S-2448               _______________________________________________

                                         SUBSTITUTE SENATE BILL NO. 5973

                        _______________________________________________

State of Washington                              50th Legislature                              1987 Regular Session

By Senate Committee on Ways & Means (originally sponsored by Senators Rasmussen, Johnson, Wojahn, Bottiger, Gaspard, von Reichbauer, Moore, Smitherman, Vognild, Zimmerman, Nelson, Owen, Benitz, Newhouse, Craswell and Deccio)

Read first time 3/9/87.

AN ACT Relating to state reinsurance of tideland and river bed titles which may be subject to Indian ownership claims; adding a new section to chapter 43.19 RCW; creating new sections; making an appropriation; and providing an effective date.

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

NEW SECTION. Sec. 1.     The legislature finds that present owners of lands formerly lying beneath the navigable rivers of this state are unable to bring suit against Indian tribes which have asserted claims that the original title of the state to such lands is invalid.  As a result, a cloud on title exists that has rendered it impossible for the present owners either to sell their property or to improve it.

NEW SECTION. Sec. 2.  A new section is added to chapter 43.19 RCW to read as follows:

          (1) The state may reinsure any company qualified to transact title insurance business in this state with respect to title insurance policies issued after the effective date of this section to any person, which guarantee or insure, in whole or in part, title to lands formerly lying beneath navigable rivers of this state against any claim of an ownership interest in or to such property derived from the claimant's status as a federally recognized Indian tribe or membership in such tribe.  The additional reinsurance premium charged the insured shall not exceed a maximum of twenty-five percent more than the applicable rate shown on the schedule of premium rates then in effect for such title insurer.

          (2) A reinsurance fund shall be created to enable the state risk manager to carry out the provisions of this section.  Moneys appropriated by the legislature to carry out the provisions of this section, and all moneys received from premiums or other recoveries shall be deposited to the credit of the reinsurance fund.  Payment of losses, settlements, judgments and all liabilities incurred by the state under this section shall be made from the fund.  The risk manager may deposit, invest, or reinvest all or any part of the fund as public funds in a qualified investment depository as provided in chapter 39.50 RCW.  Interest and benefits accruing from such deposits or investments shall be to the credit of the fund.

          (3) In addition to the administration of this section, the risk manager may adopt such rules as may be needed to carry out the purposes of this section.  The risk manager may adjust and pay losses, compromise, and settle claims, and pay the amount of any judgment rendered against the state in any suit or the amount of any settlement agreed upon in respect of any claim under insurance authorized by this section.  The risk manager may fix, adjust, and change the amounts insured and, subject to the maximum additional rate provided in subsection (1) of this section, may change the rates or premium provided for in this section.

          (4) The risk manager may appoint and prescribe the duties of such number of experts in title insurance as the risk manager deems necessary under this section.

          (5) This section shall take effect April 1, 1988.

NEW SECTION. Sec. 3.     The department of community development is directed to conduct a study of the tax revenue and economic impact of Indian tribal claims on tidelands, former tidelands, and lands formerly lying beneath the navigable waters of this state.  Such study shall assess, among other things, the direct and indirect impacts of such claims on employment in the state, investment in the state's economy, and tax revenues to the state and local governments.  In addition, such study may propose alternative measures to alleviate the tax revenue and economic impacts identified above.  The results of such study shall be submitted to the legislature in writing no later than December 1, 1987.

NEW SECTION. Sec. 4.     There is appropriated from the general fund to the department of community development for the biennium ending June 30, 1989, the sum of one hundred thousand dollars, or so much thereof as may be necessary, to carry out the purposes of section 3 of this act.