BP BHEAD INT S

AN ACT Relating to contracts between cities, counties, or other districts and owners or developers of real property; amending RCW 35.21.225, 35.43.042, 35.43.190, 35.92.010, 36.73.020, 36.94.220, 56.20.015, 57.08.010, and 57.16.050; reenacting and amending RCW 36.88.010 and 56.08.010; adding new sections to chapter 36.70A RCW; adding a new section to chapter 35.43 RCW; adding new sections to chapter 36.32 RCW; adding a new section to chapter 56.08 RCW; adding a new section to chapter 57.08 RCW; and creating new sections.

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

NEW SECTION. Sec. 1. The legislature finds that the lack of certainty in the approval of development projects can result in a waste of public and private resources, escalate housing costs for consumers and discourage the commitment to comprehensive planning which would make maximum efficient use of resources at the least economic cost to the public. Assurance to a development project applicant that upon government approval the project may proceed in accordance with existing policies and regulations, and subject to conditions of approval, all as set forth in a development agreement, will strengthen the public planning process, encourage private participation and comprehensive planning, and reduce the economic costs of development. Further, the lack of public facilities and services is a serious impediment to development of new housing and commercial uses. Project applicants and local governments may include provisions and agreements whereby applicants are reimbursed over time for financing public facilities. It is the intent of the legislature by sections 2 through 6 of this act to allow local governments and owners and developers of real property to enter into development agreements.

NEW SECTION. Sec. 2. A new section is added to chapter 36.70A RCW to read as follows:

(1) A county or city may enter into a development agreement with a person having ownership or control of real property within its jurisdiction. A city may enter into a development agreement for real property outside its boundaries as part of a proposed annexation or a service agreement. A development agreement must set forth the development standards and other provisions that shall apply to and govern and vest the development, use, and mitigation of the development of the real property for the duration specified in the agreement.

(2) Sections 1 through 4 of this act do not affect the validity of a contract rezone, concomitant agreement, annexation agreement, or other agreement in existence on the effective date of sections 1 through 4 of this act, or adopted under separate authority, that includes some or all of the development standards provided in subsection (3) of this section.

(3) For the purposes of this section, "development standards" includes, but is not limited to:

(a) Project elements such as permitted uses, residential densities, and nonresidential densities and intensities or building sizes;

(b) The amount and payment of impact fees imposed or agreed to in accordance with chapter 36.-- RCW (sections 137 and 138, chapter . . . (Senate Bill No. 5489), Laws of 1995) or any other applicable provisions of state law, other financial contributions by the property owner, inspection fees, or dedications;

(d) Design standards such as maximum heights, setbacks, drainage and water quality requirements, landscaping, and other development features;

(e) Affordable housing;

(f) Parks and open space preservation;

(g) Phasing;

(h) Review procedures and standards for implementing decisions;

(i) A build-out or vesting period for applicable standards; and

(j) Any other appropriate development requirement or procedure.

(4) The execution of a development agreement is a proper exercise of county and city police power and contract authority. A development agreement may obligate a party to fund or provide services, infrastructure, or other facilities. A development agreement shall reserve authority to impose new or different regulations to the extent required by a serious threat to public health and safety.

NEW SECTION. Sec. 3. A new section is added to chapter 36.70A RCW to read as follows:

Unless amended or terminated, a development agreement is enforceable during its term by a party. A development agreement and the development standards in the agreement govern during the term of the agreement, or for all or that part of the build-out period specified in the agreement, and may not be subject to an amendment to a zoning ordinance or development standard or regulation or a new zoning ordinance or development standard or regulation adopted after the effective date of the agreement. A permit or approval issued by the county or city after the execution of the development agreement must be consistent with the development agreement.

NEW SECTION. Sec. 4. A new section is added to chapter 36.70A RCW to read as follows:

A development agreement may be recorded with the real property records of the county in which the property is located. During the term of the development agreement, the agreement is binding on and will inure to the benefit of the parties and their successors, including a city that assumes jurisdiction through incorporation or annexation of the area covering the property covered by the development agreement.

NEW SECTION. Sec. 5. A new section is added to chapter 36.70A RCW to read as follows:

A county or city shall only approve a development agreement by ordinance or resolution after a public hearing. The county or city legislative body or a planning commission, hearing examiner, or other body designated by the legislative body to conduct the public hearing may conduct the hearing. If the development agreement relates to a development permit application, the provisions of chapter 36.-- RCW (sections 301 through 314, chapter . . . (Senate Bill No. 5489), Laws of 1995 ) shall apply to the appeal of the decision on the development agreement.

