[atlas:bill]

AN ACT Relating to downtown and neighborhood commercial district revitalization; adding a new section to chapter 82.04 RCW; adding a new section to chapter 84.36 RCW; adding a new section to chapter 82.14 RCW; adding a new chapter to Title 43 RCW; and creating a new section.

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

PART I‑-LEGISLATIVE INTENT

NEW SECTION. Sec. 101. (1) The legislature finds:

(a) The continued economic vitality of downtown and neighborhood commercial districts in our state's cities are essential to community preservation, social cohesion, and economic growth;

(b) In recent years there has been a deterioration of downtown and neighborhood commercial districts in rural and urban communities due to a shifting population base, changes in the marketplace, and greater competition from suburban shopping malls and discount centers;

(c) This decline has eroded the ability of businesses and property owners to renovate and enhance their commercial and residential properties; and

(d) Business owners in these districts need to maintain their local economies in order to provide goods and services to adjacent residents, to provide employment opportunities, and to avoid disinvestment and economic dislocations, and have developed downtown and neighborhood commercial district revitalization programs to address these problems.

(2) It is the intent of the legislature to establish a program to:

(a) Work in partnership with these organizations;

(b) Provide technical assistance and training to local governments, business organizations, downtown and neighborhood commercial district organizations, and business and property owners to accomplish community and economic revitalization and development of business districts; and

PART II‑-DOWNTOWN AND NEIGHBORHOOD COMMERCIAL DISTRICT

REVITALIZATION INCENTIVES

NEW SECTION. Sec. 201. A new section is added to chapter 82.04 RCW to read as follows:

(1) There may be credit against the tax imposed by this chapter, the value of private contributions that are designed to assist in the development and operation of a downtown and neighborhood commercial district revitalization program.

(2) The credit allowed under this section is limited to an amount equal to:

(a) Seventy-five percent of the value of the contribution that is made directly, by the business, to a downtown and neighborhood commercial district revitalization program; or

(b) Fifty percent of the value of the contribution that is made directly, by the business, to the department of community, trade, and economic development for distribution as financial or technical assistance under section 302 of this act. The total credits allowed under this section for an individual downtown and neighborhood commercial district cannot exceed one hundred thousand dollars in a calendar year. The total credits allowed under this section for a business cannot exceed two hundred fifty thousand dollars in a calendar year. The total credits allowed on a state-wide basis cannot exceed two million dollars in a calendar year.

(3) Prior to claiming the credit under this section, the business must obtain approval from the department of community, trade, and economic development. The businesses' request for approval must include a description of the contribution and the value of the contribution.

(4) This section applies only to contributions for which an application is approved on or after the effective date of this act.

(5) As used in this section:

(a) "Contribution" means either cash or other in-kind contributions or both.

(b) "Downtown and neighborhood commercial district revitalization program" means a program certified by the department of community, trade, and economic development under sections 101 and 301 through 306 of this act.

NEW SECTION. Sec. 202. A new section is added to chapter 84.36 RCW to read as follows:

(1) A physical improvement to a commercial building upon real property, that is located in an area designated by the department of community, trade, and economic development under section 303 of this act, is exempt from taxation for the ten assessment years subsequent to the completion of the improvement, if the improvement meets the guidelines established by the local downtown and neighborhood commercial district revitalization program. A taxpayer desiring to obtain the exemption granted by this section must file notice of their intent to construct the improvement prior to the improvement being made on forms prescribed by the department of revenue and furnished to the taxpayer by the county assessor. This assessment cannot be claimed more than once in a fifteen-year period. As used in this section, "downtown and neighborhood commercial district revitalization program" has the same meaning as in section 201 of this act.

(2) The department of revenue must adopt those rules as are necessary to properly administer the provisions of this section.

NEW SECTION. Sec. 203. A new section is added to chapter 82.14 RCW to read as follows:

(1) The legislative authority of a local government may impose a sales and use tax in accordance with the terms of this chapter. The tax is in addition to other taxes authorized by law and shall be collected from those persons who are taxable by the state under chapters 82.08 and 82.12 RCW upon the occurrence of any taxable event within an eligible area of the local government. The rate of tax shall not exceed two-tenths of one percent of the selling price in the case of a sales tax or value of the article used in the case of a use tax.

(2) The tax imposed under subsection (1) of this section shall be deducted from the amount of tax otherwise required to be collected or paid to the department of revenue under chapter 82.08 or 82.12 RCW. The department of revenue shall perform the collection of such taxes on behalf of the county at no cost to the county.

(3) Moneys collected under this section shall only be used for the purpose of paying the costs for a downtown and neighborhood commercial district revitalization project in an eligible area.

(4) No tax may be collected under this section before January 1, 1999.

(5) Moneys collected under this section must be matched with one dollar of local or private funds for every two dollars of funds collected under this section.

