SENATE BILL REPORT

                  SHB 2528

              As Reported By Senate Committee On:

          State & Local Government, February 21, 2000

Title:  An act relating to capacity charges for sewage facilities to enhance water quality.

Brief Description:  Regulating capacity charges for sewage facilities by metropolitan municipal corporations.

Sponsors:  House Committee on Local Government (originally sponsored by Representatives Cairnes, Cooper, G. Chandler, Dunshee, Tokuda, Linville, Stensen, Lovick, Esser, Kenney, Barlean, Constantine, Murray and Keiser).

Brief History:

Committee Activity:  State & Local Government:  2/16/2000, 2/21/2000 [DP].

SENATE COMMITTEE ON STATE & LOCAL GOVERNMENT

Majority Report:  Do pass.

  Signed by Senators Patterson, Chair; Gardner, Vice Chair; Hale, Haugen, Horn, Kline and McCaslin.

Staff:  Diane Smith (786-7410)

Background:  A metropolitan municipal corporation that is engaged in the transmission, treatment, and disposal of sewage may impose a capacity charge on the users of the facility when the customer connects, reconnects or establishes new service.  The capacity charge is based upon the cost of the sewer facility=s excess capacity, and may be collected over a 15- year period.

Sewer capacity charges for a metropolitan municipal corporation are currently set at a maximum monthly rate, and are subject to annual review and approval by the legislative authority.  Sewer capacity charges for a building other than a single family residence are based on the projected number of residential customer equivalents to be represented by the building.

A metropolitan municipal corporation is defined as a municipal corporation of the state of Washington authorized by Chapter 35.58 RCW in which two or more cities of at least 10,000 population have organized to perform certain functions, or a county which has, by ordinance or resolution, assumed the rights, powers and functions of a metropolitan municipal corporation.

Summary of Bill:  The maximum monthly rates, residential customer equivalent provisions for capacity charges, and the 15-year duration for capacity charges are eliminated.

The specific capacity charges have been modified to authorize metropolitan municipal corporations the right to charge property owners to connect to the sewage facility and to impose that charge on a monthly basis.  The connection charges are considered revenue of the sewage facility.

In addition to the connection charge, there is a capacity charge authorized to be set by the legislative body based on the property owners= equitable share of the cost of the system.

The equitable share is defined to include interest charges that apply:  (a) from the date of construction of the sewage facilities until the connection; (b) for a period not to exceed ten years, at a rate commensurate with the rate of interest applicable to the municipal corporation at the time of construction or major rehabilitation of the sewage facilities; or (c) at the time of installation of the sewer lines, but not to exceed 10 percent per year.  The aggregate amount of interest is not to exceed the equitable share of the cost of the sewage facilities allocated to such property owners.

Appropriation:  None.

Fiscal Note:  Not requested.

Effective Date:  Ninety days after adjournment of session in which bill is passed.

Testimony For:  There will be an effective building moratorium in King County without this bill.  It allows monthly hookup and capacity charges for new customers.  It is not mandatory to hook up to the sewer if an existing septic system tests as properly functioning.

Testimony Against:  None.

Testified:  Chuck Williams, King County (pro).