"Sec. 1   RCW 82.16.010 and 1996 c 150 s 1 are each amended to read as follows:
     For the purposes of this chapter, unless otherwise required by the context:
     (1) "Railroad business" means the business of operating any railroad, by whatever power operated, for public use in the conveyance of persons or property for hire. It shall not, however, include any business herein defined as an urban transportation business.
     (2) "Express business" means the business of carrying property for public hire on the line of any common carrier operated in this state, when such common carrier is not owned or leased by the person engaging in such business.
     (3) "Railroad car business" means the business of operating stock cars, furniture cars, refrigerator cars, fruit cars, poultry cars, tank cars, sleeping cars, parlor cars, buffet cars, tourist cars, or any other kinds of cars used for transportation of property or persons upon the line of any railroad operated in this state when such railroad is not owned or leased by the person engaging in such business.
     (4) "Water distribution business" means the business of operating a plant or system for the distribution of water for hire or sale.
     (5) "Light and power business" means the business of operating a plant or system for the generation, production or distribution of electrical energy for hire or sale and/or for the wheeling of electricity for others.
     (6) "Telegraph business" means the business of affording telegraphic communication for hire.
     (7) "Gas distribution business" means the business of operating a plant or system for the production or distribution for hire or sale of gas, whether manufactured or natural.
     (8) "Motor transportation business" means the business (except urban transportation business) of operating any motor propelled vehicle by which persons or property of others are conveyed for hire, and includes, but is not limited to, the operation of any motor propelled vehicle as an auto transportation company (except urban transportation business), common carrier or contract carrier as defined by RCW 81.68.010 and 81.80.010: PROVIDED, That "motor transportation business" shall not mean or include the transportation of logs or other forest products exclusively upon private roads or private highways.
     (9) "Urban transportation business" means the business of operating any vehicle for public use in the conveyance of persons or property for hire, insofar as (a) operating entirely within the corporate limits of any city or town, or within five miles of the corporate limits thereof, or (b) operating entirely within and between cities and towns whose corporate limits are not more than five miles apart or within five miles of the corporate limits of either thereof. Included herein, but without limiting the scope hereof, is the business of operating passenger vehicles of every type and also the business of operating cartage, pickup, or delivery services, including in such services the collection and distribution of property arriving from or destined to a point within or without the state, whether or not such collection or distribution be made by the person performing a local or interstate line-haul of such property.
     (10) "Public service business" means any of the businesses defined in subdivisions (1), (2), (3), (4), (5), (6), (7), (8), and (9) or any business subject to control by the state, or having the powers of eminent domain and the duties incident thereto, or any business hereafter declared by the legislature to be of a public service nature, except telephone business as defined in RCW 82.04.065 and low-level radioactive waste site operating companies as redefined in RCW 81.04.010. It includes, among others, without limiting the scope hereof: Airplane transportation, boom, dock, ferry, pipe line, toll bridge, toll logging road, water transportation and wharf businesses.
     (11) "Tugboat business" means the business of operating tugboats, towboats, wharf boats or similar vessels in the towing or pushing of vessels, barges or rafts for hire.
     (12) "Subscription television business" means providing transmission of video programming, including single-event programs, to subscribers and includes any subscriber interaction for the selection of video programming or other program services. The term includes, but is not limited to, direct broadcast satellite service, cable television service, satellite master antenna television service, master antenna television service, multipoint distribution service, multichannel/multipoint distribution service, and any audio portion of a video program.
     (13) "Gross income" means the value proceeding or accruing from the performance of the particular public service or transportation business involved, including operations incidental thereto, but without any deduction on account of the cost of the commodity furnished or sold, the cost of materials used, labor costs, interest, discount, delivery costs, taxes, or any other expense whatsoever paid or accrued and without any deduction on account of losses.
     (((13))) (14) The meaning attributed, in chapter 82.04 RCW, to the term "tax year," "person," "value proceeding or accruing," "business," "engaging in business," "in this state," "within this state," "cash discount" and "successor" shall apply equally in the provisions of this chapter.

