AN ACT Relating to financial institutions and administration of securities laws; amending RCW 21.20.005, 21.20.450, 21.20.720, 30.12.190, 31.12.005, 43.17.010, 43.17.020, 43.19.010, 43.19.020, 43.19.040, 43.19.095, 43.19.100, 43.19.110, 43.19.112, 43.24.020, 43.24.024, 46.01.011, 46.01.050, 43.07.030, 43.07.120, 43.07.130, 43.07.140, 43.07.170, 43.07.180, and 43.07.190; adding a new chapter to Title 43 RCW; creating new sections; recodifying RCW 43.07.170, 43.07.180, 43.19.020, 43.19.030, 43.19.040, 43.19.050, 43.19.090, 43.19.095, 43.19.100, 43.19.110, and 43.19.112; and providing an effective date.

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

NEW SECTION. Sec. 1. The legislature finds that the consolidation of the agencies regulating financial institutions and securities laws into one department will better serve the public interest through more efficient utilization of staff expertise. Therefore, for the convenience of administration and the centralization of control and the more efficient utilization of state resources, the state desires to combine the regulation of financial institutions and securities laws.

NEW SECTION. Sec. 2. There is hereby created a state department of financial institutions which shall be headed by the director of financial institutions. Within the department of financial institutions there shall be three divisions: A division of banking which shall be headed by the supervisor of banking; a division of savings and loan associations which shall be headed by the supervisor of savings and loan associations; and a division of securities and corporations which shall be headed by the administrator of securities and corporations.

The director of financial institutions shall exercise all powers and perform all the duties and functions prescribed before July 1, 1990, by law with respect to financial institutions, securities, and corporations currently exercised by the department of general administration, the department of licensing, and the secretary of state.

NEW SECTION. Sec. 3. The director of financial institutions may adopt any rules under chapter 34.05 RCW necessary to implement the powers and duties imposed upon the director.

NEW SECTION. Sec. 4. All powers, duties, and functions of the department of general administration pertaining to duties relating to banks and trust companies, mutual savings banks, loan agencies, and other similar institutions are transferred to the department of financial institutions. All references to the director or department of general administration in the Revised Code of Washington shall be construed to mean the director or the department of financial institutions when referring to the functions transferred in this section.

NEW SECTION. Sec. 5. All reports, documents, surveys, books, records, files, papers, or written material in the possession of the department of general administration and pertaining to the powers, functions, and duties transferred by section 4 of this act shall be delivered to the custody of the department of financial institutions. All cabinets, furniture, office equipment, motor vehicles, and other tangible property employed by the department of general administration in carrying out the powers, functions, and duties transferred by section 4 of this act shall be made available to the department of financial institutions. All funds, credits, or other assets held in connection with the powers, functions, and duties transferred by section 4 of this act shall be assigned to the department of financial institutions.

Any appropriations made to the department of general administration for carrying out the powers, functions, and duties transferred by section 4 of this act shall, on the effective date of this section, be transferred and credited to the department of financial institutions.

Whenever any question arises as to the transfer of any personnel, funds, books, documents, records, papers, files, equipment, or other tangible property used or held in the exercise of the powers and the performance of the duties and functions transferred, the director of financial management shall make a determination as to the proper allocation and certify the same to the state agencies concerned.

NEW SECTION. Sec. 6. All classified employees of the department of general administration engaged in performing the powers, functions, and duties transferred by section 4 of this act are transferred to the jurisdiction of the department of financial institutions. All employees classified under chapter 41.06 RCW, the state civil service law, are assigned to the department of financial institutions to perform their usual duties upon the same terms as formerly, without any loss of rights, subject to any action that may be appropriate thereafter in accordance with the laws and rules governing state civil service.

NEW SECTION. Sec. 7. All rules and all pending business before the department of general administration pertaining to the powers, functions, and duties transferred by section 4 of this act shall be continued and acted upon by the department of financial institutions. All existing contracts and obligations shall remain in full force and shall be performed by the department of financial institutions.

NEW SECTION. Sec. 8. The transfer of the powers, duties, functions, and personnel of the department of general administration shall not affect the validity of any act performed by such employee prior to the effective date of this section.

NEW SECTION. Sec. 9. If apportionments of budgeted funds are required because of the transfers directed by sections 5 through 8 of this act, the director of financial management shall certify the apportionments to the agencies affected, the state auditor, and the state treasurer. Each of these shall make the appropriate transfer and adjustments in funds and appropriation accounts and equipment records in accordance with the certification.

NEW SECTION. Sec. 10. Nothing contained in sections 5 through 9 of this act may be construed to alter any existing collective bargaining unit or the provisions of any existing collective bargaining agreement until the agreement has expired or until the bargaining unit has been modified by action of the personnel board as provided by law.

