BILL REQ. #:  S-1798.2 

Read first time 02/26/2003.   Referred to Committee on Economic Development.

     AN ACT Relating to employment training; and adding a new chapter to Title 28B RCW.

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

NEW SECTION.  Sec. 1   DEFINITIONS. The definitions in this section apply throughout this chapter unless the context clearly requires otherwise:
     (1) "Authority" means the employment training finance authority created under section 3 of this act or any board, body, commission, department, or officer succeeding to the principal functions of the authority or to whom the powers conferred upon the authority shall be given by law.
     (2) "Bond resolution" means any resolution of the authority, adopted under this chapter, authorizing the issuance and sale of bonds.
     (3) "Bonds" means bonds, notes, commercial paper, certificates of indebtedness, or other evidences of indebtedness of the authority issued under this chapter.
     (4) "Community college" has the definition in RCW 28B.50.030.
     (5) "Participant" means a community college that, under this chapter, undertakes a training program with a private employer.
     (6) "Program cost" means any cost related to providing training for an employer under this chapter, including development of training and contracting for training.
     (7) "Training program" means a program funded under this chapter at a community college.
     (8) "Trust indenture" means any agreement, trust indenture, or other similar instrument by and between the authority and one or more corporate trustees.

NEW SECTION.  Sec. 2   EMPLOYMENT TRAINING PROGRAM. (1) The authority, in conjunction with the higher education coordinating board, shall establish a program that allows companies considering locating or expanding in the state to receive training assistance to provide training for employees through community colleges.
     (2) To qualify for and receive assistance under this section, the company must present a proposal to a community college in the location in which it desires employee training.
     (3) The community college shall contract for or design a training program to meet the needs presented in the proposal. The training shall result in a portable credential from the community college.
     (4) The employer shall pay a fee of at least fifty percent of the cost of the training. The remaining cost of training shall be paid for from funds of the authority.
     (5) The higher education coordinating board may adopt rules to implement this section.

NEW SECTION.  Sec. 3   EMPLOYMENT TRAINING FINANCE AUTHORITY. (1) The employment training finance authority is hereby established as a public body corporate and politic, with perpetual corporate succession, constituting an agency of the state of Washington exercising essential governmental functions. The authority is a "public body" within the meaning of RCW 39.53.010.
     (2) The authority shall consist of seven members as follows: The governor, lieutenant governor, executive director of the higher education coordinating board, the director of the state system of community and technical colleges, and three public members. The public members shall be residents of the state and appointed by the governor, subject to confirmation by the senate, on the basis of their interest or expertise in the provision of higher education and the financing of higher education. The public members of the authority shall serve for terms of four years. The initial terms of the public members shall be staggered in a manner determined by the governor. In the event of a vacancy on the authority due to death, resignation, or removal of one of the public members, and upon the expiration of the term of any public member, the governor shall appoint a successor for a term expiring on the fourth anniversary of the successor's date of the appointment. If any of the state offices are abolished, the resulting vacancy on the authority shall be filled by the state officer who shall succeed substantially to the power and duties of the abolished office. Any public member of the authority may be removed by the governor for misfeasance, malfeasance, willful neglect of duty, or any other cause after notice and a public hearing, unless such notice and hearing shall be expressly waived in writing.
     (3) The governor shall serve as chairperson of the authority. The authority shall elect annually one of its members as secretary. If the governor is absent from a meeting of the authority, the secretary shall preside. However, the governor may designate an employee of the governor's office to act on the governor's behalf in all other respects during the absence of the governor at any meeting of the authority. If the designation is in writing and is presented to the person presiding at the meetings of the authority who is included in the designation, the vote of the designee has the same effect as if cast by the governor.
     (4) Any person designated by resolution of the authority shall keep a record of the proceedings of the authority and shall be the custodian of all books, documents, and papers filed with the authority, the minute book or a journal of the authority, and the authority's official seal, if any. The person may cause copies to be made of all minutes and other records and documents of the authority, and may give certificates to the effect that such copies are true copies. All persons dealing with the authority may rely upon the certificates.
     (5) Four members of the authority constitute a quorum. The authority may act on the basis of a motion except when authorizing the issuance and sale of bonds, in which case the authority shall act by resolution. Bond resolutions and other resolutions shall be adopted upon the affirmative vote of four members of the authority, and shall be signed by those members voting yes. Motions shall be adopted upon the affirmative vote of a majority of a quorum of members present at any meeting of the authority. All actions taken by the authority shall take effect immediately without need for publication or other public notice. A vacancy in the membership of the authority does not impair the power of the authority to act under this chapter.
     (6) The members of the authority shall be compensated in accordance with RCW 43.03.240 and shall be entitled to reimbursement, solely from the funds of the authority, for travel expenses as determined by the authority incurred in the discharge of their duties under this chapter.