Sec. 2   RCW 82.16.020 and 1996 c 150 s 2 are each amended to read as follows:
     (1) There is levied and there shall be collected from every person a tax for the act or privilege of engaging within this state in any one or more of the businesses herein mentioned. The tax shall be equal to the gross income of the business, multiplied by the rate set out after the business, as follows:
     (a) Express, sewerage collection, and telegraph businesses: Three and six-tenths percent;
     (b) Light and power business: Three and sixty-two one-hundredths percent;
     (c) Gas distribution business: Three and six-tenths percent;
     (d) Urban transportation business: Six-tenths of one percent;
     (e) Vessels under sixty-five feet in length, except tugboats, operating upon the waters within the state: Six-tenths of one percent;
     (f) Motor transportation, railroad, railroad car, and tugboat businesses, and all public service businesses other than ones mentioned above: One and eight-tenths of one percent;
     (g) Water distribution business: Four and seven-tenths percent;
     (h) Subscription television business: Eight and five-tenths percent.
     (2) An additional tax is imposed equal to the rate specified in RCW 82.02.030 multiplied by the tax payable under subsection (1)(a) through (g) of this section.
     (3) Twenty percent of the moneys collected under subsection (1) of this section on water distribution businesses and sixty percent of the moneys collected under subsection (1) of this section on sewerage collection businesses shall be deposited in the public works assistance account created in RCW 43.155.050.
     (4) Forty-one percent of the moneys collected under subsection (1)(h) of this section shall be deposited in the city-county assistance account created in section 4 of this act.

NEW SECTION.  Sec. 3   A new section is added to chapter 82.16 RCW to read as follows:
     A subscription television business is allowed credits against taxes under this chapter in amounts equal to franchise fees and taxes imposed on the privilege of conducting the subscription television business by cities, towns, and counties. The amount of credit allowed for franchise fees and taxes imposed on a subscription television business by a city, town, or county shall not exceed the amount of tax imposed under RCW 82.16.020(1)(h) on that business in that city, town, or county during the reporting period.