NEW SECTION. Sec. 6. Nothing in sections 1 through 5 of this act is intended to authorize local governments to impose impact fees, inspection fees, or dedications or to require any other financial contributions or mitigation measures except as expressly authorized by other applicable provisions of state law.

Sec. 7. RCW 35.21.225 and 1989 c 53 s 2 are each amended to read as follows:

The legislative authority of a city may establish one or more transportation benefit districts within a city for the purpose of acquiring, constructing, improving, providing, and funding any city street, county road, or state highway improvement that is (1) consistent with state, regional, and local transportation plans, (2) necessitated by existing or reasonably foreseeable congestion levels attributable to economic growth, and (3) partially funded by local government or private developer contributions, or a combination of such contributions. Such transportation improvements shall be owned by the city of jurisdiction if located in an incorporated area, by the county of jurisdiction if located in an unincorporated area, or by the state in cases where the transportation improvement is or becomes a state highway; and all such transportation improvements shall be administered as other public streets, roads, and highways. The district may include any area within the corporate limits of another city if that city has agreed to the inclusion pursuant to chapter 39.34 RCW. The district may include any unincorporated area if the county legislative authority has agreed to the inclusion pursuant to chapter 39.34 RCW. The agreement shall specify the area and such other powers as may be granted to the benefit district.

The members of the city legislative authority, acting ex officio and independently, shall compose the governing body of the district. The city treasurer shall act as the ex officio treasurer of the district: PROVIDED, That where a transportation benefit district includes any unincorporated area or portion of another city, the district may be governed as provided in an interlocal agreement adopted pursuant to chapter 39.34 RCW. The electors of the district shall all be registered voters residing within the district. For the purposes of this section, the term "city" means both cities and towns.

A city may contract with an owner or developer of real estate for the construction or improvement of transportation improvements that will be incorporated into or used as a public street, road, or highway, under terms approved by the owner or developer and the legislative authority of the city. Any work, construction, alteration, repair, or improvement, other than ordinary maintenance, that the city causes to be performed by an owner or developer of real estate through a contract under this section shall comply with chapter 39.12 RCW.

Sec. 8. RCW 35.43.042 and 1969 ex.s. c 258 s 2 are each amended to read as follows:

Whenever the legislative authority of any city or town has provided pursuant to law for the acquisition, construction, reconstruction, purchase, condemnation and purchase, addition to, repair, or renewal of the whole or any portion of a:

(1) System for providing the city or town and the inhabitants thereof with water, which system includes as a whole or as a part thereof water mains, hydrants or appurtenances which are authorized subjects for local improvements under RCW 35.43.040(13) or other law; or a

(2) System for providing the city or town with sewerage and storm or surface water disposal, which system includes as a whole or as a part thereof drains, sewers or sewer appurtenances which are authorized subjects for local improvements under RCW 35.43.040(7) or other law; or

(3) Off-street parking facilities; and

Has further provided in accordance with any applicable provisions of the Constitution or statutory authority for the issuance and sale of revenue bonds to pay the cost of all or a portion of any such system, such legislative authority shall have the authority to establish utility local improvement districts, and to levy special assessments on all property specially benefited by any such local improvement to pay in whole or in part the damages or costs of any local improvements so provided for.

The initiation and formation of such utility local improvement districts and the levying, collection and enforcement of assessments shall be in the manner and subject to the same procedures and limitations as are now or hereafter provided by law for the initiation and formation of local improvement districts in cities and towns and the levying, collection and enforcement of assessments pursuant thereto.

It must be specified in any petition or resolution initiating the formation of such a utility local improvement district in a city or town and in the ordinance ordered pursuant thereto, that the assessments shall be for the sole purpose of payment into such revenue bond fund as may be specified by the legislative authority for the payment of revenue bonds issued to defray the cost of such system or facilities or any portion thereof as provided for in this section.

Assessments in any such utility local improvement district may be made on the basis of special benefits up to but not in excess of the total cost of the local improvements portion of any system or facilities payable by issuance of revenue bonds. No warrants or bonds shall be issued in any such utility local improvement district, but the collection of interest and principal on all assessments in such utility local improvement district, when collected, shall be paid into any such revenue bond fund.

When in the petition or resolution for establishment of a local improvement district and in the ordinance ordered pursuant thereto, it is specified or provided that the assessments shall be for the sole purpose of payment into a revenue bond fund for the payment of revenue bonds, then the local improvement district shall be designated a "utility local improvement district".

