AN ACT Relating to the creation of regional transportation investment districts; amending RCW 43.84.092, 43.84.092, and 81.104.140; reenacting and amending RCW 47.05.021; adding new sections to chapter 43.131 RCW; adding a new chapter to Title 47 RCW; creating a new section; providing an effective date; providing an expiration date; and declaring an emergency.

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

NEW SECTION. Sec. 1. The legislature recognizes that many transportation decisions are best made at the regional level, where transportation problems are best understood. To achieve improved regional mobility, to promote individual and economic well-being, and to implement recommendation number six of the Blue Ribbon Commission on Transportation final report, relating to regional transportation solutions, regional transportation investment districts are created. It is the purpose of regional transportation investment districts to generate revenues for a limited period of time to assist in the financing of transportation improvements made to highways of statewide significance to improve transportation mobility in congested areas.

The legislature recognizes that a multimodal approach to the state's transportation system is the best means of addressing transportation needs. For the past decade, little money has been spent on adding capacity to our state's highways of statewide significance. This lack of investment includes major new highway projects to add capacity and lane miles to major state routes, interstates or other freeway systems, as well as associated high-capacity transportation capital improvements such as park and ride facilities, high-occupancy vehicle lanes, transit flyover access ramps to highway lanes, and bus pullouts along highways as means to reduce traffic congestion.

NEW SECTION. Sec. 2. The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.

(1) "Regional transportation investment district" or "district" means a quasi-municipal corporation whose boundaries are coextensive with one or more counties and which has been created by county legislative authorities and a vote of the people pursuant to this chapter to implement a regional transportation investment plan.

(2) "Regional transportation investment district planning committee" or "planning committee" means the advisory committee created pursuant to section 3 of this act to create and propose to county legislative authorities a regional transportation investment plan to develop, finance, and construct transportation projects.

(3) "Regional transportation investment plan" or "plan" means a plan to develop, construct, and finance a transportation project or projects.

(4) "Highway of statewide significance" means an existing or proposed state route or federal interstate as designated a highway of statewide significance by the transportation commission, its successor entity, or the legislature.

(5) "Transportation project" or "project" means a capital improvement or improvements to a highway of statewide significance that adds a lane or new lanes to an existing state or federal highway, including associated HOV lanes, flyover ramps, park and ride lots, and bus pullouts.

(6) "Department" means the Washington state department of transportation.

NEW SECTION. Sec. 3. Regional transportation investment district planning committees are advisory entities which are created, convened, and empowered as follows:

(1) A county or, by agreement, multiple contiguous counties, may choose to create a regional transportation investment district and convene a regional transportation investment district planning committee.

(2) If a regional transportation investment district planning committee is formed, each county commissioner or councilmember from each participating county shall appoint one member to the planning committee. The appointee must be a resident of the county the commissioner or councilmember serves, and, if the commissioner or councilmember is nominated or elected from a commissioner or councilmember district, then the appointee must also be a resident of that district. The appointee shall not be an elected federal, state, county, or city official. Members of the planning committee serve at the pleasure of the appointing councilmember or commissioner and shall receive no compensation, but may be reimbursed for travel and incidental expenses as the planning committee deems appropriate: PROVIDED, That in the event that a planning committee elects an executive board, then each member of the executive board may receive compensation of fifty dollars per day for attending meetings or conferences on behalf of the district, not to exceed three thousand dollars per year. An executive board member may waive all or a portion of his or her compensation. Compensation provided in this section is in addition to reimbursement for expenses paid by the planning committee.

(3) A regional transportation investment district planning committee may be entitled to state funding, as appropriated by the legislature, for start-up funding to pay for salaries, expenses, overhead, supplies, and similar expenses ordinarily and necessarily incurred in selecting transportation projects and funding for those projects under this chapter. Upon creation of a regional transportation investment district, the district shall reimburse the state for any sums advanced for these start-up costs from the state.

(4) At its first meeting, a regional transportation investment district planning committee may elect officers and provide for the adoption of rules and other operating procedures. Except as provided in section 15 of this act, the planning committee may elect, from its membership, an executive board to discharge the duties of the planning committee and formulate a regional transportation investment plan, subject to the approval of the full planning committee.

(5) Governance of and decisions by a regional transportation investment district planning committee shall be by majority vote of the total membership. In the event that the planning committee has been convened by multiple counties, each member's vote shall be weighted to reflect the population he or she represents relative to the population represented by the total planning committee membership. Population shall be determined utilizing the national 2000 census or subsequent national census data.

(6) At any time, with a two-thirds vote of the membership of the planning committee, the planning committee may dissolve itself.

(7) A regional transportation investment district planning committee or if applicable, its executive board, shall convene, from time to time and as appropriate, to create and adopt a regional transportation investment plan providing for the selection, development, construction, and financing of transportation projects. The regional transportation investment plan should consider transportation and land use planning. The planning committee may coordinate its activities with the department, which shall provide services, data, and personnel to assist in this planning as desired by the planning committee. In addition, the planning committee may also coordinate with such other local governments and entities that engage in transportation planning.

