FINAL BILL REPORT

                  HB 2114

                     Synopsis as Enacted

                         C 8 L 93 E1

Brief Description:  Crediting earnings on balances of certain treasury accounts.

By Representative G. Fisher; by request of Office of Financial Management.

House Committee on Revenue

Background:  The State Treasurer's Office manages over 300 funds and accounts.

Before 1991, the disposition of interest income earned by these funds and accounts varied considerably.  The majority retained 80 percent of their interest earnings and paid 20 percent to the general fund-state.  Some kept all of their interest earnings, while the rest retained no interest earnings.

The distribution of interest earnings was changed by legislation in 1991 so that interest earnings from the majority of funds and accounts are deposited in the general fund-state.  Generally, the only accounts to retain their interest earnings are those accounts the revenues of which are:

(1)required by contract to be spent for a specific purpose;

(2)derived from trust lands originally granted at statehood;

(3)collected by the state and are then distributed to local governments;

(4)derived from state employee contributions to retirement and workers' compensation programs; and

(5)related to transportation projects.

This legislation added an estimated $62 million in revenue to the general fund.

Summary:  All interest earned on the money in the following transportation accounts, and not just 20 percent, will accrue to the state general fund:  The Central Puget Sound public transportation account, the city hardship assistance account, the county arterial preservation account, the economic development account, the essential rail assistance account, the essential rail banking account, the ferry bond retirement fund, the grade crossing protective fund, the high capacity transportation account, the highway bond retirement fund, the highway construction stabilization account, the highway safety account, the motorcycle safety education account, the pilotage account, the public transportation systems account, the Puget Sound capital construction account, the Puget Sound ferry operations account, the recreational vehicle account, the rural arterial trust account, the special category C account, the State Patrol highway account, the transfer relief account, the transportation capital facilities account, the transportation equipment fund, the transportation improvement account, the urban arterial trust account, the advanced right of way revolving fund, the federal narcotics asset forfeitures account, the ferry system account, the ferry system insurance claim reserve account, the ferry system operation and maintenance account, the ferry system revenue account, the ferry system revenue bond account, the high occupancy vehicle account, and the local rail service assistance account.

The motor vehicle fund and the transportation fund will continue to retain 80 percent of their interest earnings.

Votes on Final Passage:

House  53 43

Senate 21 21 (Senate amended)

First Special Session

House  51 38

Senate 27 19

Effective:  July 1, 1993