Sec. 11. Section 60, chapter 282, Laws of 1959 as last amended by section 1, chapter 391, Laws of 1989 and RCW 21.20.005 are each amended to read as follows:

The definitions set forth in this section shall apply throughout this chapter, unless the context otherwise requires:

(1) "Director" means the director of ((~~licensing~~)) financial institutions of this state.

(2) "Salesperson" means any individual other than a broker-dealer who represents a broker-dealer or issuer in effecting or attempting to effect sales of securities, but "salesperson" does not include an individual who represents an issuer in (a) effecting a transaction in a security exempted by RCW 21.20.310(1), (2), (3), (4), (9), (10), (11), (12), or (13), as now or hereafter amended, (b) effecting transactions exempted by RCW 21.20.320, or (c) effecting transactions with existing employees, partners, or directors of the issuer if no commission or other remuneration is paid or given directly or indirectly for soliciting any person in this state.

(3) "Broker-dealer" means any person engaged in the business of effecting transactions in securities for the account of others or for that person's own account. "Broker-dealer" does not include (a) a salesperson, issuer, bank, savings institution, or trust company, (b) a person who has no place of business in this state if the person effects transactions in this state exclusively with or through the issuers of the securities involved in the transactions, other broker-dealers, or banks, savings institutions, trust companies, insurance companies, investment companies as defined in the investment company act of 1940, pension or profit-sharing trusts, or other financial institutions or institutional buyers, whether acting for themselves or as trustees, or (c) a person who has no place of business in this state if during any period of twelve consecutive months that person does not direct more than fifteen offers to sell or to buy into this state in any manner to persons other than those specified in subsection (b) above.

(4) "Guaranteed" means guaranteed as to payment of principal, interest, or dividends.

(5) "Full business day" means all calendar days, excluding therefrom Saturdays, Sundays, and all legal holidays, as defined by statute.

(6) "Investment adviser" means any person who, for compensation, engages in the business of advising others, either directly or through publications or writings, as to the value of securities or as to the advisability of investing in, purchasing, or selling securities, or who, for compensation and as a part of a regular business, issues or promulgates analyses or reports concerning securities. "Investment adviser" also includes financial planners and other persons who, as an integral component of other financially related services, (a) provide the foregoing investment advisory services to others for compensation as part of a business or (b) hold themselves out as providing the foregoing investment advisory services to others for compensation. Investment adviser shall also include any person who holds himself out as a financial planner.

"Investment adviser" does not include (a) a bank, savings institution, or trust company, (b) a lawyer, accountant, certified public accountant licensed under chapter 18.04 RCW, engineer, or teacher whose performance of these services is solely incidental to the practice of his or her profession, (c) a broker-dealer, (d) a publisher of any bona fide newspaper, news magazine, or business or financial publication of general, regular, and paid circulation, (e) a radio or television station, (f) a person whose advice, analyses, or reports relate only to securities exempted by RCW 21.20.310(1), (g) a person who has no place of business in this state if (i) that person's only clients in this state are other investment advisers, broker-dealers, banks, savings institutions, trust companies, insurance companies, investment companies as defined in the investment company act of 1940, pension or profit-sharing trust, or other financial institutions or institutional buyers, whether acting for themselves or as trustees, or (ii) during any period of twelve consecutive months that person does not direct business communications into this state in any manner to more than five clients other than those specified in clause (i) above, or (h) such other persons not within the intent of this paragraph as the director may by rule or order designate.

(7) "Issuer" means any person who issues or proposes to issue any security, except that with respect to certificates of deposit, voting trust certificates, or collateral-trust certificates, or with respect to certificates of interest or shares in an unincorporated investment trust not having a board of directors (or persons performing similar functions) or of the fixed, restricted management, or unit type; the term "issuer" means the person or persons performing the acts and assuming the duties of depositor or manager pursuant to the provisions of the trust or other agreement or instrument under which the security is issued.

(8) "Nonissuer" means not directly or indirectly for the benefit of the issuer.

(9) "Person" means an individual, a corporation, a partnership, an association, a joint-stock company, a trust where the interest of the beneficiaries are evidenced by a security, an unincorporated organization, a government, or a political subdivision of a government.

(10) "Sale" or "sell" includes every contract of sale of, contract to sell, or disposition of, a security or interest in a security for value. "Offer" or "offer to sell" includes every attempt or offer to dispose of, or solicitation of an offer to buy, a security or interest in a security for value.

Any security given or delivered with, or as a bonus on account of, any purchase of securities or any other thing is considered to constitute part of the subject of the purchase and to have been offered and sold for value. A purported gift of assessable stock is considered to involve an offer and sale. Every sale or offer of a warrant or right to purchase or subscribe to another security of the same or another issuer, as well as every sale or offer of a security which gives the holder a present or future right or privilege to convert into another security of the same or another issuer, is considered to include an offer of the other security.

(11) "Securities Act of 1933", "Securities Exchange Act of 1934", "Public Utility Holding Company Act of 1935", and "Investment Company Act of 1940" means the federal statutes of those names as amended before or after June 10, 1959.

