S-1680

AN ACT Relating to adult entertainment businesses; amending RCW 7.48A.040; adding a new chapter to Title 18 RCW; adding a new section to chapter 43.43 RCW; prescribing penalties; and providing an effective date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. It is the purpose of this chapter to regulate certain adult entertainment businesses to promote the health, safety, and welfare of the citizens of the state of Washington. The legislature finds that these businesses, when unregulated, promote illegal activities including assaults, sexual offenses, drug offenses, and prostitution.

NEW SECTION. Sec. 2. Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

(1) "Adult cabaret" means a nightclub, bar, restaurant, or similar commercial establishment which regularly features persons who appear in a state of nudity or seminude.

(2) "Adult entertainment business" means an adult cabaret or adult theater.

(3) "Adult theater" means a theater, concert hall, auditorium, or similar commercial establishment which regularly features live performances where persons appear in a state of nudity or seminude.

(4) "Applicant" means a person or persons applying for a license under this chapter, including each partner of a partnership and each officer and director of a corporation.

(5) "Department" means the department of licensing.

(6) "Licensee" means a person or persons in whose name a license has been issued under this chapter.

(7) "Nudity" means the appearance of a human bare buttock, anus, genital, or breast, or a state of dress which fails to opaquely cover a human buttock, anus, genital, or areola of the breast.

(8) "Seminude" means a state of dress not including nudity in which clothing opaquely covers only the genitals, pubic region, or areolae of the breast, as well as portions of the body covered by supporting straps or devices.

NEW SECTION. Sec. 3. (1) It is a gross misdemeanor for a person, partnership, or corporation, to own or operate an adult entertainment business in the state of Washington unless such person, partnership, or corporation, has obtained a license pursuant to this chapter.

(2) An application for a license must be made on a form provided by the department. The applicant shall provide: (a) The name, address, phone number, social security number, and date of birth of the applicant; (b) two passport-size color photographs of the applicant; (c) the applicant's principal occupation; (d) a description of the proposed establishment; (e) the nature of the proposed business; (f) location of the proposed business; (g) a record of all prior criminal convictions; and (h) such other information as the department may require by rule.

(3) The department shall require the applicant to submit to fingerprinting to assist the Washington state patrol in conducting a background check under section 30 of this act.

(4) At the time of applying, the applicant shall post notice of the application at the proposed business location, for a period of not less than thirty days, in a form and manner as required by the department by rule.

NEW SECTION. Sec. 4. (1) For the purpose of considering an application for a license, the department may cause an inspection of the premises to be made, and may inquire into all matters in connection with the construction and operation of the premises. For the purpose of reviewing a application for a license and for considering the denial, suspension, or revocation of a license, the department shall consider any prior convictions of a firearm offense under chapter 9.41 RCW, an obscenity or pornography offense under chapter 9.68 RCW, a sexual exploitation of children offense under chapter 9.68A RCW, an assault under chapter 9A.36 RCW, a sexual offense under chapter 9A.44 RCW, a prostitution or indecent exposure offense under chapter 9A.88 RCW, or a drug offense under chapter 69.41, 69.50, 69.52, or 69.53 RCW, or a substantially similar ordinance adopted by a local legislative authority or other state statute, or prior violations of the provisions of this chapter by the applicant, and the provisions of RCW 9.95.240 and chapter 9.96A RCW shall not apply to such cases. The department shall grant or refuse the license as provided in this chapter and by rule.

(2) Every license shall be issued in the name of the applicant or applicants, and the holder thereof shall not allow any other person to use the license.

(3) No license may be issued to:

(a) A partnership or corporation, unless qualified to obtain a license, as provided in this chapter;

(b) An applicant whose place of business is conducted by a manager or agent, unless such manager or agent possesses the same qualifications required of the licensee;

(c) A corporation, unless it was created under the laws of the state of Washington or holds a certificate of authority to transact business in the state of Washington;

(d) An applicant who is under eighteen years of age;

(e) An applicant who has failed to provide information reasonably necessary for issuance of the license or who has falsely answered a question or request for information on the application form;

(f) An applicant who has proposed the location of the business within a zone where such use is prohibited by state or local authority.

