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AN ACT Relating to military dependent communities; amending RCW 43.160.020, 43.160.076, 43.160.200, 43.168.020, 70.47.115; amending 1991 c 314 s 26 (uncodified); amending 1991 c 314 s 27 (uncodified); amending 1991 c 314 s 32 (uncodified); amending 1991 c 314 s 33 (uncodified); amending 1991 c 314 s 34 (uncodified); adding a new section to chapter 43.06 RCW; adding a new section to chapter 43.20A RCW; adding a new section to chapter 50.08 RCW; adding a new section to chapter 43.31 RCW; adding a new section to chapter 43.63A RCW; adding a new section to chapter 28B.50 RCW; adding new sections to chapter 28B.80 RCW; adding a new section to chapter 50.12 RCW; adding a new section to chapter 50.22 RCW; creating a new section; repealing RCW 43.160.900; and declaring an emergency.

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

NEW SECTION. Sec. 1. The legislature finds that military base closures and defense procurement contract cancellations may have extreme economic impacts on communities and firms. The legislature began to address this concern in 1990 by establishing the community diversification program in the department of community development. While this program has helped military dependent communities begin the long road to diversification, base closures or major procurement contract reductions in the near future will find these communities unable to respond adequately, endangering the health, safety, and welfare of the community. The legislature intends to target emergency state assistance to military dependent communities significantly impacted by a reduction of defense spending until a long-term strategy can be developed by the legislature, the governor, and the community. The emergency state assistance and the long-term strategy should be driven by the impacted community and consistent with the state plan for diversification required under RCW 43.63A.450(4).

NEW SECTION. Sec. 2. A new section is added to chapter 43.06 RCW to read as follows:

(1) The governor may, by executive order, declare a community to be a "military impacted area." A "military impacted area" means a community or communities, as identified in the executive order, that experience serious social and economic hardships because of a significant reduction in defense spending by the federal government in that community or communities.

(2) If the governor executes an order under subsection (1) of this section, the governor shall establish a response team to coordinate state efforts to assist the military impacted community. The response team shall include, but not be limited to, one member from each of the following agencies: (a) The department of community development; (b) the department of trade and economic development; (c) the department of social and health services; (d) the employment security department; (e) the state board for community and technical colleges; (f) the higher education coordinating board; (g) the department of transportation; and (h) the Washington energy office. The governor shall appoint a response team coordinator. The governor shall seek to actively involve the impacted community or communities in planning and implementing a response to the crisis. The governor may seek input or assistance from the community diversification advisory committee, and the governor may establish task forces in the community or communities to assist in the coordination and delivery of services to the local community. The state and community response shall consider economic development, human service, and training needs of the community or communities impacted.

NEW SECTION. Sec. 3. A new section is added to chapter 43.20A RCW to read as follows:

The department shall target its programs and provide other appropriate assistance to military impacted areas as directed by the governor and the response team established under section 2(2) of this act.

NEW SECTION. Sec. 4. A new section is added to chapter 50.08 RCW to read as follows:

NEW SECTION. Sec. 5. A new section is added to chapter 43.31 RCW to read as follows:

NEW SECTION. Sec. 6. A new section is added to chapter 43.63A RCW to read as follows:

Sec. 7. RCW 43.160.020 and 1992 c 21 s 3 are each amended to read as follows:

Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

(1) "Board" means the community economic revitalization board.

(2) "Bond" means any bond, note, debenture, interim certificate, or other evidence of financial indebtedness issued by the board pursuant to this chapter.

(3) "Department" means the department of trade and economic development or its successor with respect to the powers granted by this chapter.

(4) "Financial institution" means any bank, savings and loan association, credit union, development credit corporation, insurance company, investment company, trust company, savings institution, or other financial institution approved by the board and maintaining an office in the state.

(5) "Industrial development facilities" means "industrial development facilities" as defined in RCW 39.84.020.

(6) "Industrial development revenue bonds" means tax-exempt revenue bonds used to fund industrial development facilities.

(7) "Local government" means any port district, county, city, or town.

(8) "Sponsor" means any of the following entities which customarily provide service or otherwise aid in industrial or other financing and are approved as a sponsor by the board: A bank, trust company, savings bank, investment bank, national banking association, savings and loan association, building and loan association, credit union, insurance company, or any other financial institution, governmental agency, or holding company of any entity specified in this subsection.

(9) "Umbrella bonds" means industrial development revenue bonds from which the proceeds are loaned, transferred, or otherwise made available to two or more users under this chapter.