The provisions of chapters 35.45, 35.47 and 35.48 RCW shall have no application to utility local improvement districts created under authority of this section.

A city or town may contract with an owner or developer of real estate for the construction or improvement of systems or facilities that will be used by the general public or incorporated into or used as part of a public utility system under terms approved by the owner or developer and the legislative authority of the city or town. Any work, construction, alteration, repair, or improvement, other than ordinary maintenance, that the city or town causes to be performed by an owner or developer of real estate through a contract under this section shall comply with chapter 39.12 RCW.

Sec. 9. RCW 35.43.190 and 1987 c 242 s 3 are each amended to read as follows:

All local improvements, the funds for the making of which are derived in whole or in part from assessments upon property specially benefited shall be made by contract on competitive bids or by contract made pursuant to section 10 of this act whenever the estimated cost of such improvement including the cost of materials, supplies, labor, and equipment will exceed the sum of five thousand dollars. The city, town, or public corporation may reject any and all bids. The city, town, or public corporation itself may make the local improvements if all the bids received exceed by ten percent preliminary cost estimates prepared by an independent consulting engineer or registered professional engineer retained for that purpose by the city, town, or public corporation.

NEW SECTION. Sec. 10. A new section is added to chapter 35.43 RCW to read as follows:

The legislative authority of any city, town, or public corporation may make all or any part of the improvements to be paid for in whole or in part by assessment upon property specifically benefited by contract with any owner or owners of property located within the district, formed in accordance with RCW 35.43.080. The total cost of the improvements under the contract shall not exceed the preliminary cost estimates for such improvements prepared by an independent consulting engineer or registered professional engineer retained for that purpose by the city, town, or public corporation, by more than fifty-three percent. The contract shall be void if the owners of the property within the district subject to fifty percent or more of the total cost of the improvements object in writing within thirty days after written notice by first class mail, postage prepaid, of the terms of the contract and the preliminary costs estimates for such improvements are provided to each owner in the district. The contract may provide for the acquisition by the city or town of the improvement by payment to the owners of the costs of the construction and related costs from the proceeds of bonds issued by the district, from assessments paid to the district as appropriate, or by a credit in the amount of such costs against future assessments assessed against such property under the district. The contract shall provide that all local improvements constructed by owners shall be approved and accepted by the city or town as facilities of the municipality before payment to the owners is authorized. Any work, construction, alteration, repair, or improvement, other than ordinary maintenance, that the city, town, or public corporation causes to be performed by an owner or developer of real estate through a contract under this section shall comply with chapter 39.12 RCW.

Sec. 11. RCW 35.92.010 and 1991 c 347 s 18 are each amended to read as follows:

A city or town may construct, condemn and purchase, purchase, acquire, add to, alter, maintain and operate waterworks, within or without its limits, for the purpose of furnishing the city and its inhabitants, and any other persons, with an ample supply of water for all purposes, public and private, including water power and other power derived therefrom, with full power to regulate and control the use, distribution, and price thereof: PROVIDED, That the rates charged must be uniform for the same class of customers or service. Such waterworks may include facilities for the generation of electricity as a byproduct and such electricity may be used by the city or town or sold to an entity authorized by law to distribute electricity. Such electricity is a byproduct when the electrical generation is subordinate to the primary purpose of water supply.

In classifying customers served or service furnished, the city or town governing body may in its discretion consider any or all of the following factors: The difference in cost of service to the various customers; location of the various customers within and without the city or town; the difference in cost of maintenance, operation, repair, and replacement of the various parts of the system; the different character of the service furnished various customers; the quantity and quality of the water furnished; the time of its use; the achievement of water conservation goals and the discouragement of wasteful water use practices; capital contributions made to the system including, but not limited to, assessments; and any other matters which present a reasonable difference as a ground for distinction. No rate shall be charged that is less than the cost of the water and service to the class of customers served.