(12) "Security" means any note; stock; treasury stock; bond; debenture; evidence of indebtedness; certificate of interest or participation in any profit-sharing agreement; collateral-trust certificate; preorganization certificate or subscription; transferable share; investment contract; investment of money or other consideration in the risk capital of a venture with the expectation of some valuable benefit to the investor where the investor does not receive the right to exercise practical and actual control over the managerial decisions of the venture; voting-trust certificate; certificate of deposit for a security; certificate of interest or participation in an oil, gas or mining title or lease or in payments out of production under such a title or lease; charitable gift annuity; or, in general, any interest or instrument commonly known as a "security", or any certificate of interest or participation in, temporary or interim certificate for, receipt for, guarantee of, or warrant or right to subscribe to or purchase, any of the foregoing; or any sale of or indenture, bond or contract for the conveyance of land or any interest therein where such land is situated outside of the state of Washington and such sale or its offering is not conducted by a real estate broker licensed by the state of Washington. "Security" does not include any insurance or endowment policy or annuity contract under which an insurance company promises to pay money either in a lump sum or periodically for life or some other specified period.

(13) "State" means any state, territory, or possession of the United States, as well as the District of Columbia and Puerto Rico.

(14) "Investment adviser salesperson" means a person retained or employed by an investment adviser to solicit clients or offer the services of the investment adviser or manage the accounts of said clients.

(15) "Relatives", as used in RCW 21.20.310(11) as now or hereafter amended, shall include:

(a) A member's spouse;

(b) Parents of the member or the member's spouse;

(d) Natural or adopted children of the member or the member's spouse;

(e) Aunts and uncles of the member or the member's spouse; and

(f) First cousins of the member or the member's spouse.

Sec. 12. Section 45, chapter 282, Laws of 1959 as last amended by section 33, chapter 68, Laws of 1979 ex. sess. and RCW 21.20.450 are each amended to read as follows:

The administration of the provisions of this chapter shall be under the department of ((~~licensing~~)) financial institutions. The director may from time to time make, amend, and rescind such rules and forms as are necessary to carry out the provisions of this chapter, including rules defining any term, whether or not such term is used in the Washington securities law. The director may classify securities, persons, and matters within the director's jurisdiction, and prescribe different requirements for different classes. No rule or form, may be made unless the director finds that the action is necessary or appropriate in the public interest or for the protection of investors and consistent with the purposes fairly intended by the policy and provisions of this chapter. In prescribing rules and forms the director may cooperate with the securities administrators of the other states and the securities and exchange commission with a view to effectuating the policy of this statute to achieve maximum uniformity in the form and content of registration statements, applications, and reports wherever practicable. All rules and forms of the director shall be published.

Sec. 13. Section 9, chapter 171, Laws of 1973 1st ex. sess. as last amended by section 4, chapter 421, Laws of 1987 and RCW 21.20.720 are each amended to read as follows:

(1) A director, officer, or controlling person of a debenture company shall not:

(a) Have any interest, direct or indirect, in the gains or profits of the debenture company, except to receive dividends upon the amounts contributed by him or her, the same as any other investor or shareholder and under the same regulations and conditions: PROVIDED, That nothing in this subsection shall be construed to prohibit salaries as may be approved by the debenture company's board of directors;

(b) Become a member of the board of directors or a controlling shareholder of another debenture company or a bank, trust company, or national banking association, of which board enough other directors or officers of the debenture company are members so as to constitute with him or her a majority of the board of directors.

(2) A director, an officer, or controlling person shall not:

(a) For himself or herself or as agent or partner of another, directly or indirectly use any of the funds held by the debenture company, except to make such current and necessary payments as are authorized by the board of directors;

(b) Receive directly or indirectly and retain for his or her own use any commission on or benefit from any loan made by the debenture company, or any pay or emolument for services rendered to any borrower from the debenture company in connection with such loan;

(c) Become an indorser, surety, or guarantor, or in any manner an obligor, for any loan made from the debenture company and except when approval has been given by the director of ((~~licensing~~)) financial institutions or the director's administrator of securities upon recommendation by the company's board of directors.

(d) For himself or herself or as agent or partner of another, directly or indirectly borrow any of the funds held by the debenture company, or become the owner of real or personal property upon which the debenture company holds a mortgage, deed of trust, or property contract. A loan to or a purchase by a corporation in which he or she is a stockholder to the amount of fifteen percent of the total outstanding stock, or in which he or she and other directors, officers, or controlling persons of the debenture company hold stock to the amount of twenty-five percent of the total outstanding stock, shall be deemed a loan to or a purchase by such director or officer within the meaning of this section, except when the loan to or purchase by such corporation occurred without his or her knowledge or against his or her protest.

