BILL REQ. #:  Z-0281.1 

Read first time 01/08/2007.   Referred to Committee on Ways & Means.

     AN ACT Relating to increasing the nonconstruction loan limit for projects using financing through the public works board; amending RCW 43.155.050; reenacting and amending RCW 43.155.050; creating a new section; providing an effective date; and providing an expiration date.

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

NEW SECTION.  Sec. 1   The legislature finds that it is in the state's best fiscal interest to ensure that community infrastructure projects are ready to proceed when applying for and receiving public works board approved construction loans. Many jurisdictions use portions of their construction loans to pay for nonconstruction activities, such as planning and preconstruction, to get ready for construction. This means some of the construction phase takes place at the end of the loan agreement, and requires jurisdictions to request loan extensions. The legislature recognizes this type of financing strategy slows down the expenditure of funds, limits the amount of funding available for construction loans, and increases the amount requested for reappropriation.
     The legislature finds that from fiscal years 2002 to 2005, the public works board had one hundred two construction loan extension requests. Creating an opportunity to make more projects ready to proceed benefits the state and local jurisdictions by ensuring that construction loan funds will be spent on construction activities in a more timely manner, thereby increasing the amount of funds available for new construction loans through quicker repayment of the loans.

Sec. 2   RCW 43.155.050 and 2005 c 488 s 925 and 2005 c 425 s 4 are each reenacted and amended to read as follows:
     (1) The public works assistance account is hereby established in the state treasury. Money may be placed in the public works assistance account from the proceeds of bonds when authorized by the legislature or from any other lawful source. Money in the public works assistance account shall be used to make loans and to give financial guarantees to local governments for public works projects. Moneys in the account may also be appropriated to provide for state match requirements under federal law for projects and activities conducted and financed by the board under the drinking water assistance account. Not more than ((fifteen)) twenty-five percent of the biennial capital budget appropriation to the public works board from this account may be expended or obligated for preconstruction loans, emergency loans, or loans for capital facility planning under this chapter; of this amount, not more than ten percent of the biennial capital budget appropriation may be expended for emergency loans and not more than one percent of the biennial capital budget appropriation may be expended for capital facility planning loans. For the 2005-2007 biennium, moneys in the account may be used for grants for projects identified in section 138, chapter 488, Laws of 2005.
     (2) The job development fund is hereby established in the state treasury. Up to fifty million dollars each biennium from the public works assistance account may be transferred into the job development fund. Money in the job development fund may be used solely for job development fund program grants, administrative expenses related to the administration of the job development fund program created in RCW 43.160.230, and for the report prepared by the joint legislative audit and review committee pursuant to RCW 44.28.801(2). Moneys in the job development fund may be spent only after appropriation. The board shall prepare a prioritized list of proposed projects of up to fifty million dollars as part of the department's 2007-09 biennial budget request. The board may provide an additional alternate job development fund project list of up to ten million dollars. The legislature may remove projects from the list recommended by the board. The legislature may not change the prioritization of projects recommended for funding by the board, but may add projects from the alternate list in order of priority, as long as the total funding does not exceed fifty million dollars.

Sec. 3   RCW 43.155.050 and 2005 c 488 s 925 are each amended to read as follows:
     The public works assistance account is hereby established in the state treasury. Money may be placed in the public works assistance account from the proceeds of bonds when authorized by the legislature or from any other lawful source. Money in the public works assistance account shall be used to make loans and to give financial guarantees to local governments for public works projects. Moneys in the account may also be appropriated to provide for state match requirements under federal law for projects and activities conducted and financed by the board under the drinking water assistance account. Not more than ((fifteen)) twenty-five percent of the biennial capital budget appropriation to the public works board from this account may be expended or obligated for preconstruction loans, emergency loans, or loans for capital facility planning under this chapter; of this amount, not more than ten percent of the biennial capital budget appropriation may be expended for emergency loans and not more than one percent of the biennial capital budget appropriation may be expended for capital facility planning loans. For the 2005-2007 biennium, moneys in the account may be used for grants for projects identified in section 138, chapter 488, Laws of 2005.

NEW SECTION.  Sec. 4   Section 2 of this act expires June 30, 2011.

NEW SECTION.  Sec. 5   Section 3 of this act takes effect June 30, 2011.