S-2175

AN ACT Relating to voter approval of city assumption of a water or sewer district; and amending RCW 35.13A.020, 35.13A.030, and 35.13A.050.

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

Sec. 1. RCW 35.13A.020 and 1971 ex.s. c 95 s 2 are each amended to read as follows:

Whenever all of the territory of a ((~~water district or sewer~~)) water-sewer district is included within the corporate boundaries of a city, and the city legislative body has elected by resolution or ordinance to assume jurisdiction thereof, all real and personal property, franchises, rights, assets, taxes levied but not collected for the district for other than indebtedness, water ((~~and~~)) lines, sewer lines, drainage system, and all other facilities and equipment of the district shall become the property of such city subject to all financial, statutory, or contractual obligations of the district for the security or performance of which such property may have been pledged and the district shall be disincorporated. The disincorporation shall not impair the obligation of a contract. Such city, in addition to its other powers, shall have the power to manage, control, maintain and operate such property, facilities and equipment and to fix and collect service and other charges from owners and occupants of properties so served by the city, subject, however, to any outstanding indebtedness, bonded or otherwise, of the district payable from taxes, assessments or revenues of any kind or nature and to any other contractual obligations of the district.

Such city may by resolution of its legislative body, assume the obligation of paying such district indebtedness and of levying and of collecting or causing to be collected such district taxes, assessments and utility rates and charges of any kind or nature to pay and secure the payment of such indebtedness, according to all of the terms, conditions and covenants incident to such indebtedness, and shall assume and perform all other outstanding contractual obligation of the district in accordance with all of its terms, conditions and covenants. No such assumption shall be deemed to impair the obligation of any indebtedness or other contractual obligation entered into after August 9, 1971. During the period until the outstanding indebtedness of the district has been discharged, the territory of the district and the owners and occupants of property therein, shall continue to be liable for its and their proportionate share of such indebtedness, including any outstanding assessments levied within any local improvement district or utility local improvement district thereof. The city shall assume the obligation of causing the payment of such indebtedness, collecting such taxes, assessments and charges and observing and performing the other district contractual obligations. The legislative body of the city shall act as the officers of the district for the purpose of certifying the amount of any property tax to be levied and collected therein, and causing service and other charges and assessments to be collected from such property or owners or occupants thereof, enforcing such collection and performing all other acts necessary to insure performance of the district's contractual obligations in the same manner and by the same means as if the territory of the district had not been included within the boundaries of a city.

When a city assumes the obligation of paying the outstanding indebtedness, and if property taxes or assessments have been levied and service and other charges have accrued for such purpose but have not been collected by the district prior to such election, the same when collected shall belong and be paid to the city and be used by such city so far as necessary for payment of the indebtedness of the district existing and unpaid on the date such city elects to assume the indebtedness. Any funds received by the city which have been collected for the purpose of paying any bonded or other indebtedness of the district, shall be used for the purpose for which they were collected and for no other purpose. Any outstanding indebtedness shall be paid as provided in the bond covenants. All funds of the district on deposit with the county treasurer at the time of title transfer shall be used by the city solely for the benefit of the utility and shall not be transferred to or used for the benefit of the city's general fund.

Sec. 2. RCW 35.13A.030 and 1971 ex.s. c 95 s 3 are each amended to read as follows:

Whenever a portion of a ((~~water district or sewer~~)) water-sewer district equal to at least sixty percent of the area or sixty percent of the assessed valuation of the real property lying within such district((,)) is included within the corporate boundaries of a city, the city may either:

(1) Assume by ordinance the full and complete management and control of that portion of the entire district that is contiguous to the city and not included within another city, ((~~whereupon~~)) if the district voters of such an area approve a ballot proposition authorizing the assumption requested by the city, submitted to these voters by the board of commissioners of the district. The provisions of RCW 35.13A.020 shall be operative if the city proceeds under this subsection and any rates that are charged for service outside of the city shall be reasonable to all parties. However, the district shall not be disincorporated unless the city assumes the responsibility to serve all of the customers of the district, together with all of the district's property, facilities, and equipment; or

(2) The city may proceed directly under the provisions of RCW 35.13A.050.

Sec. 3. RCW 35.13A.050 and 1971 ex.s. c 95 s 5 are each amended to read as follows:

When electing under RCW 35.13A.030 or 35.13A.040 to proceed under this section, the city may assume, by ordinance, jurisdiction of the district's responsibilities, property, facilities and equipment within the corporate limits of the city((~~: PROVIDED, That~~)).

If on the effective date of such an ordinance the territory of the district included within the city contains any facilities serving or designed to serve any portion of the district outside the corporate limits of the city or if the territory lying within the district and outside the city contains any facilities serving or designed to serve territory included within the city (which facilities are hereafter in this section called the "serving facilities"), the city or district shall for the economically useful life of any such serving facilities make available sufficient capacity therein to serve the sewage, drainage, or water requirements of such territory, to the extent that such facilities were designed to serve such territory at a rate charged to the municipality being served which is reasonable to all parties.

In the event a city proceeds under this section, the ((~~district may elect upon a favorable vote of a majority of all voters within the district voting upon such propositions to require the~~)) city shall be required to assume responsibility for ((~~the operation and maintenance of~~)) operating and maintaining the district's property, facilities, and equipment throughout that portion of the entire district that is contiguous to the city but not included in any other city and ((to)) the district shall pay the city a charge for such operation and maintenance which is reasonable under all of the circumstances, if the voters of the district who reside in such an area approve a ballot proposition providing for this transfer of responsibility, submitted to the voters by the board of commissioners of the district.

A city acquiring property, facilities and equipment under the provisions of this section shall acquire such property, facilities and equipment, and fix and collect service and other charges from owners and occupants of properties served by the city, subject, to any contractual obligations of the district which relate to the property, facilities, or equipment so acquired by the city or which are secured by taxes, assessments or revenues from the territory of the district included within the city. In such cases, the property included within the city and the owners and occupants thereof shall continue to be liable for payment of its and their proportionate share of any outstanding district indebtedness. The district and its officers shall continue to levy taxes and assessments on and to collect service and other charges from such property, or owners or occupants thereof, to enforce such collections, and to perform all other acts necessary to insure performance of the district's contractual obligations in the same manner and by the same means as if the territory of the district had not been included within the boundaries of a city.

The district shall be disincorporated if a city assumes the responsibility to serve all of the customers of a district, together with all of the district's property, facilities, and equipment, under this section. In such an event, RCW 35.13A.020 applies. The disincorporation shall not impair the obligation of a contract.