READ FIRST TIME 03/02/09.   

     AN ACT Relating to construction financing for state colleges and universities; and amending RCW 28B.15.210, 28B.15.310, 28B.20.720, 28B.30.740, 28B.35.370, 28B.50.360, 28B.20.715, 28B.20.735, and 28B.30.730.

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

Sec. 1   RCW 28B.15.210 and 1985 c 390 s 20 are each amended to read as follows:
     Within thirty-five days from the date of collection thereof, all building fees at the University of Washington, including building fees to be charged students registering in the schools of medicine and dentistry, shall be paid into the state treasury and credited as follows:
     One-half or such larger portion as may be necessary to prevent a default in the payments required to be made out of the bond retirement fund((, and in no event shall such one-half be less than twelve dollars and fifty cents per each resident student per quarter, and thirty-seven dollars and fifty cents per each nonresident student per quarter)) to the "University of Washington bond retirement fund" and the remainder thereof to the "University of Washington building account." The sum so credited to the University of Washington building account shall be used exclusively for the purpose of erecting, altering, maintaining, equipping, or furnishing buildings, and for certificates of participation under chapter 39.94 RCW, except for any sums transferred as authorized in RCW 28B.20.725(3). The sum so credited to the University of Washington bond retirement fund shall be used for the payment of principal of and interest on bonds outstanding as provided by chapter 28B.20 RCW except for any sums transferred as authorized in RCW 28B.20.725(5).

Sec. 2   RCW 28B.15.310 and 1985 c 390 s 22 are each amended to read as follows:
     Within thirty-five days from the date of collection thereof, all building fees shall be paid ((into the state treasury)) and credited as follows: To the Washington State University bond retirement fund, one-half or such larger portion as may be necessary to prevent a default in the payments required to be made out of such bond retirement fund; and the remainder thereof to the Washington State University building account.
     The sum so credited to the Washington State University building account shall be expended by the board of regents for buildings, equipment, or maintenance on the campus of Washington State University as may be deemed most advisable and for the best interests of the university, and for certificates of participation under chapter 39.94 RCW, except for any sums transferred as authorized by law. Expenditures so made shall be accounted for in accordance with existing law and shall not be expended until appropriated by the legislature.
     The sum so credited to the Washington State University bond retirement fund shall be used to pay and secure the payment of the principal of and interest on building bonds issued by the university, except for any sums which may be transferred out of such fund as authorized by law.

Sec. 3   RCW 28B.20.720 and 1985 c 390 s 39 are each amended to read as follows:
     For the purpose of paying and securing the payment of the principal of and interest on the bonds as the same shall become due, there is created in the custody of the state treasurer a special trust fund to be known as the University of Washington bond retirement fund. An appropriation is not required for expenditures from the fund. There shall be paid into the ((state treasury and credited to a special trust fund to be known as the University of Washington bond retirement)) fund, the following:
     (1) One-half of such building fees as the board may from time to time determine, or such larger portion as may be necessary to prevent default in the payments required to be made out of the bond retirement fund((, and in no event shall such one-half be less than twelve dollars and fifty cents per each resident student per quarter and less than thirty-seven dollars and fifty cents per each nonresident student per quarter));
     (2) Any gifts, bequests, or grants which may be made, or may become available, for the purpose of furthering the construction of any authorized projects, or for the repayment of the costs thereof;
     (3) Such additional funds as the legislature may provide.
     ((Said bond retirement fund shall be kept segregated from all moneys in the state treasury and shall,)) While any ((of such)) bonds issued in accordance with the provisions of this chapter or any interest thereon remain((s)) unpaid, the bond retirement fund shall be available solely for the payment thereof except as provided in RCW 28B.20.725(5). As a part of the contract of sale of such bonds, the board undertakes to charge and collect building fees and to deposit the portion of such fees in the bond retirement fund in amounts which will be sufficient to pay the principal of, and interest on all such bonds outstanding.

