H-4835.1  _______________________________________________

                    SUBSTITUTE HOUSE BILL 2394

          _______________________________________________

State of Washington      55th Legislature     1998 Regular Session

By House Committee on Appropriations (originally sponsored by Representatives Alexander, D. Schmidt, H. Sommers, Gardner, Doumit, Lambert and Thompson; by request of Department of General Administration)

Read first time 02/03/98.  Referred to Committee on .

Consolidating general administration funds and accounts.

    AN ACT Relating to consolidating the operating funding structure of the department of general administration; amending RCW 4.92.220, 39.32.035, 39.32.040, 43.01.090, 43.19.1923, 43.19.1925, 43.19.1935, 43.19.500, 43.19.558, 43.19.605, 43.19.610, 43.19.615, 43.82.120, 43.82.125, and 43.88.350; adding a new section to chapter 43.19 RCW; repealing RCW 39.32.030, 39.32.050, and 43.19.1927; and providing an effective date.

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

NEW SECTION. Sec. 1.  A new section is added to chapter 43.19 RCW to read as follows:

    The general services administration account is created in the custody of the state treasurer and shall be used for all activities previously budgeted and accounted for in the following internal service funds:  The motor transport account, the general administration management fund, the general administration facilities and services revolving fund, the central stores revolving fund, the surplus property purchase revolving fund, and the risk management account.  Only the director or the director's designee may authorize expenditures from the account.

    Sec. 2.  RCW 4.92.220 and 1995 c 137 s 1 are each amended to read as follows:

    (1) ((A risk management account is hereby created in the treasury)) The general administration services account is to be used ((exclusively)) for the payment of costs related to:

    (a) The appropriated administration of liability, property, and vehicle claims, including investigation, claim processing, negotiation, and settlement, and other expenses relating to settlements and judgments against the state not otherwise budgeted; and

    (b) The nonappropriated pass-through cost associated with the purchase of liability and property insurance, including catastrophic insurance, subject to policy conditions and limitations determined by the risk manager.

    (2) The ((risk management)) general administration services account's appropriation for risk management shall be financed through a combination of direct appropriations and assessments to state agencies.

    Sec. 3.  RCW 39.32.035 and 1995 c 137 s 4 are each amended to read as follows:

    The ((surplus property purchase revolving fund)) general administration services account shall be administered by the director of general administration and be used for the purchase, lease or other acquisition from time to time of surplus property from any federal, state, or local government surplus property disposal agency.  The director may purchase, lease or acquire such surplus property on the requisition of an eligible donee and without such requisition at such time or times as he or she deems it advantageous to do so; and in either case he or she shall be responsible for the care and custody of the property purchased so long as it remains in his or her possession.

    Sec. 4.  RCW 39.32.040 and 1995 c 137 s 5 are each amended to read as follows:

    In purchasing federal surplus property on requisition for any eligible donee the director may advance the purchase price thereof from the ((surplus property purchase revolving fund)) general administration services account, and he or she shall then in due course bill the proper eligible donee for the amount paid by him or her for the property plus a reasonable amount to cover the expense incurred by him or her in connection with the transaction.  In purchasing surplus property without requisition, the director shall be deemed to take title outright and he or she shall then be authorized to resell from time to time any or all of such property to such eligible donees as desire to avail themselves of the privilege of purchasing.  All moneys received in payment for surplus property from eligible donees shall be deposited by the director in the ((surplus property purchase revolving fund)) general administration services account.  The director shall sell federal surplus property to eligible donees at a price sufficient only to reimburse the ((surplus property purchase revolving fund)) general administration services account for the cost of the property to the ((fund)) account, plus a reasonable amount to cover expenses incurred in connection with the transaction.  Where surplus property is transferred to an eligible donee without cost to the transferee, the director may impose a reasonable charge to cover expenses incurred in connection with the transaction.  The governor, through the director of general administration, shall administer the surplus property program in the state and shall perform or supervise all those functions with respect to the program, its agencies and instrumentalities.

    Sec. 5.  RCW 43.01.090 and 1994 c 219 s 16 are each amended to read as follows:

    The director of general administration may assess a charge or rent against each state board, commission, agency, office, department, activity, or other occupant or user for payment of a proportionate share of costs for occupancy of buildings, structures, or facilities including but not limited to all costs of acquiring, constructing, operating, and maintaining such buildings, structures, or facilities and the repair, remodeling, or furnishing thereof and for the rendering of any service or the furnishing or providing of any supplies, equipment, or materials.