(6) As used in this section:

(a) "Downtown and neighborhood commercial district revitalization project" means: Public infrastructure improvements, including street and utility improvements; professional management, planning, and promotion within the eligible area, including the management and promotion of retail trade activities in the eligible area; maintenance and security for common or public areas in the eligible area; and historic preservation activities authorized under RCW 35.21.395.

(b) "Eligible area" means a geographic area that has been designated by the department of community, trade, and economic development at the partner-level or associate-level under section 303 of this act.

PART III‑-DOWNTOWN AND NEIGHBORHOOD COMMERCIAL DISTRICT

REVITALIZATION PROGRAM

NEW SECTION. Sec. 301. The definitions in this section apply throughout this section and sections 101 and 302 through 306 of this act unless the context clearly requires otherwise.

(1) "Area" means a geographic area within a local government that is described by a close perimeter boundary.

(2) "Department" means the department of community, trade, and economic development.

(3) "Director" means the director of community, trade, and economic development.

(4) "Local government" means a city, code city, or town.

(5) "Qualified levels of participation" means a local downtown and neighborhood commercial district revitalization effort that has been certified by the department, as being at the participant-level, associate-level, or partner-level.

NEW SECTION. Sec. 302. The Washington main street program is created within the department. In order to implement the Washington main street program, the department shall:

(1) Provide technical assistance to businesses, property owners, organizations, and local governments undertaking a comprehensive downtown and neighborhood commercial district revitalization and management strategy within a specified area. Technical assistance includes, but is not limited to: Initial site evaluations and assessments; training for local programs; training for local program staff; site visits and assessments by technical specialists; local program design assistance and evaluation; and continued local program on-site assistance;

(2) To the extent funds are made available, provide financial assistance to local governments or local organizations to assist in initial program start-up costs, specific project feasibility studies, market studies, and design assistance;

(3) Develop objective criteria for selecting recipients of financial assistance under subsection (1) of this section and providing designation of a local program under section 303 of this act;

(4) Operate the Washington main street program in accordance with the plan developed by the department, in consultation with the Washington main street advisory committee created under section 304 of this act;

(5) Allow certification of local downtown and neighborhood commercial district revitalization programs by local governments with a population greater than one hundred thousand; and

(6) Consider other factors the department deems necessary for the implementation of this chapter.

NEW SECTION. Sec. 303. The department shall, by rule, adopt criteria for the designation of local downtown and neighborhood commercial district revitalization programs and official local main street programs. The categories are limited to: Partner-level, associate-level, and participant-level. In establishing the criteria, the department shall consider:

(1) The degree of interest and commitment to downtown and neighborhood commercial district revitalization and, where applicable, historic preservation by both the public and private sectors;

(2) The evidence of potential private sector investment in the downtown and neighborhood commercial district;

(3) Where applicable, a downtown and neighborhood commercial district with sufficient historic fabric to become a foundation for an enhanced community image;

(4) Organization and financial commitment to implement a long-term downtown and neighborhood commercial district revitalization program that includes a commitment to employ a professional project manager with an operating budget;

(5) The department's existing downtown revitalization services tier system;

(6) The national main street center's criteria for designating official main street cities; and

(7) Other factors the department deems necessary for the designation of a local program.

NEW SECTION. Sec. 304. (1) The Washington main street advisory committee is created within the department. The members of the advisory committee are appointed by the director and consist of:

(a) The director, or the director's designee, who shall serve as chair;

(b) One representative of private industry councils;

(d) The chair of the governor's small business improvement council;

(e) Five representatives from existing main street programs or downtown and neighborhood commercial district programs; and

(f) One representative of the Washington state office of archaeology and historic preservation.

(2) The plan required under section 302 of this act must describe:

(a) The objectives and strategies of the Washington main street program;

(b) How the Washington main street program will be coordinated with existing federal, state, local, and private sector business development and historic preservation efforts;

(d) The methods of selecting and providing assistance to participating local programs; and

(e) A means to solicit private contributions for state and local operations of the Washington main street program.

NEW SECTION. Sec. 305. The Washington main street trust fund account is created in the state treasury. All receipts from private contributions, federal funds, legislative appropriations, and fees for services, if levied, must be deposited into the account. Moneys in the account may be spent only after appropriation. Expenditures from the account may be used only for the operation of the Washington main street program.

NEW SECTION. Sec. 306. Sections 101 and 301 through 306 of this act may be known and cited as the Washington main street act.

PART IV‑-TECHNICAL PROVISIONS

NEW SECTION. Sec. 401. Sections 101 and 301 through 306 of this act constitute a new chapter in Title 43 RCW.

NEW SECTION. Sec. 402. 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.

NEW SECTION. Sec. 403. Part headings as used in this act constitute no part of the law.