Sec. 14. Section 30.12.190, chapter 33, Laws of 1955 as last amended by section 2, chapter 220, Laws of 1989 and RCW 30.12.190 are each amended to read as follows:

Every person who shall violate, or knowingly aid or abet the violation of any provision of RCW 30.04.010, 30.04.030, 30.04.050, 30.04.060, 30.04.070, 30.04.075, 30.04.111, 30.04.120, 30.04.130, 30.04.180, 30.04.210, 30.04.220, 30.04.280, 30.04.290, 30.04.300, 30.08.010, 30.08.020, 30.08.030, 30.08.040, 30.08.050, 30.08.060, 30.08.080, 30.08.090, 30.08.095, 30.08.110, 30.08.120, 30.08.140, 30.08.150, 30.08.160, 30.08.180, 30.08.190, 30.12.010, 30.12.020, 30.12.030, 30.12.060, 30.12.070, 30.12.130, 30.12.180, 30.12.190, 30.16.010, 30.20.060, 30.40.010, 30.44.010, 30.44.020, 30.44.030, 30.44.040, 30.44.050, 30.44.060, 30.44.070, 30.44.080, 30.44.090, 30.44.100, 30.44.130, 30.44.140, 30.44.150, 30.44.160, 30.44.170, 30.44.240, 30.44.250, 43.19.020 (as recodified by this 1990 act), 43.19.030 (as recodified by this 1990 act), 43.19.050 (as recodified by this 1990 act), and 43.19.090 (as recodified by this 1990 act), and every person who fails to perform any act which it is therein made his duty to perform, shall be guilty of a misdemeanor. No person who has been convicted for the violation of the banking laws of this or any other state or of the United States shall be permitted to engage in or become an officer or official of any bank or trust company organized and existing under the laws of this state.

Sec. 15. Section 2, chapter 31, Laws of 1984 and RCW 31.12.005 are each amended to read as follows:

Unless the context clearly requires otherwise, as used in this chapter:

(1) "Board" means the board of directors of a credit union.

(2) "Branch" means any office, other than the principal place of business, maintained by a credit union for the purpose of providing services directly to its members. "Branch" does not include a facility that is limited to an electronic funds transferring machine that can be operated without the assistance of an employee of a credit union.

(3) "Credit union" means a credit union organized and operating under this chapter.

(4) "Employees" means the principal operating officer and other operating personnel of a credit union.

(5) "Federal credit union" means a credit union organized and operating under the laws of the United States.

(6) "Officers" means the officers of the board of a credit union who are elected under RCW 31.12.265.

(7) "Shares" and "deposits" are synonymous and interchangeable. Shares and deposits of a credit union shall be subject to such terms and conditions as established by the board of the credit union.

(8) "Supervisor" means the supervisor of savings and loan associations appointed under RCW 43.19.100 (as recodified by this act), or the duly authorized agent of the supervisor of savings and loan associations.

(9) "Supervisory committee" means a committee having the powers and duties set forth in RCW 31.12.326 through 31.12.355. Supervisory committees are the statutory successors of auditing committees.

Sec. 16. Section 1, chapter 10, Laws of 1979 as last amended by section 810, chapter 9, Laws of 1989 1st ex. sess. and RCW 43.17.010 are each amended to read as follows:

There shall be departments of the state government which shall be known as (1) the department of social and health services, (2) the department of ecology, (3) the department of labor and industries, (4) the department of agriculture, (5) the department of fisheries, (6) the department of wildlife, (7) the department of transportation, (8) the department of licensing, (9) the department of general administration, (10) the department of trade and economic development, (11) the department of veterans affairs, (12) the department of revenue, (13) the department of retirement systems, (14) the department of corrections, (15) the department of community development, ((~~and~~)) (16) the department of health, and (17) the department of financial institutions, which shall be charged with the execution, enforcement, and administration of such laws, and invested with such powers and required to perform such duties, as the legislature may provide.

Sec. 17. Section 2, chapter 10, Laws of 1979 as last amended by section 811, chapter 9, Laws of 1989 1st ex. sess. and RCW 43.17.020 are each amended to read as follows:

There shall be a chief executive officer of each department to be known as: (1) The secretary of social and health services, (2) the director of ecology, (3) the director of labor and industries, (4) the director of agriculture, (5) the director of fisheries, (6) the director of wildlife, (7) the secretary of transportation, (8) the director of licensing, (9) the director of general administration, (10) the director of trade and economic development, (11) the director of veterans affairs, (12) the director of revenue, (13) the director of retirement systems, (14) the secretary of corrections, (15) the director of community development, ((~~and~~)) (16) the secretary of health, and the director of financial institutions.

Such officers, except the secretary of transportation, shall be appointed by the governor, with the consent of the senate, and hold office at the pleasure of the governor. The director of wildlife, however, shall be appointed according to the provisions of RCW 77.04.080. If a vacancy occurs while the senate is not in session, the governor shall make a temporary appointment until the next meeting of the senate. A temporary director of wildlife shall not serve more than one year. The secretary of transportation shall be appointed by the transportation commission as prescribed by RCW 47.01.041.