    The director of general administration may recover the full costs including appropriate overhead charges of the foregoing by periodic billings as determined by the director including but not limited to transfers upon accounts and advancements into the general administration ((facilities and)) services ((revolving fund)) account.  Charges related to the rendering of real estate services under RCW 43.82.010 and to the operation of nonassigned public spaces in Thurston county shall be allocated separately from other charges assessed under this section.  Rates shall be established by the director of general administration after consultation with the director of financial management.  The director of general administration may allot, provide, or furnish any of such facilities, structures, services, equipment, supplies, or materials to any other public service type occupant or user at such rates or charges as are equitable and reasonably reflect the actual costs of the services provided:  PROVIDED, HOWEVER, That the legislature, its duly constituted committees, interim committees and other committees shall be exempted from the provisions of this section.

    Upon receipt of such bill, each entity, occupant, or user shall cause a warrant or check in the amount thereof to be drawn in favor of the department of general administration which shall be deposited in the state treasury to the credit of the general administration ((facilities and)) services ((revolving fund established in RCW 43.19.500)) account unless the director of financial management has authorized another method for payment of costs.

    Beginning July 1, 1995, the director of general administration shall assess a capital projects surcharge upon each agency or other user occupying a facility owned and managed by the department of general administration in Thurston county.  The capital projects surcharge does not apply to agencies or users that agree to pay all future repairs, improvements, and renovations to the buildings they occupy and a proportional share, as determined by the office of financial management, of all other campus repairs, installations, improvements, and renovations that provide a benefit to the buildings they occupy or that have an agreement with the department of general administration that contains a charge for a similar purpose, including but not limited to RCW 43.01.091, in an amount greater than the capital projects surcharge.  The director, after consultation with the director of financial management, shall adopt differential capital project surcharge rates to reflect the differences in facility type and quality.  The initial payment structure for this surcharge shall be one dollar per square foot per year.  The surcharge shall increase over time to an amount that when combined with the facilities and service charge equals the market rate for similar types of lease space in the area or equals five dollars per square foot per year, whichever is less.  The capital projects surcharge shall be in addition to other charges assessed under this section.  Proceeds from the capital projects surcharge shall be deposited into the Thurston county capital facilities account created in RCW 43.19.501.

    Sec. 6.  RCW 43.19.1923 and 1991 sp.s. c 16 s 921 are each amended to read as follows:

    ((There is created within the department of general administration a revolving fund to be known as the central stores revolving fund, which)) The general administration services account shall be used for the purchase of supplies and equipment handled or rented through central stores, and the payment of salaries, wages, and other costs incidental to the acquisition, operation, and maintenance of the central stores, and other activities connected therewith, which shall include utilities services.  Disbursements from the ((fund)) account for the purchasing and contract administration activities of the division of purchasing within the department are subject to appropriation and allotment procedures under chapter 43.88 RCW.  Disbursements for all other state purchasing activities within the ((central stores)) general administration services account are not subject to appropriation.  The ((fund)) account shall be credited with all receipts from the rental, sale or distribution of supplies, equipment, and services rendered to the various state agencies.  Central stores, utilities services, and other activities within the ((central stores revolving fund)) general administration services account shall be treated as separate operating entities for financial and accounting control.  Financial records involving the ((central stores revolving fund)) general administration services account shall be designed to provide data for achieving maximum effectiveness and economy of each individual activity within the ((fund)) account.

    Sec. 7.  RCW 43.19.1925 and 1975 c 40 s 8 are each amended to read as follows:

    To supply such funds as may be necessary for making combined purchases of items or services of common use by central stores, state agencies shall, upon request of the division of purchasing, from time to time, make advance payments into the ((central stores revolving fund)) general administration services account from funds regularly appropriated to them for the procurement of supplies, equipment, and services:  PROVIDED, That advance payment for services shall be on a quarterly basis:  PROVIDED FURTHER, That any person, firm or corporation other than central stores rendering services for which advance payments are made shall deposit cash or furnish surety bond coverage to the state in an amount as shall be fixed by law, or if not fixed by law, then in such amounts as shall be fixed by the director of the department of general administration.  Any such bond so furnished shall be conditioned that the person, firm or corporation receiving the advance payment will apply it toward performance of the contract.  Funds so advanced to central stores shall be used only for the combined procurement, storage, and delivery of such stocks of supplies, equipment, and services as are requisitioned by the agency and shall be offset and repaid to the respective state agencies by an equivalent value in merchandise supplied and charged out from time to time from central stores.  Costs of operation of central stores may be recovered by charging as part of the value of materials, supplies, or services an amount sufficient to cover the costs of operating central stores.