(4) Before the department issues a license to an applicant it shall give notice of such application to the chief executive officer of the incorporated city or town, if the application is for a license within an incorporated city or town, or to the county legislative authority, if the application is for a license outside the boundaries of incorporated cities or towns, or to all such executive officers in the case of a regional adult entertainment business plan; and such incorporated city or town, through the official or employee selected by it, or the county legislative authority or the official or employee selected by it, shall have the right to file with the department within twenty days after date of transmittal of such notice, written objections against the applicant or against the premises for which the license is asked, and shall include with such objections a statement of all facts upon which such objections are based, and in case written objections are filed, may request and the department may in its discretion hold a formal hearing subject to the applicable provisions of Title 34 RCW. Upon the granting of a license under this chapter the department shall send a duplicate of the license or written notification to the chief executive officer of the incorporated city or town in which the license is granted, or to the county legislative authority if the license is granted outside the boundaries of incorporated cities or towns, or to all chief executive officers of impacted cities, towns, or counties participating in a regional adult entertainment business plan.

(5)(a) Except as set forth in (b) of this subsection, the department shall issue no license covering any premises, if such premises are within one thousand feet of the premises of any residential zone, single or multifamily dwelling, church, park, playground, day care center, or elementary or secondary school measured along the most direct route over or across established public walks, streets, or other public passageway from the outer property line of the school grounds to the nearest public entrance of the premises proposed for license. For the purpose of this section, church shall mean a building erected for and used exclusively for religious worship and schooling or other activity in connection therewith.

(b) Local legislative authority (i) shall establish a lesser buffer zone upon a finding that the adverse secondary effects of adult entertainment users would not impact public health, safety, or welfare; or (ii) may establish a greater buffer zone upon a finding that the adverse secondary effects of adult entertainment users on public health, safety, or welfare would not be reasonably and effectively mitigated.

(c) If the location requirements established pursuant to this chapter preclude location of adult entertainment businesses within a local governmental jurisdiction, such jurisdiction may join with neighboring jurisdictions in a regional adult entertainment business location plan in order to provide reasonable opportunity for location of adult entertainment businesses in the regional area.

NEW SECTION. Sec. 5. (1) The department may, subject to the provisions of this chapter and as provided by rule, suspend or cancel a license; and all rights of the licensee hereunder shall be suspended or terminated, as the case may be.

(2) Upon receipt of notice of the suspension or cancellation of a license, the licensee shall forthwith deliver the license to the department. Where the license has been suspended only, the department shall return the license to the licensee at the expiration or termination of the period of suspension.

NEW SECTION. Sec. 6. (1) Every license issued under this chapter shall be subject to all conditions and restrictions imposed by this chapter and all applicable rules of the department. All conditions and restrictions imposed by the department in the issuance of an individual license shall be listed on the face of the individual license along with the trade name, address, and expiration date.

(2) Every licensee shall post and keep posted its license in a conspicuous place on the premises.

NEW SECTION. Sec. 7. The department shall not issue a license to a transferee until the transferee has applied for and received a license under this chapter.

NEW SECTION. Sec. 8. (1)(a) At the time of the original issuance of a license, the department shall prorate the license fee charged to the new licensee according to the number of calendar quarters, or portion thereof, remaining until the first renewal of that license is required.

(b) Unless sooner canceled, every license issued by the department shall expire at midnight of the thirtieth day of June of the fiscal year for which it was issued. However, if the department deems it feasible and desirable to do so, it may establish, by rule pursuant to chapter 34.05 RCW, a system for staggering the annual renewal dates for the license authorized by this chapter. If such a system of staggered annual renewal dates is established by the department, the license fees provided by this chapter shall be appropriately prorated during the first year that the system is in effect.

(2) The adult entertainment license fee shall be at least seven hundred fifty dollars per annum and shall be paid at the time of application. One-half of the fee shall be refunded if the application is withdrawn prior to a denial of the license by the department.

