AN ACT Relating to lake improvements; adding a new chapter to Title 36 RCW; adding a new section to chapter 35.21 RCW; and repealing RCW 90.24.010, 90.24.020, 90.24.030, 90.24.040, 90.24.050, 90.24.060, 90.24.065, and 90.24.070.

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

NEW SECTION. Sec. 1. The legislature finds that the environmental, recreational, and aesthetic values of many of the state's lakes are threatened by eutrophication and other deterioration and that existing governmental authorities are unable to adequately improve and maintain the quality of the state's lakes.

It is the purpose of this chapter to establish a governmental mechanism by which property owners can embark on a program of lake improvement and maintenance for their and the general public's benefit, health, and welfare. Public property, including state property, shall be considered the same as private property in this chapter, except liens for special assessments shall not extend to public property. Lake bottom property shall not be considered to be benefited, shall not be subject to special assessments, and shall not receive voting rights under this chapter.

NEW SECTION. Sec. 2. Any county may create lake management districts to finance the improvement and maintenance of lakes located within or partially within the boundaries of the county. All or a portion of a lake and the adjacent land areas may be included within one or more lake management districts. More than one lake, or portions of lakes, and the adjacent land areas may be included in a single lake management district. A lake management district may be created for a period of up to ten years.

Special assessments may be imposed on the property included within a lake management district to finance lake improvement and maintenance activities, including: (1) The control or removal of aquatic plants and vegetation; (2) water quality; (3) the control of water levels; (4) storm water diversion and treatment; (5) agricultural waste control; (6) studying lake water quality problems and solutions; (7) cleaning and maintaining ditches and streams entering or leaving the lake; and (8) the related administrative, engineering, legal, and operational costs, including the costs of creating the lake management district.

Special assessments may be imposed annually on all the land in a lake management district for the duration of the lake management district without a related issuance of lake management district bonds. Special assessments also may be imposed in the manner of special assessments in a local improvement district with each landowner being given the choice of paying the entire special assessment in one payment, or to paying installments, with lake management district bonds being issued to obtain moneys not derived by the initial full payment of the special assessments, and the installments covering all of the costs related to issuing, selling, and redeeming the lake management district bonds.

NEW SECTION. Sec. 3. A lake management district may be initiated upon either the adoption of a resolution of intention by a county legislative authority or the filing of a petition signed by ten landowners or twenty-five percent of the landowners within the proposed lake management district, whichever is greater. A petition or resolution of intention shall set forth: (1) The nature of the lake improvement or maintenance activities proposed to be financed; (2) the amount of money proposed to be raised by special assessments; (3) whether the special assessments will be imposed annually for the duration of the lake management district, or the full special assessments will be imposed at one time, with the possibility of installments being made to finance the issuance of lake management district bonds, or both methods; (4) the number of years proposed for the duration of the lake management district; and (5) the proposed boundaries of the lake management district.

The county legislative authority may require the posting of a bond of up to five thousand dollars before the county considers the proposed creation of a lake management district initiated by petition. The bond may only be used by the county to finance its costs in studying, holding hearings, making notices, preparing special assessment rolls, and conducting elections related to the lake management district if the proposed lake management district is not created.

A resolution of intention shall also designate the number of the proposed lake management district, and fix a date, time, and place for a public hearing on the formation of the proposed lake management district. The date for the public hearing shall be at least thirty days and no more than ninety days after the adoption of the resolution of intention unless an emergency exists.

Petitions shall be filed with the county legislative authority. The county legislative authority shall determine the sufficiency of the signatures, which shall be conclusive upon all persons. No person may withdraw his or her name from a petition after it is filed. If the county legislative authority determines a petition to be sufficient and the proposed lake management district appears to be in the public interest and the financing of the lake improvement or maintenance activities is feasible, it shall adopt a resolution of intention, setting forth all of the details required to be included when a resolution of intention is initiated by the county legislative authority.