    Sec. 8.  RCW 43.19.1935 and 1985 c 188 s 1 are each amended to read as follows:

    As a means of providing for the procurement of insurance and bonds on a volume rate basis, the director of general administration through the risk management office shall purchase or contract for the needs of state agencies in relation to all such insurance and bonds:  PROVIDED, That authority to purchase insurance may be delegated to state agencies.  Insurance in force shall be reported to the risk management office periodically under rules established by the director.  Nothing contained in this section shall prohibit the use of licensed agents or brokers for the procurement and service of insurance.

    The amounts of insurance or bond coverage shall be as fixed by law, or if not fixed by law, such amounts shall be as fixed by the director of the department of general administration.

    The premium cost for insurance acquired and bonds furnished shall be paid from appropriations or other appropriate resources available to the state agency or agencies for which procurement is made, and all vouchers drawn in payment therefor shall bear the written approval of the risk management office prior to the issuance of the warrant in payment therefor.  Where deemed advisable the premium cost for insurance and bonds may be paid by the ((central stores revolving fund)) general administration services account which ((fund)) shall be reimbursed by the agency or agencies for which procurement is made.

    Sec. 9.  RCW 43.19.500 and 1994 c 219 s 17 are each amended to read as follows:

    ((There is hereby created a fund within the state treasury designated as the "department of general administration facilities and services revolving fund".  Such revolving fund)) The general administration services account shall be used by the department of general administration for the payment of certain costs, expenses, and charges, as specified in this section, incurred by it in the operation and administration of the department in the rendering of services, the furnishing or supplying of equipment, supplies and materials, and for providing or allocating facilities, including the operation, maintenance, rehabilitation, or furnishings thereof to other agencies, offices, departments, activities, and other entities enumerated in RCW 43.01.090 and including the rendering of services in acquiring real estate under RCW 43.82.010 and the operation and maintenance of nonassigned public spaces in Thurston county.  The department shall treat the rendering of services in acquiring real estate and the operation and maintenance of nonassigned public spaces as separate operating entities within the ((fund)) account for financial accounting and control.

    The schedule of services, facilities, equipment, supplies, materials, maintenance, rehabilitation, furnishings, operations, and administration to be so financed and recovered shall be determined jointly by the director of general administration and the director of financial management, in equitable amounts which, together with any other income or appropriation, will provide the department of general administration with funds to meet its anticipated expenditures during any allotment period.

    The director of general administration may adopt rules governing the provisions of RCW 43.01.090 and this section and the relationships and procedures between the department of general administration and such other entities.

    Sec. 10.  RCW 43.19.558 and 1994 sp.s. c 9 s 802 are each amended to read as follows:

    The ((motor transport)) general administration services account shall be used to pay the costs of carrying out the programs provided for in RCW 43.19.550 through 43.19.558, unless otherwise specified by law.  The director of general administration may recover the costs of the programs by billing agencies that own and operate passenger motor vehicles on the basis of a per vehicle charge.  The director of general administration, after consultation with affected state agencies, shall establish the rates.  All rates shall be approved by the director of financial management.  The proceeds generated by these charges shall be used solely to carry out RCW 43.19.550 through 43.19.558.

    Sec. 11.  RCW 43.19.605 and 1989 c 57 s 6 are each amended to read as follows:

    No cash reimbursement shall be made to agencies for property transferred under RCW 43.19.600 to the extent that such property was originally acquired without cost or was purchased from general fund appropriations.  The value of such property shall be entered upon the accounts of the ((motor transport)) general administration services account as an amount due the agency from which the vehicle was transferred.  For such property purchased from dedicated, revolving, or trust funds, the value at the time of transfer shall also be entered upon the accounts of the ((motor transport)) general administration services account as an amount due the agency and fund from which the vehicle transferred was purchased and maintained.  If surplus funds associated with motor vehicle transportation services are available in the ((motor transport)) general administration services account, the agency may be paid all or part of the amount due to the dedicated, revolving, or trust fund concerned.  Otherwise, the credit for the amount due shall be applied proportionately over the remaining undepreciated life of such property.  The prorated credits shall be applied monthly by the director of general administration against any monthly or other charges for motor vehicle transportation services rendered the agency.

