[atlas:bill]

AN ACT Relating to the trust land transfer program; adding new sections to chapter 79.08 RCW; and creating a new section.

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

NEW SECTION. Sec. 1. The legislature finds that since 1989 a trust land transfer program has been maintained through successive biennial budget legislation. This program has provided an innovative means to protect state trust lands that have significant natural, park, and recreational benefits, and provide important aquifer recharge and other environmental benefits. At the same time this program both provides immediate revenue for school construction and acquires other lands to place into trust status to improve revenues to the trust in the future. Specifically, this program has three components:

(1) It provides revenue for the trusts by depositing the timber value of the transfer properties into the trust accounts;

(2) It provides funding to replace the transferred lands with land of equal value that has better income-producing potential for trust beneficiaries; and

(3) It transfers the protected lands to more appropriate management and ownership to emphasize natural, park, water supply protection, and other purposes. Since 1989 the legislature has provided a total of three hundred seventy-two million dollars to fund trust land transfers, of which two hundred thirty-seven million dollars has been allocated to school construction funding and the balance to the purchase of replacement lands for the school trusts.

The legislature further finds that this program may be strengthened by providing guidance for developing priority parcels for trust land transfers, providing criteria to guide development of priority proposals, for providing greater public involvement in the program, and by authorizing the program in statute.

NEW SECTION. Sec. 2. A new section is added to chapter 79.08 RCW to read as follows:

(1) The trust land transfer program is established within the department of natural resources. Consistent with the requirements of section 3 of this act, the board of natural resources must adopt procedures for the department of natural resources to identify, evaluate, and submit to the board a priority list of trust lands appropriate for funding under the program. The board of natural resources must adopt criteria for evaluating trust lands appropriate for funding, which should include consideration of:

(a) Increasing the ability of the trust to produce revenue for its beneficiaries;

(b) Lands on which revenue generating capacity is constrained by local, state, or federal law; and

(c) Lands that provide significant value for purposes other than maximizing revenue from timber harvest, such as uses for parks and recreation, natural areas conservation, fish and wildlife habitat conservation, scenic enjoyment, and protection of water supplies and water quality.

The board of natural resources' evaluation criteria must place a high priority upon lands on islands that provide a significant recharge function to sole source aquifers relied upon for drinking water purposes.

(2) By July 1st of each even-numbered year, the department of natural resources must develop a prioritized list of properties eligible for trust land transfer. The list shall rank the projects in order of priority, and clearly identify the reasons each property is being recommended for transfer, the proposed use of each property, and the proposed receiving agency. The list must be submitted to the board of natural resources for its review and consideration, and be provided to members of the public requesting such information, as well as each city or county in which listed trust lands are located.

(3) The board of natural resources must schedule one or more public meetings in which citizens may provide their comments on the ranked list and upon other trust lands that may be recommended for consideration.

(4) By September 15th of each even-numbered year, the board of natural resources must recommend to the governor a prioritized list of properties eligible for trust land transfer. The board's recommendations must also be submitted to the standing capital budget committees of the senate and the house of representatives.

NEW SECTION. Sec. 3. A new section is added to chapter 79.08 RCW to read as follows:

(1) Property transferred under the trust land transfer program created in section 2 of this act must be appraised and transferred at fair market value. The proceeds of the sale or transfer attributed to timber value must be deposited by the department of natural resources in the same manner as timber revenues from other trust lands, except that no deductions may be made for the resource management cost account under RCW 79.64.040 unless the transfer is of a lease or easement interest. The proceeds of the sales attributed to land value must be deposited into the natural resources real property replacement account under RCW 43.30.265. These funds must be expended by the department of natural resources to acquire replacement real property of equal value to be managed as trust land for the trust under which the transferred land was managed.

(2) Trust land transfers may be accomplished either by a transfer of the fee interest in the land or by conveying a lease, easement, or other interest that restricts timber harvest on transferred properties for a minimum of thirty years.

(3) Prior to the transfer of lands, the receiving agency must demonstrate the ability to manage the transfer lands according to state and local laws regarding public safety, weed and fire control, and other applicable public land management requirements. Trust land transfers must be accomplished in cooperation with receiving agencies.

(4) The department of natural resources may not expend funds or otherwise financially obligate funds for trust land transfers until the legislature has appropriated funds for a specific list of projects.