BILL REQ. #:  S-1946.7 

Read first time 03/09/2005.   Referred to Committee on Transportation.

     AN ACT Relating to transportation funding for joint state and local transportation projects; amending RCW 82.36.025, 82.38.030, 46.68.090, and 43.84.092; reenacting and amending RCW 43.84.092; adding new sections to chapter 46.68 RCW; adding a new section to chapter 47.56 RCW; creating new sections; providing effective dates; providing an expiration date; and declaring an emergency.

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

NEW SECTION.  Sec. 101   The legislature finds that:
     (1) Transportation is a central component to the economic development and prosperity of Washington state. An effective transportation system is fundamental to business development, job growth, and economic security. It is therefore in the public's interest to efficiently and safely facilitate the movement of people and freight along Washington state's transportation corridors.
     (2) The state's transportation needs are substantial and immediate. The Blue Ribbon Commission on Transportation recognized these needs in its December 2000 recommendation for immediate action to solve the state's transportation crisis.
     (3) Current sources of revenue do not adequately address the state's transportation needs. The cost of construction, maintenance, operation, and preservation of the state's transportation corridors continues to increase, while the revenue from the state's motor vehicle fuel tax remains constant.
     (4) Investments into the state's transportation infrastructure must keep pace with the state's growth. Therefore, the legislature intends to increase the motor vehicle fuel tax by one cent each year over the next twenty years.
     (5) Projects funded by both state and local contributions best maximizes state and regional investments. Joint participation on the state and regional level is required in order to successfully complete significant transportation improvement projects in a timely and efficient manner.
     (6) Accountability and efficiency are critical elements in the allocation and expenditure of state funds. The transportation commission is uniquely situated to oversee the progress of transportation improvements and report back to the legislature.

Sec. 201   RCW 82.36.025 and 2003 c 361 s 401 are each amended to read as follows:
     (1) A motor vehicle fuel tax rate of twenty-three cents per gallon applies to the sale, distribution, or use of motor vehicle fuel.
     (2) Beginning July 1, 2003, an additional and cumulative motor fuel tax rate of five cents per gallon applies to the sale, distribution, or use of motor vehicle fuel. This subsection (2) expires when the bonds issued for transportation 2003 projects are retired.
     (3) The motor vehicle fuel tax rate that applies to the sale, distribution, or use of motor vehicle fuel shall be increased by one cent per gallon every July 1st from July 1, 2005, through July 1, 2009. The annual fuel tax rate increase under this subsection shall be additional and cumulative to the fuel tax rates under subsections (1) and (2) of this section and any prior annual fuel tax rate increases under this subsection.

Sec. 202   RCW 82.38.030 and 2003 c 361 s 402 are each amended to read as follows:
     (1) There is hereby levied and imposed upon special fuel users a tax at the rate of twenty-three cents per gallon of special fuel, or each one hundred cubic feet of compressed natural gas, measured at standard pressure and temperature.
     (2) Beginning July 1, 2003, an additional and cumulative tax rate of five cents per gallon of special fuel, or each one hundred cubic feet of compressed natural gas, measured at standard pressure and temperature shall be imposed on special fuel users. This subsection (2) expires when the bonds issued for transportation 2003 projects are retired.
     (3) The special fuel tax rate imposed upon special fuel users shall be increased by one cent per gallon of special fuel, or each one hundred cubic feet of compressed natural gas, every July 1st from July 1, 2005, through July 1, 2009. The annual fuel tax rate increase under this subsection shall be additional and cumulative to the fuel tax rates under subsections (1) and (2) of this section and any prior annual fuel tax rate increases under this subsection.
     (4) Taxes are imposed when:
     (a) Special fuel is removed in this state from a terminal if the special fuel is removed at the rack unless the removal is to a licensed exporter for direct delivery to a destination outside of the state, or the removal is to a special fuel distributor for direct delivery to an international fuel tax agreement licensee under RCW 82.38.320;
     (b) Special fuel is removed in this state from a refinery if either of the following applies:
     (i) The removal is by bulk transfer and the refiner or the owner of the special fuel immediately before the removal is not a licensee; or
     (ii) The removal is at the refinery rack unless the removal is to a licensed exporter for direct delivery to a destination outside of the state, or the removal is to a special fuel distributor for direct delivery to an international fuel tax agreement licensee under RCW 82.38.320;
     (c) Special fuel enters into this state for sale, consumption, use, or storage if either of the following applies:
     (i) The entry is by bulk transfer and the importer is not a licensee; or
     (ii) The entry is not by bulk transfer;
     (d) Special fuel is sold or removed in this state to an unlicensed entity unless there was a prior taxable removal, entry, or sale of the special fuel;
     (e) Blended special fuel is removed or sold in this state by the blender of the fuel. The number of gallons of blended special fuel subject to tax is the difference between the total number of gallons of blended special fuel removed or sold and the number of gallons of previously taxed special fuel used to produce the blended special fuel;
     (f) Dyed special fuel is used on a highway, as authorized by the internal revenue code, unless the use is exempt from the special fuel tax;
     (g) Dyed special fuel is held for sale, sold, used, or is intended to be used in violation of this chapter;
     (h) Special fuel purchased by an international fuel tax agreement licensee under RCW 82.38.320 is used on a highway; and
     (i) Special fuel is sold by a licensed special fuel supplier to a special fuel distributor, special fuel importer, or special fuel blender and the special fuel is not removed from the bulk transfer-terminal system.
     (((4))) (5) The tax imposed by this chapter, if required to be collected by the licensee, is held in trust by the licensee until paid to the department, and a licensee who appropriates or converts the tax collected to his or her own use or to any use other than the payment of the tax to the extent that the money required to be collected is not available for payment on the due date as prescribed in this chapter is guilty of a felony, or gross misdemeanor in accordance with the theft and anticipatory provisions of Title 9A RCW. A person, partnership, corporation, or corporate officer who fails to collect the tax imposed by this section, or who has collected the tax and fails to pay it to the department in the manner prescribed by this chapter, is personally liable to the state for the amount of the tax.

