City of Federal Way 2005 taxes are comprised of the following:
Property Tax:
Federal Way citizens are levied $12.41 per $1,000 assessed valuation, which is distributed as follows:
For each dollar of property tax a resident pays in 2005, the city will get 10.8¢. The remaining 89.2¢ goes to the Federal Way School District (34.5¢), King County (10.9¢) for regional service, to the State (23.3¢), to the library, port, and flood control districts (for a total of 6.5¢), and to local Fire Department (12.1¢) and Emergency Medical Services (1.9¢).
| Property Tax Levy Rate per $1,000 AV |
City of Federal Way |
By Taxing District |
Rate |
Federal Way School District
|
4.26
|
| EMS (voted) |
0.22 |
| Fire District #39 |
1.50 |
| King County |
1.33 |
City of Federal Way
|
1.22 |
King County Library
|
0.53 |
| Port |
0.23 |
State
| 2.50
|
| TOTAL |
11.79 |
Sales Tax:
Federal Way consumers pay an 8.8% sales tax. Of this 8.8%, .85% is returned to the city. The city receives approximately 10% (0.85% out of the 8.8%) of sales taxes collected within the city boundaries. The distribution of sales tax is as follows:
| State |
6.50% |
| City |
0.85% |
| Metro Transit |
0.80% |
| Sound Transit |
0.40% |
| King County |
0.15% |
| Criminal Justice |
0.10% |
Food & Bev
| 0.50%
|
| Total |
9.30% |
Utility Tax:
The City currently collects a 6% utility tax on electric, gas, cable, phone, surface water, and garbage services. The amount of taxes paid by an average household is around $240 per year, or $20 per month. This is the primary revenue source for the City's capital projects. This revenue has allowed the city to provide for City wide transportation improvements, set aside money for the proposed Public Safety building, fund the development of Celebration Park and construct a 250 seat theatre at Dumas Bay Center. The last 1% was added in 2003 and will fund a multipurpose community/senior center & pool for citizens of all ages to enjoy. King County does not currently collect a tax on utilities.
B&O Tax:
The city currently does not levy a business and occupations (B&O) tax.
Real Estate Excise Tax (REET):
A tax of 1.78% is levied on all sales of real estate, including a 0.5% optional city tax.
Federal Way Strengths
- Fiscally Sound Municipality = Low Tax Burden
- Of 39 King County cities, Federal Way ranks:
- 33rd in per capita tax revenue
- 32nd in per capita municipal expenditures
- No B&O tax
- No employee tax
- Competitive lodging tax
- Competitive admissions tax
- Competitive utility tax
Since its incorporation in 1990, the city has focused on important community projects such as downtown revitalization, transportation system improvements, new parks, and new community facilities for the performing arts. Nevertheless, Federal Way is a fiscally conservative city that strives to use contracting and public-private partnerships to deliver services and products to the community at the lowest possible cost.
The City Council places a strong emphasis on economic development and maintains a partnership with the Federal Way Chamber for economic development and downtown revitalization. The city strives to maintain a business-friendly permitting process and offers options for expedited review of permits and plans. In addition, unlike many surrounding communities, Federal Way does not impose any business and occupation (B&O) tax.