Sec. 4   RCW 28B.30.740 and 1985 c 390 s 44 are each amended to read as follows:
     For the purpose of paying and securing the payment of the principal of and interest on the bonds as the same shall become due, there is created in the custody of the state treasurer a special trust fund to be known as the Washington State University bond retirement fund. An appropriation is not required for expenditures from the fund. There shall be paid into the ((state treasury and credited to a special trust fund to be known as the Washington State University bond retirement fund, which fund is hereby created in the state treasury)) fund, the following:
     (1) One-half of such building fees as the board may from time to time determine, or such larger portion as may be necessary to prevent default in the payments required to be made out of the bond retirement fund;
     (2) Any grants which may be made, or may become available, for the purpose of furthering the construction of any authorized projects, or for the repayment of the costs thereof;
     (3) Such additional funds as the legislature may provide.
     ((Said bond retirement fund shall be kept segregated from all moneys in the state treasury and shall,)) While any ((of such)) bonds issued in accordance with the provisions of this chapter or any interest thereon remain unpaid, the bond retirement fund shall be available solely for the payment thereof except as provided in ((subdivision (5) of)) RCW 28B.30.750(5). As a part of the contract of sale of such bonds, the board shall undertake to charge and collect building fees and to deposit the portion of such fees in the bond retirement fund in amounts which will be sufficient to pay the principal of, and interest on all such bonds outstanding.

Sec. 5   RCW 28B.35.370 and 1991 sp.s. c 13 s 49 are each amended to read as follows:
     Within thirty-five days from the date of collection thereof all building fees of each regional university and The Evergreen State College shall be paid into the state treasury and these together with such normal school fund revenues as provided in RCW 28B.35.751 as are received by the state treasury shall be credited as follows:
     (1) On or before June 30th of each year the board of trustees of each regional university and The Evergreen State College, if issuing bonds payable out of its building fees and above described normal school fund revenues, shall certify to the state treasurer the amounts required in the ensuing twelve months to pay and secure the payment of the principal of and interest on such bonds. The amounts so certified by each regional university and The Evergreen State College shall be a prior lien and charge against all building fees and above described normal school fund revenues of such institution. The state treasurer shall thereupon deposit the amounts so certified in the Eastern Washington University capital projects account, the Central Washington University capital projects account, the Western Washington University capital projects account, or The Evergreen State College capital projects account respectively, which accounts are hereby created in the state treasury. The amounts deposited in the respective capital projects accounts shall be used ((exclusively)) to pay and secure the payment of the principal of and interest on the building bonds issued by such regional universities and The Evergreen State College as authorized by law. If in any twelve month period it shall appear that the amount certified by any such board of trustees is insufficient to pay and secure the payment of the principal of and interest on the outstanding building and above described normal school fund revenue bonds of its institution, the state treasurer shall notify the board of trustees and such board shall adjust its certificate so that all requirements of moneys to pay and secure the payment of the principal of and interest on all such bonds then outstanding shall be fully met at all times.
     (2) All normal school fund revenue pursuant to RCW 28B.35.751 shall be deposited in the Eastern Washington University capital projects account, the Central Washington University capital projects account, the Western Washington University capital projects account, or The Evergreen State College capital projects account respectively, which accounts are hereby created in the state treasury. The sums deposited in the respective capital projects accounts shall be appropriated and expended ((exclusively)) to pay and secure the payment of the principal of and interest on bonds payable out of the building fees and normal school revenue and for the construction, reconstruction, erection, equipping, maintenance, demolition and major alteration of buildings and other capital assets, and the acquisition of sites, rights-of-way, easements, improvements or appurtenances in relation thereto except for any sums transferred therefrom as authorized by law.
     (3) Funds available in the respective capital projects accounts may also be used for certificates of participation under chapter 39.94 RCW.

Sec. 6   RCW 28B.50.360 and 2005 c 488 s 922 are each amended to read as follows:
     Within thirty-five days from the date of start of each quarter all collected building fees of each such community and technical college shall be paid into the state treasury, and shall be credited as follows:
     (1) On or before June 30th of each year the college board if issuing bonds payable out of building fees shall certify to the state treasurer the amounts required in the ensuing twelve-month period to pay and secure the payment of the principal of and interest on such bonds. The state treasurer shall thereupon deposit the amounts so certified in the community and technical college capital projects account. Such amounts of the funds deposited in the community and technical college capital projects account as are necessary to pay and secure the payment of the principal of and interest on the building bonds issued by the college board as authorized by this chapter shall be ((exclusively)) devoted to that purpose. If in any twelve-month period it shall appear that the amount certified by the college board is insufficient to pay and secure the payment of the principal of and interest on the outstanding building bonds, the state treasurer shall notify the college board and such board shall adjust its certificate so that all requirements of moneys to pay and secure the payment of the principal and interest on all such bonds then outstanding shall be fully met at all times.
     (2) The community and technical college capital projects account is hereby created in the state treasury. The sums deposited in the capital projects account shall be appropriated and expended ((exclusively)) to pay and secure the payment of the principal of and interest on bonds payable out of the building fees and for the construction, reconstruction, erection, equipping, maintenance, demolition and major alteration of buildings and other capital assets owned by the state board for community and technical colleges in the name of the state of Washington, and the acquisition of sites, rights-of-way, easements, improvements or appurtenances in relation thereto, engineering and architectural services provided by the department of general administration, and for the payment of principal of and interest on any bonds issued for such purposes.
     (3) Funds available in the community and technical college capital projects account may also be used for certificates of participation under chapter 39.94 RCW.