(10) "User" means one or more persons acting as lessee, purchaser, mortgagor, or borrower under a financing document and receiving or applying to receive revenues from bonds issued under this chapter.

(11) "Timber impact area" means:

(a) A county having a population of less than five hundred thousand, or a city or town located within a county having a population of less than five hundred thousand, and meeting two of the following three criteria, as determined by the employment security department, for the most recent year such data is available: (i) A lumber and wood products employment location quotient at or above the state average; (ii) projected or actual direct lumber and wood products job losses of one hundred positions or more, except counties having a population greater than two hundred thousand but less than five hundred thousand must have direct lumber and wood products job losses of one thousand positions or more; or (iii) an annual unemployment rate twenty percent or more above the state average; or

(b) Additional communities as the economic recovery coordinating board, established in RCW 43.31.631, designates based on a finding by the board that each designated community is socially and economically integrated with areas that meet the definition of a timber impact area under (a) of this subsection.

(12) "Military impacted area" means a community or communities designated by executive order under section 2 of this act.

Sec. 8. RCW 43.160.076 and 1991 c 314 s 24 are each amended to read as follows:

(1) Except as authorized to the contrary under subsection (2) of this section, from all funds available to the board for loans and grants, the board shall spend at least fifty percent for grants and loans for projects in distressed counties, military impacted areas, or timber impact areas. For purposes of this section, the term "distressed counties" includes any county, in which the average level of unemployment for the three years before the year in which an application for a loan or grant is filed, exceeds the average state employment for those years by twenty percent.

(2) If at any time during the last six months of a biennium the board finds that the actual and anticipated applications for qualified projects in distressed counties, military impacted areas, or timber impact areas are clearly insufficient to use up the fifty percent allocation, then the board shall estimate the amount of the insufficiency and during the remainder of the biennium may use that amount of the allocation for loans and grants for projects not located in distressed counties, military impacted areas, or timber impact areas.

Sec. 9. RCW 43.160.200 and 1991 c 314 s 23 are each amended to read as follows:

(1) The economic development account is created within the public facilities construction loan revolving fund under RCW 43.160.080. Moneys in the account may be spent only after appropriation. Expenditures from the account may be used only for the purposes of RCW 43.160.010(4), to assist military impacted communities as designated under section 2 of this act, and this section. The account is subject to allotment procedures under chapter 43.88 RCW.

(2) Applications under this section for assistance from the economic development account are subject to all of the applicable criteria set forth under this chapter, as well as procedures and criteria established by the board, except as otherwise provided.

(3) Eligible applicants under this section are limited to political subdivisions of the state in timber impact areas that demonstrate, to the satisfaction of the board, the local economy's dependence on the forest products industry.

(4) Applicants must demonstrate that their request is part of an economic development plan consistent with applicable state planning requirements. Applicants must demonstrate that tourism projects have been approved by the local government and are part of a regional tourism plan approved by the local and regional tourism organizations. Industrial projects must be approved by the local government and the associate development organization.

(5) Publicly owned projects may be financed under this section upon proof by the applicant that the public project is a necessary component of, or constitutes in whole, a tourism project.

(6) Applications must demonstrate local match and participation. Such match may include: Land donation, other public or private funds or both, or other means of local commitment to the project.

(7) Board financing for feasibility studies shall not exceed twenty-five thousand dollars per study. Board funds for feasibility studies may be provided as a grant and require a dollar for dollar match with up to one-half in-kind match allowed.

(8) Board financing for tourism projects shall not exceed two hundred fifty thousand dollars. Other public facility projects under this section shall not exceed five hundred thousand dollars. Loans with flexible terms and conditions to meet the needs of the applicants shall be provided. Grants may also be authorized, but only when, and to the extent that, a loan is not reasonably possible, given the limited resources of the political subdivision.

(9) The board shall develop guidelines for allowable local match and feasibility studies.

(10) Applications under this section need not demonstrate evidence that specific private development or expansion is ready to occur or will occur if funds are provided.

(11) The board shall establish guidelines for making grants and loans under this section to ensure that the requirements of this chapter are complied with. The guidelines shall include:

(a) A process to equitably compare and evaluate applications from competing communities.

(b) Criteria to ensure that approved projects will have a high probability of success and are likely to provide long-term economic benefits to the community. The criteria shall include: (i) A minimum amount of local participation, determined by the board per application, to verify community support for the project; (ii) an analysis that establishes the project is feasible using standard economic principles; and (iii) an explanation from the applicant regarding how the project is consistent with the communities' economic strategy and goals.

(c) A method of evaluating the impact of the loans or grants on the economy of the community and whether the loans or grants achieved their purpose.

