AN ACT Relating to economic development; amending RCW 43.160.060 and 43.160.080; and creating a new section.

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

Sec. 1. Section 6, chapter 40, Laws of 1982 1st ex. sess. as amended by section 3, chapter 60, Laws of 1983 1st ex. sess. and RCW 43.160.060 are each amended to read as follows:

The board is authorized to make direct loans to political subdivisions of the state for the purposes of assisting the political subdivisions in financing the cost of public facilities, including the cost of acquisition and development of land and improvements for public facilities, as well as the acquisition, construction, rehabilitation, alteration, expansion, or improvement of the facilities. ((~~Grants~~)) A grant may also be authorized for purposes designated in this chapter, but only when ((~~grants are uniquely required~~)), and to the extent that, a loan is not reasonably possible, given the limited resources of the political subdivision.

Application for funds shall be made in the form and manner as the board may prescribe. In making grants or loans the board shall conform to the following requirements:

(1) The board shall not make a grant or loan unless the application includes convincing evidence that a specific private development or expansion is ready to occur and will only occur if the grant or loan is made.

(2) The board shall only make grants or loans for those projects which would result in specific private developments or expansions (a) in manufacturing, production, assembly, warehousing, and industrial distribution, or (b) which substantially support the trading of goods or services outside of the state's borders. In no instance may the board make a grant or loan for a project where the primary purpose is to facilitate or promote a retail shopping development or expansion unless it can be reasonably estimated that at least twenty percent of the retail trade would be to persons residing outside the state's borders.

(3) The board shall prioritize each proposed project according to the number of jobs it would create after the project is completed and according to the unemployment rate in the area in which the jobs would be located. As long as there is more demand for loans or grants than there are funds available for loans or grants, the board is instructed to fund ((~~those~~)) projects ((~~which will lead to the greatest employment once the initial project is completed~~)) in order of their priority.

(4) The board may not make a grant or loan for any project that probably would result in a development or expansion that would displace existing jobs in any other community in the state.

(5) A responsible official of the political subdivision shall be present during board deliberations and provide information that the board requests.

((~~Public facilities funds shall be used for projects to~~)) (6) The board shall only make loans or grants for projects which it finds will improve the opportunities for the successful maintenance, establishment, or expansion of industrial or commercial plants or will otherwise assist in the creation or retention of long-term economic opportunities. ((~~The board shall determine whether or not the projects will assist in alleviating unemployment.~~))

(7) Before any loan or grant application is approved, the political ((~~subdivisions of the state~~)) subdivision seeking the loan or grant must demonstrate to the community economic revitalization board that no other timely source of funding is available to ((~~them~~)) it at costs reasonably similar to financing available from the community economic revitalization board.

Sec. 2. Section 8, chapter 40, Laws of 1982 1st ex. sess. as last amended by section 12, chapter 257, Laws of 1984 and RCW 43.160.080 are each amended to read as follows:

There shall be a fund known as the public facilities construction loan revolving fund((~~, which shall consist of~~)). This fund shall consist of the following moneys which shall be deposited into it: (1) All moneys collected under this chapter, except moneys of the board collected in connection with the issuance of industrial development revenue bonds under RCW 43.160.110 through 43.160.170((~~, and~~)); (2) all principal and interest payments which are on loans made by the previously existing economic assistance authority and which are received on or after the effective date of this 1985 act; (3) any moneys appropriated or transferred to it by law((~~: PROVIDED, That seventy-five percent of~~)); and (4) all principal and interest payments on loans made with the proceeds deposited in the fund under section 901, chapter 57, Laws of 1983 1st ex. sess. ((~~shall be deposited in the general fund as reimbursement for debt service payments on the bonds authorized in RCW 43.83.184.~~)) The state treasurer shall be custodian of the revolving fund. Disbursements from the revolving fund shall be on authorization of the board. In order to maintain an effective expenditure and revenue control, the public facilities construction loan revolving fund shall be subject in all respects to chapter 43.88 RCW, but no appropriation is required to permit expenditures and payment of obligations from the fund.

Moneys in this fund not needed to meet the current expenses and obligations of the board shall be invested in the manner authorized for moneys in revolving funds. Any interest earned shall be deposited in this fund and shall be used for the purposes specified in this chapter. The state treasurer shall render reports to the board advising of the status of any funds invested, the market value of the assets as of the date the statement is rendered, and the income received from the investments during the period covered by the report.

NEW SECTION. Sec. 3. The state treasurer shall immediately transfer to the public facilities construction loan revolving fund any moneys existing in that special account containing moneys which were paid as principal and interest on loans made by the economic assistance authority or which would have been deposited under former RCW 43.31A.320 had it not been repealed.