FINAL BILL REPORT

                   SB 6748

                          C 156 L 00

                      Synopsis as Enacted

Brief Description:  Increasing local government debt limits to finance capital facilities.

Sponsors:  Senators Sellar, Patterson, McCaslin and T. Sheldon.

Senate Committee on State & Local Government

House Committee on Local Government

Background:  The amount that a city or town can borrow using general obligation debt and the purposes for which it can borrow are ruled by both statute and the state Constitution.  A city=s debt limits or debt capacity are subject to two sets of restrictions.  First, under the statutory and constitutional provisions, debt limits set the maximum amount of general obligation debt that a city can have outstanding at any one time.  Second, debt limits restrict how much of this capacity can be used for various purposes.  Statutorily, a city or town=s debt limit is as follows:  2 and 1/2 percent for providing general governing purposes (voted and nonvoted); 2 and 1/2 percent for provision of municipally-owned water, sewer, or electric facilities (voted); and 2 and 1/2 percent for providing open space and parks (voted).

Summary:  The use of the 2 and 1/2 percent voter approved indebtedness for cities and towns to provide open space and park facilities is expanded to include capital facilities associated with economic development.

Votes on Final Passage:

Senate 45 0

House8612

Effective:March 27, 2000