    To the extent surplus funds associated with motor vehicle transportation services are available in the ((motor transport)) general administration services account, the director of general administration may direct a cash reimbursement to a dedicated, revolving, or trust fund where an amount due such a fund will not be charged off to services rendered by the department of general administration within a reasonable time.

    Any disagreement between the supervisor of motor transport and an agency as to the amount of reimbursement to which it may be entitled shall be resolved by the director of general administration.

    Sec. 12.  RCW 43.19.610 and 1991 sp.s. c 13 s 35 are each amended to read as follows:

    ((There is hereby established in the state treasury an account to be known as the motor transport account into which shall be paid)) All moneys, funds, proceeds, and receipts as provided in RCW 43.19.615 and as may otherwise be provided by law shall be paid into the general administration services account.  Disbursements therefrom shall be made in accordance with the provisions of RCW 43.19.560 through 43.19.630, 43.41.130 and 43.41.140 as authorized by the director or a duly authorized representative and as may be provided by law.

    Sec. 13.  RCW 43.19.615 and 1975 1st ex.s. c 167 s 13 are each amended to read as follows:

    The director of general administration shall deposit in the ((motor transport)) general administration services account all receipts, including the initial transfer of automobile pool capital from the highway equipment fund and any other funds transferred, rentals or other fees and charges for transportation services furnished, proceeds from the sale of surplus or replaced property under the control of the supervisor of motor transport and other income, and from which shall be paid operating costs, including salaries and wages, administrative expense, overhead, the cost of replacement vehicles, additional passenger vehicles authorized pursuant to RCW 43.19.565, and any other expenses.  If it is necessary at any time for the department to request any appropriation from the general fund or various dedicated, revolving, or trust funds to purchase additional vehicles, any appropriation therefor may provide that such advance shall be repaid together with reasonable interest from surpluses of the ((motor transport)) general administration services account.

    Sec. 14.  RCW 43.82.120 and 1994 c 219 s 14 are each amended to read as follows:

    All rental income collected by the department of general administration from rental of state buildings shall be deposited in the general administration ((management fund, the creation of which is hereby authorized)) services account.

    Sec. 15.  RCW 43.82.125 and 1965 c 8 s 43.82.125 are each amended to read as follows:

    The general administration ((management fund)) services account shall be used to pay all costs incurred by the department in the operation of real estate managed under the terms of this chapter.  Moneys received into the general administration ((management fund)) services account shall be used to pay rent to the owner of the space for occupancy of which the charges have been made and to pay utility and operational costs of the space utilized by the occupying agency:  PROVIDED, That moneys received into the ((fund)) account for occupancy of space owned by the state where utilities and other operational costs are covered by appropriation to the department of general administration shall be immediately transmitted to the general fund((:  PROVIDED FURTHER, That the director may expend not to exceed fifty thousand dollars per biennium from the general administration management fund to cover unusual or unexpected expenses connected with space occupancy or management that cannot be charged directly to any specific state agency.  In the event the director determines that there is a surplus in this fund, he shall transfer such surplus to the general fund)).

    Sec. 16.  RCW 43.88.350 and 1981 c 270 s 14 are each amended to read as follows:

    Any rate increases proposed for or any change in the method of calculating charges from the legal services revolving fund or services provided in accordance with RCW 43.01.090 or 43.19.500 in the general administration ((facilities and)) services ((revolving fund, or any change in the method of calculating charges from those funds,)) account is subject to approval by the director of financial management prior to implementation.

NEW SECTION. Sec. 17.  The following acts or parts of acts are each repealed:

(1) RCW 39.32.030 and 1967 ex.s. c 70 s 3 & 1945 c 205 s 3;

(2) RCW 39.32.050 and 1945 c 205 s 6; and

(3) RCW 43.19.1927 and 1965 c 8 s 43.19.1927.

NEW SECTION. Sec. 18.  This act takes effect July 1, 1999.

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