(8) A planning committee shall select transportation projects to reduce traffic congestion and will create a regional transportation investment plan providing for the development, construction, and financing of the transportation project or projects to be constructed to submit to the county legislative authorities.

(9) A regional transportation investment district planning committee may, as part of a regional transportation investment plan, recommend the imposition of some or all of the following revenue sources:

(a) A regional sales and use tax of up to 0.5 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. The tax authorized pursuant to this section shall be in addition to the tax authorized by RCW 82.14.030 and shall be collected from those persons who are taxable by the state pursuant to chapters 82.08 and 82.12 RCW upon the occurrence of any taxable event within the taxing district. Motor vehicles, as defined in RCW 46.04.320, are exempt from the sales and use tax imposed under this subsection (9)(a);

(b) A use tax imposed on the privilege of using a motor vehicle within a regional transportation investment district. The tax applies to those persons who reside within the regional transportation investment district. The rate of the tax may not exceed 0.5 percent of the value of the motor vehicle. The tax authorized by this subsection is in addition to the tax authorized under RCW 82.14.030 and shall be imposed and collected at the time a taxable event under RCW 82.08.020(1) or 82.12.020 takes place. All revenue received under this subsection (9)(b) shall be deposited in the local sales and use tax account and distributed to the regional transportation investment district according to RCW 82.14.050. The following provisions shall apply to the use tax in this subsection (9)(b):

(i) In such cases where persons are taxable under chapter 82.08 RCW, the seller shall collect the use tax from the buyer using the collection provisions set forth in RCW 82.08.050.

(ii) In such cases where persons are taxable under chapter 82.12 RCW, the use tax shall be collected using the provisions set forth in RCW 82.12.045.

(iii) "Motor vehicle" has the meaning given in RCW 46.04.320.

(iv) "Person" has the meaning given in RCW 82.04.030.

(v) The value of a motor vehicle shall be determined by the method prescribed in RCW 82.12.010.

(vi) Except as specifically stated in this subsection (9)(b), the provisions of chapters 82.12 and 82.32 RCW shall apply to the use tax. The use tax is a local tax imposed under the authority of chapter 82.14 RCW and the provisions of chapter 82.14 RCW apply fully to the use tax;

(c) A motor vehicle, as defined in RCW 46.04.320, license fee of up to one hundred dollars per vehicle registered in the district. The department of licensing shall administer and collect this fee on behalf of a regional transportation investment district and remit this fee to the custody of the state treasurer, who shall distribute it as directed by a regional transportation investment district;

(d) A commercial parking fee of up to ten percent of the cost charged per parking transaction; and

(e) Vehicle tolls on state routes where improvements under this act add additional lanes to a highway of statewide significance. The collection of vehicle tolls on designated facilities shall be administered by the department, unless otherwise specified in law, and the state transportation commission, or its successor, shall be the tolling authority. Specifically for projects where vehicle tolls are collected, as authorized under this subsection (9)(e), the state sales tax imposed and actually collected under chapters 82.08 and 82.12 RCW, less any credits allowed under chapter 82.14 RCW, on initial construction for any project upon which tolls are to be imposed under this section shall be transferred to the motor vehicle fund. It is the legislature's intent that this transaction shall be exempt from the fiscal growth factor in RCW 43.135.055 and will be identified as a credit on the project, thereby lowering the overall cost of the project and the corresponding tolls.

(10) Taxes shall not be imposed without an affirmative vote of the people within the boundaries of the county or counties as set forth in this chapter. Revenues from these taxes may be used only to support the implementation, by a regional transportation investment district, of a regional transportation investment plan to construct transportation projects. A regional transportation investment district may contract with the state department of revenue or other appropriate entities for administration and collection of any of the taxes or fees authorized in this section.

(11) In addition to those taxes adopted pursuant to this act, a county or city may use any of its existing taxing authority to provide funds for a transportation project being constructed by a regional transportation investment district.

(12) A combination of local, state, and federal revenues may be necessary to pay for transportation projects, and the planning committee shall consider all of these revenue sources in developing a financing and funding plan. In particular, state and federal matching funds of up to sixty percent of the total costs as provided in section 11 of this act shall be considered.

(13) Upon adoption, by majority vote of the appointed members and utilizing proportional weighted voting in the case of multiple counties, of the regional transportation investment plan by the planning committee, the planning committee shall immediately transmit the regional transportation investment plan to the county legislative authority or authorities which convened the regional transportation investment district planning committee. The plan shall include a proposed ballot measure to be submitted to a vote of the people within the county or counties. This ballot measure shall call for the creation of a regional transportation investment district; specify the transportation project or projects to be constructed; specify the anticipated timeline for completion of the transportation project or projects to be constructed; and specify the tax or taxes to be imposed, the anticipated duration of the taxes imposed, and the total amount of revenue estimated to be collected.