Sec. 18. Section 43.19.010, chapter 8, Laws of 1965 as last amended by section 10, chapter 25, Laws of 1988 and RCW 43.19.010 are each amended to read as follows:

The department of general administration shall be organized into divisions, which shall include (1) ((~~the division of banking, (2) the division of savings and loan associations, (3)~~)) the division of capitol buildings, ((~~(4)~~)) (2) the division of purchasing, ((~~(5)~~)) (3) the division of engineering and architecture, and ((~~(6)~~)) (4) the division of motor vehicle transportation service.

The director of general administration shall have charge and general supervision of the department. He may appoint and deputize such clerical and other assistants as may be necessary for the general administration of the department. The director of general administration shall receive a salary in an amount fixed by the governor.

Sec. 19. Section 43.19.020, chapter 8, Laws of 1965 as amended by section 1, chapter 185, Laws of 1977 ex. sess. and RCW 43.19.020 are each amended to read as follows:

The director of ((~~general administration~~)) financial institutions shall appoint and deputize an assistant director to be known as the supervisor of banking, who shall have charge and supervision of the division of banking. With the approval of the director, he may appoint and employ bank examiners and such other assistants and personnel as may be necessary to carry on the work of the division.

No person shall be eligible for appointment as supervisor of banking unless he is, and for the last two years prior to his appointment has been, a citizen of the United States and a resident of this state; nor if he is interested in any bank or trust company as director, officer, or stockholder.

In the event of the supervisor's absence the director of general administration shall have the power to deputize one of the assistants of the supervisor to exercise all the powers and perform all the duties prescribed by law with respect to banks and trust companies, mutual savings banks, loan agencies, and other similar institutions that are performed by the supervisor so long as the supervisor is absent: PROVIDED, That such deputized supervisor shall not have the power to approve or disapprove new charters, licenses, branches, and satellite facilities, unless such action has received the prior written approval of the supervisor. Any person so deputized shall possess the same qualifications as those set out in this section for the supervisor.

Sec. 20. Section 43.19.040, chapter 8, Laws of 1965 and RCW 43.19.040 are each amended to read as follows:

The director of ((~~general administration~~)) financial institutions, through the division of banking, shall exercise all the powers and perform all the duties prescribed by law with respect to banks and trust companies, mutual savings banks, loan agencies and other similar institutions.

Sec. 21. Section 1, chapter 241, Laws of 1981 and RCW 43.19.095 are each amended to read as follows:

There is created a local fund known as the "banking examination fund" which shall consist of all moneys received by the division of banking and which shall be used for the purchase of supplies and necessary equipment and the payment of salaries, wages, utilities, and other incidental costs required for the proper maintenance of the division. The state treasurer shall be the custodian of the fund. Disbursements from the fund shall be on authorization of the director of ((~~general administration~~)) financial institutions or the supervisor of banking or the director's or supervisor's designee. In order to maintain an effective expenditure and revenue control, the fund shall be subject in all respects to chapter 43.88 RCW, but no appropriation is required to permit expenditures and payment of obligations from the fund.

Sec. 22. Section 43.19.100, chapter 8, Laws of 1965 as last amended by section 113, chapter 3, Laws of 1982 and RCW 43.19.100 are each amended to read as follows:

The director of ((~~general administration~~)) financial institutions shall appoint and deputize an assistant director to be known as the supervisor of savings and loan associations, who shall have charge and supervision of the division of savings and loan associations.

With the approval of the director, he may appoint and employ such assistants and personnel as may be necessary to carry on the work of the division.

No person shall be eligible for appointment as supervisor of savings and loan associations unless he is, and, for at least two years prior to appointment has been, a citizen of the United States ((~~and a resident of this state~~)). If the appointee is, at the time of appointment, a director, officer, or stockholder of an association or credit union, the appointee shall resign as such director or officer, or dispose of the stock prior to assuming office as supervisor.

In the event of the supervisor's absence the director of general administration shall have the power to deputize one of the assistants of the supervisor to perform day to day functions that are performed by the supervisor so long as the supervisor is absent: PROVIDED, That such deputized supervisor shall not have the power to approve or disapprove new charters, branches, or satellite facilities. Any person so deputized shall possess the same qualifications as those set out in this section for the supervisor.

Sec. 23. Section 43.19.110, chapter 8, Laws of 1965 and RCW 43.19.110 are each amended to read as follows:

The director of ((~~general administration~~)) financial institutions, through the division of savings and loan associations, shall exercise all the powers and perform all the duties prescribed by law with respect to savings and loan associations, credit unions, and other similar institutions.

