H-1769

AN ACT Relating to a local option sales and use tax on motor vehicle and special fuels; amending RCW 81.104.140, 81.104.180, and 81.104.190; adding new sections to chapter 81.104 RCW; and declaring an emergency.

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

NEW SECTION. Sec. 1. A new section is added to chapter 81.104 RCW to read as follows:

The legislative bodies of cities that operate transit systems, county transportation authorities, metropolitan municipal corporations, and public transportation benefit areas, solely for the purpose of providing high capacity transportation service may submit an authorizing proposition to the voters and if approved by a majority of persons voting, fix and impose a sales and use tax on the sale or use of motor vehicle fuel, as defined in chapter 82.36 RCW, and special fuel, as defined in chapter 82.38 RCW, in accordance with the terms of this chapter.

The tax authorized by this section is in addition to the tax authorized by RCW 82.14.030 and shall be collected from those persons who purchase or use motor vehicle fuel or special fuel upon the occurrence of the taxable event within the city, county transportation authority, metropolitan municipal corporation, or public transportation benefit area, as the case may be. The maximum rate of such tax shall be approved by the voters and shall not exceed a percent of the selling price (in the case of a sales tax) or value of the fuel used (in the case of a use tax) that generates more revenue than would be generated by a sales tax imposed under RCW 81.104.170.

NEW SECTION. Sec. 2. A new section is added to chapter 81.104 RCW to read as follows:

The tax levied under section 1 of this act does not apply to sales of:

(1) Motor vehicle fuel used in aircraft by the manufacturer thereof for research, development, and testing purposes; and

(2) Motor vehicle and special fuel if:

(a) The fuel is purchased for the purpose of public transportation and the purchaser is entitled to a refund or an exemption under RCW 82.36.275 or 82.38.080(9); or

(b) The fuel is purchased by a private, nonprofit transportation provider certified under chapter 81.66 RCW and the purchaser is entitled to a refund or an exemption under RCW 82.36.285 or 82.38.080(8).

Sec. 3. RCW 81.104.140 and 1990 c 43 s 35 are each amended to read as follows:

(1) Agencies authorized to provide high capacity transportation service, including city-owned transit systems, county transportation authorities, metropolitan municipal corporations and public transportation benefit areas, are hereby granted dedicated funding sources for such systems. These dedicated funding sources, as set forth in RCW 81.104.150, 81.104.160, ((~~and~~)) 81.104.170, and section 1 of this act, are authorized only for agencies located in class AA counties, class A counties, counties of the first class which border another state, and counties which, on March 14, 1990, are of the second class and which adjoin class A counties.

(2) Agencies providing high capacity transportation service should also seek other funds, including federal, state, local, and private sector assistance.

(3) Funding sources should satisfy each of the following criteria to the greatest extent possible:

(a) Acceptability;

(b) Ease of administration;

(d) Implementation feasibility;

(e) Revenue reliability; and

(f) Revenue yield.

(4) Agencies participating in regional high capacity transportation system development through interlocal agreements or a conference-approved interim regional rail authority or subregional process as defined in RCW 81.104.040 are authorized to levy and collect the following voter-approved local option funding sources:

(a) Employer tax as provided in RCW 81.104.150;

(b) Special motor vehicle excise tax as provided in RCW 81.104.160; ((~~and~~))

(d) Sale and use tax as provided in section 1 of this act.

Revenues from these taxes may be used only to support those purposes prescribed in subsection (8) of this section. Before an agency may impose any of the taxes enumerated in this section and authorized in RCW 81.104.150, 81.104.160, ((~~and~~)) 81.104.170, and section 1 of this act, it must comply with the process prescribed in RCW 81.104.100 and 81.104.110.

(5) Authorization in subsection (4) of this section shall not adversely affect the funding authority of existing transit agencies. Local option funds may be used to support implementation of interlocal agreements with respect to the establishment of regional high capacity transportation service. Local jurisdictions shall retain control over moneys generated within their boundaries, although funds may be commingled for planning, construction, and operation of high capacity transportation systems as set forth in the agreements.

(6) Agencies providing high capacity transportation service may contract with the state for collection and transference of local option revenue.

(7) Dedicated high capacity transportation funding shall be subject to voter approval by a simple majority.

(8) Agencies providing high capacity transportation service shall retain responsibility for revenue encumbrance, disbursement, and bonding. Funds may be used for any purpose relating to planning, construction, and operation of high capacity transportation, commuter rail, and feeder transportation systems.

Sec. 4. RCW 81.104.180 and 1990 c 43 s 44 are each amended to read as follows:

Cities that operate transit systems, county transportation authorities, metropolitan municipal corporations, and public transportation benefit areas are authorized to pledge revenues from the employer tax authorized by RCW 81.104.150, the special motor vehicle excise tax authorized by RCW 81.104.160, and the sales and use tax authorized by RCW 81.104.170 and section 1 of this act, to retire bonds issued solely for the purpose of providing high capacity transportation service.

Sec. 5. RCW 81.104.190 and 1990 c 43 s 45 are each amended to read as follows:

Cities that operate transit systems, county transportation authorities, metropolitan municipal corporations, and public transportation benefit areas may contract with the state department of revenue or other appropriate entities for administration and collection of any tax authorized by RCW 81.104.150, 81.104.160, ((~~and~~)) 81.104.170, and section 1 of this act.

NEW SECTION. Sec. 6. This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and shall take effect immediately.