NEW SECTION. Sec. 4. Notice of the public hearing shall be published in at least two consecutive issues of a newspaper of general circulation in the proposed lake management district, the date of the first publication to be at least fifteen days prior to the date fixed for the public hearing by the resolution of intention. Notice of the public hearing shall also be given to the owner or reputed owner of any lot, tract, parcel of land, or other property within the proposed lake management district by mailing the notice at least fifteen days before the date fixed for the public hearing to the owner or reputed owner of the property as shown on the tax rolls of the county assessor at the address shown thereon. Notice of the public hearing shall also be mailed to the departments of fisheries, game, and ecology at least fifteen days before the date fixed for the public hearing.

Notices of the public hearing shall: (1) Refer to the resolution of intention; (2) designate the proposed lake management district by number; (3) set forth a proposed plan describing: (a) The nature of the proposed lake improvement or maintenance activities; (b) the amount of special assessments proposed to be raised by the lake management district; (c) whether the special assessments will be imposed annually for the duration of the lake management district, or the full special assessments will be payable at one time, with the possibility of periodic installments being paid and lake management bonds being issued, or both; and (d) the proposed duration of the lake management district; and (4) indicate the date, time, and place of the public hearing designated in the resolution of intention.

In the case of the notice sent to each owner or reputed owner by mail, the notice shall set forth the estimated amount of the cost of the lake improvement or maintenance activities to be borne by special assessment or annual special assessments on the lot, tract, parcel of land, or other property owned by the owner or reputed owner.

If the county legislative authority has designated a committee of itself or an officer to hear complaints and make recommendations to the full county legislative authority, as provided in section 10 of this act, the notice shall also describe this additional step before the full county legislative authority may adopt a resolution creating the lake management district.

NEW SECTION. Sec. 5. The county legislative authority shall hold a public hearing on the proposed lake management district at the date, time, and place designated in the resolution of intention.

At this hearing the county legislative authority shall hear objections from any person affected by the formation of the lake management district. Representatives of the departments of fisheries, game, and ecology shall be afforded opportunities to make presentations on and comment on the proposal. Members of the public shall be afforded an opportunity to comment on the proposal. The county legislative authority must consider recommendations provided to it by the departments of fisheries, game, and ecology. The public hearing may be extended to other times and dates declared at the public hearing. The county legislative authority may make such changes in the boundaries of the lake management district or such modification in plans for the proposed lake improvement or maintenance activities as it deems necessary. The county legislative authority may not change boundaries of the lake management district to include property that was not included previously without first passing an amended resolution of intention and giving new notice to the owners or reputed owners of property newly included in the proposed lake management district in the manner and form and within the time provided for the original notice. The county legislative authority shall not alter the plans for the proposed lake improvement or maintenance activities to result in an increase in the amount of money proposed to be raised, and shall not increase the amount of money proposed to be raised, without first passing an amended resolution of intention and giving new notice to property owners in the manner and form and within the time provided for the original notice.

NEW SECTION. Sec. 6. After the public hearing, the county legislative authority may adopt a resolution submitting the question of creating the lake management district to the owners of land within the proposed lake management district, including publicly owned land, if the county legislative authority finds that it is in the public interest to create the lake management district and the financing of the lake improvement and maintenance activities is feasible. The resolution shall also include a plan describing the proposed lake improvement and maintenance activities which avoid adverse impacts on fish and wildlife and provide for appropriate measures to protect and enhance fish and wildlife, the number of years the lake management district will exist, the amount to be raised by special assessments, whether the special assessments shall be imposed annually for the duration of the lake management district or only once with the possibility of installments being imposed and lake management bonds being issued, or both, and, if both types of special assessments are proposed to be imposed, the lake improvement or maintenance activities proposed to be financed by each type of special assessment.

No lake management district may be created by a county that includes territory located in another county without the approval of the legislative authority of the other county.

NEW SECTION. Sec. 7. A ballot shall be mailed to each owner or reputed owner of any lot, tract, parcel of land, or other property within the proposed lake management district, including publicly owned land, which ballot shall contain the following proposition:

"Shall lake management district No. ..... be formed?

!sc ,3Yes... .....

!sc ,3No ... ..... "

In addition, the ballot shall contain appropriate spaces for the signatures of the landowner or landowners, or officer authorized to cast such a ballot. Each ballot shall include a description of the property owner's property, the number of acres of such property, and the number of feet of lake front footage, if any. A copy of the instructions and the resolution submitting the question to the landowners shall also be included.

