HOUSE BILL REPORT

SB 5726


 

 

 




As Reported by House Committee On:

Judiciary

 

Title: An act relating to eligibility to be a director of a cooperative association.

 

Brief Description: Revising eligibility requirements for directors of cooperative associations.

 

Sponsors: Senators Morton, Rasmussen, Brandland, Parlette, Swecker and Jacobsen.


Brief History:

Committee Activity:

Judiciary: 4/3/03, 4/4/03 [DP].

 

Brief Summary of Bill

    Allows members of a cooperative association to elect nonmembers to its board of directors.



 

HOUSE COMMITTEE ON JUDICIARY


Majority Report: Do pass. Signed by 9 members: Representatives Lantz, Chair; Moeller, Vice Chair; Carrell, Ranking Minority Member; McMahan, Assistant Ranking Minority Member; Campbell, Flannigan, Kirby, Lovick and Newhouse.

 

Staff: Trudes Tango Hutcheson (786-7384).

 

Background:

 

Any number of persons may join together to form, with or without stock, a cooperative association under Chapter 23.86 RCW. An association may be formed to advance "any lawful business," including any agricultural, dairy, mercantile, mining, manufacturing, or mechanical business.

 

The members of a cooperative association must elect a board, consisting of at least three directors who manage the association. The directors must be members of the association. Statutory procedures exist for members to remove a director.

 


 

 

Summary of Bill:

 

The requirement that the directors of a cooperative association must be members of the association is eliminated.

 


 

 

Appropriation: None.

 

Fiscal Note: Not Requested.

 

Effective Date: The bill takes effect 90 days after adjournment of session in which bill is passed.

 

Testimony For: Co-ops are faced with more complex and sophisticated business issues, and co-ops need to be able to elect people to their boards who have expertise in these issues. Other states allow nonmembers to be elected. Co-ops are great examples of self government, and there is no concern that there will be imbalance on the boards.

 

Testimony Against: None.

 

Testified: Senator Morton, prime sponsor; and Dan Coyne, Washington State Council of Farmer Co-operatives.