BILL REQ. #:  H-4485.1 

Read first time 01/30/2006.   Referred to Committee on Local Government.

     AN ACT Relating to annexation capital facilities districts; amending RCW 84.52.043; adding a new chapter to Title 35 RCW; and providing a contingent effective date.

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

NEW SECTION.  Sec. 1   The legislature finds that it is in the interests of the people of the state of Washington to be able to establish annexation capital facilities districts as municipal corporations and independent taxing units to facilitate the annexation of unincorporated areas that lie within designated urban growth areas. The legislature intends that these municipal corporations act in cooperation with an annexing city and the county or counties in which they are located in order to facilitate annexation by cooperating in the construction, improvement, operation, and maintenance of capital facilities within the district. This authority is intended to work in conjunction with the authority granted under chapter . . . (House Bill No. . . . .(H-4482.1/06)), Laws of 2006 to apply real estate excise tax revenues to other costs of annexation.

NEW SECTION.  Sec. 2   The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
     (1) "Annexation capital facilities" means the capital facilities, including any real and personal property including, but not limited to, land, easements, buildings, site improvements, equipment, furnishings, collections, water supply, treatment and transmission facilities, wastewater and storm water collection and transmission facilities, other utility facilities and all necessary costs related to their acquisition, financing, design, construction, equipping, remodeling, and demolition or removal of existing facilities, described in the capital facilities plan adopted by an annexing city and submitted to the county or counties as part of a proposal to create an annexation capital facilities district under section 4 of this act.
     (2) "Annexation capital facilities plan" means the plan for annexation capital facilities submitted by an annexing city as part of a proposal to form an annexation capital facilities district and approved by the voters of the district under this chapter.
     (3) "Annexing city" means a city of any class or a code city located in King, Pierce, or Snohomish county that adopts a resolution under section 4 of this act for the creation of an annexation capital facilities district.

NEW SECTION.  Sec. 3   (1) An annexation capital facilities district formed under this chapter is a municipal corporation and independent taxing authority within the meaning of Article VII, section 1 of the state Constitution, and a taxing district within the meaning of Article VII, section 2 of the state Constitution.
     (2) An annexation capital facilities district may include all or a portion of the territory located in an unincorporated portion of one or more counties and within the annexing city's urban growth area designated pursuant to RCW 36.70A.110. The creation of an annexation capital facilities district is not subject to review by a boundary review board under chapter 36.93 RCW.

NEW SECTION.  Sec. 4   (1) An annexation capital facilities district may be created for the purpose of carrying out all or a part of the annexation capital facilities plan submitted by an annexing city and approved by the voters pursuant to this chapter, and for funding the operation and maintenance of those capital facilities improvements. An annexing city shall pay the costs of an election held under this section.
     (2) The legislative authority of a county or counties shall submit a ballot proposition to create an annexation capital facilities district to the voters of that proposed district upon an annexing city's submission to the county legislative authority or authorities of a request that includes:
     (a) A resolution of the legislative authority of the annexing city proposing the formation of the district, describing its boundaries, and stating the number of voters residing in the area, as nearly as may be determined; and
     (b) An annexation capital facilities plan adopted by the annexing city. The plan may be comprised in whole or in part by reference to the capital facilities element of the city's comprehensive plan prepared and adopted under chapter 36.70A RCW.
     (3) The ballot proposition under this section must be submitted to the voters of the proposed district at a general or special election occurring at least forty-five days, but not more than one hundred eighty days, following the adoption of the annexing city's resolution. The proposition must be a single ballot proposition on the question of whether the district shall be formed that is governed and possesses the powers described in this chapter to carry out the proposed annexation capital facilities plan. The ballot proposition must be prepared by the city attorney for the annexing city in conformance with the requirements for local ballot measures under RCW 29A.36.071. A simple majority of those voting on the proposition is required for passage.
     (4) An annexation capital facilities district is governed by a board of directors consisting of five members nominated by the annexing city and appointed by the legislative authority of the county. If any city nominee is rejected or any vacancy occurs, the annexing city shall submit additional nominees for the position until one is appointed by the county legislative authority. The members serve four-year terms. Of the initial members, one must be appointed for a one-year term, one must be appointed for a two-year term, one must be appointed for a three-year term, and the remainder must be appointed for four-year terms.
     (5) No direct or collateral attack on any annexation capital facilities district authorized or created in conformance with this chapter may be commenced later than thirty days after the certification of election results creating a district under this section. Notwithstanding any provision of a city or county charter or other law, action taken under this chapter may not be subject to local referendum or be the subject of a local initiative.

NEW SECTION.  Sec. 5   (1) An annexation capital facilities district shall constitute a body corporate and possess all the usual powers of a municipal corporation as well as all other powers that may now or hereafter be specifically conferred by statute including, but not limited to, the power to enter into contracts, to sue and be sued, and take all other actions necessary and appropriate to carry out the annexation capital facilities plan and the continued operation and maintenance of such capital facilities and improvements described in the plan. An annexation capital facilities district does not have the power of eminent domain.
     (2) The governing body of the annexation capital facilities district may contract with a county or the annexing city to carry out any of its functions, including but not limited to the design, administration of construction, operation, and maintenance of annexation capital facilities, and may accept gifts or grants of money or property of any kind for district purposes. Legal title to annexation capital facilities acquired or constructed pursuant to this chapter may be transferred, acquired, or held by the annexation capital facilities district or by the county or annexing city. However, an annexation capital facilities district shall provide by contract with the annexing city that upon annexation, any annexation capital facilities owned, operated, or otherwise held by the district must be transferred to the city.
     (3) An annexation capital facilities district shall contract no new obligations relating to the financing of additional annexation capital facilities after the effective date of the annexation of the territory within the boundaries of the district into the annexing city.
     (4) An annexation capital facilities district may enter into contracts with any city or town for the purpose of exercising any powers of a community renewal agency under chapter 35.81 RCW.