NEW SECTION. Sec. 9. (1) The holder of one or more licenses may not assign and transfer the license except for transfer to the surviving spouse of a deceased licensee if the parties were maintaining a marital community and the license was issued in the names of one or both of the parties.

(2) A change in the officers or directors of a licensed corporation or a change in the manager or agent must be reported to the department within thirty days, and such persons must meet the department's approval under section 4 of this act. The department shall charge a fee of at least seventy-five dollars for the processing of such change.

NEW SECTION. Sec. 10. The department in suspending a license may further provide in the order of suspension that such suspension shall be vacated upon payment to the department by the licensee of a monetary penalty in an amount then fixed by the department.

NEW SECTION. Sec. 11. (1) It is a gross misdemeanor for a performer to appear in an adult entertainment business in a state of nudity or seminude, unless such performer has obtained a license pursuant to this chapter.

(2) An application for a performer's license must be made on a form provided by the department. The performer shall provide the following: (a) The performer's name, including all aliases, address, phone number, social security number, and date of birth; (b) Two passport-size color photographs of the performer; (c) principal occupation; (d) the name and address of the business at which the performer will perform; (e) a record of all prior criminal convictions, if any; and (f) such other information as the department may require by rule.

(3) The department shall require the applicant to submit to fingerprinting to assist the Washington state patrol in conducting a background check under section 18 of this act.

(4) No license may be issued to:

(a) A performer who is under eighteen years of age;

(b) A performer who has failed to provide information reasonably necessary for issuance of the license or has falsely answered a question or request for information on the application form.

(c) A performer who has violated the provisions of this chapter or been convicted of a firearm offense under chapter 9.41 RCW, an obscenity or pornography offense under chapter 9.68 RCW, a sexual exploitation of children offense under chapter 9.68A RCW, an assault under chapter 9A.36 RCW, a sexual offense under chapter 9A.44 RCW, a prostitution or indecent exposure offense under chapter 9A.88 RCW, or a drug offense under chapter 69.41, 69.50, 69.52, or 69.53 RCW, or a substantially similar ordinance adopted by a local legislative authority or other state statute; and (i) less than two years have elapsed since the date of the conviction or the date of release from confinement for the conviction, whichever is the later date, if the conviction is of a misdemeanor or gross misdemeanor offense; or (ii) less than five years have elapsed since the date of the conviction or the date of release from confinement for the conviction, whichever is the later date, if the conviction is of a felony offense or of two misdemeanor or gross misdemeanor offenses occurring within any twenty-four month period.

(5) The performer license fee shall be at least seventy-five dollars per annum and shall be paid at the time of application. One-half of the fee shall be refunded if the application is withdrawn prior to denial of the license by the department.

(6) The department shall issue a temporary performer's license valid for a period of five days, if the department is unable to determine the performer's qualifications for an annual license within twenty-four hours from the time of application.

(7) Every performer shall keep his or her license on the premises while performing.

NEW SECTION. Sec. 12. There is hereby imposed an admissions tax of one dollar upon all customers of adult entertainment businesses within the state. The tax provided for in this section shall be collected by the business and remitted to the state treasurer for deposit in the public safety education account established under RCW 43.08.250.

NEW SECTION. Sec. 13. Every business licensed under section 4 of this act shall file monthly reports with the department pursuant to rule. The reports shall include the following: (1) The number of customers patronizing the business during the month; (2) the name, address, social security number, and date of birth of all performers appearing in a state of nudity or seminude during the month; and (3) such further information as the department may require.

NEW SECTION. Sec. 14. The department, for the purpose of maintaining public health, safety, and welfare, may limit the number of licenses issued in each county or region, based upon a finding of inadequate protection against cumulative adverse secondary effects of adult entertainment businesses located in such counties.

In determining whether licenses shall be issued in a county or region, the department shall ascertain, pursuant to rule, whether the existing restrictions on adult entertainment businesses reasonably and adequately protect the public health, safety, and welfare against the cumulative adverse secondary effects of licensed adult entertainment businesses.