Sec. 7   RCW 28B.20.715 and 1985 c 390 s 38 are each amended to read as follows:
     For the purpose of financing the cost of any projects, the board is hereby authorized to adopt the resolution or resolutions and prepare all other documents necessary for the issuance, sale and delivery of the bonds or any part thereof at such time or times as it shall deem necessary and advisable. Said bonds:
     (1) Shall not constitute
     (a) An obligation, either general or special, of the state; or
     (b) A general obligation of the University of Washington or of the board;
     (2) Shall be
     (a) Either registered or in coupon form; and
     (b) Issued in denominations of not less than one hundred dollars; and
     (c) Fully negotiable instruments under the laws of this state; and
     (d) Signed on behalf of the university by the president of the board, attested by the secretary of the board, have the seal of the university impressed thereon or a facsimile of such seal printed or lithographed in the bottom border thereof, and the coupons attached thereto shall be signed with the facsimile signatures of such president and secretary;
     (3) Shall state
     (a) The date of issue; and
     (b) The series of the issue and be consecutively numbered within the series; and
     (c) That, except as otherwise provided in subsection (8)(e) of this section, the bond is payable both principal and interest solely out of the bond retirement fund;
     (4) Each series of bonds shall bear interest, payable either annually or semiannually, as the board may determine;
     (5) Shall be payable both principal and interest out of the bond retirement fund;
     (6) Shall be payable at such times over a period of not to exceed forty years from date of issuance, at such place or places, and with such reserved rights of prior redemption, as the board may prescribe;
     (7) Shall be sold in such manner and at such price as the board may prescribe;
     (8) Shall be issued under and subject to such terms, conditions and covenants providing for the payment of the principal thereof and interest thereon and such other terms, conditions, covenants and protective provisions safeguarding such payment, not inconsistent with this chapter, and as found to be necessary by the board for the most advantageous sale thereof, which may include but not be limited to:
     (a) A covenant that the building fees shall be established, maintained and collected in such amounts that will provide money sufficient to pay the principal of and interest on all bonds payable out of the bond retirement fund, to set aside and maintain the reserves required to secure the payment of such principal and interest, and to maintain any coverage which may be required over such principal and interest;
     (b) A covenant that a reserve account shall be created in the bond retirement fund to secure the payment of the principal of and interest on all bonds issued and a provision made that certain amounts be set aside and maintained therein;
     (c) A covenant that sufficient moneys may be transferred from the University of Washington building account to the bond retirement fund when ordered by the board of regents in the event there is ever an insufficient amount of money in the bond retirement fund to pay any installment of interest or principal and interest coming due on the bonds or any of them;
     (d) A covenant fixing conditions under which bonds on a parity with any bonds outstanding may be issued;
     (e) A covenant to obligate, to pay the principal of or interest on the bonds, all or a component of the fees and revenues of the University of Washington that are not subject to appropriation by the legislature and that do not constitute general state revenues as defined in Article VIII, section 1 of the state Constitution or general state revenues for the purpose of calculating statutory limits on state indebtedness pursuant to RCW 39.42.060.
     The proceeds of the sale of all bonds((, exclusive of accrued interest which shall be deposited in the bond retirement fund, shall be deposited in the state treasury to the credit of the University of Washington building account and)) issued in accordance with this chapter shall be used solely for paying the costs of the projects, including costs of issuance and other financing costs.

