H-3770              _______________________________________________

                                                   HOUSE BILL NO. 1654

                        _______________________________________________

State of Washington                              49th Legislature                              1986 Regular Session

By Representatives Haugen and May

Read first time 1/21/86 and referred to Committee on Local Government.

AN ACT Relating to local government debt computation; amending RCW 39.36.030; and adding a new section to chapter 39.36 RCW.

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

        Sec. 1.  Section 2, chapter 143, Laws of 1917 as amended by section 1, chapter 123, Laws of 1921 and RCW 39.36.030 are each amended to read as follows:

          Whenever it shall be necessary to compute the indebtedness of a taxing district for bonding or any other indebtedness purposes, taxes levied for the current year and cash on hand received for the purpose of carrying on the business of such taxing district for such current year shall be considered as an asset only as against indebtedness incurred during such current year which is payable from such taxes or cash on hand:  PROVIDED, HOWEVER, That all taxes levied for the payment of bonds, warrants or other public debts of such taxing district, shall be deemed a competent and sufficient asset of the taxing district to be considered in calculating the constitutional debt limit or the debt limit prescribed by this chapter for any taxing district:  PROVIDED, That the provisions of this section shall not apply in computing the debt limit of a taxing district in connection with bonds authorized pursuant to a vote of the electors at an election called prior to March 1, 1917:  AND PROVIDED FURTHER, That there shall be excluded from the computation of the level of indebtedness, pursuant to the limitations imposed by RCW 39.36.020, the amount of loans between the state and any taxing district authorized pursuant to RCW 43.155.060.

NEW SECTION. Sec. 2.  A new section is added to chapter 39.36 RCW to read as follows:

          Prior to December 1, 1986, the house local government committee and the senate committee on governmental operations shall undertake a joint study of local government debt limitations.  Such study shall include an analysis of the degree which taxing districts have utilized existing voter and nonvoter approved debt issuance authority, the degree to which increased debt authority is necessary to accommodate substitution of state and federal loan programs for former grant-in-aid programs, and the degree to which issuance of debt may provide for a greater long-run efficient utilization of resources to meet prospective capital needs.