NEW SECTION. Sec. 8. The balloting shall be subject to the following conditions, which shall be included in the instructions mailed with each ballot, as provided in section 7 of this act: (1) All ballots must be signed by the owner or reputed owner of property according to the assessor's tax rolls; (2) each ballot must be returned to the county legislative authority not later than five o'clock p.m. of a specified day, which shall be at least twenty but not more than thirty days after the ballots are mailed; (3) each property owner shall mark his or her ballot for or against the creation of the proposed lake management district, with the ballot weighted so that the property owner has one vote for any amount of property up to one acre and one vote for each additional acre, or major portion of an acre, he or she owns in the proposed lake management district and one vote for each fifty feet, or major portion thereof, of lake frontage he or she owns in the proposed lake management district; and (4) the valid ballots shall be tabulated and a simple majority of the votes cast shall determine whether the proposed lake management district shall be approved or rejected.

NEW SECTION. Sec. 9. If the proposal receives a simple majority vote in favor of creating the lake management district, the county legislative authority shall adopt an ordinance creating the lake management district and may proceed with establishing the special assessments, collecting the special assessments, and performing the lake improvement or maintenance activities. If a proposed lake management district includes more than one lake and its adjacent areas, the lake management district may only be established if the proposal receives a simple majority vote in favor of creating it by the voters on each lake and its adjacent areas. The county legislative authority shall publish a notice in a newspaper of general circulation in a lake management district indicating that such an ordinance has been adopted within ten days of the adoption of the ordinance.

The ballots shall be available for public inspection after they are counted.

NEW SECTION. Sec. 10. A county legislative authority may adopt an ordinance providing for a committee of itself, or an officer, to hold public hearings on the proposed formation of a lake management district and hear objections to the proposed formation as provided in section 5 of this act. The committee or officer shall make a recommendation to the full legislative authority, which need not hold a public hearing on the proposed creation of the lake management district. The full county legislative authority by resolution may approve or disapprove the recommendation and submit the question of creating the lake management district to the property owners as provided in sections 6 through 9 of this act.

NEW SECTION. Sec. 11. No lawsuit may be maintained challenging the jurisdiction or authority of the county legislative authority to proceed with the lake improvement and maintenance activities and creating the lake management district or in any way challenging the validity of the actions or decisions or any proceedings relating to the actions or decisions unless the lawsuit is served and filed no later than forty days after publication of a notice that the ordinance has been adopted ordering the lake improvement and maintenance activities and creating the lake management district. Written notice of the appeal shall be filed with the county legislative authority and clerk of the superior court in the county in which the property is situated.

NEW SECTION. Sec. 12. After a lake management district is created, the county shall prepare a proposed special assessment roll. A separate special assessment roll shall be prepared for annual special assessments if both annual special assessments and special assessments paid at one time are imposed. The proposed special assessment roll shall list: (1) Each separate lot, tract, parcel of land, or other property in the lake management district; (2) the acreage of such property, and the number of feet of lake frontage, if any; (3) the name and address of the owner or reputed owner of each lot, tract, parcel of land, or other property as shown on the tax rolls of the county assessor; and (4) the special assessment proposed to be imposed on each lot, tract, parcel of land, or other property, or the annual special assessments proposed to be imposed on each lot, tract, parcel of land, or other property.

At the time, date, and place fixed for a public hearing, the county legislative authority shall act as a board of equalization and hear objections to the special assessment roll, and at the times to which the public hearing may be adjourned, the county legislative authority may correct, revise, raise, lower, change, or modify the special assessment roll or any part thereof, or set the proposed special assessment roll aside and order a new proposed special assessment roll to be prepared. The county legislative authority shall confirm and approve a special assessment roll by adoption of a resolution.

If a proposed special assessment roll is amended to raise any special assessment appearing thereon or to include omitted property, a new public hearing shall be held. The new public hearing shall be limited to considering the increased special assessments or omitted property. Notices shall be sent to the owners or reputed owners of the affected property in the same manner and form and within the time provided for the original notice.

Objections to a proposed special assessment roll must be made in writing, shall clearly state the grounds for objections, and shall be filed with the governing body prior to the public hearing. Objections to a special assessment or annual special assessments that are not made as provided in this section shall be deemed waived and shall not be considered by the governing body or a court on appeal.

