BILL REQ. #:  H-5084.1 

READ FIRST TIME 02/13/06.   

     AN ACT Relating to water resource management in the Columbia river basin; amending 2005 c 488 s 332 (uncodified); reenacting and amending RCW 43.84.092; adding a new chapter to Title 90 RCW; making appropriations; and providing an effective date.

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

NEW SECTION.  Sec. 1   (1) The legislature finds that state water resources management in the Columbia river basin must immediately initiate the development of new water supplies to meet the economic and community development needs of people and the instream flow needs of fish.
     (2) The legislature therefore declares that a Columbia river basin water supply development program is needed, and directs the department of ecology to aggressively pursue the development of cost-effective water supplies to benefit both instream and out-of-stream uses.

NEW SECTION.  Sec. 2   (1) To support the development of new water supplies in the Columbia river, the department of ecology shall work with all interested parties, including but not limited to, interested watershed planning groups working adjacent to the Columbia river and tribal governments, to develop a Columbia river water supply inventory. The inventory must include:
     (a) A list of potential conservation and storage projects in the Columbia river basin;
     (b) Estimates of project costs and benefits;
     (c) A ranking of projects from the least expensive per acre-foot of water conserved to the most expensive per acre-foot;
     (d) A ranking of projects from the most beneficial to fish to the least beneficial to fish; and
     (e) A ranking of projects from the most beneficial to agriculture to the least beneficial to agriculture.
     (2) The Columbia river water supply inventory should consider long-term trends in water supply and demand, rely on existing project data already completed by local planning groups, and supplement existing information as necessary to develop a useful inventory.
     (3) The department of ecology shall complete the first Columbia river water supply inventory by November 15, 2006, and shall update the inventory annually thereafter.

NEW SECTION.  Sec. 3   (1) Except as otherwise provided in this section, new water supplies developed and secured through the operation or development of storage facilities made possible with funding from the Columbia river basin water storage and supply account shall be allocated as follows:
     (a) Two-thirds of active storage shall be allocated to out-of-stream uses; and
     (b) One-third of active storage shall be placed in the state trust water rights program to enhance instream flows. The timing of releases of this water shall be determined in cooperation with the department of fish and wildlife to maximize benefits to salmon and steelhead populations.
     (2) The one-third/two-thirds allocation of water resources between instream and out-of-stream uses that is established in this section shall not be applied by the department of ecology when considering applications for changes or transfers of existing water rights in the Columbia river basin.
     (3) The department of ecology shall focus its efforts to develop water supplies for the Columbia river basin on the following needs:
     (a) Alternatives to ground water for farmers in the Odessa subarea aquifer;
     (b) Sources of municipal water supply for pending water right applications;
     (c) A new uninterruptible supply of water for the holders of interruptible water rights on the Columbia river mainstem that are subject to instream flows or other mitigation conditions to protect stream flows; and
     (d) New municipal, domestic, industrial, and irrigation water needs within the Columbia river basin.
     (4) The department of ecology shall monitor and evaluate the new water allocated to instream use under this section and section 5 of this act, in order to identify the maximum streamflow that is beneficial to aquatic life. The department shall submit a decadal report to the appropriate committees of the legislature that identifies how much new water has been dedicated to instream uses and how close the Columbia river basin is to reaching the maximum beneficial flow during the times of the year with the lowest flow levels. Once the maximum beneficial flow that is beneficial to aquatic life has been reached and maintained, all additional new water supplies developed and secured under this section shall be allocated for out-of-stream uses.

NEW SECTION.  Sec. 4   (1) In order to implement the Columbia river basin water supply development program, the department of ecology has the authority to enter into voluntary regional agreements that establish conditions under which water withdrawn from the Columbia river will be approved. These agreements shall pertain to specific geographic areas and to individuals or entities that use or propose to use water from the Columbia river mainstem. Regional solutions must, to the maximum extent practicable, include input from and acceptance by citizens within the affected region, voluntary processes and agreements that develop unique solutions for each region, avoidance of policies that will create precedents impacting the ability of other regions of the state to develop their own unique solutions, and efforts to harmonize such regional efforts with watershed planning efforts conducted under the authority of this chapter or chapter 90.82 RCW.
     (a) Voluntary regional agreements based upon conserved water are authorized. Conserved water shall be allocated in a manner that concurrently ensures that:
     (i) Water is provided for out-of-stream uses; and
     (ii) No reduction in stream flows during fish critical periods in the Columbia river mainstem will occur as a result of the new appropriation of water.
     (b) Applicants under a voluntary regional agreement must demonstrate efficient water use practices.
     (c) Voluntary regional agreements based upon accessing water supplies from new or existing storage facilities shall be implemented consistent with the requirements of section 3 of this act. Applicants under a voluntary regional agreement must demonstrate efficient water use practices.
     (2) The mitigation standards established in this section are intended to streamline issuance of new water rights from the Columbia river. Nothing in this chapter is intended to stop the processing of applications for new water rights. Nothing in this chapter may be interpreted or administered in a manner that precludes the use of existing authority to process water right applications under chapter 90.03 or 90.44 RCW, or in a manner that impairs or diminishes a valid water right.
     (3)(a) Before entering into a voluntary agreement under this section, the department of ecology must:
     (i) Consult with the department of fish and wildlife and watershed planning groups regarding the benefits that the voluntary agreement can produce for fish and wildlife species and other instream values on the Columbia river mainstem; and
     (ii) Provide a thirty-day public review and comment period for a draft agreement, and publish a summary of any public comments received. The thirty-day review period shall not begin until after the department of ecology has concluded its consultation with the department of fish and wildlife and the appropriate watershed planning groups.
     (b) To meet its responsibility under this section, the department of fish and wildlife shall consult with fisheries comanagers and shall inform the department of ecology of the recommendations of fisheries comanagers. The department of fish and wildlife shall provide comments, including the recommendations of fisheries comanagers, to the department within thirty days following receipt of a draft agreement for review.
     (4) In implementing this section, the department of ecology shall inform the legislature as to such efforts and request any additional authority needed for implementation.