NEW SECTION. Sec. 4. A regional transportation investment district is a quasi-municipal corporation which shall be formed in the following manner:

(1) The legislative authority of the county, or in the case of multiple counties, the legislative authorities, which convened the planning committee shall decide by resolution whether to adopt the regional transportation investment plan submitted by a regional transportation investment district planning committee and participate in the regional transportation investment district. This action shall be completed within sixty days following receipt of the planning committee's adopted plan.

(2) If any county opts not to adopt the plan or participate in the regional transportation investment district, but one or more contiguous counties do choose to continue to participate, then the planning committee may, within ninety days, redefine the regional transportation investment plan, and the ballot measure to be submitted to the people, to reflect elimination of one or more counties, and submit the redefined plan to the legislative authorities of the remaining counties for their decision as to whether to continue to adopt the redefined plan and participate. This action shall be completed within sixty days following receipt of the redefined plan.

(3) The legislative authorities of the county or counties deciding to participate shall place on the ballot, at the next general election or at a special election called for this purpose, the single ballot proposition adopted by the planning committee. The county legislative authorities may not alter the plan or ballot measure adopted by the planning committee and approved by the legislative authority or authorities. Only those registered voters residing within the county or counties participating shall vote on the ballot measure.

A simple majority of those voting within the county or counties is required for approval. If the vote is affirmative, then the regional transportation investment district is created.

(4) If the vote fails, then the planning committee may redefine the selected projects, the construction and financing plan, and the ballot measure proposition. The county legislative authorities may approve the new plan and ballot measure, and may then submit the revised proposition to the voters at the next election or a special election. No single proposition may be submitted to the voters more than three times.

If a positive vote on a proposition is not achieved by the third vote, then the planning committee shall be dissolved within sixty days.

NEW SECTION. Sec. 5. If the voters approve the plan creating a regional transportation investment district, the district will be declared formed. The county election official of a county must, within fifteen days of the final certification of the election results, publish a notice in a newspaper or newspapers of general circulation in the district declaring the district formed, and must mail copies of the notice to the governor, the secretary of transportation, and the executive director of each regional transportation planning organization which has part or all of any participating county within its boundaries. A party challenging the formation of a voter-approved district must file a lawsuit challenging the district's formation within thirty days after the final certification of the election, and shall serve notice of the lawsuit upon each county participating in the district. Failure to challenge within that time forever bars further challenge of the district's valid formation.

NEW SECTION. Sec. 6. Membership of a regional transportation investment district shall be composed of one representative from each county council or commission district within the regional transportation investment district.

(1) The initial membership of a regional transportation investment district created pursuant to this chapter shall be composed of the members of the regional transportation investment district planning committee. Members serve at the pleasure of the county commissioner or councilmember representing the district from which the initial appointment was made to the planning committee.

(2) In the event of a vacancy, the county commissioner or councilmember representing the district from which the initial appointment was made shall appoint a replacement member to the district. The appointee must be a resident of the county the commissioner or councilmember serves, and if the commissioner or councilmember is nominated or elected from a commissioner or councilmember district, then the appointee must also be a resident of that district. The appointee shall not be an elected federal, state, county, or city official. Members of a district serve at the pleasure of the appointing county commissioner or councilmember.

(3) Members of the regional transportation investment district shall receive no compensation, but may receive per diem and be reimbursed for travel and incidental expenses as the district deems appropriate: PROVIDED, That in the event a district elects an executive board, then each member of the executive board may receive compensation of fifty dollars per day for attending meetings or conferences on behalf of the district, not to exceed three thousand dollars per year. An executive board member may waive all or a portion of his or her compensation. Compensation provided in this section is in addition to reimbursement for expenses paid by the district.

NEW SECTION. Sec. 7. (1) A regional transportation investment district shall meet from time to time as necessary to oversee the implementation of the regional transportation investment plan. At its first meeting, the regional transportation investment district planning committee may elect officers and provide for the adoption of rules and other operating procedures. Except as provided in section 15 of this act, the district may elect, from its membership, an executive board to discharge the duties of the district and implement the regional transportation investment plan, subject to the approval of the full district membership. Governance of and decisions by a regional transportation investment district shall be by majority vote of the total membership. In the event that the district is composed of multiple counties, each member's vote shall be weighted to reflect the population he or she represents relative to the population represented by the total district membership. Population shall be determined utilizing the national 2000 census or subsequent national census data.

(2) A regional transportation investment district is a body corporate and shall have the powers necessary and incidental to overseeing the implementation of a regional transportation investment plan approved by the voters under this act, including but not limited to:

(a) The authority to hire no more than six employees, including, if it chooses, a director or executive officer, a treasurer or financial officer, a project manager or engineer, legal counsel, a project permit coordinator, and clerical staff; and

(b) The authority to pay for services and enter into contracts, including professional service contracts.