NEW SECTION. Sec. 13. A county legislative authority may adopt an ordinance providing for a committee of itself, or an officer, to hear objections to the special assessment roll, act as a board of equalization, and make recommendations to the full county legislative authority, which need not hold a public hearing on the special assessment roll. The ordinance shall provide a process by which an appeal may be made in writing to the full county legislative authority by a person protesting his or her special assessment or annual special assessments as confirmed by the committee or officer. The full county legislative authority by resolution shall approve the special assessment roll, modify and approve the special assessment roll as a result of hearing objections, or reject the special assessment roll and return it to the committee or officer for further work and recommendations. No objection to the decision of the full county legislative authority approving the special assessment roll may be considered by a court unless an objection to the decision has been timely filed with the county legislative authority as provided in this section.

NEW SECTION. Sec. 14. Notice of the original public hearing on the proposed special assessment roll, and any public hearing held as a result of raising special assessments or including omitted property, shall be published and mailed to the owner or reputed owner of the property as provided in section 4 of this act for the public hearing on the formation of the lake management district. However, the notice need only provide the total amount to be collected by the special assessment roll and shall state that: (1) A public hearing on the proposed special assessment roll will be held, giving the time, date, and place of the public hearing; (2) the proposed special assessment roll is available for public perusal, giving the times and location where the proposed special assessment roll is available for public perusal; (3) objections to the proposed special assessment must be in writing, include clear grounds for objections, and must be filed prior to the public hearing; and (4) failure to so object shall be deemed to waive an objection.

Notices mailed to the owners or reputed owners shall additionally indicate the amount of special assessment ascribed to the particular lot, tract, parcel of land, or other property owned by the person so notified.

NEW SECTION. Sec. 15. The decision of a county legislative authority upon any objection to the special assessment roll may be appealed to the superior court only if the objection had been timely made in the manner prescribed in this chapter. The appeal shall be made within ten days after publication of a notice that the resolution confirming the special assessment roll has been adopted by filing written notice of the appeal with the county legislative authority and the clerk of the superior court in the county in which the real property is situated. The notice of appeal shall describe the property and set forth the objections of the appellant to the special assessment. Within ten days from the filing of such notice of appeal with the clerk of the superior court, the appellant shall file with the clerk of the court a transcript consisting of the special assessment roll and his or her objections thereto, together with the resolution confirming such special assessment roll and the record of the county legislative authority with reference to the special assessment or annual special assessments, which transcript, upon payment of the necessary fees therefor, shall be furnished by an officer of the county and by him or her certified to contain full, true, and correct copies of all matters and proceedings required to be included in the transcript. Such fees shall be the same as the fees payable to the county clerk for the preparation and certification of transcripts on appeal to the supreme court or the court of appeals in civil actions.

At the time of the filing of the notice of appeal with the clerk of the superior court a sufficient bond in the penal sum of two hundred dollars, with a surety or sureties thereon as provided by law for appeals in civil cases, shall be filed conditioned to prosecute such appeal without delay, and if unsuccessful, to pay all costs incurred by the county because of the appeal. The court may order the appellant, upon application therefor, to execute and file such additional bond or bonds as the necessity of the case may require.

Within three days after such transcript is filed in the superior court, the appellant shall give written notice to the county legislative authority that such transcript is filed. The notice shall state a time, not less than three days from the service thereof, when the appellant will call up the cause for hearing.

The superior court shall, at this time or at such further time as may be fixed by order of the court, hear and determine such appeal without a jury, and such cause shall have preference over all civil causes pending in the court, except proceedings under an act relating to eminent domain in such county and actions of forcible entry and detainer. The judgment of the court shall confirm, correct, modify, or annul the special assessment or annual special assessments insofar as the same affects the property of the appellant. A certified copy of the decision of the court shall be filed with the officer having custody of the special assessment roll, and he or she shall modify and correct such special assessment roll in accordance with the decision.