NEW SECTION.  Sec. 4   POWERS AND DUTIES. The authority is authorized and empowered to do the following, on such terms, with such security and undertakings, subject to such conditions, and in return for such consideration, as the authority shall determine in its discretion to be necessary, useful, or convenient in accomplishing the purposes of this chapter:
     (1) To adopt rules in accordance with chapter 34.05 RCW;
     (2) To adopt an official seal and to alter the same at pleasure;
     (3) To maintain an office at any place or places as the authority may designate;
     (4) To sue and be sued in its own name, and to plead and be impleaded;
     (5) To make and execute agreements with participants and others and all other instruments necessary, useful, or convenient for the accomplishment of the purposes of this chapter;
     (6) To provide long-term or short-term financing or refinancing to participants for program costs, by way of loan or other financing or security device or any such combination;
     (7) To accept and receive funds, grants, gifts, pledges, guarantees, mortgages, trust deeds, other security instruments, and property from the federal government or the state or other public body, entity, or agency and from any public or private institution, association, corporation, or organization, including participants. It shall not accept or receive from the state or any taxing agency any money derived from taxes;
     (8) To open and maintain a bank account or accounts in one or more qualified public depositories in this state and to deposit all or any part of authority funds therein;
     (9) To charge to and equitably apportion among participants the administrative costs and expenses incurred in the exercise of the powers and duties conferred by this chapter;
     (10) To consult with the higher education coordinating board to determine program priorities under the purposes of this chapter; and
     (11) To do all other things necessary, useful, or convenient to carry out the purposes of this chapter.
     In the exercise of any of these powers, the authority shall incur no expense or liability that is an obligation, either general or special, of the state, or a general obligation of the authority, and shall pay no expense or liability from funds other than funds of the authority. Funds of the state shall not be used for such purpose.