NEW SECTION. Sec. 15. The action, order, or decision of the department as to a denial of an application for the reissuance of a license or as to a revocation, suspension, or modification of a license is an adjudicative proceeding and subject to the applicable provisions of chapter 34.05 RCW.

(1) An opportunity for a hearing may be provided an applicant for the reissuance of a license prior to the disposition of the application, and if no such opportunity for a prior hearing is provided then an opportunity for a hearing to reconsider the application must be provided the applicant.

(2) An opportunity for a hearing must be provided a licensee prior to a revocation or modification of a license and, except as provided in subsection (4) of this section, prior to the suspension of a license.

(3) No hearing shall be required until demanded by the applicant or licensee.

(4) The department may summarily suspend a license or permit for a period of up to thirty days without a prior hearing if it finds that public health, safety, or welfare imperatively requires emergency action, and incorporates a finding to that effect in its order; and proceedings for revocation or other action must be promptly instituted and determined.

NEW SECTION. Sec. 16. No provision in this chapter limits the authority of local jurisdictions from further regulating adult entertainment businesses as to hours of operation, location of premises, or manner of operation.

The provisions of this chapter relating to the licensing of any adult entertainment business shall not be exclusive and any political subdivision of the state of Washington within whose jurisdiction the adult entertainment business is located may require any registrations or licenses, or charge any fee for the same or similar purpose; and nothing herein shall limit or abridge the authority of any political subdivision to levy and collect a general and nondiscriminatory license fee levied upon all businesses, or to levy a tax based upon gross business conducted by any firm within said political subdivision.

NEW SECTION. Sec. 17. The director has the following authority:

(1) To adopt, amend, or rescind such rules as are deemed necessary to carry out this chapter;

(2) To investigate all complaints or reports of conduct in violation of this chapter and to hold hearings as provided in this chapter;

(3) To issue subpoenas and administer oaths in connection with any investigation, hearing, or proceeding held under this chapter;

(4) To take or cause depositions to be taken and use other discovery procedures as needed in any investigation, hearing, or proceeding held under this chapter;

(5) To compel attendance of witnesses at hearings;

(6) To take emergency action ordering summary suspension of a license, or restriction or limitation of the licensee's practice pending proceedings by the disciplining authority;

(7) To use the office of administrative hearings as authorized in chapter 34.12 RCW to conduct hearings. However, the director or the director's designee shall make the final decision in the hearing;

(8) To enter into contracts for professional services determined to be necessary for adequate enforcement of this chapter;

(9) To adopt standards of conduct or practice for adult entertainment businesses;

(10) To grant or deny license applications, to impose any sanction against a license applicant or license holder provided by this chapter;

(11) To adjust license fees under this chapter above the minimum set by law;

(12) To enter into an assurance of discontinuance in lieu of issuing a statement of charges or conducting a hearing. The assurance shall consist of a statement of the law in question and an agreement to not violate the stated provision. The applicant or license holder shall not be required to admit to any violation of the law, nor shall the assurance be construed as such an admission. Violation of an assurance under this subsection is grounds for disciplinary action;

(13) To designate individuals authorized to sign subpoenas and statements of charges; and

(14) To employ such investigative, administrative, and clerical staff as necessary for the enforcement of this chapter.

NEW SECTION. Sec. 18. A person, including but not limited to consumers, licensees, corporations, organizations, and state and local governmental agencies, may submit a written complaint to the department charging a license holder or applicant with a violation of established standards of appropriate conduct. If the department determines that the complaint merits investigation, or if the department has reason to believe, without a formal complaint, that a license holder or applicant may have engaged in inappropriate conduct, the department shall investigate to determine whether there has been inappropriate conduct. A person who files a complaint under this section in good faith is immune from suit in any civil action related to the filing or contents of the complaint.

