to customer rates or charges and separately state the tax amount on billings. The bill defines covered utilities (electrical power, gas, telephone, water, sewer, solid waste, and cable service) by reference to existing RCW and federal Telecommunications Act definitions. A county may adopt limited exemptions for sales to identified business customers but may not provide a general exemption for residential customers unless business customers are also exempt. A county must allow a credit against its tax for the amount of any similar utility tax imposed by a city or town on the same taxable event, but the credit may not exceed the county tax otherwise due. A county may begin collection only on the first day of a calendar quarter and not sooner than 75 days after adopting the ordinance or resolution. The text provided does not define “similar utility tax” or set out administration, collection procedures, enforcement, filing or reporting requirements, revenue distribution, penalties, or rules for changing or repealing the tax rate; several key terms are referenced to other statutes, so the exact legal meanings depend on those external provisions.

If passed, counties would gain a new option to tax utilities’ gross income from providing service inside the county at rates up to 3 percent. Utilities would be required to add that tax to customer bills as a separate line item, and counties could start collections only on the first day of a quarter and not sooner than 75 days after adopting the tax. This most directly affects county governments (a new local revenue tool), utility companies (new billing and collection duties and the need to credit any city or town utility taxes against the county amount), and utility customers (likely higher bills as utilities pass the tax through). Counties can choose targeted exemptions for certain business customers but cannot broadly exempt residents without also exempting businesses. Important details are missing from the text provided—how “similar” city taxes are defined, exact definitions of covered utilities (reliant on other statutes), and rules about administration, revenue use, enforcement, or rate changes—so some implementation and fiscal effects remain uncertain.