SENATE BILL REPORT
SHB 2214
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 of March 23, 2009
Title: An act relating to the reasonable costs of financing consolidated rental car facilities and common use transportation equipment and facilities.
Brief Description: Concerning airport operators financing consolidated rental car facilities and common use transportation equipment and facilities.
Sponsors: House Committee on Transportation (originally sponsored by Representative Simpson).
Brief History: Passed House: 3/06/09, 94-1.
Committee Activity: Transportation: 3/25/09.
SENATE COMMITTEE ON TRANSPORTATION |
Staff: Wendy Malkin (786-7434)
Background: In 2005 the Legislature passed Substitute Senate Bill 5584 authorizing municipal airports to impose a customer facility charge on airport rental car customers. The purpose of the charge is to finance the design, construction, and operation of a consolidated rental car facility and a common use transportation system. The transportation system would transport customers between the car rental facility and other airport facilities. Rental car companies collect the facility charge as part of each rental car agreement, and the charge is deposited into a trust account for the benefit of the airport operator. The facility charges must not exceed the costs of financing and operating the consolidated facility, and the funds from the charges cannot be used for any other purpose.
Currently, car rental facilities at SeaTac are located at numerous sites near and at the airport. The purpose of the off-site consolidated rental car facility and common use transportation is to reduce airport congestion and increase parking space in the airport garage.
In 2008 the Port of Seattle (Port) began construction of the consolidated rental car facility at SeaTac. Construction and operation of the facility has been funded with the facility charges collected from rental car customers. The project is expected to need an additional $400 million in financing. The Port planned to complete the project with a mid-2008 bond issue backed by revenues collected from the facility charge. However, the Port delayed issuing bonds due to the unfavorable market for taxable municipal bonds.
The Port has $100 million available in its Airport Development Fund to loan to the Consolidated Rental Car Facility Project. The Airport Development Fund includes earnings from non-airline revenue, such as parking garage receipts, concession sales, and advertising.
Summary of Bill: Explicit authority is given to a municipal airport operator to use its own funds to finance a consolidated rental car facility and common use transportation system. In addition, the airport operator is entitled to earn a rate of return on such funds no greater than the interest rate the airport operator would have to pay to finance such a facility in the appropriate capital market. The airport operator must establish a rate of return in consultation with the rental car companies. The airport operator may use the earned interest for purposes other than those associated with the consolidated rental car facility and common use transportation equipment and facilities.
Appropriation: None.
Fiscal Note: Available.
Committee/Commission/Task Force Created: No.
Effective Date: The bill contains an emergency clause and takes effect immediately.