(3) A regional transportation investment district does not have the authority to acquire, hold, or dispose of real property.

(4) A regional transportation investment district shall not own, operate, or maintain any ongoing facility, road, or transportation system.

(5) A regional transportation investment district may accept and expend or use gifts, grants, or donations.

(6) A regional transportation investment district may coordinate its activities with the department, which shall provide services, data, and personnel to assist as desired by the regional transportation investment district.

(7) It is the intent of the legislature that administrative and overhead costs of a regional transportation investment district be minimized. For projects costing up to fifty million dollars, administrative and overhead costs may not exceed three percent of the total construction and design project costs per year. For projects costing in excess of fifty million dollars, administrative and overhead costs shall be no more than three percent of the first fifty million dollars in costs, plus an additional one-tenth of one percent for each additional dollar above fifty million. These limitations apply only to the district, and shall not be construed as limiting the administration or expenditures of the department of transportation.

(8) A regional transportation investment district may not substantially vary the regional transportation investment plan or the projects to be constructed. Minor variations or deviations as to the timeline, project plans, or right‑of‑way, and of up to five percent of the total costs may be made, but in no case may the district add to or delete from the plan projects to be constructed. Major revisions to the plan, including the addition or deletion of projects to be constructed, must be submitted first to the county legislative authorities and then a vote of the people in the same manner as provided for the initial plan under this chapter.

(9) To assure accountability to the public for the timely construction of the transportation project or projects within cost projections, the district shall issue a public report every year on the progress made in implementing the regional transportation investment plan. In the report, the district shall detail progress in two areas: (a) Whether the project or projects costs-to-date are within the amount of revenue raised for the project or projects under the vote of the people as provided in section 4 of this act; and (b) whether the project or projects are proceeding in accordance with the original construction schedule. If the progress of a project or projects is inconsistent with either the cost projections or timelines, the district shall provide the public with a plan to move the project or projects back into compliance with the original construction schedule and cost projections.

NEW SECTION. Sec. 8. The regional transportation investment district, by resolution, shall designate a person having experience in financial or fiscal matters as treasurer of the district. The district may designate the treasurer of a county within which the district is located to act as its treasurer. Such a treasurer shall possess all of the powers, responsibilities, and duties the county treasurer possesses related to investing surplus funds. The district shall require a bond with a surety company authorized to do business in the state of Washington in an amount and under the terms and conditions the district, by resolution, from time to time finds will protect the district against loss. The premium on any such bond shall be paid by the district.

All district funds shall be paid to the treasurer and shall be disbursed by the treasurer only on warrants issued by district upon orders or vouchers approved by the district.

The treasurer shall establish a special fund, into which shall be paid all district funds, and the treasurer shall maintain such special accounts as may be created by the district into which shall be placed all money as the district may, by resolution, direct.

If the treasurer of the district is the treasurer of a county, all district funds shall be deposited with the county depositary under the same restrictions, contracts, and security as provided for county depositaries. If the treasurer of the district is some other person, all funds shall be deposited in such bank or banks authorized to do business in this state that have qualified for insured deposits under any federal deposit insurance act as the district, by resolution, shall designate.

The district may provide and require a reasonable bond of any other person handling moneys or securities of the district, but the district shall pay the premium on the bond.

NEW SECTION. Sec. 9. The district may not issue any debt of its own for more than two years' duration. A district may enter into agreements with the state to pledge taxes or other revenues of the district for the purpose of paying in part or whole principal and interest on bonds issued by the state. The contracts pledging revenues and taxes shall be binding for the term of the agreement, but not to exceed twenty-five years, and no tax pledged by an agreement may be eliminated or modified if it would impair the pledge of the agreement.

NEW SECTION. Sec. 10. (1) The department shall create a division of dedicated staff and services whose sole responsibility is to coordinate the design, preliminary engineering, permitting, financing, and construction of projects under consideration by a regional transportation investment district planning committee or which are part of a regional transportation investment plan being implemented by a regional transportation investment district.

(2) All of the powers granted the department pursuant to Title 47 RCW relating to highway construction may, at the request of a regional transportation investment district, be utilized to implement a regional transportation investment plan and construct transportation projects.

NEW SECTION. Sec. 11. (1) A regional transportation investment district is eligible for state and federal matching funds of up to sixty percent of the total costs of a transportation project or series of projects being constructed by a regional transportation investment district. A regional transportation investment district need not utilize matching funds, and nothing in this section may be construed as prohibiting a regional transportation investment district from funding and paying all or more than forty percent of the total costs of a transportation project or series of projects being constructed.

