BP BHEAD INT S

AN ACT Relating to public drinking water systems; amending RCW 43.155.050; adding a new chapter to Title 70 RCW; creating a new section; and declaring an emergency.

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

NEW SECTION. Sec. 1. The legislature finds that a state-wide assessment of water systems has shown that public drinking water systems have over two billion dollars worth of critical needs for financial assistance by 1999 to assure safe, reliable, and viable water supplies, meet the requirements of the federal safe drinking water act, provide for comprehensive planning and regional planning of public water systems, assess the status of the state's drinking water quality, develop least-cost solutions to public water systems through consolidation of small systems into larger and financially viable utilities, and implement demand management strategies to more effectively use the state's financial resources and water resources. The water system needs assessment, contained in the January 1993 report by the office of financial management on local public works needs and options, found that over nine hundred million of these needs had no identified source of federal, state, local, or private funding.

The federal government has indicated an intention to provide new funding for water system needs on a national basis through creation of a drinking water state revolving fund. Congress has appropriated one billion three hundred million dollars to fund this program, which is anticipated to receive an additional three billion dollars in funding from congress over the next three years. The state of Washington needs to have the broad-based authority and ability to promptly receive and disburse federal assistance to eligible water systems.

It is the intent of the legislature to establish the necessary accounts and administration for a system of grants, loans, or other forms of financial assistance in addition to existing state financial assistance programs, that will: (1) Receive and utilize federal capitalization grants and other funding to provide assistance for planning, design, acquisition, construction, consolidation, and improvement of public water system facilities, projects and activities; (2) meet the short-term and long-term needs identified and prioritized in the state-wide assessment; and (3) encourage responsible and efficient water system management throughout the state.

It is the further intent of the legislature to use existing state programs for the administrative and financial mechanisms necessary to ensure prompt and coordinated delivery of the financial assistance to public water systems authorized under this chapter.

NEW SECTION. Sec. 2. Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

(1) "Board" means the public works board.

(2) "Department" means the department of health.

(3) "Federal capitalization grants" means grants from the federal government provided under the authority of the federal safe drinking water act.

(4) "Private water purveyor" means a public water system not owned by a governmental body.

(5) "Public water purveyor" means a governmental body, including a public or quasi-public organization, that owns and operates a public water system, or the authorized agent of such an entity.

(6) "Public water system" has the meaning prescribed in the Washington state safe drinking water act, chapter 70.119A RCW.

NEW SECTION. Sec. 3. The drinking water assistance account is established in the state treasury. Money may be placed in the account from the proceeds of bonds when authorized by the legislature, transfers from other state funds or accounts, federal capitalization grants or other financial assistance, all repayments of moneys borrowed from the account, all interest payments made by borrowers from the account or otherwise earned on the account, or any other lawful source. Moneys from the account may be spent only by the secretary of health or the public works board after appropriation. Expenditures from the account may be used only to meet the purposes of this chapter.

NEW SECTION. Sec. 4. The department shall establish and maintain a program to use the moneys in the drinking water assistance account as provided by the federal government under the safe drinking water act. The department shall determine assistance priorities and carry out oversight and activities related to such assistance. The department shall in consultation with the board, the department of community, trade, and economic development, purveyors, local health departments, and other interested parties, establish guidelines and requirements for the provision of grants, loans, or other financial assistance to public water systems that are consistent with the findings and intent contained in section 1 of this act. The department shall ensure that guidelines and requirements:

(1) Utilize, to the maximum extent, all available federal financial assistance, and are consistent with federal requirements;

(2) Are consistent with existing water resource planning and management, including coordinated water supply plans, regional water resource plans, and comprehensive plans under the growth management act, chapter 36.70A RCW;

(3) Prioritize least-cost solutions, including consolidation and restructuring of small systems where appropriate into more economical units, and the provision of regional facilities;

(4) Assure implementation of water conservation and other demand management measures consistent with state guidelines for water utilities;

