AN ACT Relating to state government; amending RCW 41.04.230; and adding a new chapter to Title 43 RCW.

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

NEW SECTION. Sec. 1. The purpose of this chapter is to establish a new nontax source of revenue through the sale of Washington state savings bonds. The proceeds provide an opportunity for the public to make voluntary investments in capital projects contributing to a vital economy, necessary to the public's health and safety, or desirable to enhance the quality of life in Washington. These low denomination tax exempt bonds shall be issued with specific projects in mind so that the public may demonstrate its support for these projects through the purchase of the bonds while gaining access to tax exempt investments.

NEW SECTION. Sec. 2. This chapter may be known and cited as the Washington state savings bond act of 1985.

NEW SECTION. Sec. 3. For the purpose of implementing the intent of this chapter, the state finance committee is authorized to issue general obligation bonds of the state of Washington in the maximum sum of one hundred million dollars each biennium or so much thereof as may be approved by the legislature in any general or special appropriation bill enacted by the legislature.

NEW SECTION. Sec. 4. The state finance committee may issue the bonds in the denomination of one hundred dollars or more and in such form as shall minimize administrative costs. It shall establish a program that allows for the purchase of the bonds at such time and manner as will maximize public participation. To this end, the state finance committee shall authorize and promote the use of payroll deductions for the purchase of the bonds and may contract with financial institutions to assist in administration of this chapter.

NEW SECTION. Sec. 5. The state finance committee shall establish the interest rates and maturity schedule for redemption of the bonds but in no event may the maturity exceed ten years.

NEW SECTION. Sec. 6. The proceeds from the sale of the bonds authorized by the legislature shall be deposited in the state savings bond account hereby created in the general fund and shall be used exclusively for the purposes specified in this chapter and for the payment of expenses incurred in the issuance, sale, and retirement of the bonds. On a biennial basis, the legislature shall designate projects which are public in nature and which preserve the tax exempt status of the bonds and shall rank projects by order of priority. The proceeds from this fund shall be extended to the designated legislative priorities in order. No lower priority project may be funded until each higher priority project is fully funded. No project may be funded more than one time nor for a period greater than twenty-four months, except in the case of reappropriation of unexpended project funds from the previous biennium.

NEW SECTION. Sec. 7. (1) The state savings bond redemption fund hereby created in the state treasury shall be used for the payment of the principal of and interest on the bonds authorized in section 3 of this act which are issued with serial maturities.

The state finance committee shall, on or before June 30th of each year, certify to the state treasurer the amount needed in the ensuing twelve months to meet the bond retirement and interest requirements. Not less than thirty days prior to the date on which any interest or principal and interest payment is due, the state treasurer shall withdraw from any general state revenues received in the state treasury and deposit in the state savings bond redemption fund an amount equal to the amount certified by the state finance committee to be due on the payment date.

Bonds issued under section 3 of this act shall state that they are a general obligation of the state of Washington, shall pledge the full faith and credit of the state to the payment of the principal thereof and the interest thereon, and shall contain an unconditional promise to pay the principal and interest as the same shall become due.

The owner and holder of each of the bonds or the trustee for the owner and holder of any of the bonds may by mandamus or other appropriate proceeding require the transfer and payment of funds as directed in this section.

(2) As to any of the bonds which are issued in form payable as to both principal and interest only at maturity:

(a) The state finance committee shall, on or before June 30 of each year, certify to the state treasurer:

(i) The amount equal to the amount to be paid by the state on the bonds at their maturity, divided by the number of years between their date of issuance and their date of maturity;

(ii) Reduced by the earnings which have accrued during the immediately preceding twelve months from the investment of any money on deposit in the state savings bond redemption fund for the bonds.

(b) On or before July 31 of each year, the state treasurer shall withdraw from any general state revenues received in the state treasury the amount certified by the state finance committee and deposit this amount in the state savings bond redemption fund for purposes of payment of the bonds at maturity. If the earnings on the investment of money deposited in the state savings bond redemption fund for the bonds exceeds the amount described in (a)(i) of this subsection in any year, the state treasurer shall withdraw this excess from the fund and deposit the excess in the general fund of the state treasury.

(c) The state treasurer shall account separately for money deposited into the state savings bond redemption fund for these bonds and shall invest the money at a yield not exceeding the yield permitted by law.

NEW SECTION. Sec. 8. Any bonds authorized by this chapter shall be a legal investment for all state funds or funds under state control and for all funds of any other public body.

Sec. 9. Section 5, chapter 59, Laws of 1969 as last amended by section 3, chapter 28, Laws of 1983 1st ex. sess. and RCW 41.04.230 are each amended to read as follows:

Any official of the state authorized to disburse funds in payment of salaries and wages of public officers or employees is authorized, upon written request of the officer or employee, to deduct from the salaries or wages of the officers or employees, the amount or amounts of subscription payments, premiums, contributions, or continuation thereof, for payment of the following:

(1) Credit union deductions: PROVIDED, That the credit union is organized solely for public employees: AND PROVIDED FURTHER, That twenty-five or more employees of a single state agency or a total of one hundred or more state employees of several agencies have authorized such a deduction for payment to the same credit union.

(2) Parking fee deductions: PROVIDED, That payment is made for parking facilities furnished by the agency or by the department of general administration.

(3) U.S. savings bond deductions: PROVIDED, That a person within the particular agency shall be appointed to act as trustee. The trustee will receive all contributions; purchase and deliver all bond certificates; and keep such records and furnish such bond or security as will render full accountability for all bond contributions.

(4) Washington state savings bond deductions: PROVIDED, That a person within the particular agency shall be appointed to act as trustee. The trustee will receive all contributions; purchase and deliver all bond certificates; and keep such records and furnish such bond or security as will render full accountability for all bond contributions.

(5) Board, lodging or uniform deductions when such board, lodging and uniforms are furnished by the state, or deductions for academic tuitions or fees or scholarship contributions payable to the employing institution.

((~~(5)~~)) (6) Dues and other fees deductions: PROVIDED, That the deduction is for payment of membership dues to any professional organization formed primarily for public employees or college and university professors: AND PROVIDED, FURTHER, That twenty-five or more employees of a single state agency, or a total of one hundred or more state employees of several agencies have authorized such a deduction for payment to the same professional organization.

((~~(6)~~)) (7) Labor or employee organization dues may be deducted in the event that a payroll deduction is not provided under a collective bargaining agreement under the provisions of RCW 41.06.150: PROVIDED, That twenty-five or more officers or employees of a single agency, or a total of one hundred or more officers or employees of several agencies have authorized such a deduction for payment to the same labor or employee organization: PROVIDED, FURTHER, That labor or employee organizations with five hundred or more members in state government may have payroll deduction for employee benefit programs.

((~~(7)~~)) (8) Insurance contributions to the trustee of contracts for payment of premiums under contracts authorized by the state employees' insurance board.

Deductions from salaries and wages of public officers and employees other than those enumerated in this section or by other law, may be authorized by the director of financial management for purposes clearly related to state employment or goals and objectives of the agency and for plans authorized by the state employees' insurance board.

The authority to make deductions from the salaries and wages of public officers and employees as provided for in this section shall be in addition to such other authority as may be provided by law: PROVIDED, That the state or any department, division, or separate agency of the state shall not be liable to any insurance carrier or contractor for the failure to make or transmit any such deduction.

NEW SECTION. Sec. 10. 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. 11. Sections 1 through 8 of this act shall constitute a new chapter in Title 43 RCW.