Sec. 10. RCW 43.168.020 and 1991 c 314 s 19 are each amended to read as follows:

Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

(1) "Committee" means the Washington state development loan fund committee.

(2) "Department" means the department of community development.

(3) "Director" means the director of the department of community development.

(4) "Distressed area" means: (a) A county which has an unemployment rate which is twenty percent above the state average for the immediately previous three years; (b) a metropolitan statistical area, as defined by the office of federal statistical policy and standards, United States department of commerce, in which the average level of unemployment for the calendar year immediately preceding the year in which an application is filed under this chapter exceeds the average state unemployment for such calendar year by twenty percent. Applications under this subsection (4)(b) shall be filed by April 30, 1989; (c) an area within a county, which area: (i) Is composed of contiguous census tracts; (ii) has a minimum population of five thousand persons; (iii) has at least seventy percent of its families and unrelated individuals with incomes below eighty percent of the county's median income for families and unrelated individuals; and (iv) has an unemployment rate which is at least forty percent higher than the county's unemployment rate; or (d) a county designated as a timber impact area under RCW 43.31.601 or military impacted area as designated under section 2 of this act if an application is filed by July 1, ((~~1993~~)) 1995. For purposes of this definition, "families and unrelated individuals" has the same meaning that is ascribed to that term by the federal department of housing and urban development in its regulations authorizing action grants for economic development and neighborhood revitalization projects.

(5) "Fund" means the Washington state development loan fund.

(6) "Local development organization" means a nonprofit organization which is organized to operate within an area, demonstrates a commitment to a long-standing effort for an economic development program, and makes a demonstrable effort to assist in the employment of unemployed or underemployed residents in an area.

(7) "Project" means the establishment of a new or expanded business in an area which when completed will provide employment opportunities. "Project" also means the retention of an existing business in an area which when completed will provide employment opportunities.

Sec. 11. RCW 70.47.115 and 1992 c 21 s 7 are each amended to read as follows:

(1) The administrator, when specific funding is provided and where feasible, shall make the basic health plan available in timber impact areas and military impacted areas designated under section 2 of this act. The administrator shall prioritize making the plan available under this section to military impacted areas as designated under section 2 of this act or the timber impact areas meeting the following criteria, as determined by the employment security department: (a) A lumber and wood products employment location quotient at or above the state average; (b) a direct lumber and wood products job loss of one hundred positions or more; and (c) an annual unemployment rate twenty percent above the state average.

(2) Persons assisted under this section shall meet the requirements of enrollee as defined in RCW 70.47.020(4).

(3) For purposes of this section, "timber impact area" means:

Sec. 12. 1991 c 314 s 26 (uncodified) is amended to read as follows:

(1) For the period beginning July 1, 1991, and ending June 30, ((~~1993~~)) 1995, in timber impact areas or military impacted areas the public works board may award low-interest or interest-free loans to local governments for construction of new public works facilities that stimulate economic growth or diversification.

(2) For the purposes of this section and section 27 of this act:

(a) "Public facilities" means bridge, road and street, domestic water, sanitary sewer, and storm sewer systems.

(b) "Timber impact area" means a county having a population of less than five hundred thousand, or a city or town located within a county having a population of less than five hundred thousand, and meeting two of the following three criteria, as determined by the employment security department, for the most recent year such data is available: (i) A lumber and wood products employment location quotient at or above the state average; (ii) projected or actual direct lumber and wood products job losses of one hundred positions or more, except counties having a population greater than two hundred thousand but less than five hundred thousand must have direct lumber and wood products job losses of one thousand positions or more; or (iii) an annual unemployment rate twenty percent or more above the state average.

(3) The loans may have a deferred payment of up to five years but shall be repaid within twenty years. The public works board may require other terms and conditions and may charge such rates of interest on its loans as it deems appropriate to carry out the purposes of this section. Repayments shall be made to the public works assistance account.

(4) The board may make such loans irrespective of the annual loan cycle and reporting required in RCW 43.155.070.

Sec. 13. 1991 c 314 s 27 (uncodified) is amended to read as follows:

(1) As authorized by section 26 of this act, the board shall establish criteria for awarding loans to local governments in timber impact areas and military impacted areas including, but not limited to, the following:

(a) If a county or city, the local government must be imposing the tax authorized by chapter 82.46 RCW at a rate of at least one-quarter of one percent;

(b) The local government must have in place a capital improvement plan meeting standards established by the board and an economic development plan meeting standards established by the department;

(c) The local economy must have experienced or be about to experience employment losses due to the timber economy or changes in military spending;

(d) The proposed project must provide an opportunity to create or retain jobs within the local economy. Priority may be given to those projects that provide an opportunity to retain or create jobs for the pool of local workers affected by the timber economy or changes in military spending;

(e) The local government must provide reasonable assurances of its ability to repay the debt; and

(f) The local government must meet any additional guidelines and criteria established by the board for awarding loan funds.