An appeal shall lie to the supreme court or the court of appeals from the judgment of the superior court, as in other cases, however, such appeal must be taken within fifteen days after the date of the entry of the judgment of the superior court, and the record and opening brief of the appellant in the cause shall be filed in the supreme court or the court of appeals within sixty days after the appeal is taken by notice as provided in this section. The time for filing the record and serving and filing of briefs may be extended by order of the superior court, or by stipulation of the parties concerned. The supreme court or the court of appeals on such appeal may correct, modify, confirm, or annul the special assessment or annual special assessments insofar as the same affects the property of the appellant. A certified copy of the order of the supreme court or the court of appeals upon such appeal shall be filed with the officer having custody of such special assessment roll, who shall thereupon modify and correct such special assessment roll in accordance with such decision.

NEW SECTION. Sec. 16. All property included within a lake management district shall be considered to be the property specially benefited by the lake improvement or maintenance activities and shall be the property upon which special assessments are imposed to pay the costs and expenses of the lake improvement or maintenance activities, or such part of the costs and expenses as may be chargeable against the property specially benefited. The special assessments shall be imposed on property in accordance with the special benefits conferred on the property up to but not in excess of the total costs and expenses of the lake improvement or maintenance activities as provided in the special assessment roll.

Special assessments may be measured by front footage, acreage, the extent of improvements on the property, or any other factors that are deemed to fairly reflect special benefits. Special assessments may be calculated by using more than one factor. Zones around the public improvement may be used that reflect different levels of benefit in each zone that are measured by a front footage, acreage, the extent of improvements, or other factors.

Public property, including property owned by the state of Washington, shall be subject to special assessments to the same extent that private property is subject to the special assessments, except no lien shall extend to public property.

NEW SECTION. Sec. 17. The total annual special assessments may not exceed the estimated cost of the lake improvement or maintenance activities proposed to be financed by such special assessments, as specified in the resolution of intention. The total of special assessments imposed in a lake management district that are of the nature of special assessments imposed in a local improvement district shall not exceed one hundred fifty percent of the estimated total cost of the lake improvement or maintenance activities that are proposed to be financed by the lake management district as specified in the resolution of intention. After a lake management district has been created, the resolution of intention may be amended to increase the amount to be financed by the lake management district by using the same procedure in which a lake management district is created.

NEW SECTION. Sec. 18. Whenever annual special assessments are being imposed, the county legislative authority may modify the level of annual special assessments imposed by conforming with the procedures and subject to the limitations included in sections 12 through 17 of this act.

NEW SECTION. Sec. 19. Special assessments and installments on any special assessment shall be collected by the county treasurer.

The county treasurer shall publish a notice indicating that the special assessment roll has been confirmed and that the special assessments are to be collected. The notice shall indicate the duration of the lake management district and shall describe whether the special assessments will be paid in annual payments for the duration of the lake management district, or whether the full special assessments will be payable at one time, with the possibility of periodic installments being paid and lake management bonds being issued, or both.

If the special assessments are to be payable at one time, the notice additionally shall indicate that all or any portion of the special assessments may be paid within thirty days from the date of publication of the first notice without penalty or interest. This notice shall be published in a newspaper of general circulation in the lake management district.

Within ten days of the first newspaper publication, the county treasurer shall notify each owner or reputed owner of property whose name appears on the special assessment roll, at the address shown on the special assessment roll, for each item of property described on the list: (1) Whether one special assessment payable at one time or special assessments payable annually have been imposed; (2) the amount of the property subject to the special assessment or annual special assessments; and (3) the total amount of the special assessment due at one time, or annual amount of special assessments due. If the special assessment is due at one time, the notice shall also describe the thirty-day period during which the special assessment may be paid without penalty, interest, or cost.

NEW SECTION. Sec. 20. If the special assessments are to be payable at one time, all or any portion of any special assessment may be paid without interest, penalty, or costs during this thirty-day period and placed into a special fund to defray the costs of the lake improvement or maintenance activities. The remainder shall be paid in installments as provided in a resolution adopted by the county legislative authority, but the last installment shall be due at least two years before the maximum term of the bonds issued to pay for the improvements or maintenance. The installments shall include amounts sufficient to redeem the bonds issued to pay for the lake improvement and maintenance activities. A twenty-day period shall be allowed after the due date of any installment within which no interest, penalty, or costs on the installment may be imposed.