NEW SECTION.  Sec. 203   A new section is added to chapter 46.68 RCW to read as follows:
     Beginning July 1, 2005, and every July 1st thereafter, the state treasurer shall deposit into the joint state and local transportation account created in section 302 of this act, an amount equal to one and three-quarters percent of the average, annual amount of retired motor vehicle fuel tax debt from the preceding three fiscal years. In calculating the above amount, Referendum 49, special category C, Tacoma Narrows bridge, nickel account, and transportation improvement board bonds shall not be included.

Sec. 301   RCW 46.68.090 and 2003 c 361 s 403 are each amended to read as follows:
     (1) All moneys that have accrued or may accrue to the motor vehicle fund from the motor vehicle fuel tax and special fuel tax shall be first expended for purposes enumerated in (a) and (b) of this subsection. The remaining net tax amount shall be distributed monthly by the state treasurer in accordance with subsections (2), (3), and (4) of this section.
     (a) For payment of refunds of motor vehicle fuel tax and special fuel tax that has been paid and is refundable as provided by law;
     (b) For payment of amounts to be expended pursuant to appropriations for the administrative expenses of the offices of state treasurer, state auditor, and the department of licensing of the state of Washington in the administration of the motor vehicle fuel tax and the special fuel tax, which sums shall be distributed monthly.
     (2) All of the remaining net tax amount collected under RCW 82.36.025(1) and 82.38.030(1) shall be distributed as set forth in (a) through (j) of this subsection.
     (a) For distribution to the motor vehicle fund an amount equal to 44.387 percent to be expended for highway purposes of the state as defined in RCW 46.68.130;
     (b) For distribution to the special category C account, hereby created in the motor vehicle fund, an amount equal to 3.2609 percent to be expended for special category C projects. Special category C projects are category C projects that, due to high cost only, will require bond financing to complete construction.
     The following criteria, listed in order of priority, shall be used in determining which special category C projects have the highest priority:
     (i) Accident experience;
     (ii) Fatal accident experience;
     (iii) Capacity to move people and goods safely and at reasonable speeds without undue congestion; and
     (iv) Continuity of development of the highway transportation network.
     Moneys deposited in the special category C account in the motor vehicle fund may be used for payment of debt service on bonds the proceeds of which are used to finance special category C projects under this subsection (2)(b);
     (c) For distribution to the Puget Sound ferry operations account in the motor vehicle fund an amount equal to 2.3283 percent;
     (d) For distribution to the Puget Sound capital construction account in the motor vehicle fund an amount equal to 2.3726 percent;
     (e) For distribution to the urban arterial trust account in the motor vehicle fund an amount equal to 7.5597 percent;
     (f) For distribution to the transportation improvement account in the motor vehicle fund an amount equal to 5.6739 percent and expended in accordance with RCW 47.26.086;
     (g) For distribution to the cities and towns from the motor vehicle fund an amount equal to 10.6961 percent in accordance with RCW 46.68.110;
     (h) For distribution to the counties from the motor vehicle fund an amount equal to 19.2287 percent: (i) Out of which there shall be distributed from time to time, as directed by the department of transportation, those sums as may be necessary to carry out the provisions of RCW 47.56.725; and (ii) less any amounts appropriated to the county road administration board to implement the provisions of RCW 47.56.725(4), with the balance of such county share to be distributed monthly as the same accrues for distribution in accordance with RCW 46.68.120;
     (i) For distribution to the county arterial preservation account, hereby created in the motor vehicle fund an amount equal to 1.9565 percent. These funds shall be distributed by the county road administration board to counties in proportions corresponding to the number of paved arterial lane miles in the unincorporated area of each county and shall be used for improvements to sustain the structural, safety, and operational integrity of county arterials. The county road administration board shall adopt reasonable rules and develop policies to implement this program and to assure that a pavement management system is used;
     (j) For distribution to the rural arterial trust account in the motor vehicle fund an amount equal to 2.5363 percent and expended in accordance with RCW 36.79.020.
     (3) One hundred percent of the net tax amount collected under RCW 82.36.025(2) and 82.38.030(2) shall be distributed to the transportation 2003 account (nickel account).
     (4)(a) 52.3488 percent of the net tax amount collected under RCW 82.36.025(3) and 82.38.030(3) shall be distributed to the joint state and local transportation account created in section 302 of this act. The remaining net tax amount shall be distributed according to subsection (2)(e) through (j) of this section.
     (b) The state treasurer shall transfer annually the following amounts from the following accounts into the joint state and local transportation account:
     (i) $4,759,397 from the urban arterial trust account;
     (ii) $3,572,145 from the transportation improvement account;
     (iii) $6,733,996 from the motor vehicle fund dedicated to cities and towns;
     (iv) $12,105,907 from the motor vehicle fund dedicated to counties;
     (v) $1,231,763 from the county arterial preservation account;
     (vi) $1,596,791 from the rural arterial trust account.
     (5) Nothing in this section or in RCW 46.68.130 may be construed so as to violate any terms or conditions contained in any highway construction bond issues now or hereafter authorized by statute and whose payment is by such statute pledged to be paid from any excise taxes on motor vehicle fuel and special fuels.