(2) The regional transportation investment district matching account is hereby created within the state treasury. The regional transportation investment district matching account shall be administered by the state treasurer. Funds appropriated by the legislature as matching state money for a transportation project or series of projects being constructed by a regional transportation investment district shall be deposited into this account. The purpose of this account is to serve as an account from which payments for transportation projects being constructed by a regional transportation investment district may be made. Payments from this account may be made as follows:

(a) The state may pay for its share of up to sixty percent, including federal funds, of the total costs of a transportation project or series of projects being constructed by a regional transportation investment district from funds appropriated to this account by the legislature for this purpose; and

(b) A regional transportation investment district may also transfer money to this account to pay for its share of any transportation projects being constructed by the state on behalf of that regional transportation investment district, or for payment of any bonds, debt, or other financing incurred by the state on its behalf to construct such projects. The state may then use these transfers to make payments on the district's behalf.

All moneys deposited in the regional transportation investment district matching account shall be invested by the state treasurer. Funds within the regional transportation investment district matching account shall be used solely to pay for transportation projects being constructed by a regional transportation investment district.

NEW SECTION. Sec. 12. The department or district may use the design‑build procedure for projects developed by a regional transportation investment district. As used in this section "design‑build procedure" means a method of contracting under which the department or district contracts with another party for such party to both design and build the structures, facilities, and other items specified in the contract.

NEW SECTION. Sec. 13. Within thirty days of the completion of the construction of the project or series of projects forming the regional transportation investment plan, the district shall terminate day‑to‑day operations and exist solely as a limited entity which oversees the collection of revenue and the payment of any debt service or financing still in effect, if any. The district shall adjust its employees, administration, and overhead expenses downward accordingly. Any taxes imposed pursuant to an approved plan shall terminate when the financing or debt service on the project or series of projects constructed is completed and paid, thirty days from which point the district shall dissolve itself and cease to exist. If there is no debt outstanding, then the district shall dissolve within thirty days from completion of construction of the project or series of projects forming the regional transportation investment plan.

NEW SECTION. Sec. 14. Any transportation project constructed pursuant to this chapter becomes and remains the property of the state of Washington.

NEW SECTION. Sec. 15. The legislature finds that regional solutions to the state's transportation needs are of paramount concern. The legislature further recognizes that different areas of the state will need the flexibility to fashion local solutions to their transportation problems, and that regional transportation systems may evolve over time.

(1) The central Puget Sound regional transportation investment district planning committee is hereby created as a pilot project, and consists of the counties of King, Pierce, and Snohomish. The planning committee shall conduct its affairs and formulate a regional transportation investment plan as provided under section 3 of this act, except that it shall elect an executive board of seven members to discharge the duties of the planning committee and formulate a regional transportation investment plan, subject to the approval of the full planning committee. All other provisions of this chapter shall apply to this pilot project.

(2) Areas of the state outside of King, Snohomish, and Pierce counties shall be eligible for grants from the state of one hundred fifty thousand dollars or more to study and develop regional transportation models. Regions electing to participate in this pilot program shall develop a model that can be used in other parts of the state and shall report to the transportation committees in the senate and house of representatives on the positive and negative aspects of the model as well as costs associated with it no later than June 30, 2002.

Sec. 16. RCW 43.84.092 and 2000 2nd sp.s. c 4 s 5 are each amended to read as follows:

(1) All earnings of investments of surplus balances in the state treasury shall be deposited to the treasury income account, which account is hereby established in the state treasury.

(2) The treasury income account shall be utilized to pay or receive funds associated with federal programs as required by the federal cash management improvement act of 1990. The treasury income account is subject in all respects to chapter 43.88 RCW, but no appropriation is required for refunds or allocations of interest earnings required by the cash management improvement act. Refunds of interest to the federal treasury required under the cash management improvement act fall under RCW 43.88.180 and shall not require appropriation. The office of financial management shall determine the amounts due to or from the federal government pursuant to the cash management improvement act. The office of financial management may direct transfers of funds between accounts as deemed necessary to implement the provisions of the cash management improvement act, and this subsection. Refunds or allocations shall occur prior to the distributions of earnings set forth in subsection (4) of this section.

(3) Except for the provisions of RCW 43.84.160, the treasury income account may be utilized for the payment of purchased banking services on behalf of treasury funds including, but not limited to, depository, safekeeping, and disbursement functions for the state treasury and affected state agencies. The treasury income account is subject in all respects to chapter 43.88 RCW, but no appropriation is required for payments to financial institutions. Payments shall occur prior to distribution of earnings set forth in subsection (4) of this section.

