HB 2431
SignedHouse
Nonprofit halls/fundraising
Increasing the maximum annual limit for regularly scheduled fundraising activities for the nonprofit public assembly halls and meeting places property tax exemption.
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 increases the number of days per year that nonprofit organizations can use their exempt public assembly hall property for regularly scheduled fundraising activities from 15 to 50 days without jeopardizing the property tax exemption. It also updates related rules and sets a sunset date for the change.
- Increases the maximum number of days per year that property exempt under RCW 84.36.037 (nonprofit public assembly halls) may be used for regularly scheduled fundraising activities from 15 days to 50 days.
- Clarifies that fundraising events conducted on exempt property do not automatically trigger tax liability, as long as they align with the organization’s purpose or are run by a nonprofit.
- Maintains existing rules allowing up to 50 days per year of non-exempt use without losing the property tax exemption, and up to 15 of those days for activities involving pecuniary gain—unless the property is used for fundraising, in which case the higher 50-day limit applies.
- Adds a new exception for qualifying farmers markets (under RCW 66.24.170), allowing up to 53 days of use annually for exempt property used in that context, with income required to support the property’s operation.
- Revises the expiration and implementation schedule: Section 1 (the 50-day fundraising limit increase) expires on January 1, 2033, while Section 2 (technical clarifications and formatting updates) takes effect on that same date.
Who is affected
- Nonprofit organizations operating public assembly halls — Nonprofit organizations that own or operate public assembly halls or meeting places (e.g., community centers, fraternal lodges, religious or cultural centers) that rely on property tax exemptions and host fundraising events.
- Local governments — Local governments (counties and cities) that collect property taxes—this bill may reduce their tax revenue if more fundraising activity is allowed without triggering tax liability.
- Community-based fundraising groups — Volunteer groups and community-based nonprofits that host regular fundraising events (e.g., dinners, auctions, festivals) on exempt property and may currently exceed the previous 15-day limit for such activities.
Pro/Con Analysis
Stronger case for benefits
Potential Benefits (4)
The increase from 15 to 50 days for fundraising activities on exempt property significantly eases operational constraints for small, community-based nonprofits (e.g., fraternal orders, religious congregations, community centers) that rely on regular events like dinners, auctions, and festivals to fund programming—many of which currently exceed the 15-day limit and risk losing tax-exempt status. This allows them to sustain vital local services without costly legal or administrative workarounds.
Business & EmploymentPeopleRef: Sec. 1(8)(d)The new 53-day exception for qualifying farmers markets (under RCW 66.24.170) directly supports small-scale farmers and local food system infrastructure by permitting more market days on exempt land—provided revenue supports property upkeep—helping sustain rural and urban food access initiatives that serve low-income communities.
Business & EmploymentPeopleRef: Sec. 1(8)(c)Clarifying that fundraising events consistent with an organization’s purpose do not automatically trigger tax liability strengthens due process and reduces regulatory uncertainty for nonprofits, protecting their ability to organize and advocate without fear of arbitrary tax penalties—especially important for marginalized groups using community spaces for mutual aid or cultural preservation.
Rights & LibertiesPeopleRef: Sec. 1(2)(b)The provision that inadvertent overuse (not part of a pattern) does not trigger tax liability provides a safety net for small volunteer groups that may occasionally exceed day limits—reducing compliance burden and legal risk for grassroots organizations that lack legal staff.
Business & EmploymentPeopleRef: Sec. 1(2)(c)
Potential Concerns (1)
The bill increases the allowable fundraising days for exempt nonprofit public assembly halls from 15 to 50 days per year, which may reduce local government property tax revenue by allowing more commercial-like activity on tax-exempt property without triggering tax liability. While the fiscal impact is unspecified, increased use for fundraising (a revenue-generating activity) on exempt land reduces the tax base, disproportionately affecting school districts and other local services reliant on property tax revenue.
Local GovernmentPeopleRef: Sec. 1(8)(d)
Who Is Most Affected
Community-based nonprofits (e.g., fraternal lodges, religious congregations, cultural centers) that rely on regular fundraising events to support programming—many currently operate near or over the 15-day limit. This bill allows them to expand events without risking tax liability, supporting service continuity and community cohesion.
Small-scale farmers and food justice groups running farmers markets on exempt land gain up to 53 days of use if revenue supports property upkeep—helping sustain local food access and small farm viability, especially in underserved areas.
Local governments (counties, cities, school districts) face reduced property tax revenue as more high-traffic fundraising events occur on exempt land. While the fiscal impact is unspecified, even modest increases in exempt land use can cumulatively strain budgets for schools, roads, and emergency services—particularly in districts already underfunded.
Large national nonprofits with regional offices are unlikely to benefit significantly, as they typically do not rely on physical fundraising days limits—this bill primarily aids small, locally owned or operated groups with limited administrative capacity.
Low-income residents who rely on community centers, food banks, or cultural hubs run by nonprofits benefit indirectly from expanded programming capacity—though they may bear some cost through reduced local services if tax revenue declines significantly.