NEW SECTION.  Sec. 5   Conserved water funded by the state:
     (1) To benefit the Columbia river mainstem shall be permanently held in trust in proportion to the share of funding provided by the state to complete the project. Water held in trust under this section shall be used to improve instream flows for the benefit of fish and other instream values;
     (2) Developed within the federal Columbia basin reclamation project shall become a portion of the project water supply to be used to replace deep well irrigation within the Odessa ground water management subarea and to reduce water diversions from the Columbia river.

NEW SECTION.  Sec. 6   (1) By July 1, 2006, the department shall convene discussion groups, including all appropriate stakeholders, to consider and make recommendations on the following issues:
     (a) The public interest in regional equity regarding the sources of water supplies and mechanisms, to determine whether interregional water transfers jeopardize the economic health of any region or tributary basin. The review must also consider mechanisms that might provide for water supplies in other regions while retaining the water right in the region of the water source;
     (b) Whether a water bank for the Columbia river mainstem would simplify and improve the approval of water acquisitions, leases, loans, and exchanges; reduce the time and costs associated with such transactions; and increase the availability of water supplies and water-related information.
     (2) Reports from the reviews under this section are due to the appropriate committees of the legislature by December 31, 2006.

NEW SECTION.  Sec. 7   The Columbia river basin water storage and supply account is created in the state treasury. All receipts from appropriations made to the account and receipts of payments made by water users that are based on an appropriate and economically viable share of construction, operation, and maintenance costs of water supply projects must be deposited into the account. Moneys in the account may be spent only after appropriation. Expenditures from the account may be used to assess, plan, and develop new storage and improve or alter operations of existing storage facilities designed to provide access to new water supplies within the Columbia river basin for both instream and out-of-stream uses. The department of ecology shall manage any appropriations made from the account for the purposes of developing water supplies in a manner that yields the greatest benefits to the state.

NEW SECTION.  Sec. 8   (1) In order to better understand current water use in the Columbia mainstem, the department of ecology shall establish and maintain a Columbia mainstem water resources information system that provides the information necessary for effective mainstem water resource planning and management. To accomplish this objective, the department shall consult with and use information already compiled by existing local watershed planning groups, the United States bureau of reclamation, the Bonneville power administration, irrigation districts, and conservation districts in the basin.
     (2) The data program shall include a system for collecting and providing access to water resource data as well as a system for cataloging, storing, and retrieving the information so it may be made readily available to and effectively used by the department and by the public and also include data on:
     (a) The total aggregate quantity of water issued under state permits and certificates and filed under state claims on the Columbia river mainstem and for ground water within one mile of the mainstem;
     (b) The total aggregate volume of current water use under these rights as metered and reported by water users;
     (c) The aggregate quantity of water that is currently inchoate or under development under these rights;
     (d) Conservation projects that have been implemented under this chapter and the amount of water conservation they have achieved; and
     (e) Other relevant water use data.
     (3) The department of ecology shall collect this data annually and publish it on the department's web site no later than November 1st of each year.

Sec. 9   RCW 43.84.092 and 2005 c 514 s 1106, 2005 c 353 s 4, 2005 c 339 s 23, 2005 c 314 s 110, 2005 c 312 s 8, and 2005 c 94 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 Columbia river basin water storage and supply 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 developmental disabilities community trust 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 education legacy trust account, the election account, the emergency reserve fund, The Evergreen State College capital projects account, the federal forest revolving account, the freight mobility investment 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 high-occupancy toll lanes operations 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 real estate appraiser commission account, the regional transportation investment district account, the resource management cost account, the rural Washington loan fund, the site closure account, the small city pavement and sidewalk 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 transportation partnership 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.

Sec. 10   2005 c 488 s 332 (uncodified) is amended to read as follows:
FOR THE DEPARTMENT OF ECOLOGY
     Columbia River Initiative (06-2-010)

     The appropriation in this section is subject to the following conditions and limitations:
     (1) $6,000,000 is provided solely for feasibility studies related to off-mainstem storage projects and impacts of changing operations at the Potholes reservoir, and grant funding for the purchase and installation of water measuring devices.
     (2) Of the amount appropriated in this section, $10,000,000 ((may not be expended prior to enactment of state legislation that establishes the policy requirements for a new water resources and water rights management program for the Columbia river mainstem. If such legislation is not enacted prior to June 30, 2006, this amount shall lapse)) is provided to begin implementation of the Columbia basin water storage and supply development program established in this act. Within this amount, the department shall support, to the extent that projects are ready to proceed and to the extent that resources allow, the following water supply projects, including but not limited to: Storage development or storage enhancement projects, projects that provide surface water supply for the Odessa subarea within the boundaries of the Columbia river basin project, projects which enhance water supplies for the Walla Walla and Yakima rivers through exchanges and other methods, projects which address water supply needs for the Quad-Cities, and investments resulting in water use efficiency. The department shall report progress under this section to the appropriate committees of the legislature by December 1, 2006.

Appropriation:
     State Building Construction Account--State . . . . . . . . . . . . $16,000,000

     Prior Biennia (Expenditures) . . . . . . . . . . . . $0
     Future Biennia (Projected Costs) . . . . . . . . . . . . $52,610,000
          TOTAL . . . . . . . . . . . . $68,610,000

NEW SECTION.  Sec. 11   Sections 1 through 8 of this act constitute a new chapter in Title 90 RCW.

NEW SECTION.  Sec. 12   This act takes effect July 1, 2006.