(4) Monthly, the state treasurer shall distribute the earnings credited to the treasury income account. The state treasurer shall credit the general fund with all the earnings credited to the treasury income account except:

(a) The following accounts and funds shall receive their proportionate share of earnings based upon each account's and fund's average daily balance for the period: The capitol building construction account, the Cedar River channel construction and operation account, the Central Washington University capital projects account, the charitable, educational, penal and reformatory institutions account, the common school construction fund, the regional transportation investment district matching account, the county criminal justice assistance account, the county sales and use tax equalization account, the data processing building construction account, the deferred compensation administrative account, the deferred compensation principal account, the department of retirement systems expense account, the drinking water assistance account, the Eastern Washington University capital projects account, the education construction fund, the emergency reserve fund, the federal forest revolving account, the health services account, the public health services account, the health system capacity account, the personal health services account, the state higher education construction account, the higher education construction account, the highway infrastructure account, the industrial insurance premium refund account, the judges' retirement account, the judicial retirement administrative account, the judicial retirement principal account, the local leasehold excise tax account, the local real estate excise tax account, the local sales and use tax account, the medical aid account, the mobile home park relocation fund, the multimodal transportation account, the municipal criminal justice assistance account, the municipal sales and use tax equalization account, the natural resources deposit account, the perpetual surveillance and maintenance account, the public employees' retirement system plan 1 account, the public employees' retirement system plan 2 account, the Puyallup tribal settlement account, the resource management cost account, the site closure account, the special wildlife account, the state employees' insurance account, the state employees' insurance reserve account, the state investment board expense account, the state investment board commingled trust fund accounts, the supplemental pension account, the teachers' retirement system plan 1 account, the teachers' retirement system combined plan 2 and plan 3 account, the tobacco prevention and control account, the tobacco settlement account, the transportation infrastructure account, the tuition recovery trust fund, the University of Washington bond retirement fund, the University of Washington building account, the volunteer fire fighters' and reserve officers' relief and pension principal fund, the volunteer fire fighters' and reserve officers' administrative fund, the Washington judicial retirement system account, the Washington law enforcement officers' and fire fighters' system plan 1 retirement account, the Washington law enforcement officers' and fire fighters' system plan 2 retirement account, the Washington school employees' retirement system combined plan 2 and 3 account, the Washington state health insurance pool account, the Washington state patrol retirement account, the Washington State University building account, the Washington State University bond retirement fund, the water pollution control revolving fund, and the Western Washington University capital projects account. Earnings derived from investing balances of the agricultural permanent fund, the normal school permanent fund, the permanent common school fund, the scientific permanent fund, and the state university permanent fund shall be allocated to their respective beneficiary accounts. All earnings to be distributed under this subsection (4)(a) shall first be reduced by the allocation to the state treasurer's service fund pursuant to RCW 43.08.190.

(b) The following accounts and funds shall receive eighty percent of their proportionate share of earnings based upon each account's or fund's average daily balance for the period: The aeronautics account, the aircraft search and rescue account, the county arterial preservation account, the department of licensing services account, the essential rail assistance account, the ferry bond retirement fund, the grade crossing protective fund, the high capacity transportation account, the highway bond retirement fund, the highway safety account, the motor vehicle fund, the motorcycle safety education account, the pilotage account, the public transportation systems account, the Puget Sound capital construction account, the Puget Sound ferry operations account, the recreational vehicle account, the rural arterial trust account, the safety and education account, the special category C account, the state patrol highway account, the transportation equipment fund, the transportation fund, the transportation improvement account, the transportation improvement board bond retirement account, and the urban arterial trust account.

(5) In conformance with Article II, section 37 of the state Constitution, no treasury accounts or funds shall be allocated earnings without the specific affirmative directive of this section.

Sec. 17. RCW 43.84.092 and 2000 2nd sp.s. c 4 s 6 are each amended to read as follows:

(1) All earnings of investments of surplus balances in the state treasury shall be deposited to the treasury income account, which account is hereby established in the state treasury.

