"Sec. 1   RCW 35.21.420 and 1965 c 7 s 35.21.420 are each amended to read as follows:
     (1) Any city owning and operating a public utility and having facilities for the generation of electricity located in a county other than that in which the city is located, may provide for the public peace, health, safety and welfare of such county as concerns the facilities and the personnel employed in connection therewith, by contributing to the support of the county government of any such county and enter into contracts with any such county therefor.
     (2)(a) Any city with a population greater than five hundred thousand people owning and operating a public utility and having facilities for the generation of electricity located in a county other than that in which the city is located, must provide for the impacts of lost revenue and the public peace, health, safety, and welfare of such county as concerns the facilities and the personnel employed in connection therewith, by contributing to the support of the county, city, or town government and school district of any such county and enter into contracts with any such county therefor as specified in RCW 35.21.425.
     (b)(i) In the event a contract entered into under this section between a county and the governing body of a city with a population greater than five hundred thousand people authorized or required under this section expires prior to the adoption of a new contract between the parties, the city must continue to make compensatory payments calculated based on the payment terms set forth in the most recent expired compensation contract between the city and the county until such time as a new contract is entered into by the parties.
     (ii) In the event a contract entered into under this section between a county and the governing body of a city with a population greater than five hundred thousand people expired prior to the effective date of this act, the city shall be indebted to the county for any resulting arrearage accruing from the time of the expiration of the contract until such time as a new contract is entered into by the parties. The dollar amount of such arrearage shall be calculated retroactively by reference to the payment terms set forth in the most recent expired compensation contract between the city and the county.
     (c) In the event a contract entered into under this section between a county and the governing body of a city with a population greater than five hundred thousand people expires, or has expired prior to the effective date of this section and the county and the city are unable to reach agreement on a new contract within six months of such expiration, then either the county or the city may initiate the arbitration procedures set forth in RCW 35.21.426 by serving a written notice of intent to arbitrate on the other. Arbitration must commence within sixty days of service of such notice, and must follow the arbitration procedures as provided in RCW 35.21.426. The city is responsible for the costs of arbitration, including compensation for the arbitrators' services, except that the city and the county shall bear their own costs for attorneys' fees and their own costs of litigation.

Sec. 2   RCW 35.21.425 and 1965 c 7 s 35.21.425 are each amended to read as follows:
     (1) Except as provided in subsection (2) of this section, whenever after March 17, 1955, any city shall construct hydroelectric generating facilities or acquire land for the purpose of constructing the same in a county other than the county in which such city is located, and by reason of such construction or acquisition shall (1) cause loss of revenue and/or place a financial burden in providing for the public peace, health, safety, welfare, and added road maintenance in such county, in addition to road construction or relocation as set forth in RCW 90.28.010 and/or (2) shall cause any loss of revenues and/or increase the financial burden of any school district affected by the construction because of an increase in the number of pupils by reason of the construction or the operation of said generating facilities, the city shall enter into an agreement with said county and/or the particular school district or districts affected for the payment of moneys to recompense such losses or to provide for such increased financial burden, upon such terms and conditions as may be mutually agreeable to the city and the county and/or school district or districts.
     (2)(a) Whenever after March 17, 1955, a municipal owned utility located in a city with a population greater than five hundred thousand people constructs or operates hydroelectric generating facilities or acquires land for the purpose of constructing or operating the same in a county other than the county in which the city is located must enter into an agreement with the county affected for the annual payment of moneys to recompense such losses, as provided under subsection (1) of this section.
     (b)(i) In the event an agreement entered into under this section between a county and the governing body of either a city with a population greater than five hundred thousand people or a municipal utility owned by a city with a population greater than five hundred thousand people expires prior to the adoption of a new agreement between the parties, the city or utility must continue to make compensatory payments calculated based on the payment terms set forth in the most recent expired compensation contract between the city and the county until such time as a new agreement is entered into by the parties.
     (ii) In the event an agreement entered into under this section between a county and the governing body of either a city with a population greater than five hundred thousand people or a municipal utility owned by a city with a population greater than five hundred thousand people expired prior to the effective date of this act, the city shall be indebted to the county for any resulting arrearage accruing from the time of the expiration of the agreement until such time as a new agreement is entered into by the parties. The dollar amount of such arrearage shall be calculated retroactively by reference to the payment terms set forth in the most recent expired compensation agreement between the city and the county.
     (c) In the event an agreement entered into under this section between a county and the governing body of either a city with a population greater than five hundred thousand people or a municipal utility owned by a city with a population greater than five hundred thousand people expires, or has expired prior to the effective date of this section, and the county and the city are unable to reach agreement on a new agreement within six months of such expiration, then either the county or the city may initiate the arbitration procedures set forth in RCW 35.21.426 by serving a written notice of intent to arbitrate on the other. Arbitration must commence within sixty days of service of such notice, and must follow the arbitration procedures as provided in RCW 35.21.426. The city is responsible for the costs of arbitration, including compensation for the arbitrators' services, and the city and the county shall bear their own costs for attorneys' fees and their own costs of litigation.

NEW SECTION.  Sec. 3   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 immediately."