(2) Existing debt or other financial obligations of the local government shall not be refinanced under this section and section 26 of this act.

(3) The board shall award loans only to those projects that meet the criteria and will fulfill the purpose of this section and section 26 of this act. Any funds not obligated at the close of the biennium shall be returned to the public works assistance account.

Sec. 14. 1991 c 314 s 32 (uncodified) is amended to read as follows:

RCW 43.160.076 and 1991 c 314 s 24 & 1985 c 446 s 6 are each repealed effective June 30, ((~~1993~~)) 1995.

Sec. 15. 1991 c 314 s 33 (uncodified) is amended to read as follows:

Section 23 of this act expires June 30, ((~~1993~~)) 1995.

Sec. 16. 1991 c 314 s 34 (uncodified) is amended to read as follows:

Section 25 of this act shall take effect July 1, ((~~1993~~)) 1995.

NEW SECTION. Sec. 17. A new section is added to chapter 28B.50 RCW to read as follows:

(1) After notification by the governor that a community is designated a military impacted area under section 2 of this act, the state board for community and technical colleges shall administer a program designed to provide higher education opportunities to defense dependent workers negatively impacted by a reduction in military spending in their community and their unemployed spouses who are enrolled in a community or technical college for ten or more credit hours per quarter. In administering the program, the state board for community and technical colleges shall do the following:

(a) With the assistance of an advisory committee, design a procedure for selecting workers to participate in the program;

(b) Allocate funding to community and technical colleges attended by participants;

(d) Report to the legislature annually each December on the status of the program.

(2) Unemployed spouses of eligible defense dependent workers may participate in the program, but tuition and fees may be waived under the program only for the worker or the spouse but not both.

(3) The boards of trustees of the community and technical colleges shall waive tuition and fees for program participants, for a maximum of six quarters within a two-year period.

(4) During a biennium, the number of full-time equivalent students to be served in this program is determined by the applicable omnibus appropriations act, and is in addition to the community college enrollment level funded by the applicable omnibus appropriations act.

NEW SECTION. Sec. 18. A new section is added to chapter 28B.80 RCW to read as follows:

After notification by the governor that a community is designated a military impacted area under section 2 of this act, the board shall administer a program designed to provide upper division higher education opportunities to defense dependent workers, their spouses, and others in military impacted areas. In administering the program, the board shall do the following:

(1) Distribute funding for institutions of higher education to service placebound students in the military impacted areas as designated under section 2 of this act;

(2) Appoint an advisory committee to assist the board in program design and future project selection;

(3) Monitor the program and report on student progress and outcome; and

(4) Report to the legislature each December on the status of the program.

NEW SECTION. Sec. 19. A new section is added to chapter 28B.80 RCW to read as follows:

(1) After notification by the governor that a community is designated a military impacted area under section 2 of this act, the board shall contract with institutions of higher education to provide upper division classes to serve additional placebound students in military impacted areas. The number of full-time equivalent students served in this manner is determined by the applicable omnibus appropriations act. The board may direct that all the full-time equivalent enrollments be served in one of the eligible military impacted areas if it determines that this would be the most viable manner of establishing the program and using available resources. The institutions shall utilize telecommunication technology, if available, to carry out the purposes of this section. The institutions providing the service shall waive the tuition, service, and activities fees for defense dependent workers or their unemployed spouses enrolled as full-time equivalent students allocated to the college under this section.

(2) Unemployed spouses of eligible defense dependent workers may participate in the program, but tuition and fees may be waived under the program only for the worker or the spouse but not both.

(3) For an eligible participant, tuition must be waived for a maximum of four semesters or six quarters within a two-year time period and the participant must be enrolled for a minimum of ten credits per semester or quarter.

NEW SECTION. Sec. 20. A new section is added to chapter 28B.80 RCW to read as follows:

Defense dependent workers and their spouses must receive priority for attendance in upper division courses allocated under section 19 of this act. Remaining allocations may be distributed to others in the military impacted area.