For such purposes any city or town may take, condemn and purchase, purchase, acquire, and retain water from any public or navigable lake or watercourse, surface or ground, and, by means of aqueducts or pipe lines, conduct it to the city or town; and it may erect and build dams or other works across or at the outlet of any lake or watercourse in this state for the purpose of storing and retaining water therein up to and above high water mark; and for all the purposes of erecting such aqueducts, pipe lines, dams, or waterworks or other necessary structures in storing and retaining water, or for any of the purposes provided for by this chapter, the city or town may occupy and use the beds and shores up to the high water mark of any such watercourse or lake, and acquire the right by purchase, or by condemnation and purchase, or otherwise, to any water, water rights, easements or privileges named in this chapter, or necessary for any of said purposes, and the city or town may acquire by purchase or condemnation and purchase any properties or privileges necessary to be had to protect its water supply from pollution. Should private property be necessary for any such purposes or for storing water above high water mark, the city or town may condemn and purchase, or purchase and acquire such private property. For the purposes of waterworks which include facilities for the generation of electricity as a byproduct, nothing in this section may be construed to authorize a city or town that does not own or operate an electric utility system to condemn electric generating, transmission, or distribution rights or facilities of entities authorized by law to distribute electricity, or to acquire such rights or facilities without the consent of the owner.

A city or town may contract with an owner or developer of real estate for the construction or improvement of waterworks that will be incorporated into or used as part of a public utility system under terms approved by the owner or developer and the legislative authority of the city or town. Any work, construction, alteration, repair, or improvement, other than ordinary maintenance, that the city or town causes to be performed by an owner or developer of real estate through a contract under this section shall comply with chapter 39.12 RCW.

NEW SECTION. Sec. 12. A new section is added to chapter 36.32 RCW to read as follows:

RCW 36.32.240, 36.32.250, and 36.32.260 do not apply to contracts with the owner or developer of real estate for the construction or improvement of public facilities or systems that will be incorporated into or used as part of public systems under the county's authority pursuant to RCW 36.73.020, 36.88.010, or 36.94.220.

NEW SECTION. Sec. 13. A new section is added to chapter 36.32 RCW to read as follows:

The county legislative authority may make all or any part of the improvements to be paid for in whole or in part by assessment upon property specifically benefited by contract with any owner or owners of property located within the county benefit or improvement district pursuant to RCW 36.73.020, 36.88.010, or 36.94.220. The total cost of the improvements under the contract shall not exceed the preliminary cost estimates for such improvements prepared by an independent consulting engineer or registered professional engineer retained for that purpose by the county, by more than fifty-three percent. The contract shall be void if the owners of the property within the county benefit or improvement district subject to fifty percent or more of the total cost of the improvements object in writing within thirty days after written notice by first class mail, postage prepaid, of the terms of the contract and the preliminary costs estimates for such improvements are provided to each owner of property specifically benefited in the county benefit or improvement district. The contract may provide for the acquisition by the county of the improvement by payment to the owners of the costs of the construction and related costs from the proceeds of bonds issued by the benefit or improvement district, from assessments paid to the benefit or improvement district as appropriate, or by a credit in the amount of such costs against future assessments assessed against such property under the benefit or improvement district. The contract shall provide that all local improvements constructed by owners shall be approved and accepted by the county as facilities of the county before payment to the owners is authorized. Any work, construction, alteration, repair, or improvement, other than ordinary maintenance, that the county causes to be performed by an owner or developer of real estate through a contract under this section shall comply with chapter 39.12 RCW.

Sec. 14. RCW 36.73.020 and 1989 c 53 s 1 are each amended to read as follows:

The legislative authority of a county may establish one or more transportation benefit districts within the county for the purpose of acquiring, constructing, improving, providing, and funding any city street, county road, or state highway improvement, which may include right of way improvements, including but not limited to landscaping, lighting, irrigation, cable, and power line improvements, within or without the district that is (1) consistent with state, regional, and local transportation plans, (2) necessitated by existing or reasonably foreseeable congestion levels attributable to economic growth, and (3) partially funded by local government or private developer contributions, or a combination of such contributions. Such transportation improvements shall be owned by the county of jurisdiction if located in an unincorporated area, by the city of jurisdiction if located in an incorporated area, or by the state in cases where the transportation improvement is or becomes a state highway; and all such transportation improvements shall be administered and maintained as other public streets, roads, and highways. The district may not include any area within the corporate limits of a city unless the city legislative authority has agreed to the inclusion pursuant to chapter 39.34 RCW. The agreement shall specify the area and such powers as may be granted to the benefit district.

The members of the county legislative authority, acting ex officio and independently, shall compose the governing body of the district: PROVIDED, That where a transportation benefit district includes any portion of an incorporated city, town, or another county, the district may be governed as provided in an interlocal agreement adopted pursuant to chapter 39.34 RCW. The county treasurer shall act as the ex officio treasurer of the district. The electors of the district shall all be registered voters residing within the district. For purposes of this section, the term "city" means both cities and towns.