The county shall establish by ordinance an amount of interest that will be imposed on late special assessments imposed annually or at once, and on installments of a special assessment. The ordinance shall also specify the penalty, in addition to the interest, that will be imposed on a late annual special assessment, special assessment, or installment which shall not be less than five percent of the delinquent special assessment or installment.

The owner of any lot, tract, parcel of land, or other property charged with a special assessment may redeem it from all liability for the unpaid amount of the installments by paying, to the county treasurer, the remaining portion of the installments that is attributable to principal on the lake management district bonds.

NEW SECTION. Sec. 21. Whenever any land against which there has been levied any special assessment or annual special assessments by any county has been sold in part, subdivided, or short subdivided, the county legislative authority may order a segregation of the special assessment or annual special assessments. If an installment has been made, the segregation shall apportion the remaining installments on the parts or lots created.

Any person desiring to have such a special assessment or annual special assessments against a tract of land segregated to apply to smaller parts thereof shall apply to the county legislative authority which levied the special assessment or annual special assessments. If the county legislative authority determines that a segregation should be made, it shall by resolution order the county treasurer to segregate the special assessment or annual special assessments on the original assessment roll as directed in the resolution. The segregation shall be made as nearly as possible on the same basis as the original special assessment or annual special assessments were levied, and the total of the segregated parts of the special assessment or annual special assessments shall equal the amount of the special assessment or annual special assessments unpaid before segregation. The resolution shall describe the original tract and the amount and date of the original special assessment or annual special assessments and shall define the boundaries of the divided parts and the amount of the special assessment or annual special assessments chargeable to each part. A certified copy of the resolution shall be delivered to the county treasurer who shall proceed to segregate the special assessment or annual special assessments upon being tendered a fee of three dollars for each tract of land for which a segregation is to be made. In addition to such charge the county legislative authority may require as a condition to the order of segregation that the person seeking it pay the local government the reasonable engineering and clerical costs incident to making the segregation.

NEW SECTION. Sec. 22. Within fifteen days after a county creates a lake management district, the county shall cause to be filed with the county treasurer, a description of the lake improvement and maintenance activities proposed that the lake management district finances, the lake management district number, and a copy of the diagram or print showing the boundaries of the lake management district and preliminary special assessment roll or abstract of same showing thereon the lots, tracts, parcels of land, and other property that will be specially benefited thereby and the estimated cost and expense of such lake improvement and maintenance activities to be borne by each lot, tract, parcel of land, or other property. The treasurer shall immediately post the proposed special assessment roll upon his or her index of special assessments against the properties affected by the lake improvement or maintenance activities.

NEW SECTION. Sec. 23. The special assessment or annual special assessments imposed upon the respective lots, tracts, parcels of land, and other property in the special assessment roll or annual special assessment roll confirmed by resolution of the county legislative authority for the purpose of paying the cost and expense in whole or in part of any lake improvement or maintenance activities shall be a lien upon the property assessed from the time the special assessment roll is placed in the hands of the county treasurer for collection, but as between the grantor and grantee, or vendor and vendee of any real property, when there is no express agreement as to payment of the special assessments against the real property, the lien of such special assessments shall attach thirty days after the filing of the diagram or print and the estimated cost and expense of such lake improvement or maintenance activities to be borne by each lot, tract, parcel of land, or other property, as provided in section 22 of this act. Interest and penalty shall be included in and shall be a part of the special assessment lien. No lien shall extend to public property subjected to special assessments.

The special assessment lien shall be paramount and superior to any other lien or encumbrance theretofore or thereafter created except a lien for general taxes.

NEW SECTION. Sec. 24. Special assessments shall be valid and enforceable as such and the lien thereof on the property assessed shall be valid if the county legislative authority in making the special assessments acted in good faith and without fraud. Delinquent special assessments or installments shall be foreclosed in the same manner as special assessments are foreclosed under chapter 36.94 RCW. Public property subject to special assessments shall not be subject to liens.

NEW SECTION. Sec. 25. The county legislative authority may stop the imposition of annual special assessments if, in its opinion, the public interest will be served by such action.

NEW SECTION. Sec. 26. (1) Counties may issue lake management district bonds in accordance with this section. Lake management district bonds may be issued to obtain money sufficient to cover that portion of the special assessments that are not paid within the thirty-day period provided in section 19 of this act. The maximum term of lake management district bonds shall be ten years.