NEW SECTION. Sec. 19. (1) If the department determines, upon investigation, that there is reason to believe a violation of this chapter has occurred, a statement of charge or charges shall be prepared and served upon the license holder or applicant. The statement of charge or charges shall be accompanied by a notice that the license holder or applicant may request a hearing to contest the charge or charges. The license holder or applicant must file a request for hearing with the department within twenty days after being served the statement of charges. The failure to request a hearing constitutes a default, whereupon the director may enter an order pursuant to RCW 34.05.440.

(2) If a hearing is requested, the time of the hearing shall be scheduled but the hearing shall not be held earlier than thirty days after service of the charges upon the license holder or applicant. A notice of hearing shall be issued at least twenty days prior to the hearing, specifying the time, date, and place of the hearing.

NEW SECTION. Sec. 20. The procedures governing adjudicative proceedings before agencies under chapter 34.05 RCW, the administrative procedure act, govern all hearings before the director.

NEW SECTION. Sec. 21. Upon a finding that a license holder or applicant has engaged in conduct or acts or violated conditions that are grounds for disciplinary action, the director may issue an order providing for one or any combination of the following:

(1) Revocation of the license;

(2) Suspension of the license for a fixed or indefinite term;

(3) Censure or reprimand;

(4) Compliance with conditions of probation for a designated period of time;

(5) Payment of a fine for each violation of this chapter, not to exceed one thousand dollars per violation. Funds received shall be placed in the health professions account;

(6) Denial of the license request.

Any of the actions under this section may be totally or partly stayed by the director. All costs associated with compliance with orders issued under this section are the obligation of the license holder or applicant.

NEW SECTION. Sec. 22. The following conduct, acts, or conditions, constitute grounds for disciplinary action against any license holder or applicant under the jurisdiction of this chapter: (1) Conviction of a firearm offense under chapter 9.41 RCW, an obscenity or pornography offense under chapter 9.68 RCW, a sexual exploitation of children offense under chapter 9.68A RCW, an assault under chapter 9A.36 RCW, a sexual offense under chapter 9A.44 RCW, a prostitution or indecent exposure offense under chapter 9A.88 RCW, or a drug offense under chapter 69.41, 69.50, 69.52, or 69.53 RCW, or a substantially similar ordinance adopted by a local legislative authority or other state statute. If the act constitutes a crime, conviction in a criminal proceeding is not a condition precedent to disciplinary action. Upon such a conviction, however, the judgment and sentence is conclusive evidence at the ensuing disciplinary hearing of the guilt of the license holder or applicant of the crime described in the indictment or information, and of the person's violation of the statute on which it is based. For the purposes of this section, conviction includes all instances in which a plea of guilty or nolo contendere is the basis for the conviction and all proceedings in which the sentence has been deferred or suspended.

(2) Misrepresentation or concealment of a material fact in obtaining a license or in reinstatement thereof;

(3) All advertising that is false, fraudulent, or misleading;

(4) Failure to cooperate with the department in the conduct of an investigation by:

(a) Not furnishing any requested papers or documents;

(b) Not furnishing in writing a full and complete explanation regarding the matter under investigation; or

(c) Not responding to subpoenas issued by the director, whether or not the recipient of the subpoena is the subject of the investigation;

(5) Failure to comply with an order issued by the director or an assurance of discontinuance entered into with the director;

(6) Aiding and abetting an unlicensed person to practice when a license is required;

(7) Interference with an investigation or disciplinary proceeding by willful misrepresentation of facts before the director or the director's authorized representative, or by the use of threats or harassment against any witness to prevent them from providing evidence in a disciplinary proceeding or any other legal action.

NEW SECTION. Sec. 23. (1) The director shall investigate complaints concerning practice by unlicensed persons of a profession or business for which a license is required by this chapter. In the investigation of the complaints, the director shall have the same authority as provided the director under section 17 of this act. The director shall issue a cease and desist order to a person after notice and hearing and upon a determination that the person has violated this subsection. If the director makes a written finding of fact that the public interest will be irreparably harmed by delay in issuing an order, the director may issue a temporary cease and desist order. The cease and desist order shall not relieve the person so practicing or operating a business without a license from criminal prosecution therefor, but the remedy of a cease and desist order shall be in addition to any criminal liability. The cease and desist order is conclusive proof of unlicensed practice and may be enforced through remedial sanctions under chapter 7.21 RCW. This method of enforcement of the cease and desist order may be used in addition to, or as an alternative to, any provisions for enforcement of agency orders set out in chapter 34.05 RCW.