A county may contract with an owner or developer of real estate for the construction or improvement of transportation improvements that will be incorporated into or used as part of the public system under terms approved by the owner or developer and the legislative authority of the county. Any work, construction, alteration, repair, or improvement, other than ordinary maintenance, that the county causes to be performed by an owner or developer of real estate through a contract under this section shall comply with chapter 39.12 RCW.

Sec. 15. RCW 36.88.010 and 1985 c 400 s 3 and 1985 c 369 s 7 are each reenacted and amended to read as follows:

All counties have the power to create county road improvement districts for the acquisition of rights of way and improvement of county roads, existing private roads that will become county roads as a result of this improvement district process and, with the approval of the state department of transportation, state highways; for the construction or improvement of necessary drainage facilities, bulkheads, retaining walls, and other appurtenances therefor, bridges, culverts, sidewalks, curbs and gutters, escalators, or moving sidewalks; and for the draining or filling of drainage potholes or swamps. Such counties have the power to levy and collect special assessments against the real property specially benefited thereby for the purpose of paying the whole or any part of the cost of such acquisition of rights of way, construction, or improvement.

A county may contract with an owner or developer of real estate for the construction or improvement of roads and related facilities authorized under this section that will be incorporated into or become public roads under terms approved by the owner or developer and the legislative authority of the county. Any work, construction, alteration, repair, or improvement, other than ordinary maintenance, that the county causes to be performed by an owner or developer of real estate through a contract under this section shall comply with chapter 39.12 RCW.

Sec. 16. RCW 36.94.220 and 1981 c 313 s 3 are each amended to read as follows:

(1) A county shall have the power to establish utility local improvement districts and local improvement districts within the area of a sewerage and/or water general plan and to levy special assessments under a mode of annual installments extending over a period not exceeding twenty years on all property specially benefited by any local improvement on the basis of the special benefits to pay in whole or in part the damages or costs of any improvements ordered in such county.

(2) Utility local improvement districts and local improvement districts may include territory within a city or town only with the written consent of the city or town, but if the local district is formed before such area is included within the city or town, no such consent shall be necessary. Utility local improvement districts and local improvement districts used to provide sewerage disposal systems may include territory within a sewer district or within a water district providing sewerage disposal systems only with the written consent of the sewer district or such a water district, but if the local district is formed before such area is included within the sewer district or such a water district, no consent is necessary. Utility local improvement districts and local improvement districts used to provide water systems may include territory within a water district or within a sewer district providing water systems only with the written consent of the water district or such a sewer district, but if the local district is formed before such area is included within the water district or such a sewer district, no consent is necessary.

(3) The levying, collection, and enforcement of all public assessments hereby authorized shall be in the manner now and hereafter provided by law for the levying, collection, and enforcement of local improvement assessments by cities and towns, insofar as the same shall not be inconsistent with the provisions of this chapter. In addition, the county shall file the preliminary assessment roll at the time and in the manner prescribed in RCW 35.50.005. The duties devolving upon the city treasurer under such laws are imposed upon the county treasurer for the purposes of this chapter. The mode of assessment shall be in the manner to be determined by the county legislative authority by ordinance or resolution. As an alternative to equal annual assessment installments of principal provided for cities and towns, a county legislative authority may provide for the payment of such assessments in equal annual installments of principal and interest. Assessments in any local district may be made on the basis of special benefits up to but not in excess of the total cost of any sewerage and/or water improvement made with respect to that local district and the share of any general sewerage and/or water facilities allocable to that district. In utility local improvement districts, assessments shall be deposited into the revenue bond fund or general obligation bond fund established for the payment of bonds issued to pay such costs which bond payments are secured in part by the pledge of assessments, except pending the issuance and sale of such bonds, assessments may be deposited in a fund for the payment of such costs. In local improvement districts, assessments shall be deposited into a fund for the payment of such costs and local improvement bonds issued to finance the same or into the local improvement guaranty fund as provided by applicable statute.

A county may contract with an owner or developer of real estate for the construction or improvement of sewer or water systems that will be incorporated into or used as part of a public water or sewer system under terms approved by the owner or developer and the legislative authority of the county. Any work, construction, alteration, repair, or improvement, other than ordinary maintenance, that the county causes to be performed by an owner or developer of real estate through a contract under this section shall comply with chapter 39.12 RCW.

