AN ACT Relating to the financing of water pollution control facilities and systems; 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 long-range environmental goals for the state of Washington must include the protection of the state's critical water bodies for the health, safety, and enjoyment of its people, and the economic use of water by providing facilities and systems among others, for the general control, abatement, collection, treatment, or disposal of nonradioactive liquid waste materials. The purpose of this chapter is to provide financial assistance to the state and local governments in the achievement of federal and state water pollution control requirements for the protection and utilization of the state's critical water resources.

NEW SECTION. Sec. 2. For the purpose of providing funds for the planning, design, acquisition, construction, and improvement of public waste disposal and management facilities in this state, the state finance committee is authorized to issue as specified herein general obligation bonds of the state of Washington in the sum of four hundred million dollars, or so much thereof as may be required to finance the improvements defined in this chapter and all costs incidental thereto. Bond proceeds may be used to pay administrative costs and other costs incidental to such projects and to the issuance of such bonds including, but not limited to, salaries and costs of officials and employees of the state and costs of insurance or credit enhancement agreements. The department may not use or permit the use of any funds derived from the sale of bonds authorized by this chapter for the support of increased capacity for development or growth.

These bonds shall be paid and discharged within thirty years of the date of issuance. Bonds authorized in this section shall be sold in such manner, at such time or times, in such amounts and at such price as the state finance committee shall determine. No such bonds may be offered for sale without prior legislative appropriation of the net proceeds of the sale of the bonds. The state finance committee may obtain insurance or letters of credit and may authorize the execution and delivery of agreements, promissory notes, and other obligations for the purpose of insuring the payment or enhancing the marketability of bonds authorized in this section. Promissory notes or other obligations issued pursuant to this section shall not constitute a debt or the contracting of indebtedness under any constitutional or statutory indebtedness limitation if their payment is conditioned upon the failure of the state to pay the principal of or interest on the bonds with respect to which the same relate.

NEW SECTION. Sec. 3. The proceeds from the sale of bonds authorized by this chapter shall be deposited in the 1985 water pollution control facilities account hereby created in the general fund and shall be used exclusively for the purpose specified in this chapter and for payment of the expenses incurred in the issuance and sale of the bonds.

NEW SECTION. Sec. 4. The proceeds from the sale of the bonds deposited in the state and local improvements revolving account--waste disposal facilities 1985 of the general fund under the terms of this chapter shall be administered by the state department of ecology subject to legislative appropriation. The department may use or permit the use of any funds derived from the sale of bonds authorized under this chapter to accomplish the purpose for which the bonds are issued by direct expenditures and by grants or loans to public bodies, including grants to public bodies as cost-sharing funds in any case where federal, local, or other funds are made available on a cost-sharing basis for improvements within the purposes of this chapter. The department shall ensure that grants of funds authorized under this chapter do not constitute more than fifty percent of the total eligible cost of any liquid waste disposal or management facility. The department shall also ensure that any combination of grants and loans of funds authorized under this chapter or by a federal agency shall not exceed seventy-five percent of the eligible cost of any liquid waste disposal or management facility. Not more than two percent of the proceeds of the bond issue may be used by the department of ecology in relation to the administration of the expenditures, grants, and loans.

The department of ecology shall present a progress report on use of bond proceeds to the legislature no later than November 30th of each year.

NEW SECTION. Sec. 5. The department shall allocate from those funds authorized by this chapter in the following manner:

(1) No more than two hundred forty-three million five hundred thousand dollars for construction of pollution control facilities that discharge directly into Puget Sound;

(2) No more than twenty-two million five hundred thousand dollars for projects involving direct discharge into the straits of Juan De Fuca, Georgia, and Rosario;

(3) No more than nine million dollars for projects involving direct discharges into other marine estuaries within Washington state;

(4) No more than sixty-seven million dollars for construction of facilities that will protect from contamination sole source aquifers as designated under the federal safe drinking water act, and other groundwater bodies as designated by the department, including but not limited to the Spokane-Rathdrum Prairie Aquifer; and

(5) No more than fifty-eight million dollars and such sums that may be remaining in the categories specified in subsections (1) through (4) of this section, for construction of waste disposal and management facilities that result in water quality improvement of fresh and marine waters, specifically including waste disposal and management facilities that result in water quality improvement of inland lakes the funding of which shall be given a high priority by the department.

