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2026 Pavement Maintenance Overlay Special Provisions <br />PW# 3860 SP - 18 March 5, 2026 <br />1 1-07.2.RTF <br />2 1-07.2 State Taxes <br />3 <br />4 Delete this section, including its sub-sections, in its entirety and replace it with the following: <br />5 <br />6 1-07.2 State Sales Tax <br />7 (June 27, 2011 APWA GSP) <br />8 <br />9 The Washington State Department of Revenue has issued special rules on the State <br />10 sales tax. Sections 1-07.2(1) through 1-07.2(3) are meant to clarify those rules. The <br />11 Contractor should contact the Washington State Department of Revenue for answers to <br />12 questions in this area. The Contracting Agency will not adjust its payment if the <br />13 Contractor bases a bid on a misunderstood tax liability. <br />14 <br />15 The Contractor shall include all Contractor-paid taxes in the unit bid prices or other <br />16 contract amounts. In some cases, however, state retail sales tax will not be included. <br />17 Section 1-07.2(2) describes this exception. <br />18 <br />19 The Contracting Agency will pay the retained percentage (or release the Contract Bond if <br />20 a FHWA-funded Project) only if the Contractor has obtained from the Washington State <br />21 Department of Revenue a certificate showing that all contract-related taxes have been <br />22 paid (RCW 60.28.051). The Contracting Agency may deduct from its payments to the <br />23 Contractor any amount the Contractor may owe the Washington State Department of <br />24 Revenue, whether the amount owed relates to this contract or not. Any amount so <br />25 deducted will be paid into the proper State fund. <br />26 <br />27 1-07.2(1) State Sales Tax Rule 171 <br />28 <br />29 WAC 458-20-171, and its related rules, apply to building, repairing, or improving streets, <br />30 roads, etc., which are owned by a municipal corporation, or political subdivision of the <br />31 state, or by the United States, and which are used primarily for foot or vehicular traffic. <br />32 This includes storm or combined sewer systems within and included as a part of the street <br />33 or road drainage system and power lines when such are part of the roadway lighting <br />34 system. For work performed in such cases, the Contractor shall include Washington <br />35 State Retail Sales Taxes in the various unit bid item prices, or other contract amounts, <br />36 including those that the Contractor pays on the purchase of the materials, equipment, or <br />37 supplies used or consumed in doing the work. <br />38 <br />39 1-07.2(2) State Sales Tax Rule 170 <br />40 <br />41 WAC 458-20-170, and its related rules, apply to the constructing and repairing of new or <br />42 existing buildings, or other structures, upon real property. This includes, but is not limited <br />43 to, the construction of streets, roads, highways, etc., owned by the state of Washington; <br />44 water mains and their appurtenances; sanitary sewers and sewage disposal systems <br />45 unless such sewers and disposal systems are within, and a part of, a street or road <br />46 drainage system; telephone, telegraph, electrical power distribution lines, or other <br />47 conduits or lines in or above streets or roads, unless such power lines become a part of a <br />48 street or road lighting system; and installing or attaching of any article of tangible personal <br />49 property in or to real property, whether or not such personal property becomes a part of <br />50 the realty by virtue of installation. <br />51