Sec. 17. RCW 56.08.010 and 1989 c 389 s 2 and 1989 c 308 s 1 are each reenacted and amended to read as follows:

A sewer district may acquire by purchase or by condemnation and purchase all lands, property rights, water, and water rights, both within and without the district, necessary for its purposes. A sewer district may lease real or personal property necessary for its purposes for a term of years for which such leased property may reasonably be needed where in the opinion of the board of sewer commissioners such property may not be needed permanently or substantial savings to the district can be effected thereby. The right of eminent domain shall be exercised in the same manner and by the same procedure as provided for cities and towns, insofar as consistent with the provisions of this title, except that all assessments or reassessment rolls required to be filed by eminent domain commissioners or commissioners appointed by the court shall be prepared and filed by the district, and the duties devolving upon the city treasurer shall be imposed upon the county treasurer for the purposes hereof. A sewer district may construct, condemn and purchase, add to, maintain, and operate systems of sewers for the purpose of furnishing the district and inhabitants thereof with an adequate system of sewers for all uses and purposes, public and private, including but not limited to on-site sewage disposal facilities, approved septic tanks or approved septic tank systems, other facilities and systems for the collection, interception, treatment, and disposal of wastewater, and for the control of pollution from wastewater and for the protection, preservation, and rehabilitation of surface and underground waters, facilities for the drainage of storm or surface waters, public highways, streets, and roads with full authority to regulate the use and operation thereof and the service rates to be charged and may construct, acquire, or own buildings and other necessary district facilities. Such sewage facilities may include facilities which result in combined sewage disposal, treatment, or drainage and electric generation, provided that the electricity generated thereby is a byproduct of the system of sewers. Such electricity may be used by the sewer district or sold to any entity authorized by law to distribute electricity. Such electricity is a byproduct when the electrical generation is subordinate to the primary purpose of sewage disposal, treatment, or drainage. For such purposes a district may conduct sewage throughout the district and throughout other political subdivisions within the district, and construct and lay sewer pipe along and upon public highways, roads, and streets, within and without the district, and condemn and purchase or acquire land and rights of way necessary for such sewer pipe. A district may erect sewage treatment plants, within or without the district, and may acquire by purchase or condemnation, properties or privileges necessary to be had to protect any lakes, rivers, or watercourses and also other areas of land from pollution, from its sewers or its sewage treatment plant. For the purposes of sewage facilities which include facilities which result in combined sewage disposal, treatment, or drainage and electric generation where the electric generation is a byproduct, nothing in this section may be construed to authorize a district to condemn electric generating, transmission, or distribution rights or facilities of entities authorized by law to distribute electricity, or to acquire such rights or facilities without the consent of the owner. A district may charge property owners seeking to connect to the district system of sewers, as a condition to granting the right to so connect, in addition to the cost of such connection, such reasonable connection charge as the board of commissioners shall determine to be proper in order that such property owners shall bear their equitable share of the cost of such system. For purposes of calculating a connection charge, the board of commissioners shall determine the pro rata share of the cost of existing facilities and facilities planned for construction within the next ten years and contained in an adopted comprehensive plan and other costs borne by the district which are directly attributable to the improvements required by property owners seeking to connect to the system. The cost of existing facilities shall not include those portions of the system which have been donated or which have been paid for by grants.

The connection charge may include interest charges applied from the date of construction of the sewer system until the connection, or for a period not to exceed ten years, whichever is shorter, at a rate commensurate with the rate of interest applicable to the district at the time of construction or major rehabilitation of the sewer system, or at the time of installation of the sewer lines to which the property owner is seeking to connect.

A district may permit payment of the cost of connection and the reasonable connection charge to be paid with interest in installments over a period not exceeding fifteen years. The county treasurer may charge and collect a fee of three dollars per parcel for each year for the treasurer's services. Such fees shall be a charge to be included as part of each annual installment, and shall be credited to the county current expense fund by the county treasurer. A district may compel all property owners within the sewer district located within an area served by the district system of sewers to connect their private drain and sewer systems with the district system under such penalty as the sewer commissioners shall prescribe by resolution. The district may for such purpose enter upon private property and connect the private drains or sewers with the district system and the cost thereof shall be charged against the property owner and shall be a lien upon property served.

Revenues from connection charges excluding permit fees are to be considered payments in aid of construction as defined by department of revenue rule.

A sewer district may contract with an owner or developer of real estate for the construction or improvement of sewer systems that will be incorporated into or used as part of the public sewer system under terms approved by the owner or developer and the board of commissioners. Any work, construction, alteration, repair, or improvement, other than ordinary maintenance, that the sewer district causes to be performed by an owner or developer of real estate through a contract under this section shall comply with chapter 39.12 RCW.