Sec. 24. Section 2, chapter 241, Laws of 1981 and RCW 43.19.112 are each amended to read as follows:

There is created a local fund known as the "savings and loan associations and credit unions examination fund" which shall consist of all moneys received by the division of savings and loan associations and which shall be used for the purchase of supplies and necessary equipment and the payment of salaries, wages, utilities, and other incidental costs required for the proper maintenance of the division. The state treasurer shall be the custodian of the fund. Disbursements from the fund shall be on authorization of the director of ((~~general administration~~)) financial institutions or the supervisor of savings and loan associations or the director's or supervisor's designee. In order to maintain an effective expenditure and revenue control, the fund shall be subject in all respects to chapter 43.88 RCW, but no appropriation is required to permit expenditures and payment of obligations from the fund.

Sec. 25. Section 43.24.020, chapter 8, Laws of 1965 as last amended by section 314, chapter 9, Laws of 1989 1st ex. sess. and RCW 43.24.020 are each amended to read as follows:

The director of licensing shall administer all laws with respect to the examination of applicants for, and the issuance of, licenses to persons to engage in any business, profession, trade, occupation, or activity except for health professions.

((~~This shall include the administration of all laws pertaining to the regulation of securities and speculative investments.~~))

Sec. 26. Section 42, chapter 170, Laws of 1965 ex. sess. as amended by section 96, chapter 158, Laws of 1979 and RCW 43.24.024 are each amended to read as follows:

The director of licensing may delegate to the assistant director of the business and professions administration in the department of licensing authority to promulgate rules and regulations relating to the licensing of persons engaged in businesses and professions ((~~and to the administration of laws pertaining to the regulation of securities~~)). The director may delegate the authority to issue and sign licenses, certificates, permits and renewals thereof pertaining to those activities transferred to the business and professions administration in the department of licensing pursuant to RCW 46.01.050.

Sec. 27. Section 1, chapter 334, Laws of 1977 ex. sess. as amended by section 113, chapter 158, Laws of 1979 and RCW 46.01.011 are each amended to read as follows:

The legislature finds that the department of licensing administers laws relating to the licensing and regulation of professions, businesses, ((~~securities,~~)) gambling, and other activities in addition to administering laws relating to the licensing and regulation of vehicles and vehicle operators, dealers, and manufacturers. The laws administered by the department have the common denominator of licensing and regulation and are directed toward protecting and enhancing the well-being of the residents of the state.

Sec. 28. Section 5, chapter 156, Laws of 1965 as last amended by section 116, chapter 158, Laws of 1979 and RCW 46.01.050 are each amended to read as follows:

(1) All powers, functions and duties vested by law in the division of professional licensing in the department of licensing on August 9, 1969, other than those enumerated in RCW 46.01.040, shall be transferred to the business and professions administration hereby created consisting of the divisions of ((~~securities,~~)) real estate((,)) and professional licensing((,)) within the department of licensing.

(2) All powers, functions, and duties of the department of licensing on June 30, 1990, relating to the regulation of securities and speculative investments shall be transferred to the department of financial institutions. All references to the director or the department of licensing shall be construed to mean the director or department of financial institutions when referring to the functions transferred in this subsection.

Sec. 29. Section 43.07.030, chapter 8, Laws of 1965 as last amended by section 186, chapter 35, Laws of 1982 and RCW 43.07.030 are each amended to read as follows:

The secretary of state shall:

(1) Keep a register of and attest the official acts of the governor;

(2) Affix the state seal, with his attestation, to commissions, pardons, and other public instruments to which the signature of the governor is required, and also attestations and authentications of certificates and other documents properly issued by the secretary;

(3) Record all ((~~articles of incorporation,~~)) deeds((,)) or other papers filed in the secretary of state's office;

(4) Receive and file all the official bonds of officers required to be filed with the secretary of state;

(5) Take and file in the secretary of state's office receipts for all books distributed by him;

(6) Certify to the legislature the election returns for all officers required by the Constitution to be so certified, and certify to the governor the names of all other persons who have received at any election the highest number of votes for any office the incumbent of which is to be commissioned by the governor;

(7) Furnish, on demand, to any person paying the fees therefor, a certified copy of all or any part of any law, record, or other instrument filed, deposited, or recorded in the secretary of state's office;

(8) Present to the speaker of the house of representatives, at the beginning of each regular session of the legislature during an odd-numbered year, a full account of all purchases made and expenses incurred by the secretary of state on account of the state;

(9) File in his office an impression of each and every seal in use by any state officer;

((~~[(10)]~~)) (10) Keep a record of all fees charged or received by the secretary of state.

