"NEW SECTION.  Sec. 1   This act may be known and cited as the clean water act of 2010.

NEW SECTION.  Sec. 2   (1) The legislature finds that nonpoint water pollution and contaminated storm water runoff creates a significant ecological burden on the rivers, aquifers, lakes, streams, and marine receiving waters across Washington and imposes a significant economic burden on many of the state's businesses and residents.
     (2) The legislature recognizes that the burden of nonpoint and storm water pollution is caused by both increased volumes of water runoff due to the expansion of impervious surfaces and the toxic substances that pollute the runoff. The burden of storm water and nonpoint pollution from hazardous substances is difficult to offset because the source of pollution is not a single physical point, but occurs wherever the toxic substances are manufactured, used, or consumed.
     (3) The legislature finds that the federal government and the state of Washington have identified control of pollutants in storm water runoff through national pollutant discharge elimination system phase I and II municipal storm water permits as a requirement for the state and local jurisdictions. Impacts from the polluted storm water may be prevented or controlled through retrofit projects for existing infrastructure as well as other means.
     (4) The legislature finds that resources available to offset the direct burdens of storm water pollution by hazardous substances are insufficient to meet existing needs. Existing funding is raised largely by local governments and is disproportionately borne by fees levied on individuals and property owners.
     (5) Finally, the legislature finds that increasing the tax on hazardous substances is necessary to fund programs that will offset the burdens that pollution places on the environment and the waters of the state.

Sec. 3   RCW 82.21.030 and 1989 c 2 s 10 are each amended to read as follows:
     (1)(a) A tax is imposed on the privilege of possession of hazardous substances in this state. The rate of the tax ((shall be)) is seven-tenths of one percent multiplied by the wholesale value of the substance.
     (b) Beginning May 1, 2010, an additional tax is imposed on the privilege of possession of hazardous substances in this state. The rate of the tax is 0.85 percent multiplied by the wholesale value of the substance. A credit is allowed, in accordance with rules adopted by the department, for taxes paid under this subsection (1)(b) with respect to any possession of petroleum products when the petroleum products are exported for use or sale outside this state.
     (2)(a) Moneys collected under ((this chapter shall)) subsection (1)(a) of this section must be deposited in the toxics control accounts under RCW 70.105D.070 and expended in accordance with the purposes stated therein.
     (b) Moneys collected under subsection (1)(b) of this section must be deposited into the clean water legacy fund hereby created in the state treasury.
     (3) Chapter 82.32 RCW applies to the tax imposed in this chapter. The tax due dates, reporting periods, and return requirements applicable to chapter 82.04 RCW apply equally to the tax imposed in this chapter.

NEW SECTION.  Sec. 4   A new section is added to chapter 76.09 RCW to read as follows:
     Consistent with RCW 76.09.405, the department must administer any money deposited in the forest and fish support account from the clean water legacy fund to fund activities pursuant to the state's implementation of the forests and fish report as defined in this chapter and related activities including but not limited to adaptive management or monitoring.