Sec. 8   RCW 28B.20.735 and 1985 c 390 s 40 are each amended to read as follows:
     The bonds authorized to be issued pursuant to the provisions of RCW 28B.20.700 through 28B.20.740 shall not be general obligations of the state of Washington, but shall be limited obligation bonds payable only from the special fund created for their payment ((derived from the building fees)) as herein provided. The legislature may provide additional means for raising money for the payment of interest and principal of said bonds. RCW 28B.20.700 through 28B.20.740 shall not be deemed to provide an exclusive method for such payment. The power given to the legislature by this section to provide additional means for raising money is permissive, and shall not in any way be construed as a pledge of the general credit of the state of Washington.

Sec. 9   RCW 28B.30.730 and 2002 c 238 s 302 are each amended to read as follows:
     For the purpose of financing the cost of any projects, the board is hereby authorized to adopt the resolution or resolutions and prepare all other documents necessary for the issuance, sale and delivery of the bonds or any part thereof at such time or times as it shall deem necessary and advisable. Said bonds:
     (1) Shall not constitute
     (a) An obligation, either general or special, of the state; or
     (b) A general obligation of Washington State University or of the board;
     (2) Shall be
     (a) Either registered or in coupon form; and
     (b) Issued in denominations of not less than one hundred dollars; and
     (c) Fully negotiable instruments under the laws of this state; and
     (d) Signed on behalf of the university by the president of the board, attested by the secretary or the treasurer of the board, have the seal of the university impressed thereon or a facsimile of such seal printed or lithographed in the bottom border thereof, and the coupons attached thereto shall be signed with the facsimile signatures of such president and secretary;
     (3) Shall state
     (a) The date of issue; and
     (b) The series of the issue and be consecutively numbered within the series; and
     (c) That, except as otherwise provided in subsection (8)(e) of this section, the bond is payable both principal and interest solely out of the bond retirement fund;
     (4) Each series of bonds shall bear interest, payable either annually or semiannually, as the board may determine;
     (5) Shall be payable both principal and interest out of the bond retirement fund;
     (6) Shall be payable at such times over a period of not to exceed forty years from date of issuance, at such place or places, and with such reserved rights of prior redemption, as the board may prescribe;
     (7) Shall be sold in such manner and at such price as the board may prescribe;
     (8) Shall be issued under and subject to such terms, conditions and covenants providing for the payment of the principal thereof and interest thereon and such other terms, conditions, covenants and protective provisions safeguarding such payment, not inconsistent with RCW 28B.30.700 through 28B.30.780, and as found to be necessary by the board for the most advantageous sale thereof, which may include but not be limited to:
     (a) A covenant that the building fees shall be established, maintained and collected in such amounts that will provide money sufficient to pay the principal of and interest on all bonds payable out of the bond retirement account, to set aside and maintain the reserves required to secure the payment of such principal and interest, and to maintain any coverage which may be required over such principal and interest;
     (b) A covenant that a reserve account shall be created in the bond retirement fund to secure the payment of the principal of and interest on all bonds issued and a provision made that certain amounts be set aside and maintained therein;
     (c) A covenant that sufficient moneys may be transferred from the Washington State University building account to the bond retirement account when ordered by the board of regents in the event there is ever an insufficient amount of money in the bond retirement account to pay any installment of interest or principal and interest coming due on the bonds or any of them;
     (d) A covenant fixing conditions under which bonds on a parity with any bonds outstanding may be issued;
     (e) A covenant to obligate, to pay the principal of or interest on the bonds, all or a component of the fees and revenues of Washington State University that are not subject to appropriation by the legislature and that do not constitute general state revenues as defined in Article VIII, section 1 of the state Constitution or general state revenues for the purpose of calculating statutory limits on state indebtedness pursuant to RCW 39.42.060.
     The proceeds of the sale of all bonds ((shall be deposited in the state treasury to the credit of the Washington State University building account and)) issued in accordance with this chapter shall be used solely for paying the costs of the projects, including costs of issuance and other financing costs. The Washington State University building account shall be credited with the investment income derived pursuant to RCW 43.84.080 on the investable balances of scientific permanent fund and agricultural permanent fund, less the allocation to the state treasurer's service fund pursuant to RCW 43.08.190. ((During the 2001-2003 fiscal biennium, the legislature may transfer from the Washington State University building account to the state general fund such amounts as reflect the excess fund balance of the account.))