(a) The following accounts and funds shall receive their proportionate share of earnings based upon each account's and fund's average daily balance for the period: The capitol building construction account, the Cedar River channel construction and operation account, the Central Washington University capital projects account, the charitable, educational, penal and reformatory institutions account, the common school construction fund, the regional transportation investment district matching account, the county criminal justice assistance account, the county sales and use tax equalization account, the data processing building construction account, the deferred compensation administrative account, the deferred compensation principal account, the department of retirement systems expense account, the drinking water assistance account, the Eastern Washington University capital projects account, the education construction fund, the emergency reserve fund, the federal forest revolving account, the health services account, the public health services account, the health system capacity account, the personal health services account, the state higher education construction account, the higher education construction account, the highway infrastructure account, the industrial insurance premium refund account, the judges' retirement account, the judicial retirement administrative account, the judicial retirement principal account, the local leasehold excise tax account, the local real estate excise tax account, the local sales and use tax account, the medical aid account, the mobile home park relocation fund, the multimodal transportation account, the municipal criminal justice assistance account, the municipal sales and use tax equalization account, the natural resources deposit account, the perpetual surveillance and maintenance account, the public employees' retirement system plan 1 account, the public employees' retirement system combined plan 2 and plan 3 account, the Puyallup tribal settlement account, the resource management cost account, the site closure account, the special wildlife account, the state employees' insurance account, the state employees' insurance reserve account, the state investment board expense account, the state investment board commingled trust fund accounts, the supplemental pension account, the teachers' retirement system plan 1 account, the teachers' retirement system combined plan 2 and plan 3 account, the tobacco prevention and control account, the tobacco settlement account, the transportation infrastructure account, the tuition recovery trust fund, the University of Washington bond retirement fund, the University of Washington building account, the volunteer fire fighters' and reserve officers' relief and pension principal fund, the volunteer fire fighters' and reserve officers' administrative fund, the Washington judicial retirement system account, the Washington law enforcement officers' and fire fighters' system plan 1 retirement account, the Washington law enforcement officers' and fire fighters' system plan 2 retirement account, the Washington school employees' retirement system combined plan 2 and 3 account, the Washington state health insurance pool account, the Washington state patrol retirement account, the Washington State University building account, the Washington State University bond retirement fund, the water pollution control revolving fund, and the Western Washington University capital projects account. Earnings derived from investing balances of the agricultural permanent fund, the normal school permanent fund, the permanent common school fund, the scientific permanent fund, and the state university permanent fund shall be allocated to their respective beneficiary accounts. All earnings to be distributed under this subsection (4)(a) shall first be reduced by the allocation to the state treasurer's service fund pursuant to RCW 43.08.190.

(5) In conformance with Article II, section 37 of the state Constitution, no treasury accounts or funds shall be allocated earnings without the specific affirmative directive of this section.

Sec. 18. RCW 81.104.140 and 1992 c 101 s 25 are each amended to read as follows:

(1) Agencies authorized to provide high capacity transportation service, including transit agencies and regional transit authorities, are hereby granted dedicated funding sources for such systems. These dedicated funding sources, as set forth in RCW 81.104.150, 81.104.160, and 81.104.170, are authorized ((~~only~~)) for agencies located in (((a) each county with a population of two hundred ten thousand or more and (b) each county with a population of from one hundred twenty‑five thousand to less than two hundred ten thousand except for those counties that do not border a county with a population as described under (a) of this subsection. In any county with a population of one million or more or in any county having a population of four hundred thousand or more bordering a county with a population of one million or more)) any county other than a county which, in whole or in part, is a part of a regional transit authority, or is eligible to form or participate in a regional transit authority. For counties which, in whole or in part, are part of a regional transit authority, or which are eligible to form or participate in a regional transit authority, these funding sources may be imposed only by a regional transit authority.

(2) Agencies planning to construct and operate a high capacity transportation system should also seek other funds, including federal, state, local, and private sector assistance.

(3) Funding sources should satisfy each of the following criteria to the greatest extent possible:

(a) Acceptability;

(b) Ease of administration;

(d) Implementation feasibility;

(e) Revenue reliability; and

(f) Revenue yield.

(4) Agencies participating in regional high capacity transportation system development are authorized to levy and collect the following voter‑approved local option funding sources:

(a) Employer tax as provided in RCW 81.104.150;

(b) Special motor vehicle excise tax as provided in RCW 81.104.160; and

Revenues from these taxes may be used only to support those purposes prescribed in subsection (10) of this section. Before the date of an election authorizing an agency to impose any of the taxes enumerated in this section and authorized in RCW 81.104.150, 81.104.160, and 81.104.170, the agency must comply with the process prescribed in RCW 81.104.100 (1) and (2) and 81.104.110. No construction on exclusive right of way may occur before the requirements of RCW 81.104.100(3) are met.

(5) Authorization in subsection (4) of this section shall not adversely affect the funding authority of transit agencies not provided for in this chapter. Local option funds may be used to support implementation of interlocal agreements with respect to the establishment of regional high capacity transportation service. Except when a regional transit authority exists, local jurisdictions shall retain control over moneys generated within their boundaries, although funds may be commingled with those generated in other areas for planning, construction, and operation of high capacity transportation systems as set forth in the agreements.

(6) Agencies planning to construct and operate high capacity transportation systems may contract with the state for collection and transference of voter‑approved local option revenue.

(7) Dedicated high capacity transportation funding sources authorized in RCW 81.104.150, 81.104.160, and 81.104.170 shall be subject to voter approval by a simple majority. A single ballot proposition may seek approval for one or more of the authorized taxing sources. The ballot title shall reference the document identified in subsection (8) of this section.

(8) Agencies shall provide to the registered voters in the area a document describing the systems plan and the financing plan set forth in RCW 81.104.100. It shall also describe the relationship of the system to regional issues such as development density at station locations and activity centers, and the interrelationship of the system to adopted land use and transportation demand management goals within the region. This document shall be provided to the voters at least twenty days prior to the date of the election.

(9) For any election in which voter approval is sought for a high capacity transportation system plan and financing plan pursuant to RCW 81.104.040, a local voter's pamphlet shall be produced as provided in chapter 29.81A RCW.