NEW SECTION.  Sec. 5   SPECIAL OBLIGATION BONDS--ISSUANCE. (1) The authority may, from time to time, issue its special obligation bonds in order to carry out the purposes of this chapter and to enable the authority to exercise any of the powers granted to it in this chapter. The bonds shall be issued pursuant to a bond resolution or trust indenture and shall be payable solely out of the special fund or funds created by the authority in the bond resolution or trust indenture. The special fund or funds shall be funded in whole or in part from moneys paid by one or more participants for whose benefit such bonds were issued and from the sources, if any, described in section 4(7) of this act or from the proceeds of bonds issued by the authority for the purpose of refunding any outstanding bonds of the authority.
     (2) The bonds may be secured by:
     (a) A first lien against any unexpended proceeds of the bonds;
     (b) A first lien against moneys in the special fund or funds created by the authority for their payment;
     (c) A first or subordinate lien against the revenue and receipts of the participant or participants, which revenue is derived in whole or in part from the training program financed by the authority;
     (d) A first or subordinate security interest against any real or personal property, tangible or intangible, of the participant or participants, including, but not limited to, the training program financed by the authority;
     (e) Any other real or personal property, tangible or intangible; or
     (f) Any combination of (a) through (e) of this subsection.
     Any security interest created against the unexpended bond proceeds and against the special funds created by the authority shall be immediately valid and binding against the moneys and any securities in which the moneys may be invested without authority or trustee possession, and the security interest shall be prior to any party having any competing claim against the moneys or securities, without filing or recording under Article 9A of the Uniform Commercial Code, Title 62A RCW, and regardless of whether the party has notice of the security interest.
     (3) The bonds may be issued as serial bonds or as term bonds or any such combination. The bonds shall bear such date or dates; mature at such time or times; bear interest at such rate or rates, either fixed or variable; be payable at such time or times; be in such denominations; be in such form, either coupon or registered, or both; carry such registration privileges; be made transferable, exchangeable, and interchangeable; be payable in lawful money of the United States of America at such place or places; be subject to such terms of redemption; and be sold at public or private sale, in such manner, at such time, and at such price as the authority shall determine. The bonds shall be executed by the manual or facsimile signatures of the chairperson and the authority's duly-elected secretary or its executive director, and by the trustee if the authority determines to use a trustee. At least one signature shall be manually subscribed. Coupon bonds shall have attached interest coupons bearing the facsimile signatures of the chairperson and the secretary or the executive director.
     (4) Any bond resolution, trust indenture, or agreement with a participant relating to bonds issued by the authority or the financing or refinancing made available by the authority may contain provisions, which may be made a part of the contract with the holders or owners of the bonds to be issued, pertaining to the following, among other matters:
     (a) The security interests granted by the participant to secure repayment of any amounts financed and the performance by the participant of its other obligations in the financing;
     (b) The security interests granted to the holders or owners of the bonds to secure repayment of the bonds;
     (c) Rentals, fees, and other amounts to be charged, and the sums to be raised in each year through such charges, and the use, investment, and disposition of the sums;
     (d) The segregation of reserves or sinking funds, and the regulation, investment, and disposition thereof;
     (e) Limitations on the uses of the project;
     (f) Limitations on the purposes to which, or the investments in which, the proceeds of the sale of any issue of bonds may be applied;
     (g) Terms pertaining to the issuance of additional parity bonds;
     (h) Terms pertaining to the incurrence of parity debt;
     (i) The refunding of outstanding bonds;
     (j) Procedures, if any, by which the terms of any contract with bondholders may be amended or abrogated;
     (k) Acts or failures to act that constitute a default by the participant or the authority in their respective obligations and the rights and remedies in the event of a default;
     (l) Terms governing performance by the trustee of its obligation; or
     (m) Such other additional covenants, agreements, and provisions as are deemed necessary, useful, or convenient by the authority for the security of the holders of the bonds.
     (5) Bonds may be issued by the authority to refund other outstanding authority bonds, at or before the maturity thereof, and to pay any redemption premium with respect thereto. Bonds issued for such refunding purposes may be combined with bonds issued for the financing or refinancing of new training programs. Pending the application of the proceeds of the refunding bonds to the redemption of the bonds to be redeemed, the authority may enter into an agreement or agreements with a corporate trustee under section 8 of this act with respect to the interim investment of the proceeds and the application of the proceeds and the earnings on the proceeds to the payment of the principal of and interest on, and the redemption of the bonds to be redeemed.
     (6) All bonds and any interest coupons appertaining to the bonds are negotiable instruments under Title 62A RCW.
     (7) Neither the members of the authority, nor its employees or agents, nor any person executing the bonds is liable personally on the bonds or subject to any personal liability or accountability by reason of the issuance of the bonds.
     (8) The authority may purchase its bonds with any of its funds available for the purchase. The authority may hold, pledge, cancel, or resell the bonds subject to and in accordance with agreements with bondholders.
     (9) The total outstanding bonded indebtedness of the authority shall not exceed fifty million dollars.