NEW SECTION. Sec. 21. A new section is added to chapter 50.12 RCW to read as follows:

(1) After notification by the governor that a community is designated a military impacted area under section 2 of this act, and subject to the availability of state or federal funds, the employment security department, as a member of the agency response team under section 2 of this act, shall consult with and may subcontract with local educational institutions, local businesses, local labor organizations, local associate development organizations, local private industry councils, local social service organizations, and local governments in carrying out a program of training and services, including entrepreneurial training and training through the self-employment and enterprise development program, for dislocated defense workers in military impacted areas.

(2) The department shall conduct a survey to determine the actual future employment needs and jobs skills in military impacted areas.

(3) The department shall coordinate the services provided in this section with all other services provided by the department and with the other economic recovery efforts undertaken by state and local government agencies on behalf of the military impacted areas.

(4) The department shall make every effort to procure additional federal and other moneys for the efforts enumerated in this section.

(5) For the purposes of this section, "military impacted areas" means communities designated as military impacted areas under section 2 of this act.

NEW SECTION. Sec. 22. A new section is added to chapter 50.22 RCW to read as follows:

(1) After the governor notifies the department that a community has been designated a military impacted area under section 2 of this act, an additional benefit period is established for counties identified under subsection (2) of this section beginning on the first Sunday after the effective date of this section and for the civilian military defense industry beginning with the third week after the first Sunday after the effective date of this section. Benefits must be paid as provided in subsection (3) of this section to exhaustees eligible under subsection (4) of this section.

(2) The additional benefit period begins with the third week after a week in which the commissioner determines that a county contains a military impacted area. The additional benefit period for a county may end no sooner than fifty-two weeks after the additional benefit period begins.

(3) Additional benefits must be paid as follows:

(a) The total additional benefit amount is fifty-two times the individual's weekly benefit amount, reduced by the total amount of regular benefits and extended benefits paid, or deemed paid, with respect to the benefit year. Additional benefits are not payable for weeks more than one year beyond the end of the benefit year of the regular claim, and are payable for up to five weeks following the completion of the training required under this section.

(b) The weekly benefit amount must be calculated as specified in RCW 50.22.040.

(c) Benefits paid under this section must be paid under the same terms and conditions as regular benefits and may not be charged to the experience rating account of individual employers. The additional benefit period is suspended with the start of an extended benefit period, or a totally federally funded benefit program, with eligibility criteria and benefits comparable to the program established under this section, and resume the first week following the end of the federal program.

(4) An additional benefit eligibility period is established for an exhaustee who:

(a)(i) At the time of last separation from employment, resided in or was employed in a county identified under subsection (2) of this section; or

(ii) During his or her base year, earned wages in at least six hundred eighty hours in the civilian military defense industry, which is determined by the department;

(b)(i) Has received notice of termination or lay off; and

(ii) Is unlikely to return to employment in his or her principal occupation or previous industry because of a diminishing demand within his or her labor market for his or her skills in the occupation or industry;

(c)(i) Is notified by the department of the requirements of this section and develops an individual training program that is submitted to the commissioner for approval by sixty days after the individual is notified of the requirements of this section, and enters the approved training program not later than ninety days after the date of the individual's termination or layoff, or ninety days after the effective date of this section, whichever is later, unless the department determines that the training is not available during the ninety-day period, in which case the individual shall enter training as soon as it is available; or

(ii) Is enrolled in training approved under this section on a full-time basis and maintains satisfactory progress in the training; and

(d) Does not receive a training allowance or stipend under the provisions of federal or state law.

(5) For the purposes of this section:

(a) "Training program" means:

(i) A remedial education program determined to be necessary after counseling at the educational institution in which the individual enrolls under his or her approved training program; or

(ii) A vocational training program at an educational institution that:

(A) Is training for a labor demand occupation;

(B) Is likely to facilitate a substantial enhancement of the individual's marketable skills and earning power; and

(C) Does not include on-the-job training or other training under which the individual is paid by an employer for work performed by the individual during the time that the individual receives additional benefits under subsection (1) of this section.

(b) "Educational institution" means an institution of higher education as defined in RCW 28B.10.016 or an educational institution as defined in RCW 28C.04.410(3).

(c) "Training allowance or stipend" means discretionary use, cash-in-hand payments available to the individual to be used as the individual sees fit, but does not mean direct or indirect compensation for training costs such as tuition or books and supplies.

(6) The commissioner shall adopt rules necessary to implement this section.

NEW SECTION. Sec. 23. RCW 43.160.900 and 1987 c 422 s 10, 1985 c 446 s 25, & 1982 1st ex.s. c 40 s 10 are each repealed.

NEW SECTION. Sec. 24. 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. 25. This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and shall take effect immediately.