Whenever lake management district bonds are proposed to be issued, the county legislative authority shall create a special fund or funds for the lake management district from which all or a portion of the costs of the lake improvement and maintenance activities shall be paid. Lake management district bonds shall not be issued in excess of the costs and expenses of the lake improvement and maintenance activities and shall not be issued prior to twenty days after the thirty days allowed for the payment of special assessments without interest or penalties.

Lake management district bonds shall be exclusively payable from the special fund or funds and from a guaranty fund that the county may have created out of a portion of proceeds from the sale of the lake management district bonds.

(2) Lake management district bonds shall not constitute a general indebtedness of the county issuing the bond nor an obligation, general or special, of the state. The owner of any lake management district bond shall not have any claim for the payment thereof against the county that issues the bonds except for payment from the special assessments made for the lake improvement or maintenance activities for which the lake management district bond was issued and from a lake management district guaranty fund that may have been created. The county shall not be liable to the owner of any lake management district bond for any loss to the lake management district guaranty fund occurring in the lawful operation of the fund. The owner of a lake management district bond shall not have any claim against the state arising from the lake management district bond, special assessments, or guaranty fund. Tax revenues shall not be used to secure or guarantee the payment of the principal of or interest on lake management district bonds.

The substance of the limitations included in this subsection shall be plainly printed, written, engraved, or reproduced on: (a) Each lake management district bond that is a physical instrument; (b) the official notice of sale; and (c) each official statement associated with the lake management district bonds.

(3) If the county fails to make any principal or interest payments on any lake management district bond or to promptly collect any special assessment securing the bonds when due, the owner of the lake management district bond may obtain a writ of mandamus from any court of competent jurisdiction requiring the county to collect the special assessments, foreclose on the related lien, and make payments out of the special fund or guaranty fund if one exists. Any number of owners of lake management districts may join as plaintiffs.

(4) A county may create a lake management district bond guaranty fund for each issue of lake management district bonds. The guaranty fund shall only exist for the life of the lake management district bonds with which it is associated. A portion of the bond proceeds may be placed into a guaranty fund. Unused moneys remaining in the guaranty fund during the last two years of the installments shall be used to proportionally reduce the required level of installments and shall be transferred into the special fund into which installment payments are placed.

(5) Lake management district bonds shall be issued and sold in accordance with chapter 39.46 RCW. The authority to create a special fund or funds shall include the authority to create accounts within a fund.

NEW SECTION. Sec. 27. A new section is added to chapter 35.21 RCW to read as follows:

Any city or town may establish lake management districts within its boundaries as provided in chapter 36.__ RCW (sections 1 through 26 of this act). When a city or town establishes a lake management district pursuant to chapter 36.__ RCW (sections 1 through 26 of this act), the term "county legislative authority" shall be deemed to mean the city or town governing body, the term "county" shall be deemed to mean the city or town, and the term "county treasurer" shall be deemed to mean the city or town treasurer or other fiscal officer.

NEW SECTION. Sec. 28. The following acts or parts of acts are each repealed:

(1) Section 2, chapter 107, Laws of 1939, section 1, chapter 258, Laws of 1959 and RCW 90.24.010;

(2) Section 3, chapter 107, Laws of 1939 and RCW 90.24.020;

(3) Section 4, chapter 107, Laws of 1939, section 1, chapter 210, Laws of 1947, section 2, chapter 258, Laws of 1959, section 1, chapter 243, Laws of 1963 and RCW 90.24.030;

(4) Section 5, chapter 107, Laws of 1939, section 3, chapter 258, Laws of 1959 and RCW 90.24.040;

(5) Section 6, chapter 107, Laws of 1939 and RCW 90.24.050;

(6) Section 7, chapter 107, Laws of 1939 and RCW 90.24.060;

(7) Section 4, chapter 258, Laws of 1959 and RCW 90.24.065; and

(8) Section 8, chapter 107, Laws of 1939, section 177, chapter 81, Laws of 1971 and RCW 90.24.070.

NEW SECTION. Sec. 29. Sections 1 through 26 of this act shall constitute a new chapter in Title 36 RCW.