(10) Agencies providing high capacity transportation service shall retain responsibility for revenue encumbrance, disbursement, and bonding. Funds may be used for any purpose relating to planning, construction, and operation of high capacity transportation systems and commuter rail systems, personal rapid transit, busways, bus sets, and entrained and linked buses.

(11) By interlocal agreement, transit agencies located in any county other than a county which, in whole or in part, is a part of a regional transit authority, or is eligible to form or participate in a regional transit authority, may choose to coordinate their efforts to implement some or all of the dedicated funding sources set forth in RCW 81.104.150, 81.104.160, and 81.104.170, to implement high-capacity transportation service as a joint effort, across their respective jurisdictions. The respective county legislative authorities may choose to set forth a common ballot measure and vote to accomplish this purpose.

Sec. 19. RCW 47.05.021 and 1998 c 245 s 95 and 1998 c 171 s 5 are each reenacted and amended to read as follows:

(1) The transportation commission is hereby directed to conduct periodic analyses of the entire state highway system, report thereon to the chairs of the transportation committees of the senate and house of representatives, including one copy to the staff of each of the committees, biennially and based thereon, to subdivide, classify, and subclassify according to their function and importance all designated state highways and those added from time to time and periodically review and revise the classifications into the following three functional classes:

(a) The "principal arterial system" shall consist of a connected network of rural arterial routes with appropriate extensions into and through urban areas, including all routes designated as part of the interstate system, which serve corridor movements having travel characteristics indicative of substantial statewide and interstate travel;

(b) The "minor arterial system" shall, in conjunction with the principal arterial system, form a rural network of arterial routes linking cities and other activity centers which generate long distance travel, and, with appropriate extensions into and through urban areas, form an integrated network providing interstate and interregional service; and

(c) The "collector system" shall consist of routes which primarily serve the more important intercounty, intracounty, and intraurban travel corridors, collect traffic from the system of local access roads and convey it to the arterial system, and on which, regardless of traffic volume, the predominant travel distances are shorter than on arterial routes.

(2) In making the functional classification the transportation commission shall adopt and give consideration to criteria consistent with this section and federal regulations relating to the functional classification of highways, including but not limited to the following:

(a) Urban population centers within and without the state stratified and ranked according to size;

(b) Important traffic generating economic activities, including but not limited to recreation, agriculture, government, business, and industry;

(d) Directness of travel and distance between points of economic importance;

(e) Length of trips;

(f) Character and volume of traffic;

(g) Preferential consideration for multiple service which shall include public transportation;

(h) Reasonable spacing depending upon population density; and

(i) System continuity.

(3) The transportation commission or the legislature shall designate state highways of statewide significance under RCW 47.06.140((~~, and~~)). If the commission designates a state highway of statewide significance, it shall submit a list of such facilities for adoption by the ((~~1999~~)) legislature. This statewide system shall include at a minimum interstate highways and other statewide principal arterials that are needed to connect major communities across the state and support the state's economy.

(4) The transportation commission shall designate a freight and goods transportation system. This statewide system shall include state highways, county roads, and city streets. The commission, in cooperation with cities and counties, shall review and make recommendations to the legislature regarding policies governing weight restrictions and road closures which affect the transportation of freight and goods.

NEW SECTION. Sec. 20. The legislature hereby designates state route number 519 and that portion of state route number 509 which runs or will run from state route number 518 in the north to the intersection with interstate 5 in the south as state highways of statewide significance.

NEW SECTION. Sec. 21. A new section is added to chapter 43.131 RCW to read as follows:

Regional transportation investment districts and their powers and duties shall be terminated on June 30, 2006, as provided in section 22 of this act.

NEW SECTION. Sec. 22. A new section is added to chapter 43.131 RCW to read as follows:

The following acts or parts of acts, as now existing or hereafter amended, are each repealed, effective June 30, 2007:

(1) Section 1 of this act;

(2) Section 2 of this act;

(3) Section 3 of this act;

(4) Section 4 of this act;

(5) Section 5 of this act;

(6) Section 6 of this act;

(7) Section 7 of this act;

(8) Section 8 of this act;

(9) Section 9 of this act;

(10) Section 10 of this act;

(11) Section 11 of this act;

(12) Section 12 of this act;

(13) Section 13 of this act;

(14) Section 14 of this act; and

(15) Section 15 of this act.

NEW SECTION. Sec. 23. Section 16 of this act expires March 1, 2002.

NEW SECTION. Sec. 24. Section 17 of this act takes effect March 1, 2002.

NEW SECTION. Sec. 25. Sections 1 through 15 of this act constitute a new chapter in Title 47 RCW.

NEW SECTION. Sec. 26. 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. 27. Sections 1 through 16 and 18 through 20 of this act are necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and take effect immediately.