NEW SECTION.  Sec. 6   (1) An annexation capital facilities district may impose:
     (a) Any charge or fee that the annexing city would be authorized by statute to impose for the use of, or service received from, the annexation capital facilities;
     (b) Regular property taxes not to exceed one dollar and fifty cents per thousand dollars of assessed valuation.
     (2) Revenues derived from these charges, fees, and taxes may be used only for district purposes, including but not limited to making payments to the annexing city or county to be used to pay principal and interest on special revenue bonds or general obligation bonds issued by the city or county to finance annexation capital facilities.
     (3) The limitation in RCW 84.55.010 does not apply to the first regular property tax levy imposed under this section following the formation of an annexation capital facilities district.

NEW SECTION.  Sec. 7   (1) An annexation capital facilities district may enter into agreements with the annexing city, a county, the state of Washington, or any state financing authority to pledge taxes or other revenues of the district for the purpose of paying in part or whole principal and interest on bonds or other evidences of indebtedness issued by the annexing city, the county, the state of Washington, or any state financing authority to complete any portion of the annexation capital facilities plan. The agreements pledging revenues and taxes are binding for their terms, but not to exceed twenty years.
     (2) After the effective date of the annexation of the territory within the annexation capital facilities district, revenues collected by the district may be used solely to make payments required under a pledging agreement or to fund the continued operation and maintenance of annexation capital facilities.

NEW SECTION.  Sec. 8   (1) An annexation capital facilities district may be dissolved by a majority vote of the governing body when all obligations of the annexation capital facilities district relating to bonds issued to finance the annexation capital facilities have been discharged and all other contractual obligations of the annexation capital facilities district have either been discharged or assumed by another governmental entity.
     (2) An annexation capital facilities district must be automatically dissolved on the date that is ninety days after (a) all of the territory included within the district has been annexed into a city and those annexations have become effective; and (b) all obligations have been discharged or assumed by another governmental entity as described in subsection (1) of this section.

Sec. 9   RCW 84.52.043 and 2005 c 122 s 3 are each amended to read as follows:
     Within and subject to the limitations imposed by RCW 84.52.050 as amended, the regular ad valorem tax levies upon real and personal property by the taxing districts hereafter named shall be as follows:
     (1) Levies of the senior taxing districts shall be as follows: (a) The levy by the state shall not exceed three dollars and sixty cents per thousand dollars of assessed value adjusted to the state equalized value in accordance with the indicated ratio fixed by the state department of revenue to be used exclusively for the support of the common schools; (b) the levy by any county shall not exceed one dollar and eighty cents per thousand dollars of assessed value; (c) the levy by any road district shall not exceed two dollars and twenty-five cents per thousand dollars of assessed value; and (d) the levy by any city or town shall not exceed three dollars and thirty-seven and one-half cents per thousand dollars of assessed value. However any county is hereby authorized to increase its levy from one dollar and eighty cents to a rate not to exceed two dollars and forty-seven and one-half cents per thousand dollars of assessed value for general county purposes if the total levies for both the county and any road district within the county do not exceed four dollars and five cents per thousand dollars of assessed value, and no other taxing district has its levy reduced as a result of the increased county levy.
     (2) The aggregate levies of junior taxing districts and senior taxing districts, other than the state, shall not exceed five dollars and ninety cents per thousand dollars of assessed valuation. The term "junior taxing districts" includes all taxing districts other than the state, counties, road districts, cities, towns, port districts, and public utility districts. The limitations provided in this subsection shall not apply to: (a) Levies at the rates provided by existing law by or for any port or public utility district; (b) excess property tax levies authorized in Article VII, section 2 of the state Constitution; (c) levies for acquiring conservation futures as authorized under RCW 84.34.230; (d) levies for emergency medical care or emergency medical services imposed under RCW 84.52.069; (e) levies to finance affordable housing for very low-income housing imposed under RCW 84.52.105; (f) the portions of levies by metropolitan park districts that are protected under RCW 84.52.120; (g) levies imposed by ferry districts under RCW 36.54.130; (h) levies for criminal justice purposes under RCW 84.52.135; ((and)) (i) the portions of levies by fire protection districts that are protected under RCW 84.52.125; and (j) levies by annexation capital facilities districts under section 6 of this act.

NEW SECTION.  Sec. 10   This act takes effect July 1, 2006, only if chapter . . . (House Bill No. . . . . (H-4482.1/06)), Laws of 2006 is signed by the governor. If chapter . . . (House Bill No. . . . . (H-4482.1/06)), Laws of 2006 is not signed by the governor by July 1, 2006, this act is null and void.

NEW SECTION.  Sec. 11   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. 12   Sections 1 through 8, 10, and 11 of this act constitute a new chapter in Title 35 RCW.