Sec. 30. Section 43.07.120, chapter 8, Laws of 1965 as last amended by section 39, chapter 307, Laws of 1989 and RCW 43.07.120 are each amended to read as follows:

(1) The secretary of state shall collect the fees herein prescribed for the secretary of state's official services:

(a) For a copy of any law, resolution, record, or other document or paper on file in the secretary's office for which no other fee is provided, fifty cents per page for the first ten pages and twenty-five cents per page for each additional page;

(b) For any certificate under seal, five dollars;

~~(d)~~)) For each deed or patent of land issued by the governor, if for one hundred and sixty acres of land, or less, one dollar, and for each additional one hundred and sixty acres, or fraction thereof, one dollar;

((~~(e)~~)) (d) For recording miscellaneous records, papers, or other documents, five dollars for filing each case.

(2) The secretary of state may adopt rules under chapter 34.05 RCW establishing reasonable fees for the following services rendered under ((~~Title 23A RCW,~~))chapter 18.100, 23.86, 23.90, 24.03, 24.06, 24.12, 24.20, 24.24, 24.28, 24.36, or 25.10 RCW:

(a) Any service rendered in-person at the secretary of state's office;

(b) Any expedited service;

(d) The providing of information by microfiche or other reduced-format compilation;

(e) The handling of checks or drafts for which sufficient funds are not on deposit;

(f) The resubmission of documents previously submitted to the secretary of state where the documents have been returned to the submittor to make such documents conform to the requirements of the applicable statute;

(g) The handling of telephone requests for information; and

(h) Special search charges.

(3) To facilitate the collection of fees, the secretary of state may establish accounts for deposits by persons who may frequently be assessed such fees to pay the fees as they are assessed. The secretary of state may make whatever arrangements with those persons as may be necessary to carry out this section.

(4) No member of the legislature, state officer, justice of the supreme court, judge of the court of appeals, or judge of the superior court shall be charged for any search relative to matters pertaining to the duties of his or her office; nor may such official be charged for a certified copy of any law or resolution passed by the legislature relative to his or her official duties, if such law has not been published as a state law.

Sec. 31. Section 1, chapter 122, Laws of 1971 ex. sess. as last amended by section 40, chapter 307, Laws of 1989 and RCW 43.07.130 are each amended to read as follows:

There is created within the state treasury a revolving fund, to be known as the "secretary of state's revolving fund," which shall be used by the office of the secretary of state to defray the costs of printing, reprinting, or distributing printed matter authorized by law to be issued by the office of the secretary of state, and any other cost of carrying out the functions of the secretary of state under ((~~Title 23A RCW, or~~)) chapters 18.100, 23.86, 23.90, 24.03, 24.06, 24.12, 24.20, 24.24, 24.28, 24.36, or 25.10 RCW.

The secretary of state is hereby authorized to charge a fee for such publications in an amount which will compensate for the costs of printing, reprinting, and distributing such printed matter. Fees recovered by the secretary of state under RCW 43.07.120(2),((~~23A.36.050, 23A.40.030,~~))24.03.410, 24.06.455, or 46.64.040, and such other moneys as are expressly designated for deposit in the secretary of state's revolving fund shall be placed in the secretary of state's revolving fund.

Sec. 32. Section 2, chapter 85, Laws of 1973 1st ex. sess. as amended by section 189, chapter 35, Laws of 1982 and RCW 43.07.140 are each amended to read as follows:

The secretary of state is hereby specifically authorized to print, reprint, and distribute the following materials:

(1) ((~~Lists of active corporations;~~

~~(2) The provisions of Title 23 RCW;~~

~~(3) The provisions of Title 23A RCW;~~

~~(4)~~)) The provisions of Title 24 RCW;

((~~(5)~~)) (2) The provisions of chapter 25.10 RCW;

((~~(6)~~)) (3) The provisions of Title 29 RCW;

((~~(7)~~)) (4) The provisions of Title 62A RCW;

((~~(8)~~)) (5) The provisions of chapter 18.100 RCW;

((~~(9)~~)) (6) The provisions of chapter 19.77 RCW;

((~~(10)~~)) (7) The provisions of chapter 43.07 RCW;

((~~(11)~~)) (8) The provisions of the Washington state Constitution;

((~~(12)~~)) (9) The provisions of chapter 42.17 RCW and rules adopted by the public disclosure commission;

((~~(13)~~)) (10) The provisions of chapters 40.14, 40.16, and 40.20 RCW, and any statutes, rules, schedules, indexes, guides, descriptions, or other materials related to the public records of state or local government or to the state archives; and

((~~(14)~~)) (11) Rules and informational publications related to the statutory provisions set forth above.