(5) Provide assistance for the necessary planning and engineering to assure that consistency, coordination, and proper professional review are incorporated into projects or activities proposed for funding;

(6) Include minimum standards for financial viability and water system planning;

(7) Provide for testing and evaluation of the water quality of the state's public water systems to assure that priority for financial assistance is provided to systems and areas with threats to public health from contaminated supplies and reduce in appropriate cases the substantial increases in costs and rates that customers of small systems would otherwise incur under the monitoring and testing requirements of the federal safe drinking water act; and

(8) Are coordinated, to the maximum extent possible, with other state programs that provide financial assistance to public water systems and state programs that address existing or potential water quality or drinking water contamination problems.

NEW SECTION. Sec. 5. The board shall develop a financial assistance program using appropriated funds from the drinking water assistance account to meet the purposes and guidelines authorized in this chapter. The board shall consult with the department and water purveyors in developing the financial assistance program. The board shall, to the extent necessary to meet federal requirements, administer the program in order to ensure that all federal capitalization grants, together with loan repayments and interest, are separately accounted for and used solely for the purposes prescribed by federal law.

The board shall develop, in conjunction with the department, criteria for financial assistance to be made to public water systems. The criteria shall emphasize public water systems with the most critical public health needs; the capacity of the water system to effectively manage its resources; the ability to promptly commence the project; and the relative benefit to the community served. Priority shall be given to those systems that are ready to proceed, that will provide water system improvements to the greatest number of people, and any other criteria that the board shall develop in consultation with the department and water system purveyors.

NEW SECTION. Sec. 6. The department, the board, and the department of community, trade, and economic development shall be entitled to reasonable administrative expenses in developing and implementing the programs authorized under this chapter.

In all cases where the department, board, and any other department, agency, board, or commission of state government interact or provide service under this chapter, the administering government body shall endeavor to provide cost-effective services. The provision of services shall include: (1) Whenever allowed by law, the use of policy statements or guidelines instead of administrative rules; (2) using existing management mechanisms rather than creating new administrative structures; (3) investigating the use of service contracts, either with other governmental entities or with nongovernmental service providers; (4) the use of joint or combined financial assistance applications; and (5) any other method or practice designed to streamline the delivery of services.

Sec. 7. RCW 43.155.050 and 1993 sp.s. c 24 s 921 are each amended to read as follows:

The public works assistance account is hereby established in the state treasury. Money may be placed in the public works assistance account from the proceeds of bonds when authorized by the legislature or from any other lawful source. Money in the public works assistance account shall be used to make loans and to give financial guarantees to local governments for public works projects. Moneys in the account may also be appropriated to provide for state match requirements under federal law for projects and activities conducted and financed by the board under the drinking water assistance account. During the 1993-95 fiscal biennium, moneys in the public works assistance account may be appropriated for flood control assistance including grants under chapter 86.26 RCW. To the extent that moneys in the public works assistance account are not appropriated during the 1993-95 fiscal biennium for public works or flood control assistance, the legislature may direct their transfer to the state general fund. In awarding grants under chapter 86.26 RCW, the department of ecology shall give strong preference to local governments that have: (1) Implemented, or are in the process of implementing, an ordinance that establishes a flood plain policy that is substantially more stringent than minimum federal requirements; (2) completed a comprehensive flood control plan meeting the requirements of RCW 86.12.200; or (3) constructed, or are in the process of constructing, a system of overtopping dikes or levees that allow public access.

NEW SECTION. Sec. 8. The department of health and the public works board are directed not to develop or establish the program prescribed in sections 4 and 5 of this act until the federal government authorizes a state revolving program that will provide federal financial assistance to water systems as outlined in this act.

NEW SECTION. Sec. 9. 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.

NEW SECTION. Sec. 10. Sections 1 through 6 of this act shall constitute a new chapter in Title 70 RCW.