NEW SECTION. Sec. 18. A new section is added to chapter 56.08 RCW to read as follows:

RCW 56.08.070 does not apply to contracts with the owner or developer of real estate for the construction or improvement of sewer systems that will be incorporated into or used as part of the public sewer system pursuant to RCW 56.08.010, so long as the procedures of section 10 of this act are followed.

Sec. 19. RCW 56.20.015 and 1983 c 167 s 159 are each amended to read as follows:

In addition to all of the powers and authorities set forth in Title 56 RCW, any sewer district ((~~shall have~~)) has all of the powers of cities as set forth in RCW 35.43.184, 35.43.186, and section 10 of this act and chapter 35.44 RCW. Sewer districts may also exercise all of the powers permitted to a water district under Title 57 RCW, except that a sewer district may not exercise water district powers in any area within its boundaries which is part of an existing district which previously shall have been duly authorized to exercise water district powers in such area without the consent by resolution of the board of commissioners of such district.

A sewer district shall have the power to issue general obligation bonds for water system purposes: PROVIDED, That a proposition to authorize general obligation bonds payable from excess tax levies for water system purposes pursuant to chapters 57.16 and 57.20 RCW shall be submitted to all of the qualified voters within that part of the sewer district which is not contained within another existing district duly authorized to exercise water district powers, and the taxes to pay the principal of and interest on the bonds approved by such voters shall be levied only upon all of the taxable property within such part of the sewer district. Such bonds may also be issued and sold in accordance with chapter 39.46 RCW.

Sec. 20. RCW 57.08.010 and 1994 c 81 s 81 are each amended to read as follows:

(1)(a) A water district may acquire by purchase or condemnation, or both, all property and property rights and all water and water rights, both within and without the district, necessary for its purposes.

(b) A water district may lease real or personal property necessary for its purposes for a term of years for which such leased property may reasonably be needed where in the opinion of the board of water commissioners such property may not be needed permanently or substantial savings to the district can be effected thereby.

(c) The right of eminent domain shall be exercised in the same manner and by the same procedure as provided for cities and towns, insofar as consistent with the provisions of this title, except that all assessment rolls to be prepared and filed by eminent domain commissioners or commissioners appointed by the court shall be prepared and filed by the water district, and the duties devolving upon the city treasurer are hereby imposed upon the county treasurer.

(d) A water district may construct, condemn and purchase, purchase, add to, maintain, and supply waterworks to furnish the district and inhabitants thereof, and any city or town therein and any other persons, both within and without the district, with an ample supply of water for all uses and purposes public and private with full authority to regulate and control the use, content, distribution, and price thereof in such a manner as is not in conflict with general law and may construct, acquire, or own buildings and other necessary district facilities. Where a customer connected to the district's system uses the water on an intermittent or transient basis, a district may charge for providing water service to such a customer, regardless of the amount of water, if any, used by the customer.

(e) A water district contiguous to Canada may contract with a Canadian corporation for the purchase of water and for the construction, purchase, maintenance, and supply of waterworks to furnish the district and inhabitants thereof and residents of Canada with an ample supply of water under terms approved by the board of commissioners. Such waterworks may include facilities which result in combined water supply and electric generation, provided that the electricity generated thereby is a byproduct of the water supply system.

(f) Such electricity may be used by the water district or sold to any entity authorized by law to distribute electricity. Such electricity is a byproduct when the electrical generation is subordinate to the primary purpose of water supply.

(g) For such purposes, a water district may take, condemn and purchase, purchase, acquire, and retain water from any public or navigable lake, river, or watercourse, or any underflowing water and, by means of aqueducts or pipe line conduct the same throughout such water district and any city or town therein and carry it along and upon public highways, roads, and streets, within and without such district.

(h) For the purpose of constructing or laying aqueducts or pipe lines, dams, or waterworks or other necessary structures in storing and retaining water or for any other lawful purpose such water district may occupy the beds and shores up to the high water mark of any such lake, river, or other watercourse, and may acquire by purchase or condemnation such property or property rights or privileges as may be necessary to protect its water supply from pollution.

(i) For the purposes of waterworks which include facilities for the generation of electricity as a byproduct, nothing in this section may be construed to authorize a water district to condemn electric generating, transmission, or distribution rights or facilities of entities authorized by law to distribute electricity, or to acquire such rights or facilities without the consent of the owner.

(2) A water district may purchase and take water from any municipal corporation.

(3) A water district may fix rates and charges for water supplied and may charge property owners seeking to connect to the district's water supply system, as a condition to granting the right to so connect, in addition to the cost of such connection, such reasonable connection charge as the board of commissioners shall determine to be proper in order that such property owners shall bear their equitable share of the cost of such system.

