"Sec. 2   RCW 35.104.040 and 2007 c 251 s 4 are each amended to read as follows:
     (1) The higher education coordinating board may approve applications submitted by local governments for an area's designation as a health sciences and services authority under this chapter. The director ((shall)) must determine the division to review applications submitted by local governments under this chapter. The application for designation ((shall)) must be in the form and manner and contain such information as the higher education coordinating board may prescribe, provided the application ((shall)):
     (a) Contains sufficient information to enable the director to determine the viability of the proposal;
     (b) Demonstrates that an ordinance or resolution has been passed by the legislative authority of a local government that delineates the boundaries of an area that may be designated an authority;
     (c) ((Be)) Is submitted on behalf of the local government, or, if that office does not exist, by the legislative body of the local government;
     (d) Demonstrates that the public funds directed to programs or facilities in the authority will leverage private sector resources and contributions to activities to be performed;
     (e) Provides a plan or plans for the development of the authority as an entity to advance as a cluster for health sciences education, health sciences research, biotechnology development, biotechnology product commercialization, and/or health care services; and
     (f) Demonstrates that the state has previously provided funds to health sciences and services programs or facilities in the applicant city, town, or county.
     (2) The director ((shall)) must determine the division to develop criteria to evaluate the application. The criteria ((shall)) must include:
     (a) The presence of infrastructure capable of spurring development of the area as a center of health sciences and services;
     (b) The presence of higher education facilities where undergraduate or graduate coursework or research is conducted; and
     (c) The presence of facilities in which health services are provided.
     (3) There ((shall)) may be no more than ((one authority)) two authorities statewide.
     (4) An authority may only be created in a county with a population of less than one million persons and located east of the crest of the Cascade mountains.
     (5) The director may reject or approve an application. When denying an application, the director must specify the application's deficiencies. The decision regarding such designation as it relates to a specific local government is final; however, a rejected application may be resubmitted.
     (6) Applications are due by December 31, ((2007)) 2010, and must be processed within sixty days of submission.
     (7) The director may, at his or her discretion, amend the boundaries of an authority upon the request of the local government.
     (8) The higher education coordinating board may adopt any rules necessary to implement this chapter ((251, Laws of 2007 within one hundred twenty days of July 22, 2007)).
     (9) The higher education coordinating board must develop evaluation and performance measures in order to evaluate the effectiveness of the programs in the authorities that are funded with public resources. A report to the legislature ((shall be)) is due on a biennial basis beginning December 1, 2009. In addition, the higher education coordinating board ((shall)) must develop evaluation criteria that enables the local governments to measure the effectiveness of the program.

Sec. 3   RCW 82.14.480 and 2007 c 251 s 11 are each amended to read as follows:
     (1) The legislative authority of a local jurisdiction that has created a health sciences and services authority under RCW 35.104.030, prior to January 1, 2010, may impose a sales and use tax in accordance with the terms of this chapter. The tax is in addition to other taxes authorized by law and ((shall)) must be collected from those persons who are taxable by the state under chapters 82.08 and 82.12 RCW upon the occurrence of any taxable event within the local jurisdiction. The rate of the tax ((shall)) may not exceed 0.020 percent of the selling price in the case of a sales tax or the value of the article used in the case of a use tax.
     (2) The tax imposed under subsection (1) of this section ((shall)) must be deducted from the amount of tax otherwise required to be collected or paid over to the department under chapter 82.08 or 82.12 RCW. The department of revenue ((shall)) must perform the collection of the tax on behalf of the authority at no cost to the authority.
     (3) The amounts received under this section may only be used in accordance with RCW 35.104.060 or to finance and retire the indebtedness incurred pursuant to RCW 35.104.070, in whole or in part.
     (4) This section expires January 1, 2023."