SENATE BILL REPORT

SB 5599

BYSenators Smitherman, Lee and Barr

Creating the rural affairs advisory committee.

Senate Committee on Economic Development & Labor

Senate Hearing Date(s):January 26, 1989

Senate Staff:Patrick Woods (786-7430)

AS OF FEBRUARY 1, 1989

BACKGROUND:

During the last decade, the state's rural counties experienced continued economic downturns that proved disproportionately severe as compared with the more urbanized counties in the central Puget Sound region.  Twenty-two of the state's 39 counties, all of which are rural, fall within the category "distressed" as defined under several state programs.  It is estimated that distressed counties have lost approximately 14,000 jobs between 1980 and 1986 as opposed to a net gain of 185,000 in the rest of the state.  The contrast between the two regions is further demonstrated by the difference in per capita income with the central Puget Sound having 15 percent above the state's average income level and other regions having 10 percent below the average level. (1987 average state per capita income was $12,615.)

The reasons for the economic disparity and decline within the state are complex and varied.  However, the dependence of rural regions on agriculture, timber, fishing and resource based industries along with the depressed markets in the majority of these products during the '80s is considered to be a major factor driving this phenomenon.

In an effort to promote rural economic development, the Legislature established a number of programs.  These programs are administered by several agencies including the Department of Community Development, the Department of Trade and Economic Development and the Department of Agriculture. 

SUMMARY:

There is established within the Department of Community Development the Rural Affairs Advisory Committee.  The committee is authorized to:  review the state's rural revitalization programs; provide policy direction regarding the economic stabilization and revitalization in rural Washington; promote coordination of the state's rural development programs; undertake research projects; advise state agencies regarding modification of state programs to improve services to rural areas; and act as an advocate and resource center for rural development efforts.  The committee is appointed by the Governor and is comprised of legislators, local public officials, rural business and labor representatives, a representative of federal agencies, a representative of state agencies that administer rural development programs.

The Department of Community Development in consultation with the Rural Affairs Advisory Committee is directed to undertake two rural diversification projects modeled after the recent Tri-Cities diversification program.  The purpose of the projects are to:  encourage the formation of new businesses and industries in rural areas; retain and expand existing businesses; and build local capacity to provide ongoing direction to areawide revitalization efforts with the major emphasis on local decisionmaking.  In determining the location of the diversification projects, the department shall consider the following priorities:  the degree of economic distress in the community; the level of community initiative; and the feasibility of significantly impacting the community's economic condition.  The director of the Department of Community Development, upon designating the diversification sites, shall appoint local boards to review and recommend to the department those economic diversification activities that best suit their local needs.  The eligible diversification activities include but are not limited to the following:  export promotion programs; import substitution programs; business and job retention programs; tourism development; training and retraining; investment opportunities; business financing initiative; and business development programs.

The committee is required to report to the Legislature and Governor annually on the rural development activities in Washington, to assess the revitalization projects that have been undertaken, and make any recommendations and findings regarding rural development programs.

Appropriation:    $450,000 from the general fund for diversification projects; $100,000 to the Rural Affairs Advisory Committee

Revenue:    none

Fiscal Note:      requested January 25, 1989