FINAL BILL REPORT

HB 1280

C 6 L 03

Synopsis as Enacted

Brief Description: Changing provisions for financing contracts for state university research facilities or equipment.

Sponsors: By Representatives Murray, Alexander and Dunshee; by request of University of Washington.

House Committee on Capital Budget

Senate Committee on Ways & Means

Background:

Generally, new capital facilities for state agencies and higher education institutions must be specifically authorized by the Legislature. The Legislature has authorized the regents and trustees of the four-year public institutions of higher education to issue revenue bonds and other debt to finance certain types of capital facilities without specific legislative approval. This includes financing student housing, dining halls, facilities for student activities and parking. Typically the bond-holders are secured only by the university's revenues from its facilities; the debt is not a general obligation of the state.

In 2002 the Legislature authorized the University of Washington (UW) and Washington State University (WSU) to acquire and finance research facilities and related equipment through the non-state fees and revenues each university receives from its facilities or research activities. This financing includes issuing local bonds or entering into lease purchase agreements. The regents must consider the maintenance and operating costs of the research facility and related equipment. State-appropriated funds may not be used for maintenance and operating expenses or to support grant or contract research in these facilities. The universities must report annually to the Legislature on the financing of research facilities under this authority.

The UW and the WSU had prior statutory authorization to enter into financing contracts supported by non-state funds without State Finance Committee approval. A statutory reference in the 2002 legislation to make the institutions' new financing authority for research facilities consistent with this existing statute excluded the new authority rather than including it.

Summary:

The University of Washington and Washington State University are authorized to enter into financing contracts supported by non-state research-related funds to finance research facilities and related equipment without prior notice and approval of the State Finance Committee. Clarification is also made that the two universities may acquire real property for these research facilities using financing contracts supported by non-state research-related funds without prior legislative approval.

Votes on Final Passage:

House 97  0

Senate 48  1

Effective: July 27, 2003