NEW SECTION.  Sec. 5   A new section is added to chapter 90.48 RCW to read as follows:
     (1) The storm water account is created in the state treasury. Any moneys in the account are allocated to the department of ecology and may be spent only after appropriation. Expenditures from the account must be used on activities or projects that mitigate or prevent storm water pollution as provided in this section.
     (2)(a) After deducting the department's administrative costs of no more than four percent of the appropriations included in the omnibus operating and capital appropriations acts associated with administering a competitive grant process, moneys must be distributed annually as provided in (b) of this subsection.
     (b)(i) By January 1, 2011, and by January 1st of each year thereafter, seventy-five thousand dollars must be provided to each jurisdiction that is subject to the national pollutant discharge elimination system phase I or phase II requirements.
     (ii)(A) Until July 1, 2011, all of the remaining moneys must be allocated through the grant process to local governments covered by national pollutant discharge elimination system municipal phase I or phase II permits to fund local government projects or activities that mitigate or prevent contamination of storm water or the recontamination of receiving waters previously remediated under federal or state-approved activities. To be eligible, local governments must provide fifty percent of project or activity costs from other nonstate fund sources.
     (B) Beginning July 1, 2011, fifty percent of the remaining moneys must be allocated through the grant process described in (b)(ii)(A) of this subsection.
     (iii) Beginning July 1, 2011, forty percent of the remaining moneys must be allocated through the grant process to local governments for retrofit projects that address contamination of storm water, or projects that directly reduce toxic diesel emissions that result in air deposition of storm water pollutants. The moneys for retrofit projects must be prioritized for projects that utilize low-impact development retrofit strategies, but moneys may be awarded for other retrofit projects if the site does not lend itself to low-impact development techniques or other retrofit techniques that are shown to be more effective in terms of addressing water quality problems associated with the site.
     (iv) Beginning July 1, 2011, ten percent of the remaining moneys must be allocated through either existing storm water grant programs or the grant process to projects under (b)(i) or (ii) of this subsection and to the highest priority projects based upon ecological and water quality benefits determined by the department. For projects qualifying under this subsection, moneys may be allocated to meet the matching requirements under (b)(i) of this subsection to jurisdictions that demonstrate economic hardship in meeting the matching requirement.
     (3) In consultation with stakeholders, the department must develop criteria for administering the program and ranking projects for funding based on water quality benefits. In developing criteria applicable to projects in the Puget Sound basin, the department must consult with the Puget Sound partnership. Consistent with RCW 90.71.340, when making grants under this section that contribute to Puget Sound protection and recovery, the department must consult with the Puget Sound partnership to ensure that grants are for projects and activities that are consistent with the prioritization of the 2020 action agenda. All activities or capital projects approved for funding must demonstrate the potential to achieve clear ecological or water quality benefits. The department must endeavor to distribute the moneys within each geographic region of the state in proportion to the severity of impacts to waterways from storm water pollution.
     (4) The department must initiate the grant application process by July 1, 2010.
     (5) The ecosystem coordination board of the Puget Sound partnership must conduct a regular review of environmental outcomes derived from projects in the Puget Sound basin that have been funded under this section and must recommend, as necessary, actions to improve environmental benefits of the program in the Puget Sound basin.
     (6) By December 1, 2013, and every two years thereafter, the department must report to the governor and the appropriate committees of the legislature on the progress of the program and the suitability of the percentage allocations specified in subsection (2)(b) of this section.
     (7) The definitions in this section apply throughout this section unless the context clearly requires otherwise.
     (a) "Department" means the department of ecology.
     (b) "Low-impact development" means a storm water management and land use strategy applied, where feasible, at the parcel and subdivision, or drainage area, level that emphasizes conservation and use of on-site natural features integrated with engineered, small-scale hydrologic controls to more closely mimic predevelopment hydrologic functions.
     (c) "Retrofit" means the renovation of existing development to improve or eliminate storm water problems associated with the site or drainage area.

NEW SECTION.  Sec. 6   A new section is added to chapter 90.48 RCW to read as follows:
     (1) The water quality action account is created in the state treasury. Any moneys in the water quality action account are allocated to the department of ecology and may be spent only after appropriation. The account may not be used to fund specific state activities that are required to be funded through fees paid by state and federal water quality permittees.
     (2) Moneys in the water quality action account may be used only for state responsibilities to carry out the purposes of this chapter to: Prevent pollution of streams, rivers, aquifers, marine receiving waters, and drinking water; prevent beach and shellfish bed closures due to polluted surface runoff; and protect fish and wildlife habitat from polluted surface runoff. More specifically, moneys may be used for, but not limited to, the following purposes:
     (a) Creation and maintenance of a storm water technology center to assist businesses and governmental entities by developing resources for testing, monitoring, adopting, and implementing new clean water practices and technologies;
     (b) Improved storm water research, data management, and monitoring;
     (c) Development of clean water guidance and best management practices for nonpermitted surface runoff activities; and
     (d) Improved source control actions, such as collaboration with local governments to provide local source control inspectors.

NEW SECTION.  Sec. 7   A new section is added to chapter 90.71 RCW to read as follows:
     Consistent with RCW 90.71.340, the Puget Sound partnership must use any money deposited in the Puget Sound recovery account from the clean water legacy fund to fund activities or capital projects that are consistent with the prioritization of the 2020 action agenda.

NEW SECTION.  Sec. 8   A new section is added to chapter 90.48 RCW to read as follows:
     (1) The multidisciplinary college of the environment at the University of Washington must develop by November 1, 2010, a plan to establish and maintain within the resources appropriated in the omnibus operating and capital appropriation acts the research monitoring and assessment capabilities needed to assure that funded projects are delivering systemic ecological and economic benefits.
     (2) By November 1, 2010, the department, in coordination with the Puget Sound partnership must convene a broad stakeholder engagement process that includes local government, environmental organizations, research organizations, and businesses. Building on the planning of the Puget Sound partnership and the research and assessment plan developed by the University of Washington college of the environment, the goal of this process is to develop recommendations for a continued, comprehensive and broad-based approach to funding storm water management and cleanup, including identification of all local, state, and federal resources that are available for this purpose which may be considered by the legislature.

