Legislative updates to the administration of the current use program

Intended audience: County assessors, county treasurers, taxing districts, local governments, and program participants.

The 2025 Legislature passed two bills impacting lands classified in the current use program under Chapter 84.34 RCW. The effective date for these bills is July 27, 2025, except where otherwise noted.

ESSB 5445 Allowing agrivoltaic facilities

Engrossed Substitute Senate Bill 5445 allows agrivoltaic facilities to coexist with agricultural operations on lands classified as farm and agricultural land under RCW 84.34.020(2)(a) through (h). An “agrivoltaic facility” is defined as “a ground-mounted photovoltaic solar energy system that is designed to be operated coincident with continued productive agricultural use of the land.”

ESSB 5445 adds new sections to chapter 43.21F RCW, outlining the definition and requirements for agrivoltaic facilities. Specifically, the bill requires that the agrivoltaic facility (i.e., solar energy system) must be designed, installed, and operated in a way that supports the ongoing viability of the farming operation, maintaining both energy production and agricultural output.

Since both solar energy production and the commercial agricultural activities occur simultaneously, the land remains eligible for its current use classification. The presence of the solar energy system does not count toward the 20% limit on “incidental use” and cannot be used as reason to reclassify or remove the land from classification.

SHB 1261 Concerning gross income, appurtenances and incidental uses, and calculation of additional taxes

Substitute House Bill 1261 makes several changes to the administration of land classified in the current use program under RCW 84.34.020. Key updates include: 

• Expanded definition of gross income: The bill expands qualifying income sources for farm and agricultural land of at least five acres but less than 20 acres. 

• New definitions: Codifies and clarifies the definitions of "appurtenances" and "incidental use" for classified land. 

• Restrictions on removal from classification: Limits when land can lose its classification due to certain uses. 

• Tax change: Effective September 1, 2025, reduces the period for imposing additional tax from the previous seven years to four years for classified farm and agricultural land withdrawals and removals. 

Gross income requirements for smaller farms

Under RCW 84.34.020(2)(b)(ii), farming operations of at least five acres, but less than 20 acres, must meet a minimum gross income threshold. SHB 1261 expands the definition of “gross income from agricultural uses” to also include:

• (B) The wholesale value of agricultural products sold to persons allowed to harvest the agricultural products they purchase, if the products harvested are grown on the same land.

Example: A farm operates a pick-your-own pumpkin patch. Admission fees to the farm do not qualify as gross income to meet the minimum per-acre requirement for classified farm and agricultural land. However, the wholesale value of the pumpkins picked and purchased by visitors can now qualify towards the farm’s minimum gross income requirements. 

Appurtenances and incidental use

SHB 1261 adds legal definitions to clarify acceptable uses of classified land. The following two new subsections have been added to the definitions in RCW 84.34.020:

• (9) "Appurtenance" means something used with, and related to or dependent upon another thing that is, something that belongs to something else, an adjunct. The thing appurtenant is strictly necessary and essential to the proper use and enjoyment of the land, as well as useful or necessary for carrying out the purposes for which the land is classified under this chapter.
  • (a) In terms of farm and agricultural land, an "appurtenance" is something used for a particular sort of farm and is widely and routinely used in the operation of the commercial agricultural enterprise.
  • (b) An "appurtenance" includes, but is not limited to, portable sanitation equipment, barn, or tool shed, or equipment used for a particular purpose or task, such as tools, instruments, or machinery.
• (10) "Incidental use" means a use of land classified as farm and agricultural land or timberland that is compatible with commercial agricultural purposes. "Incidental use" for land classified as farm and agricultural land may not exceed 20 percent of the total classified land, while incidental use for timberland may not exceed 10 percent of the total classified land. An "incidental use" may include, but is not limited to, wetland preservation, a gravel pit, a farm woodlot, a produce stand, or an unpaved parking area necessary for the safe visiting or viewing of classified land.

These additional definitions do not change the requirement that land classified as farm and agricultural land must be primarily used for commercial agricultural purposes, and timberland must be primarily used for the growing and harvesting of timber for commercial purposes. “Primary use” is when, upon inspection of the classified land, the amount of one use is greater than any other use on the parcel and does not represent a specific percentage of the classified land (WAC 458-30-200(2)(ll).

Removal of classification

RCW 84.34.108 identifies conditions for the removal of classified land from the current use program, including specific conditions under which the classification may not be removed. SHB 1261 adds a new subsection regarding farm and agricultural land, prohibiting the removal of land beneath an existing appurtenance because of certain limited actions or activities, as follows:

• (2)(b) Land classified as farm and agricultural land under RCW 84.34.020 upon which an existing appurtenance is located may not be removed from classification as a result of minor upgrades and alterations to the appurtenance such as the addition of a cement pad, plumbing, or electrical, or limited compatible uses including educational and recreational farming programs, events such as seasonal farm festivals, and celebratory gatherings such as weddings, unless:
  • (i) Retaining the classification of such land would exceed the 20 percent incidental use limitation provided in the definition of incidental use in RCW 84.34.020; or
  • (ii) The structure no longer meets the definition of appurtenance under RCW 84.34.020.
• (c) For the purpose of this subsection (2), "existing appurtenance" does not include a newly constructed structure or major redevelopment of an existing structure.

In summary, minor, supportive upgrades to farm structures, such as adding utilities to a shed or barn used during a seasonal event, will not disqualify the land from its farm and agricultural land classification, provided the structure continues to serve a legitimate agricultural purpose and incidental use limits are not exceeded. 

The Incidental Use and Appurtenance Guidance addressing these topics last year will be updated to reflect these changes and will be available by July 25, 2025.

Additional tax calculations – effective September 1, 2025

RCW 84.34.108(4)(a) describes the way additional tax is calculated upon removal from classification. SHB 1261 reduces the number of years used to calculate prior years’ additional tax from seven years to four years for both removals and withdrawals of farm and agricultural land occurring on or after September 1, 2025, as described below:

• (ii) For removals, or withdrawals, of classified farm and agricultural land on or after September 1, 2025, equal to the difference between the property tax paid as farm and agricultural and the amount of property tax otherwise due and payable for the four years last past had the land not been so classified.

This change applies only to removals and withdrawals from the farm and agricultural land classification. The method for calculating additional tax for removals or withdrawals from the timberland classification and the open space land classification remains unchanged. 

Removal and withdrawal forms will be updated to reflect this change prior to the effective date of the legislation. 

Questions?

Please visit our property tax page or contact your county assessor.