NEW SECTION.  Sec. 6   SPECIAL OBLIGATION BONDS--PAYMENT--SEGREGATION OF PROCEEDS AND MONEYS. Bonds issued under this chapter shall not be deemed to constitute obligations, either general or special, of the state or of any political subdivision of the state, or a pledge of the faith and credit of the state or of any political subdivision, or a general obligation of the authority. The bonds shall be special obligations of the authority and shall be payable solely from the special fund or funds created by the authority in the bond resolution or trust indenture under which the bonds were issued. Except for initial appropriations for the biennium ending June 30, 2005, the fund or funds shall be funded in whole or in part from moneys paid by one or more participants for whose benefit the bonds were issued, from the sources, if any, under section 4(7) of this act, or from the proceeds of bonds issued by the authority for the purpose of refunding any outstanding bonds of the authority. The issuance of bonds under this chapter shall not obligate, directly, indirectly, or contingently, the state or any political subdivision of the state to levy any taxes or appropriate or expend any funds for the payment of the principal or the interest on the bonds.
     Neither the proceeds of bonds issued under this chapter, any moneys used or to be used to pay the principal of or interest on the bonds, nor any moneys received by the authority to defray its administrative costs shall constitute public money or property. All of such moneys shall be kept segregated and set apart from funds of the state and any political subdivision of the state and shall not be subject to appropriation or allotment by the state or subject to the provisions of chapter 43.88 RCW.

NEW SECTION.  Sec. 7   AGREEMENTS WITH PARTICIPANTS--PAYMENT OF COSTS AND EXPENSES. In connection with any bonds issued by the authority, the authority shall enter into agreements with participants which shall provide for the payment by each participant of amounts which shall be sufficient, together with other revenues available to the authority, if any, to: (1) Pay the participant's share of the administrative costs and expenses of the authority; (2) pay the costs of conducting the training program financed by the authority, to the extent that the payment of the costs has not otherwise been adequately provided for; (3) pay the principal of, premium, if any, and interest on outstanding bonds of the authority issued in respect of such program or programs as the same shall become due and payable; and (4) create and maintain reserves required or provided for in any bond resolution or trust indenture authorizing the issuance of such bonds of the authority. The payments shall not be subject to supervision or regulation by any department, committee, board, body, bureau, or agency of the state other than the authority.

NEW SECTION.  Sec. 8   MONEYS DEEMED TRUST FUNDS--AGREEMENT OR TRUST INDENTURE WITH BANK OR TRUST COMPANY. All moneys received by or on behalf of the authority under this chapter, whether as proceeds from the sale of bonds or from participants or from other sources shall be deemed to be trust funds to be held and applied solely as provided in this chapter. The authority, in lieu of receiving and applying the moneys itself, may enter into an agreement or trust indenture with one or more banks or trust companies having the power and authority to conduct trust business in the state to:
     (1) Perform all of any part of the obligations of the authority with respect to: (a) Bonds issued by it; (b) the receipt, investment, and application of the proceeds of the bonds and moneys paid by a participant or available from other sources for the payment of the bonds; (c) the enforcement of the obligations of a participant in connection with the financing or refinancing of any project; and (d) other matters relating to the exercise of the authority's powers under this chapter;
     (2) Receive, hold, preserve, and enforce any security interest or evidence of security interest granted by a participant for purposes of securing the payment of the bonds; and
     (3) Act on behalf of the authority or the holders or owners of bonds of the authority for purposes of assuring or enforcing the payment of the bonds, when due.

NEW SECTION.  Sec. 9   HOLDERS OR OWNERS OF BONDS--TRUSTEES--ENFORCEMENT OF RIGHTS. Any holder or owner of bonds of the authority issued under this chapter or any holder of the coupons appertaining to the bonds, and the trustee or trustees under any trust indenture, except to the extent the rights given are restricted by the authority in any bond resolution or trust indenture authorizing the bonds, may, either at law or in equity, by suit, action, mandamus, or other proceedings, protect and enforce any of their respective rights.

