SHB 1260
SignedHouse
Document recording fee admin
Concerning administrative costs associated with the document recording fee.
How does a bill become law?
- Introduced: The bill is filed and assigned a number.
- Committee: A subject-matter committee holds hearings, takes public testimony, and decides whether to advance the bill.
- Floor Vote: The full chamber (House or Senate) debates and votes on the bill.
- Opposite Chamber: The bill repeats the committee and floor vote process in the other chamber.
- Governor: The Governor reviews the bill and decides whether to sign or veto it.
- Signed: The bill has been signed into law.
AI Analysis
This bill adds a $183 surcharge to most document recordings in Washington, with funds distributed to counties and the state to support housing and homelessness programs. The surcharge applies unless a document falls under specific exemptions, and revenue is allocated to support emergency shelter, rental assistance, eviction prevention, and permanent supportive housing—especially for people with low incomes or disabilities.
- Imposes a new $183 surcharge on each document recorded by county auditors, in addition to existing recording fees.
- Exempts certain documents from the surcharge, including assignments of previously recorded deeds of trust, vital records (birth, marriage, divorce, death), marriage licenses, and federal/state/local government liens.
- Distributes surcharge revenue: 1% to county auditors, 30% to counties, 54.1% to the state’s Home Security Fund, 13.1% to the Affordable Housing for All Account, and 1.8% to the Landlord Mitigation Program Account.
- Requires counties to use their share for local homelessness and housing programs, with at least 15% dedicated to housing for extremely low- and very low-income households (at or below 30–50% of area median income).
- Directs the Department of Commerce to use state funds primarily for homelessness assistance (e.g., eviction prevention, emergency shelter, permanent supportive housing), with priority for chronically homeless individuals and people with disabilities.
Who is affected
- County auditors — County auditors collect the new $183 surcharge on document recordings and retain 1% of the funds for their administrative costs; they also distribute funds to counties and cities per the bill’s formula.
- Counties — Counties receive 30% of the surcharge revenue and must use most of it for local housing and homelessness programs, including supporting cities with their own homeless housing plans.
- Cities — Cities that run their own local homeless housing programs receive a share of the surcharge based on their portion of the real estate excise tax, and may use up to 10% for administrative costs.
- Department of Commerce — The Washington State Department of Commerce receives over 68% of the surcharge revenue to fund state-level homelessness prevention, housing assistance, and landlord mitigation programs.
- People experiencing or at risk of homelessness — People experiencing or at risk of homelessness benefit from increased funding for emergency shelter, rental assistance, eviction prevention, and permanent supportive housing.
Pro/Con Analysis
Stronger case for benefits
Potential Benefits (5)
The bill creates a dedicated, substantial funding stream ($120M/year) for housing and homelessness programs, with explicit requirements that at least 15% of county funds serve extremely low-income households (≤30% AMI) and state funds prioritize permanent supportive housing for people with disabilities—directly targeting the most vulnerable residents.
HousingPeopleRef: Sec. 1(2)(c), (d), (e) & (3)(c)By funding eviction prevention, emergency shelter, and rapid rehousing, the bill reduces shelter overcrowding, street homelessness, and associated public health and safety risks—benefiting not only unhoused individuals but also neighbors and first responders.
Public SafetyPeopleRef: Sec. 1(4)(b)The bill empowers counties and cities to design local homelessness responses through interlocal agreements, allowing flexibility to address regional needs—while ensuring a baseline of 15% of funds serve the lowest-income residents, preventing local underfunding of core needs.
Local GovernmentPeopleRef: Sec. 1(3)(b)The Affordable Housing for All Account (13.1% of revenue) specifically funds operating cost supplements for housing serving ≤30% AMI households—addressing the chronic underfunding of affordability for the poorest residents, who often fall through cracks between capital and operating budgets.
HousingPeopleRef: Sec. 1(5)(b)(i)-(ii)While the surcharge adds cost to title and recording operations, the 1% administrative retention for county auditors helps offset increased workload, and the bill does not impose new reporting or compliance burdens beyond fee collection—limiting negative impact on small title agencies and county staff.
Business & EmploymentPeopleRef: Sec. 1(2)(a)
Potential Concerns (5)
The $183 surcharge applies to assignments of previously recorded deeds of trust, which are routine financial transactions in real estate lending and refinancing; this adds a recurring cost to mortgage servicing and title operations, potentially increasing loan closing costs for borrowers and administrative burdens on lenders, especially community banks and credit unions.
Business & EmploymentIndustryRef: Sec. 1(1)(a)The surcharge is applied per document, not per transaction value, making it regressive: low-value property transfers (e.g., $150K homes) bear the same $183 fee as high-value transfers ($2M+), disproportionately affecting lower- and middle-income households engaged in routine real estate activity.
FinancialIndustryRef: Sec. 1(2)(c) & (d)Counties may retain up to 10% of their 30% share for administrative costs, but the bill does not cap this amount or require transparency in how those funds are used—creating risk that local governments may divert funds from direct housing services to general administration, diluting program impact.
Local GovernmentIndustryRef: Sec. 1(3)(a)While the bill prioritizes chronically homeless individuals and people with disabilities, the eligibility criteria and grant administration process do not mandate outcome-based performance metrics—risking funds being used for short-term shelter rather than long-term housing placement or stability, especially for high-need populations.
HousingLean industryRef: Sec. 1(4)(b)The $120M annual revenue is derived from a flat per-document surcharge, not a progressive tax on wealth or income—meaning the burden falls most heavily on frequent, low-value real estate transactions (e.g., low-income renters who must move often, seniors downsizing, first-time homebuyers), while high-net-worth individuals who transact infrequently or use trusts/LLCs may avoid the fee entirely.
FinancialIndustryRef: Sec. 1(2)(c)
Who Is Most Affected
People experiencing or at risk of homelessness benefit strongly: the bill creates new, targeted funding for emergency shelter, eviction prevention, and permanent supportive housing—especially for those with disabilities and chronic homelessness. However, access depends on county and state implementation capacity and outreach efforts.
Low- and middle-income homeowners and renters face a regressive $183 fee per document, which may increase housing transaction costs—especially impactful for frequent movers, seniors downsizing, or first-time buyers. But they benefit from improved housing stability programs funded by the surcharge.
Counties and cities gain new dedicated revenue for housing programs, but must comply with strict usage rules (e.g., 15% for extremely low-income households) and administrative reporting. Smaller counties may struggle with implementation capacity, while larger ones may leverage scale to maximize impact.
Title companies, mortgage lenders, and real estate agents face increased per-transaction costs due to the $183 surcharge, which may be passed to consumers. However, the bill does not restrict their operations, and stable housing markets ultimately benefit all real estate actors.
State agencies (Commerce, HOPE & Homes) gain new funding and authority to expand housing programs, but must balance competing priorities (e.g., shelter vs. permanent housing) and ensure funds reach the most vulnerable. Success depends on effective grant administration and interagency coordination.