Sec. 33. Section 191, chapter 35, Laws of 1982 and RCW 43.07.170 are each amended to read as follows:

If the ((~~secretary of state~~)) director determines that the public interest and the purpose of the corporation filing statutes administered by the ((~~secretary of state~~)) director would be best served by a filing system utilizing microfilm, microfiche, or methods of reduced-format document recording, the secretary of state may, by rule adopted under chapter 34.05 RCW, establish such a filing system. In connection therewith, the secretary of state may eliminate any requirement for a duplicate original filing copy, and may establish reasonable requirements concerning paper size, print legibility, and quality for photo-reproduction processes as may be necessary to ensure utility and readability of any reduced-format filing system. If the secretary of state determines that the public interest and the purpose of the corporation filing statutes administered by the secretary of state would be best served by a filing system utilizing microfilm, microfiche, or methods of reduced-format document recording, the ((~~secretary of state~~)) director may, by rule adopted under chapter 34.05 RCW, establish such a filing system. In connection therewith, the ((~~secretary of state~~)) director may eliminate any requirement for a duplicate original filing copy, and may establish reasonable requirements concerning paper size, print legibility, and quality for photo-reproduction processes as may be necessary to ensure utility and readability of any reduced-format filing system.

Sec. 34. Section 192, chapter 35, Laws of 1982 and RCW 43.07.180 are each amended to read as follows:

The ((~~secretary of state~~)) director may, by rule adopted under chapter 34.05 RCW, adopt and implement a system of renewals for annual corporate licenses or filings in which the renewal dates are staggered throughout the year.

To facilitate the implementation of the staggered system, the ((~~secretary of state~~)) director may extend the duration of corporate licensing periods or report filing periods and may impose and collect such additional proportional fees as may be required on account of the extended periods.

Sec. 35. Section 193, chapter 35, Laws of 1982 as amended by section 41, chapter 307, Laws of 1989 and RCW 43.07.190 are each amended to read as follows:

Where the secretary of state determines that a summary face sheet or cover sheet would expedite review of any documents made under ((~~Title 23A RCW, or~~)) chapter 18.100, 23.86, 23.90, 24.03, 24.06, 24.12, 24.20, 24.24, 24.36, or 25.10 RCW, the secretary of state may require the use of a summary face sheet or cover sheet that accurately reflects the contents of the attached document. The secretary of state may, by rule adopted under chapter 34.05 RCW, specify the required contents of any summary face sheet and the type of document or documents in which the summary face sheet will be required, in addition to any other filing requirements which may be applicable.

NEW SECTION. Sec. 36. All powers, duties, and functions of the secretary of state pertaining to corporations and securities are transferred to the department of financial institutions. All references to the secretary of state in the Revised Code of Washington shall be construed to mean the director or the department of financial institutions when referring to the functions transferred in this section.

NEW SECTION. Sec. 37. All reports, documents, surveys, books, records, files, papers, or written material in the possession of the secretary of state pertaining to the powers, functions, and duties transferred shall be delivered to the custody of the department of financial institutions. All cabinets, furniture, office equipment, motor vehicles, and other tangible property employed by the secretary of state in carrying out the powers, functions, and duties transferred shall be made available to the department of financial institutions. All funds, credits, or other assets held in connection with the powers, functions, and duties transferred shall be assigned to the department of financial institutions.

Any appropriations made to the secretary of state for carrying out the powers, functions, and duties transferred shall, on the effective date of this section, be transferred and credited to the department of financial institutions.

NEW SECTION. Sec. 38. All employees of the secretary of state engaged in performing the powers, functions, and duties transferred are transferred to the jurisdiction of the department of financial institutions. All employees classified under chapter 41.06 RCW, the state civil service law, are assigned to the department of financial institutions to perform their usual duties upon the same terms as formerly, without any loss of rights, subject to any action that may be appropriate thereafter in accordance with the laws and rules governing state civil service.

NEW SECTION. Sec. 39. All rules and all pending business before the secretary of state pertaining to the powers, functions, and duties transferred shall be continued and acted upon by the department of financial institutions. All existing contracts and obligations shall remain in full force and shall be performed by the department of financial institutions.

NEW SECTION. Sec. 40. The transfer of the powers, duties, functions, and personnel of the secretary of state shall not affect the validity of any act performed prior to the effective date of this section.

NEW SECTION. Sec. 41. If apportionments of budgeted funds are required because of the transfers directed by sections 37 through 40 of this act, the director of financial management shall certify the apportionments to the agencies affected, the state auditor, and the state treasurer. Each of these shall make the appropriate transfer and adjustments in funds and appropriation accounts and equipment records in accordance with the certification.

NEW SECTION. Sec. 42. Nothing contained in sections 36 through 41 of this act may be construed to alter any existing collective bargaining unit or the provisions of any existing collective bargaining agreement until the agreement has expired or until the bargaining unit has been modified by action of the personnel board as provided by law.

NEW SECTION. Sec. 43. RCW 43.07.170, 43.07.180, 43.19.020, 43.19.030, 43.19.040, 43.19.050, 43.19.090, 43.19.095, 43.19.100, 43.19.110, and 43.19.112 are each recodified as sections in chapter 43.-- RCW (sections 1 through 3 of this act).

NEW SECTION. Sec. 44. Sections 1 through 3 of this act shall constitute a new chapter in Title 43 RCW.

NEW SECTION. Sec. 45. This act shall take effect July 1, 1990.