NEW SECTION.  Sec. 10   BONDS AS SECURITIES--LEGAL INVESTMENTS.
The bonds of the authority are securities in which all public officers and bodies of this state and all counties, cities, municipal corporations, and political subdivisions, all banks, bankers, trust companies, savings banks and institutions, building and loan associations, savings and loan associations, investment companies, insurance companies and associations, and all executors, administrators, guardians, trustees, and other fiduciaries may legally invest any sinking funds, moneys, or other funds belonging to them or within their control.

NEW SECTION.  Sec. 11   BOND COUNSEL. (1) The authority shall adopt written policies to provide for the selection of bond counsel. The policies shall provide for the creation and maintenance of a roster of attorneys whom the authority believes possess the requisite special expertise and professional standing to provide bond counsel opinions that would be accepted by the underwriters, bondholders, and other members of the financial community, and that would be in furtherance of the public interest in obtaining the lowest possible interest rates on the bonds issued by the authority. Any attorney may apply to have his or her name placed on the roster, but may not be placed on the roster unless the attorney demonstrates to the authority's satisfaction that the attorney would issue the kind of opinions required by this section.
     (2) Before selecting an attorney or attorneys to provide bond counsel services, the authority shall provide all attorneys on the roster with a notice of its intentions to select bond counsel and shall invite each of them to submit to the authority his or her fee schedule for providing bond counsel services. The authority shall have wide discretion in selecting the attorney or attorneys it considers to be most appropriate to provide the services, but in the exercise of this discretion the authority shall consider all submitted fee schedules and the public interest in achieving issuance of bonds on terms most favorable to the authority. At least once every two calendar years, the authority shall select an attorney or attorneys to serve as bond counsel. However, the authority may retain an attorney for longer than two years when necessary to complete work on a particular bond issue. An attorney previously retained may be selected again but only after the authority has provided other attorneys on the roster with an opportunity to be selected and has made the fee schedule review required under this subsection. As an alternative to retaining counsel for a period of time, the authority may appoint an attorney to serve as counsel in respect to only a particular bond issue or issues.

NEW SECTION.  Sec. 12   UNDERWRITERS. (1) The authority shall adopt written policies to provide for the selection of underwriters. The policies shall provide for the creation of a roster of underwriters whom the authority believes possess the requisite special expertise and professional standing to provide bond marketing services that would be accepted by bondholders and other members of the financial community, and that would be in furtherance of the public interest in marketing the authority's bonds at the lowest possible costs. Any underwriter may apply to have its name placed on the roster, but may not be placed on the roster unless it demonstrates to the authority's satisfaction that it meets the requirements of this section.
     (2) Whenever the authority decides that it needs the services of an underwriter, it shall provide all underwriters on the roster with a notice of its intentions and shall invite each of them to submit to the authority an itemization of its fees and other charges for providing underwriting services on the issue. The itemization shall be by categories designed by the authority. The authority shall have wide discretion in selecting the underwriter it considers to be most appropriate to provide the services, but in the exercise of this discretion the authority shall consider the underwriter's fees and other charges and the public interest in achieving issuance of bonds on terms most favorable to the authority.

NEW SECTION.  Sec. 13   CHAPTER SUPPLEMENTAL--APPLICATION OF OTHER LAWS. This chapter provides a complete, additional, and alternative method for accomplishing the purposes of this chapter and shall be regarded as supplemental and additional to powers conferred by other laws. The issuance of bonds and refunding bonds under this chapter need not comply with the requirements of any other law applicable to the issuance of bonds.

NEW SECTION.  Sec. 14   CONSTRUCTION. This chapter, being necessary for the welfare of the state and its inhabitants, shall be liberally construed to effect its purposes. Insofar as the provisions of this chapter are inconsistent with the provisions of any general or special law, or parts thereof, the provisions of this chapter shall be controlling.

NEW SECTION.  Sec. 15   CAPTIONS NOT LAW. Captions used in this chapter are not any part of the law.

NEW SECTION.  Sec. 16   SEVERABILITY. 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. 17   Sections 1 through 16 of this act constitute a new chapter in Title 28B RCW.