AN ACT Relating to local government; amending RCW 84.09.030; adding a new section to chapter 27.12 RCW; adding a new section to chapter 84.55 RCW; adding a new chapter to Title 39 RCW; creating new sections; and providing an expiration date.

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

NEW SECTION. Sec. 1. Any agreement or contract between two taxing districts other than the state which is otherwise authorized by law may be made contingent upon a particular property tax levy rate of an identified taxing district other than the state where such rate affects the regular property tax rate of one of the parties to the contract and therefore affects the party's resources with which to perform under the contract.

This section shall expire December 31, 1987.

NEW SECTION. Sec. 2. Any taxing district other than the state may transfer funds to another taxing district other than the state where the regular property tax levy rate of the second district may affect the regular property tax levy rate of the first district and where such transfer is part of an agreement whereby proration or reduction of property taxes is lessened or avoided.

This section shall expire December 31, 1987.

NEW SECTION. Sec. 3. A new section is added to chapter 84.55 RCW to read as follows:

The regular property tax levies for each taxing district other than the state for taxes due in 1987 through 1990 may be set at the amount which would otherwise be allowed under this chapter if the regular property tax levy for the district for taxes due in 1986 and 1987 had been set at the full amount allowed under this chapter.

This section shall expire December 31, 1990.

NEW SECTION. Sec. 4. A new section is added to chapter 27.12 RCW to read as follows:

An intercounty rural library district shall be dissolved, and a separate rural county library district established in each of the counties within which the intercounty rural library district was located, upon the adoption of a resolution providing for such by the county legislative authority in each of the counties within which the intercounty rural library district is located: PROVIDED, That such action shall not be taken unless it is requested by resolution of the board of trustees of the intercounty rural library district. The boundaries of each rural county library so created shall be the same as those portions of the intercounty rural library district in that county. Prior to the adoption of these resolutions, the county legislative authority of each of these counties, acting as the respective boards of trustees of the rural county library districts that will be created upon the dissolution of the intercounty rural library district, shall have entered into a contract creating a regional library out of the rural county library districts. The contract creating the regional library shall be adopted, in all other respects, under the provisions of RCW 27.12.080.

Indebtedness of the intercounty rural library district shall remain in effect. Excess property tax levies authorized to retire voter approved general obligation indebtedness of an intercounty rural library district shall continue to be imposed and applied to retire the general obligation indebtedness. Where regular property tax levies are necessary to retire nonvoter approved general obligation indebtedness of the intercounty rural library district, regular property tax levies shall continue to be imposed within the boundaries of the dissolved intercounty rural library district at a rate necessary to retire the indebtedness, but not exceeding a rate that the intercounty rural library district otherwise could have imposed.

The maximum regular property tax rate that each of these newly created rural county library districts may impose in the initial year of their existence shall be equal to the regular property tax levy rate that the intercounty rural library district could have imposed in the year in which it is dissolved, not including any proration that would have occurred, less any levy rate continued to be imposed in the boundaries of the dissolved intercounty rural library district to retire any nonvoter approved general obligation indebtedness of the dissolved intercounty rural library district that still remains outstanding.

Where property tax levies of such an intercounty rural library district have been imposed, but not collected, the tax collections shall be distributed to the regional library. The assets and liabilities of the intercounty rural library district shall become assets and liabilities of the regional library.

NEW SECTION. Sec. 5. The local governance study commission created in RCW 43.63A.252 shall undertake a study of the financing of those junior taxing districts subject to the prorating of property taxes pursuant to RCW 84.52.010. The study shall examine the extent to which those districts are dependent either directly or indirectly on property tax revenues, the impact of prorating of property taxes on the ability of those districts to maintain acceptable levels of services, and the need for a diversified resource base for such districts in anticipation of lessened or negative growth in property values. If the study reveals the existing funding mechanism to be inadequate to meet the long-term financing needs of the services provided by those districts, then alternative proposals shall be recommended to the legislature concerning the provision and financing of those services, and those junior taxing districts are put on notice that, due to extreme limitations in the availability of regular property taxing authority for junior taxing districts, these recommendations may involve significant changes from the status quo. The commission shall report its findings by December 1, 1986.

Sec. 6. Section 84.09.030, chapter 15, Laws of 1961 as last amended by section 9, chapter 203, Laws of 1984 and RCW 84.09.030 are each amended to read as follows:

For the purposes of property taxation and the levy of property taxes the boundaries of counties, cities and all other taxing districts shall be the established official boundaries of such districts existing on the first day of March of the year in which the levy is made, and no such levy shall be made for any taxing district whose boundaries were not duly established on the first day of March of such year: PROVIDED, That ((for the year 1981 only the boundaries of library districts shall be the established official boundaries existing on the first day of October: PROVIDED FURTHER, That for the year 1984 only, boundaries of public hospital districts shall be the established official boundaries existing on the first day of April)) the official boundaries of rural county library districts created pursuant to section 4 of this 1986 act shall be established on the first day of October in the year in which they are created. In any case where any instrument setting forth the official boundaries of any newly established taxing district, or setting forth any change in such boundaries, is required by law to be filed in the office of the county auditor or other county official, said instrument shall be filed in triplicate. The officer with whom such instrument is filed shall transmit two copies to the county assessor.

NEW SECTION. Sec. 7. 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. 8. Sections 1 and 2 of this act are supplementary and in addition to any other authority granted by law and shall not be construed to limit any other law.

NEW SECTION. Sec. 9. Sections 1 and 2 of this act shall constitute a new chapter in Title 39 RCW.