NEW SECTION.  Sec. 4   A new section is added to chapter 82.14 RCW to read as follows:
     (1) The city-county assistance account is created in the state treasury. Money in the account may be spent only after appropriation. Expenditures from the account may be used only for the purposes provided in this section.
     (2) Fifty percent of the receipts deposited in the city-county assistance account shall be allocated to counties, and the remainder shall be allocated to cities.
     (3) Revenues allocated to counties shall be distributed as provided under this subsection.
     (a) Except as provided in (b) and (c) of this subsection, the amount distributed to a county under this section shall be an amount equal to twenty-five percent of the greater of the amounts described under (a)(i) through (iii) of this subsection.
     (i) For a county imposing the sales and use tax under RCW 82.14.030(1) at the maximum rate and receiving less than the base amount from the tax in the measurement year, an amount from the city-county assistance account sufficient, when added to the amount of revenues received by the county in the measurement year, to equal the base amount. For the purposes of this subsection (3)(a)(i), "base amount" means two hundred fifty thousand dollars in the first distribution year. Thereafter, "base amount" means two hundred fifty thousand dollars increased by the rate of inflation as provided under subsection (5) of this section.
     (ii)(A) For a county with an unincorporated population of one hundred thousand or less and imposing the sales and use tax under RCW 82.14.030(1) at the maximum rate and receiving less than seventy percent of the statewide weighted average per capita level of revenues for the unincorporated areas of all counties in the measurement year as determined by the department, an amount from the city-county assistance account sufficient, when added to the per capita level of revenues for the unincorporated area received by the county in the measurement year, to equal seventy percent of the statewide weighted average per capita level of revenues for the unincorporated areas of all counties in the measurement year.
     (B) For a county with an unincorporated population of more than one hundred thousand and imposing the sales and use tax under RCW 82.14.030(1) at the maximum rate and receiving less than sixty-five percent of the statewide weighted average per capita level of revenues for the unincorporated areas of all counties in the measurement year as determined by the department, an amount from the city-county assistance account sufficient, when added to the per capita level of revenues for the unincorporated area received by the county in the measurement year, to equal sixty-five percent of the statewide weighted average per capita level of revenues for the unincorporated areas of all counties in the measurement year.
     (iii)(A) For a county with an unincorporated population of fifteen thousand or less, an amount equal to the amount provided to the county for fiscal year 2005 by section 716, chapter 276, Laws of 2004.
     (B) For a county with an unincorporated population of more than fifteen thousand and less than twenty-two thousand, and with respect to distributions made under this section in calendar years 2006 and 2007 only, an amount equal to the amount provided to the county for fiscal year 2005 by section 716, chapter 276, Laws of 2004.
     (b) If funds in the city-county assistance account for allocation to the counties are inadequate to make the distributions in (a) of this subsection, then the distributions shall be reduced ratably among the qualifying counties.
     (c) If funds in the city-county assistance account for allocation to the counties exceed the amount necessary to make the distributions in (a) of this subsection, the excess funds shall be apportioned ratably among those counties receiving funds under this section and imposing the tax under RCW 82.14.030(1) at the maximum rate.
     (4) Revenues allocated to cities shall be distributed as provided under this subsection.
     (a) Except as provided in (c), (d), and (e) of this subsection, the amount distributed to a city under this section shall be an amount equal to twenty-five percent of the greater of the amounts described under (a)(i) through (iii) of this subsection. This subsection (4)(a) applies only to cities with a population of five thousand or less and with a per capita assessed value of taxable property in the measurement year less than twice the statewide average per capita assessed value of taxable property for all cities for the measurement year.
     (i) For a city imposing the sales and use tax under RCW 82.14.030(1) at the maximum rate and receiving less than fifty-five percent of the statewide weighted average per capita level of revenues for all cities in the measurement year as determined by the department, an amount from the city-county assistance account sufficient, when added to the per capita level of revenues received by the city in the measurement year, to equal fifty-five percent of the statewide weighted average per capita level of revenues for all cities in the measurement year.
     (ii) An amount equal to the amount provided to the city for fiscal year 2005 by section 721, chapter 25, Laws of 2003 1st sp. sess.
     (iii) For a city with a per capita assessed value of taxable property in the measurement year less than fifty percent of the statewide average per capita assessed value of taxable property for all cities in the measurement year as determined by the department, an amount determined by subtracting the city's per capita assessed value of taxable property in the measurement year from fifty percent of the statewide average per capita assessed value of taxable property for all cities in the measurement year, dividing that amount by one thousand, and multiplying the result by the city's population.
     (b) Except as provided in (c), (d), and (e) of this subsection, the amount distributed to a city under this section shall be an amount equal to twenty-five percent of the greater of the amounts described under (b)(i) through (iii) of this subsection. This subsection (4)(b) applies only to cities with a population of more than five thousand and with a per capita assessed value of taxable property in the measurement year less than the statewide average per capita assessed value of taxable property for all cities for the measurement year.
     (i) For a city imposing the sales and use tax under RCW 82.14.030(1) at the maximum rate and receiving less than fifty percent of the statewide weighted average per capita level of revenues for all cities in the measurement year as determined by the department, an amount from the city-county assistance account sufficient, when added to the per capita level of revenues received by the city in the measurement year, to equal fifty percent of the statewide weighted average per capita level of revenues for all cities in the measurement year.
     (ii) For distributions in calendar years 2006 and 2007 only, an amount equal to the amount provided to the city for fiscal year 2005 by section 721, chapter 25, Laws of 2003 1st sp. sess.
     (iii) For a city with a per capita assessed value of taxable property in the measurement year less than fifty percent of the statewide average per capita assessed value of taxable property for all cities in the measurement year as determined by the department, an amount determined by subtracting the city's per capita assessed value of taxable property in the measurement year from fifty percent of the statewide average per capita assessed value of taxable property for all cities in the measurement year, dividing that amount by one thousand, and multiplying the result by the city's population.
     (c) A city may not receive an amount in any distribution year that would cause cumulative distributions to the city under this section for the year to exceed one hundred thousand dollars, increased after the first distribution year by the rate of inflation as provided under subsection (5) of this section.
     (d) If funds in the city-county assistance account for allocation to the cities are inadequate to make the distributions in (a) and (b) of this subsection, then the distributions shall be reduced ratably among the qualifying cities.
     (e) If funds in the city-county assistance account for allocation to the cities exceed the amount necessary to make the distributions in (a) and (b) of this subsection, the excess funds shall be apportioned ratably among those cities receiving funds under this section and imposing the tax under RCW 82.14.030(1) at the maximum rate.
     (f) This subsection (4) applies only to cities incorporated prior to the effective date of this section.
     (5)(a) For the purpose of certifications under subsection (6) of this section, the department shall calculate the base amount in subsection (3)(a)(i) of this section and the amount in subsection (4)(c) of this section for distribution years after the first distribution year using an adjustment for inflation as defined in RCW 84.55.005.
     (b) With respect to a city, town, or county to which or from which unincorporated territory is annexed during a measurement year, and for the purposes of calculating amounts for distribution under subsections (3) and (4) of this section based upon information from that year, the department shall utilize estimates of the population and assessed value of taxable property in the jurisdiction immediately prior to the annexation.
     (6)(a) Distributions of the amounts provided under subsections (3) and (4) of this section shall be made quarterly beginning on January 1, 2006, based on receipts to the city-county assistance account as provided in (b) of this subsection. The department shall certify the amounts to be distributed under this section to the state treasurer. Amounts certified by the department are final and may not be appealed. The certification shall be made by January 1, 2006, for the January 1, 2006, distribution, and by April 1, 2006, for the April 1, 2006, distribution. The certification shall be made by June 1, 2006, with respect to the distributions occurring in the ensuing distribution year, and by June 1st of each year thereafter with respect to the distributions occurring in each subsequent distribution year.
     (b) The quarterly distributions shall be made based on receipts to the city-county assistance account as follows:
     (i) Any distribution made on January 1st shall be based on receipts to the account during the immediately preceding September, October, and November;
     (ii) Any distribution made on April 1st shall be based on receipts to the account during the immediately preceding December, January, and February;
     (iii) Any distribution made on July 1st shall be based on receipts to the account during the immediately preceding March, April, and May; and
     (iv) Any distribution made on October 1st shall be based on receipts to the account during the immediately preceding June, July, and August.
     (7) All distributions to local governments from the city-county assistance account constitute increases in state distributions of revenue to political subdivisions for purposes of state reimbursement for the costs of new programs and increases in service levels under RCW 43.135.060, including any claims or litigation pending against the state on or after January 1, 2005.
     (8) For the purposes of this section, the following definitions apply:
     (a) Except for the initial distribution year, "distribution year" means the twelve-month period beginning July 1st. For the purposes of the initial distribution year, "distribution year" means the twelve-month period ending June 30, 2006.
     (b) "Measurement year" means the calendar year prior to the year in which the certification under subsection (6) of this section is made.
     (c) "Population" means the population for the county or city as determined by the office of financial management for the measurement year.
     (d) "City" means city or town.

