AGO 1956 No. 351 - Dec 17 1956
TAXES ‑- PROPERTY TAXES, FEDERAL AND PROPERTY ‑- VETERAN'S ADMINISTRATION
Real property deeded by a mortgagor to the Veterans' Administration in lieu of foreclosure action remains subject to state and county advalorem taxes.
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December 17, 1956
Honorable Roger L. Olson
Pasco, Washington Cite as: AGO 55-57 No. 351
This is in answer to your letter of November 20, 1956, inquiring as to the taxable status of property deeded by a mortgagor to the Federal National Mortgage Association who thereupon deeded it to the Veterans Administration, H. V. Highley, Administrator, in lieu of foreclosure action. You inquire whether the property so deeded is exempt from property taxes in this state.
We assume that the mortgage secured a loan guaranteed by the Veterans Administration pursuant to 38 U.S.C.A. § 694a, and that the deed to the property was taken pursuant to authority of 38 U.S.C.A. § 694j. From this assumption we conclude that the property remains subject to all state and local property taxes.
The 19th Amendment to the State Constitution provides:
"The United States and its agencies and instrumentalities, and their property, may be taxed under any of the tax laws of this state, whenever and in such manner as such taxation may be authorized or permitted under the laws of the United States, notwithstanding anything to the contrary in the Constitution of this state."
Even prior to this amendment our supreme court had held that where the Congress had consented to state taxation of federally-owned property, our legislature by enactment, RCW 84.08.180, could validly subject such federally-owned property to state taxes. Boeing Aircraft Co. v. R. F. C., 25 Wn. (2d) 652.
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Property acquired by the Veterans Administration under the authority of 38 U.S.C.A. § 693et seq., more specifically § 694j, is, by congressional consent, subject to state and local taxation. 38 U.S.C.A. § 694j provides:
"(a) With respect to matters arising by reason of this subchapter as now or hereafter amended and, notwithstanding the provisions of any other law, the Administrator may‑-
"(6) Complete, administer, operate, obtain and pay for insurance on, and maintain, renovate, repair, modernize, lease, or otherwise deal with any property acquired or held pursuant to this subchapter: Provided, That the acquisition of any such property shall not deprive any State or political subdivision thereof of its civil or criminal jurisdiction of, on, or over such property (including power to tax) or impair the rights under the State or local law of any persons on such property."
It may be noted that this congressional consent follows the treatment given by Congress generally to property acquired by the Federal Housing Administration under the National Housing Act as amended. See 12 U.S.C.A. §§ 1706b, 1714 and 1722.
If the taxes on such property are not paid, the lien therefor attaches to the property even though the United States is the present owner, United States v. Alabama, 313 U.S. 274, and if the government holds title to the property at the time tax statements are mailed, those statements should be mailed directly to the proper government official.
Very truly yours,
Assistant Attorney General