NEW SECTION.  Sec. 302   A new section is added to chapter 46.68 RCW to read as follows:
     (1)(a) The joint state and local transportation account is hereby created in the motor vehicle fund. Money in the account may be spent only after appropriation. Expenditures from the account may only be used for expenditures, including the repayment of principal and interest on bonds issued, for the following projects:
     (i) Alaskan Way viaduct--$2,000,000,000;
     (ii) State route 520 bridge replacement--$1,500,000,000;
     (iii) State route 405 corridor improvements--$500,000,000;
     (iv) State route 395 north Spokane--$600,000,000;
     (v) The Columbia river crossing-Vancouver--$500,000,000;
     (vi) Projects approved by a transportation benefit district created pursuant to Senate Bill No. 5177 (2005) and submitted to and adopted by the legislature as eligible for expenditures from this account;
     (vii) Projects approved by the regional transportation investment district and submitted to and adopted by the legislature as eligible for expenditures from this account.
     (b) Expenditures from the account on a project must not exceed the expenditure amount listed by the project name, or fifty percent of the project, whichever is less.
     (2) Funding will be made available from the joint state and local transportation account based on the account cash flow and in the priority order of the projects listed above, once matching funds have been secured by the local jurisdictions. However, if matching funds for priority projects are not secured by local jurisdictions by the end of 2005, other eligible projects under this section with secured local matching funds may take priority.

NEW SECTION.  Sec. 303   A new section is added to chapter 47.56 RCW to read as follows:
     (1) Tolls may be imposed on any projects or improvements approved and funded in accordance with section 302 of this act.
     (2) The Washington state transportation commission has the authority to authorize tolls on any projects approved by the commission and funded by taxes in the manner provided in section 302 of this act.

NEW SECTION.  Sec. 401   A new section is added to chapter 46.68 RCW to read as follows:
     Accountability and effectiveness are important aspects of setting tax policy. In order to make policy choices regarding the best use of limited state resources, the legislature and the public need information on state tax expenditures for transportation projects and improvements. Therefore, the Washington state transportation commission is required to report to the transportation committees of the legislature by December 1, 2009, December 1, 2014, December 1, 2019, and December 1, 2023. The report shall include but not be limited to the following information:
     (1) A detailed description of the transportation projects and improvements funded by the fuel taxes authorized in this act, and related information, including, but not limited to:
     (a) The name and location of transportation projects and improvements;
     (b) The projected cost of projects and improvements;
     (c) Actual expenditures as of November 1, 2009, regarding projects and improvements;
     (d) A comparison of projected costs versus actual costs, as of November 1, 2009, regarding projects and improvements;
     (e) A description of the funding framework for projects and improvements, specifically identifying and detailing contributions by local governments and the federal government;
     (f) An estimate of the number of vehicles that use or will use completed projects or improvements.
     (2) An assessment of the efficiency with which state fuel tax dollars are being spent on transportation projects and improvements, and any recommendations for the more effective use of these tax dollars.
     (3) A recommendation to the legislature as to whether an additional five-cent fuel tax, increased over five years, should be authorized by the legislature.

Sec. 501   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 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 joint state and local transportation 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. 502   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 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 joint state and local transportation 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. 601   Part headings used in this act are not part of the law.

NEW SECTION.  Sec. 602   This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 1, 2005, except for section 502 of this act which takes effect July 1, 2006.

NEW SECTION.  Sec. 603   Section 501 of this act expires July 1, 2006.