NEW SECTION.  Sec. 5   A new section is added to chapter 44.28 RCW to read as follows:
     During calendar year 2008, the joint legislative audit and review committee shall review the distributions to cities and counties under section 4 of this act to determine the extent to which the distributions target the needs of cities and counties for which the repeal of the motor vehicle excise tax had the greatest fiscal impact. In conducting the study, the committee shall solicit input from the cities and counties. The department of revenue and the state treasurer shall provide the committee with any data within their purview that the committee considers necessary to conduct the review. The committee shall report to the legislature the results of its findings, and any recommendations for changes to the distribution formulas under section 4 of this act, by December 31, 2008.

Sec. 6   RCW 43.84.092 and 2003 c 361 s 602, 2003 c 324 s 1, 2003 c 150 s 2, and 2003 c 48 s 2 are each reenacted and 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 city-county assistance account, the common school construction fund, 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 drinking water assistance administrative account, the drinking water assistance repayment account, the Eastern Washington University capital projects account, the education construction fund, the election account, the emergency reserve fund, The Evergreen State College capital projects account, 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 oyster reserve land 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 public facilities construction loan revolving account beginning July 1, 2004, the public health supplemental account, the public works assistance account, the Puyallup tribal settlement account, the regional transportation investment district 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 Tacoma Narrows toll bridge 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 fruit express account, 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 2003 account (nickel 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. 7   RCW 43.84.092 and 2004 c 242 s 60 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 city-county assistance account, the common school construction fund, 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 drinking water assistance administrative account, the drinking water assistance repayment account, the Eastern Washington University capital projects account, the education construction fund, the election account, the emergency reserve fund, The Evergreen State College capital projects account, 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 oyster reserve land 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 public facilities construction loan revolving account beginning July 1, 2004, the public health supplemental account, the public works assistance account, the Puyallup tribal settlement account, the regional transportation investment district 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 Tacoma Narrows toll bridge 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 fruit express account, 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 public safety employees' 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 2003 account (nickel 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.

NEW SECTION.  Sec. 8   This act takes effect August 1, 2005, except for section 7 of this act which takes effect July 1, 2006.

NEW SECTION.  Sec. 9   Section 6 of this act expires July 1, 2006."