HOUSE BILL REPORT
HB 2357
This analysis was prepared by non-partisan legislative staff for the use of legislative members in
their deliberations. This analysis is not a part of the legislation nor does it constitute a
statement of legislative intent.
As Passed House:
March 14, 2007
Title: An act relating to school districts' use of state forest revenues.
Brief Description: Allowing a school district to transfer certain revenue into the district's capital projects account.
Sponsors: By Representatives McIntire and Fromhold.
Brief History:
Capital Budget: 3/1/07, 3/5/07 [DP].
Floor Activity:
Passed House: 3/14/07, 96-0.
Brief Summary of Bill |
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HOUSE COMMITTEE ON CAPITAL BUDGET
Majority Report: Do pass. Signed by 22 members: Representatives Fromhold, Chair; Ormsby, Vice Chair; Schual-Berke, Vice Chair; McDonald, Ranking Minority Member; Newhouse, Assistant Ranking Minority Member; Blake, Chase, Dunshee, Eickmeyer, Flannigan, Goodman, Hankins, Hasegawa, Kelley, McCune, Orcutt, Pearson, Pedersen, Sells, Skinner, Strow and Upthegrove.
Staff: Susan Howson (786-7142).
Background:
School districts are required to establish several funds, including a general fund, a debt
service fund, and a capital projects fund. Districts may use each fund for particular purposes,
subject to statutory restrictions. A school district may issue general obligation bonds that are
payable from the district's tax revenues and from other moneys lawfully available and
pledged for that purpose. Proceeds from a district's bond levies must be deposited in the
district's debt service fund.
The state holds certain forest lands in trust for counties. Net revenues from these state forest
lands are distributed to counties in the same manner as general taxes are paid and prorated
during the year of payment. As junior taxing districts, school districts thus receive a portion
of state forest land revenue distributions. The distribution of state forest lands revenue that a
school district receives depends on the types of tax levies that the school district has passed.
For example, if the district has passed a capital levy for construction or remodeling, a portion
of the state forest lands revenue is deposited in the district's capital projects fund, where
capital levy proceeds are deposited. If the district has passed a bond levy, a portion of the
state forest lands revenue is deposited in the district's debt service fund, where district
revenues dedicated to debt service on bond levies are deposited.
A 1998 informal opinion of the Attorney General's office advises that school districts do not
have statutory authority to transfer state forest lands revenue distributed to their debt service
funds into their capital projects funds. This is because the statute that distributes the forest
land revenues to junior taxing districts operates as a dedication of that revenue to the
respective local funds that receive tax revenues. For this reason, school districts may not
spend distributions of state forest land revenues directly from their debt service funds for
capital purposes.
Summary of Bill:
School districts are authorized to transfer distributions of state forest land revenues from their
debt service funds to their capital projects funds, so long as those revenues have not been
pledged for debt service on school district bonds.
Appropriation: None.
Fiscal Note: Not requested.
Effective Date: The bill takes effect 90 days after adjournment of session in which bill is passed.
Staff Summary of Public Testimony:
(In support) This bill gives business managers and superintendents the flexibility to move
forest land revenues from a school district's debt service fund to their capital projects fund as
long as these funds are not dedicated to debt retirement on existing bonds.
(Opposed) None.
Persons Testifying: Mitch Denning, Alliance of Educators Association.