NEW SECTION.  Sec. 9   A new section is added to chapter 82.21 RCW to read as follows:
     (1) Subject to the conditions and limitations in this section, a motor carrier may request a refund of the tax imposed under RCW 82.21.030(1)(b) with respect to motor vehicle fuel and special fuel purchased by the motor carrier for use in the fuel tanks of the motor carrier's commercial motor vehicles. A motor carrier is entitled to a refund under this section regardless of whether the tax has been paid by the motor carrier directly to the department on the possession of motor vehicle fuel or special fuel in this state or indirectly through the purchase of motor vehicle fuel or special fuel that is subject to the tax imposed in this chapter.
     (2)(a) For motor vehicle fuel or special fuel for which the motor carrier indirectly paid the tax imposed under RCW 82.21.030(1)(b), the amount of the refund is determined by dividing the average annual wholesale price of the motor vehicle fuel or special fuel, as the case may be, by the average annual retail price of motor vehicle fuel or special fuel, as the case may be, then multiplying the quotient by the tax rate in RCW 82.21.030(1)(b) expressed as a decimal, then multiplying the product by the actual price paid by the motor carrier for the motor vehicle fuel and special fuel. For the purpose of this subsection, the average wholesale and retail prices of motor vehicle fuel and special fuel are based on average wholesale and retail prices for gasoline, in the case of motor vehicle fuel, and diesel fuel, in the case of special fuel, determined for this state by the United States energy information administration of the United States department of energy for the most recent twelve consecutive month period published as of January 1st of the year during which application for refund under this section is made. The department of revenue must use the same consecutive twelve-month period to determine the average wholesale and retail prices of motor vehicle fuel and special fuel.
     (b) Where the motor carrier has paid the tax imposed in RCW 82.21.030(1)(b) on the possession of motor vehicle fuel and special fuel in this state, the amount of the refund is the amount of such tax actually paid.
     (3)(a) Beginning January 1, 2011, a motor carrier may request a refund from the department during any calendar year for the tax imposed under this chapter on motor vehicle fuel and special fuel purchased by the motor carrier during the immediately preceding calendar year only. Refunds requested during calendar year 2011 are limited to the tax imposed in RCW 82.21.030(1)(b) and paid directly or indirectly on motor vehicle fuel or special fuel purchased on or after the effective date of this section. The department must rule on requests within sixty days of receipt.
     (b) The refund request, including documentation and information required by the department, must be made using an electronic application process as prescribed by the department. Only one remittance request may be made by a motor carrier in a calendar year.
     (c) An application for refund of the tax imposed under RCW 82.21.030(1)(b) must be made by December 31st for taxes imposed in RCW 82.21.030(1)(b) on motor vehicle fuel and special fuel purchased by the motor carrier in the preceding calendar year.
     (d) The total amount of a refund request must be at least twenty-five dollars. The department must deny any request for a refund that is less than twenty-five dollars.
     (e) A motor carrier who requests a refund under this section must, when requested, grant the department of revenue access to the records of the motor carrier necessary to verify entitlement to and the proper amount of a refund under this section.
     (4) Amounts refunded under this section must be disbursed from the clean water legacy account created in the state treasury in RCW 82.21.010. The following definitions apply throughout this section unless the context clearly requires otherwise.
     (a) "Commercial motor vehicle" means a motor vehicle or combination of motor vehicles used in commerce exclusively to transport property for hire if the motor vehicle:
     (i) Has a gross vehicle weight rating of twenty-six thousand one pounds or more (eleven thousand seven hundred ninety-four kilograms or more) inclusive of a towed unit with a gross vehicle weight rating of ten thousand pounds or more (four thousand five hundred thirty-six kilograms or more); or
     (ii) Has a gross vehicle weight rating of twenty-six thousand one pounds or more (eleven thousand seven hundred ninety-four kilograms or more).
     (b) "Motor carrier" means any person who engages in the business of transporting property for hire.
     (c) "Motor vehicle fuel" has the same meaning as provided in RCW 82.36.010.
     (d) "Special fuel" has the same meaning as provided in RCW 82.38.020.

NEW SECTION.  Sec. 10   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. 11   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 May 1, 2010."