NEW SECTION. Sec. 6. When allocating funds appropriated by the legislature to the projects within the categories described in section 5 of this act, the department of ecology shall take into consideration the following:

(1) The protection of water quality and public health;

(2) The level of local fiscal effort calculated per capita since 1972 in financing water quality improvements;

(3) Regulatory actions established in federal and state compliance orders;

(4) The cost of improvements mandated by federal and state agencies;

(5) The amount of state general fund revenue collected in the area served by a local project sponsor;

(6) The recommendations of the Puget Sound water quality authority and any other board, council, commission, or group established by the legislature to study water pollution control issues around the state; and

(7) Geographical distribution.

One-half of one percent of the total authorized by the legislature each biennium may be used to provide funds to local bodies to prepare feasibility studies on joint development and other alternative methods of financing waste water treatment facilities. Public bodies receiving funds for investigating the feasibility of alternative waste water financing methods shall not have their standing on the department of ecology grant funding priority list jeopardized.

NEW SECTION. Sec. 7. Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

(1) "Waste disposal and management facilities" means any facilities or systems owned or operated by a public body for the control, collection, storage, treatment, disposal, recycling, or recovery of nonradioactive liquid wastes, including but not limited to sanitary sewage, storm water, residential, industrial, commercial, and agricultural wastes, and concentrations of organic sediments, inorganic nutrients, and toxic materials which are causing environmental degradation and loss of the beneficial use of the environment. Waste disposal and management facilities may include all equipment, utilities, structures, real property, and interest in and improvements on real property necessary for or incidental to such purpose. As used in this chapter, the phrase "waste disposal and management facilities" shall not include the acquisition of equipment used to collect residential or commercial garbage.

(2) "Public body" means the state of Washington or any agency, political subdivision, taxing district, or municipal corporation thereof, an agency of the federal government, and those Indian tribes now or hereafter recognized as such by the federal government.

(3) "Control" means those measures necessary to maintain and/ or restore the beneficial uses of critical state water resources including, but not limited to, the diversion, sedimentation, flocculation, dredge and disposal, or containment or treatment of nutrients, organic waste, and toxic material to restore the beneficial use of the state's critical water resources and prevent the continued pollution of these resources.

(4) "Planning" means the development of comprehensive plans for the purpose of identifying critical water resource needs for specific waste disposal facilities as well as the development of plans specific to a particular project.

(5) "Critical water resource" means those significant water bodies in jeopardy of further degradation causing irreparable deterioration.

(6) "Department" means the department of ecology.

NEW SECTION. Sec. 8. Both principal of and interest on the bonds authorized by section 2 of this act shall be payable from the water pollution control facilities bond redemption fund. The state finance committee may provide that a special account be created in such fund to facilitate payment of such principal and interest.

The state finance committee shall, on or before June 30th of each year, certify to the state treasurer the amount required for principal and interest on such bonds in accordance with the provisions of the bond proceedings. The state treasurer shall withdraw from any general state revenues received in the state treasury and deposit in the waste disposal facilities bond redemption fund, or a special account in such fund, such amounts and at such times as are required by the bond proceedings. The owner of each of the bonds or the trustee for any of the bonds may by mandamus or other appropriate proceeding require the transfer and payment of funds as directed in this chapter.

NEW SECTION. Sec. 9. The legislature may provide additional means for raising moneys for the payment of the principal and interest of the bonds authorized in this chapter, and this chapter shall not be deemed to provide an exclusive method for such payment.

NEW SECTION. Sec. 10. The bonds authorized in this chapter shall be a legal investment for all state funds or for funds under state control and for all funds of any other public body.

NEW SECTION. Sec. 11. The total authorization of this chapter shall be reduced by such sums as specifically appropriated in lieu of bond sales authorized by this chapter.

NEW SECTION. Sec. 12. Sections 1 through 11 of this act shall constitute a new chapter in Title 43 RCW.