AN
ACT Relating to studying methods for calculating water-dependent lease rates on
state-owned aquatic lands; amending RCW 79.90.480; and creating new sections.
BE IT
ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
NEW
SECTION. Sec. 1. (1)
The legislature finds that the current method for determining water-dependent
rental rates for aquatic land leases may not be achieving the management goals
in RCW 79.90.455. The current method for setting rental rates, as well as
alternatives to the current methods, should be evaluated in light of achieving
management goals for aquatic lands leases. The legislature further finds that
there should be no further increases in water-dependent rental rates for marina
leases before the completion of this evaluation.
(2)
The department of natural resources shall study and prepare a report to the
legislature on alternatives to the current method for determination of
water-dependent rent set forth in RCW 79.90.480. The report shall be prepared
with the assistance of appropriate outside economic expertise and stakeholder
involvement. Affected stakeholders shall participate with the department by
providing information necessary to complete this study. For each alternative,
the report shall:
(a)
Describe each method and the costs and benefits of each;
(b)
Compare each with the current method of calculating rents;
(c)
Provide the private industry perspective;
(d)
Describe the public perspective;
(e)
Analyze the impact on state lease revenue;
(f)
Evaluate the impacts of water-dependent rates on economic development in
economically distressed counties; and
(g)
Evaluate the ease of administration.
(3)
The report shall be presented to the legislature by November 1, 1998, with the
recommendations of the department clearly identified. The department's
recommendations shall include draft legislation as necessary for implementation
of its recommendations.
Sec.
2. RCW
79.90.480 and 1984 c 221 s 7 are each amended to read as follows:
Except
as otherwise provided by this chapter, annual rent rates for the lease of
state-owned aquatic lands for water-dependent uses shall be determined as
follows:
(1)(a)
The assessed land value, exclusive of improvements, as determined by the county
assessor, of the upland tax parcel used in conjunction with the leased area or,
if there are no such uplands, of the nearest upland tax parcel used for
water-dependent purposes divided by the parcel area equals the upland value.
(b)
The upland value times the area of leased aquatic lands times thirty percent
equals the aquatic land value.
(2)
As of July 1, 1989, and each July 1 thereafter, the department shall determine
the real capitalization rate to be applied to water-dependent aquatic land
leases commencing or being adjusted under subsection (3)(a) of this section in
that fiscal year. The real capitalization rate shall be the real rate of
return, except that until June 30, 1989, the real capitalization rate shall be
five percent and thereafter it shall not change by more than one percentage
point in any one year or be more than seven percent or less than three percent.
(3)
The annual rent shall be:
(a)
Determined initially, and redetermined every four years or as otherwise
provided in the lease, by multiplying the aquatic land value times the real
capitalization rate; and
(b)
Adjusted by the inflation rate each year in which the rent is not determined
under subsection (3)(a) of this section.
(4)
If the upland parcel used in conjunction with the leased area is not assessed
or has an assessed value inconsistent with the purposes of the lease, the
nearest comparable upland parcel used for similar purposes shall be substituted
and the lease payment determined in the same manner as provided in this section.
(5)
For the purposes of this section, "upland tax parcel" is a tax
parcel, some portion of which has upland characteristics. Filled tidelands or
shorelands with upland characteristics which abut state-owned aquatic land
shall be considered as uplands in determining aquatic land values.
(6)
The annual rent for filled state-owned aquatic lands that have the
characteristics of uplands shall be determined in accordance with RCW 79.90.500
in those cases in which the state owns the fill and has a right to charge for
the fill.
(7)
For leases for marina uses only, beginning on the effective date of this
section, the annual rental rates in effect on December 31, 1997, shall remain
in effect until July 1, 1999, at which time the annual water-dependent rent
shall be determined by the method in effect at that time. In order to be
eligible for the rate to remain at this level, a marina lease must be in good
standing, meaning that the lessee must be current with payment of rent, the
lease not expired or in approved holdover status, and the lessee not in breach
of other terms of the agreement.
(8)
For all new leases for marinas, or any other water-dependent use, issued after
December 31, 1997, the initial annual water-dependent rent shall be determined
by the methods in subsections (1) through (6) of this section.
NEW
SECTION. Sec. 3. In
order to facilitate the participation of affected stakeholders in the preparation
of the report to the legislature, the department of natural resources shall
form two committees: The report preparation committee and the report
evaluation committee.
(1)
The report preparation committee consists of one representative with knowledge
of waterfront industries and economic principles from each of the following
groups: Private marina operators, northwest marine trade association,
association of Washington cities, association of Washington counties,
Washington public ports association, commercial waterfront business other than
marinas, and the aquatic resources division of the department of natural
resources. The report preparation committee will work with the staff and
consultants of the department of natural resources to assemble and evaluate
relevant data, develop alternatives, and draft the report.
(2)
The report evaluation committee consists of the manager of the aquatic
resources division, three representatives of the marina industry state-wide
nominated by the Northwest marine trade association, three representatives of
other commercial users of aquatic lands state-wide chosen by the department of
natural resources in consultation with the Northwest marine trade association,
the executive director of the Washington public ports association, and one
representative selected jointly by the association of Washington cities and the
association of Washington counties. The report evaluation committee shall
review the draft report submitted by the report preparation committee and assist
the department of natural resources in identifying economic impacts of the
various alternatives and in selecting a preferred alternative to present to the
legislature.
NEW
SECTION. Sec. 1. If
specific funding for the purposes of this act, referencing this act by bill or
chapter number, is not provided by June 30, 1998, in the omnibus appropriations
act, this act is null and void.
