AN
ACT Relating to private activity bonds; and amending RCW 39.86.100 and
39.86.120.
BE IT
ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec.
1. RCW
39.86.100 and 1987 c 297 s 1 are each amended to read as follows:
The
federal tax reform act of 1986 imposes an annual ceiling on the aggregate
amount of federally tax-exempt private activity bonds, including bonds for
housing, student loans, exempt facilities, small issue industrial,
redevelopment, and certain public utility projects, that may be issued during
any calendar year by or on behalf of states and their political subdivisions.
((The tax reform act of 1986 establishes a private activity bond ceiling for
each state of seventy-five dollars per capita for 1987 and of fifty dollars per
capita for 1988 and each year thereafter.)) In 2001, the ceiling will
be increased to sixty-two dollars and fifty cents per capita and in 2002 the
ceiling will be increased to seventy-five dollars per capita, to be indexed
annually, for 2003 and every year thereafter. However, a study by the
department of community development indicates that the dollar amount of the
state ceiling is considerably less than the anticipated dollar amount for which
issuers would need an allocation from the state ceiling. The tax reform act of
1986 provides a formula for allocating the annual ceiling among various issuers
of private activity bonds within a state, but permits each state to enact a
different allocation method that is appropriate to that state's needs. The
purpose of this chapter is to provide a flexible and efficient method of
allocating the annual state ceiling in Washington in a manner that recognizes
the need of the state and its political subdivisions to finance activities or
projects that satisfy a substantial public purpose.
Sec.
2. RCW
39.86.120 and 1990 c 50 s 1 are each amended to read as follows:
(1)
Except as provided in subsections (2) and (4) of this section, the initial
allocation of the state ceiling shall be for each year as follows:
((1989 and 1990 and
THEREAFTER THEREAFTER
(If the small (If the small
issue category issue category
is permitted is not permitted
BOND USE under
federal under federal
CATEGORY 1987 1988 law)
law)
Housing 5% 25% 25%
35%
Student
Loans 10% 15% 15% 15%
Exempt
Facility 40% 20% 20% 35%
Public
Utility 10% 10% 10% 10%
Small Issue 30% 25% 25% 0%
Remainder and
redevelopment
5% 5% 5% 5%))
BOND USE 2002
and ALTERNATIVE
CATEGORY 2001 THEREAFTER ALLOCATION
Housing 27.5% 30.0% 32.0%
Small
Issue 24.5% 24.0% 25.0%
Exempt
Facility 19.5% 19.0% 20.0%
Student
Loans 14.5% 14.0% 15.0%
Public
Utility 10.0% 10.0% 0.0%
Remainder
and
redevelopment 4.0% 3.0% 8.0%
(2)
Initial allocations may be modified by the agency only to reflect an issuer's
carryforward amount. Any reduction of the initial allocation shall be added to
the remainder and be available for allocation or reallocation.
(3)
The remainder shall be allocated by the agency among one or more issuers from
any bond use category with regard to the criteria specified in RCW 39.86.130.
(4)
Should any bond use category no longer be subject to the state ceiling due to federal
or state provisions of law, the agency shall divide the amount of that initial
allocation among the remaining categories as necessary or appropriate with
regard to the criteria specified in RCW 39.86.130. Upon the earlier of:
(a) Exhaustion of the seven hundred fifty million dollar authority under I.R.C.
1317(25), or any new federal legislation increasing the amount of authority, or
creating additional authority; or (b) waiver of the authority described under
(a) of this subsection due to alternative federal authority that does not use a
state volume cap, then the alternative allocation schedule in subsection (1) of
this section will be used.
(5)(a)
Prior to September 1 of each calendar year, any available portion of an initial
allocation may be allocated or reallocated only to an issuer within the same
bond use category, except that the remainder category, or portions thereof, may
be allocated at any time to any bond use category.
(b)
Beginning September 1 of each calendar year, the agency may allocate or
reallocate any available portion of the state ceiling to any bond use category
with regard to the criteria specified in RCW 39.86.130.