(2) The attorney general, a county prosecuting attorney, the director, a board, or any person may in accordance with the law of this state governing injunctions, maintain an action in the name of this state to enjoin any person practicing a profession or business for which a license is required by this chapter without a license from engaging in such practice or operating such business until the required license is secured. However, the injunction shall not relieve the person so practicing or operating a business without a license from criminal prosecution therefor, but the remedy by injunction shall be in addition to any criminal liability.

(3) Unlicensed practice as a performer or operating a business for which a license is required by this chapter unless otherwise exempted by law, constitutes a gross misdemeanor.

NEW SECTION. Sec. 24. A person or business that violates an injunction issued under this chapter shall pay a civil penalty, as determined by the court, of not more than twenty-five thousand dollars, which shall be paid to the department. For the purpose of this section, the superior court issuing any injunction shall retain jurisdiction and the cause shall be continued, and in such cases the attorney general acting in the name of the state may petition for the recovery of civil penalties.

NEW SECTION. Sec. 25. (1) The director or individuals acting on the director's behalf are immune from suit in any civil or criminal action based on any disciplinary proceedings or other official acts performed in the course of their duties in the administration and enforcement of this chapter.

(2) Local legislative authorities are immune from suit in any civil or criminal action based on any official acts performed in the course of their duties in the administration or enforcement of this chapter.

In any challenge to location, distance, or conduct requirements imposed by the local legislative authority pursuant to this chapter, the authority may tender the defense of those issues to the state and the state and local jurisdiction shall jointly assume the obligation to defend issues raised by this chapter.

NEW SECTION. Sec. 26. Existing adult entertainment businesses are exempt from any location restrictions imposed by this chapter for a period of three years from the date of enactment. At the expiration of the three-year period the department shall ascertain on an annual basis, pursuant to rule, whether an existing business should be licensed at the existing location. In making this determination for each specific location, the department shall consider, but not be limited to, the following: (1) The general public health, safety, and welfare; (2) the number of criminal investigations and arrests occurring on the premises and in the general vicinity; (3) the number of violations of this chapter, department rules, or local ordinances as committed by owners, operators, or performers of the business; and (4) the fiscal impact imposed on local law enforcement agencies related to continuation of the business.

NEW SECTION. Sec. 27. It is a gross misdemeanor for any person to permit any person under the age of eighteen on the premises of any adult entertainment business under his or her control.

NEW SECTION. Sec. 28. It is a class C felony for any person to employ or permit any person under the age of eighteen to appear in a state of nudity or seminude on the premises of any adult entertainment business under his or her control.

NEW SECTION. Sec. 29. Sections 1 through 28 of this act shall constitute a new chapter in Title 18 RCW.

NEW SECTION. Sec. 30. A new section is added to chapter 43.43 RCW to read as follows:

The department of licensing may request of the Washington state patrol criminal identification system information regarding the conviction of offenses listed under section 11(5) of this act for any applicant as defined in section 2 of this act.

Sec. 31. RCW 7.48A.040 and 1985 c 235 s 1 are each amended to read as follows:

(1) No person shall with knowledge maintain a moral nuisance.

(2) Upon a determination that a defendant has with knowledge maintained a moral nuisance, the court shall impose a civil fine and judgment of an amount as the court shall determine to be appropriate. In imposing the civil fine, the court shall consider the wilfulness of the defendant's conduct and the profits made by the defendant attributable to the lewd matter, lewdness, or prostitution, whichever is applicable. In no event shall the civil fine exceed the greater of ((~~twenty-five~~)) fifty thousand dollars or these profits.

NEW SECTION. Sec. 32. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.

NEW SECTION. Sec. 33. This act shall take effect January 1, 1992.