S-1593

AN ACT Relating to revolving funds for electric utilities serving rural areas to enhance local rural economic development activities; adding a new section to chapter 82.16 RCW; and creating a new section.

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

NEW SECTION. Sec. 1. The legislature finds that it is necessary to employ multiple approaches to revitalize the economy of Washington state's rural areas. The legislature also finds that where possible, Washington state should develop programs that can complement other private, state, and federal programs. It is the intent of section 2 of this act to complement such rural economic development efforts by creating a public utility tax offset program to help establish locally based electric utility revolving fund programs to be used for economic development and job creation.

NEW SECTION. Sec. 2. A new section is added to chapter 82.16 RCW to read as follows:

(1) The following definitions apply to this section:

(a) "Qualifying project" means a project designed to achieve job creation or business retention, to add or upgrade nonelectrical infrastructure, to add or upgrade health and safety facilities, to accomplish energy and water use efficiency improvements, including renewable energy development, or to add or upgrade emergency services in any designated qualifying rural area.

(b) "Qualifying rural area" means:

(i) A county with fewer than one hundred persons per square mile as determined annually by the office of financial management and published by the department of revenue effective for the period July 1st through June 30th; or

(ii) Any geographic area in the state that receives electricity from a light and power business with fewer than twenty-six meters per mile of distribution line as determined and published by the department of revenue effective July 1st of each year. The department shall use current data provided by the electricity industry.

(c) "Electric utility rural economic development revolving fund" means a fund devoted exclusively to funding qualifying projects in qualifying rural areas.

(d) "Local board" is a board of directors with at least, but not limited to, three members who have been appointed by the sponsoring electric utility to oversee and direct the activities of the electric utility rural economic development revolving fund.

(e) "Geographic area" means any portion of a light and power business' service territory, either in whole or any subdivision thereof.

(2) A light and power business with fewer than twenty-six active meters per mile of distribution line in any geographic area in the state shall be allowed a credit against taxes due under this chapter in an amount equal to fifty percent of contributions made in any calendar year directly to an electric utility rural economic development revolving fund. The credit under this section shall not exceed one hundred thousand dollars per calendar year. The credit may not exceed the tax that would otherwise be due under this chapter. Refunds shall not be granted in the place of credits and excess expenditures shall not be carried over to subsequent years.

(3) The right to claim tax credits under this section expires December 31, 2005. However any credits claimed prior to that date remain available for use indefinitely, subject to restrictions set forth in subsection (6) of this section.

(4) To qualify for the credit in subsection (2) of this section, the light and power business shall establish an electric utility rural economic development revolving fund which is governed by a local board whose members shall reside in the qualifying rural area served by the light and power business. The local board shall have authority to determine all criteria and conditions for the expenditure of funds from the electric utility rural economic development fund, and for the terms and conditions of repayment.

(5) Any funds repaid to the electric utility rural economic development fund by recipients shall be made available for additional qualifying projects.

(6) If at any time the electric utility rural economic development fund is dissolved, any moneys claimed as a tax credit under this section shall either be granted to a qualifying project or refunded to the state within two years of termination.