(a) For purposes of calculating a connection charge, the board of commissioners shall determine the pro rata share of the cost of existing facilities and facilities planned for construction within the next ten years and contained in an adopted comprehensive plan and other costs borne by the district which are directly attributable to the improvements required by property owners seeking to connect to the system. The cost of existing facilities shall not include those portions of the system which have been donated or which have been paid for by grants.

(b) The connection charge may include interest charges applied from the date of construction of the water system until the connection, or for a period not to exceed ten years, whichever is shorter, at a rate commensurate with the rate of interest applicable to the district at the time of construction or major rehabilitation of the water system, or at the time of installation of the water lines to which the property owner is seeking to connect.

(4)(a) A district may permit payment of the cost of connection and the reasonable connection charge to be paid with interest in installments over a period not exceeding fifteen years. The county treasurer may charge and collect a fee of three dollars for each year for the treasurer's services. Such fees shall be a charge to be included as part of each annual installment, and shall be credited to the county current expense fund by the county treasurer.

(b) Revenues from connection charges excluding permit fees are to be considered payments in aid of construction as defined by department of revenue rule.

(5) A district may operate and maintain a park or recreational facilities on real property that it owns or in which it has an interest that is not immediately necessary for its purposes.

If such park or recreational facilities are operated by a person other than the district, including a corporation, partnership, or other business enterprise, the person shall indemnify and hold harmless the district for any injury or damage caused by the action of the person.

(6) A water district may contract with an owner or developer of real estate for the construction or improvement of waterworks that will be incorporated into or used as part of the public water system under terms approved by the owner or developer and the board of commissioners. Any work, construction, alteration, repair, or improvement, other than ordinary maintenance, that the water district causes to be performed by an owner or developer of real estate through a contract under this section shall comply with chapter 39.12 RCW.

NEW SECTION. Sec. 21. A new section is added to chapter 57.08 RCW to read as follows:

RCW 57.08.050 does not apply to contracts with the owner or developer of real estate for the construction or improvement of waterworks that will be incorporated into or used as part of the public waterworks system pursuant to RCW 57.08.010, so long as the procedures of section 10 of this act are followed.

Sec. 22. RCW 57.16.050 and 1987 c 169 s 2 are each amended to read as follows:

(1) A district may establish local improvement districts within its territory; levy special assessments under the mode of annual installments extending over a period not exceeding twenty years, on all property specially benefited by a local improvement, on the basis of special benefits to pay in whole or in part the damage or costs of any improvements ordered in the district; and issue local improvement bonds in the local improvement district to be repaid by the collection of special assessments. Such bonds may be of any form, including bearer bonds or registered bonds as provided in RCW 39.46.030. The levying, collection and enforcement of such special assessments and issuance of bonds shall be as provided for the levying, collection, and enforcement of special assessments and the issuance of local improvement district bonds by cities and towns insofar as consistent herewith. The duties devolving upon the city or town treasurer are hereby imposed upon the county treasurer of the county in which the real property is located for the purposes hereof. The mode of assessment shall be determined by the water commissioners by resolution. When in the petition or resolution for the establishment of a local improvement district, and in the approved comprehensive plan or approved amendment thereto or plan providing for additions and betterments to the original plan, previously adopted, it is provided that, except as set forth in this section, the special assessments shall be for the sole purpose of payment into the revenue bond fund for the payment of revenue bonds, then the local improvement district shall be designated as a "utility local improvement district." No warrants or bonds shall be issued in a utility local improvement district, but the collection of interest and principal on all special assessments in the utility local improvement district shall be paid into the revenue bond fund, except that special assessments paid before the issuance and sale of bonds may be deposited in a fund for the payment of costs of improvements in the utility local improvement district.

(2) Such bonds may also be issued and sold in accordance with chapter 39.46 RCW.

(3) A district may contract with an owner or developer of real estate for the construction or improvement of waterworks that will be incorporated into or used as part of the public water system under terms approved by the owner or developer and the board of commissioners. Any work, construction, alteration, repair, or improvement, other than ordinary maintenance, that the district causes to be performed by an owner or developer of real estate through a contract under this section shall comply with chapter 39.12 RCW.

(4) In addition to all of the powers and authorities set forth in this title, any water district has all of the powers of cities as set forth in RCW 35.43.184, 35.43.186, and section 10 of this act.

NEW SECTION. Sec. 23. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.