BILL REQ. #:  S-0215.2 

Read first time 02/01/2005.   Referred to Committee on International Trade & Economic Development.

     AN ACT Relating to establishing the short line rail revitalization program; adding a new section to chapter 43.160 RCW; and creating a new section.

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

NEW SECTION.  Sec. 1   The legislature finds that freight rail service is an essential part of Washington state's participation in the world marketplace. The legislature further finds that by earmarking freight rail funds through state fiscal year 2012-2013, it limits its ability to effectively compete in the worldwide marketplace. The legislature further finds that such an inability to compete decreases its ability to retain or secure economic development opportunities that wholly, or in part, depend on establishing, maintaining, or rehabilitating short line freight rail service. The legislature further finds that short line freight rail service has been a deciding factor in economic development opportunities, particularly the construction of a $110 million glass manufacturing plant near Winlock, Washington. A total state expenditure of $800,000 for a short line freight rail spur line will help create an estimated 210 family-wage jobs in Washington state, with an average salary of $45,300 per year, and help create a local payroll of $9.5 million per year to help energize Washington's economy. Therefore, the legislature finds that it would be well served by establishing a short line rail revitalization program within the department of community, trade, and economic development.
     It is the intent of the legislature to establish a short line rail revitalization program within the community economic revitalization board within the department of community, trade, and economic development to allow political subdivisions to be approved for a sales and use tax credit for short line rail projects that are reasonably expected to provide a direct economic benefit in this state.

NEW SECTION.  Sec. 2   A new section is added to chapter 43.160 RCW to read as follows:
     (1) The board shall develop a short line rail revitalization program, through which the board shall consider applications from political subdivisions of the state for the purpose of:
     (a) Acquiring, building, rebuilding, rehabilitating, or improving rail lines;
     (b) Purchasing or rehabilitating railroad equipment necessary to maintain essential rail service;
     (c) Constructing railroad improvements to mitigate port access or mainline congestion; or
     (d) Construction of loading facilities to increase business on light density lines or to mitigate the impacts of abandonment.
     (2) In consultation with the Washington state department of transportation freight rail program, the board shall develop criteria for approving and prioritizing applications. The board may approve applications only where a direct economic benefit is reasonably expected in this state as a direct or indirect result of the rail improvement.
     (3) The board shall consider, process, and either approve or reject an application within sixty days of submission.
     (4) In consultation with the Washington state department of transportation freight rail program, the board shall develop, publish, and make available to short line rail stakeholders, and the public, materials describing the short line rail revitalization program and its application process. Short line rail stakeholders must include, but not be limited to, owners and operators of all short line railroads in this state.
     (5) A political subdivision of the state whose short line rail revitalization application has been approved qualifies for a state sales and use tax credit of 0.033 percent, in a maximum project amount to be determined by the board. The tax credit expires when the political subdivision has been fully reimbursed for actual costs associated with the approved short line rail project. The cumulative impact on the state general fund from approved state sales and use tax credits issued under the short line rail revitalization program may not exceed twenty-five million dollars per state fiscal year.
     (6) Political subdivisions of the state may submit applications to the short line rail revitalization program on behalf of a privately owned short line railroad.
     (7) In consultation with the Washington state department of transportation freight rail program, the board shall report to the legislature on a biennial basis on the short line rail revitalization program. The report must give a detailed account of approved and rejected projects under the program, their cumulative impact on the state's general fund, a cost-benefit analysis of projects to the state including highway maintenance and improvement savings, and a summary of the economic benefits realized through the program.