BILL REQ. #:  H-2539.1 

READ FIRST TIME 04/24/13.   

     AN ACT Relating to eliminating the economic development-related agencies, boards, and commissions; amending RCW 28B.30.530, 28B.155.010, 28C.18.060, 39.102.040, 43.160.060, 43.160.900, 43.330.050, 43.330.080, 43.330.082, 43.330.090, 43.330.250, 43.330.270, 43.330.280, 43.330.375, 50.38.050, 82.14.505, 82.33A.010, 43.131.418, 28B.50.902, 42.30.110, 42.56.270, 43.333.030, 43.333.040, 43.333.050, 43.333.800, 70.210.020, 70.210.030, 70.210.040, 70.210.050, 70.210.060, 43.374.010, and 43.330.010; reenacting and amending RCW 28C.18.080, 43.84.092, 43.84.092, and 43.330.310; amending 2012 c 63 s 1 (uncodified); adding new sections to chapter 43.333 RCW; adding a new section to chapter 70.210 RCW; repealing RCW 43.162.005, 43.162.010, 43.162.012, 43.162.015, 43.162.020, 43.162.025, 43.162.030, 43.162.040, 82.33A.020, 41.06.0711, 43.333.010, 43.333.020, 43.336.010, 43.336.020, 43.336.030, 43.336.040, 43.336.050, 43.336.060, 43.336.900, and 43.330.290; providing a contingent effective date; providing expiration dates; and providing a contingent expiration date.

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

Sec. 101   RCW 28B.30.530 and 2012 c 229 s 808 are each amended to read as follows:
     (1) The board of regents of Washington State University shall establish the Washington State University small business development center.
     (2) The center shall provide management and technical assistance including but not limited to training, counseling, and research services to small businesses throughout the state. The center shall work with the department of commerce, the state board for community and technical colleges, the workforce training and education coordinating board, the employment security department, ((the Washington state economic development commission,)) associate development organizations, and workforce development councils to:
     (a) Integrate small business development centers with other state and local economic development and workforce development programs;
     (b) Target the centers' services to small businesses;
     (c) Tailor outreach and services at each center to the needs and demographics of entrepreneurs and small businesses located within the service area;
     (d) Establish and expand small business development center satellite offices when financially feasible; and
     (e) Coordinate delivery of services to avoid duplication.
     (3) The administrator of the center may contract with other public or private entities for the provision of specialized services.
     (4) The small business development center may accept and disburse federal grants or federal matching funds or other funds or donations from any source when made, granted, or donated to carry out the center's purposes. When drawing on funds from the business assistance account created in RCW 28B.30.531, the center must first use the funds to make increased management and technical assistance available to existing small businesses and start-up businesses at satellite offices. The funds may also be used to develop and expand assistance programs such as small business planning workshops and small business counseling.
     (5) By December 1, 2010, the center shall provide a written progress report and a final report to the appropriate committees of the legislature with respect to the requirements in subsection (2) of this section and the amount and use of funding received through the business assistance account. The reports must also include data on the number, location, staffing, and budget levels of satellite offices; affiliations with community colleges, associate development organizations or other local organizations; the number, size, and type of small businesses assisted; and the types of services provided. The reports must also include information on the outcomes achieved, such as jobs created or retained, private capital invested, and return on the investment of state and federal dollars.
     (6)(a) Subject to the availability of amounts appropriated for this specific purpose, by December 1, 2010, the center, in conjunction with the department of commerce, must prepare and present to the governor and appropriate legislative committees a specific, actionable plan to increase access to capital and technical assistance to small businesses and entrepreneurs beginning with the 2011-2013 biennium. In developing the plan, the center and the department may consult with the Washington state microenterprise association, and with other government, nonprofit, and private organizations as necessary. The plan must identify:
     (i) Existing sources of capital and technical assistance for small businesses and entrepreneurs;
     (ii) Critical gaps and barriers to availability of capital and delivery of technical assistance to small businesses and entrepreneurs;
     (iii) Workable solutions to filling the gaps and removing barriers identified in (a)(ii) of this subsection; and
     (iv) The financial resources and statutory changes necessary to put the plan into effect beginning with the 2011-2013 biennium.
     (b) With respect to increasing access to capital, the plan must identify specific, feasible sources of capital and practical mechanisms for expanding access to it.
     (c) The center and the department must include, within the analysis and recommendations in (a) of this subsection, any specific gaps, barriers, and solutions related to rural and low-income communities and small manufacturers interested in exporting.

Sec. 102   RCW 28B.155.010 and 2012 c 242 s 1 are each amended to read as follows:
     (1) The joint center for aerospace technology innovation is created to:
     (a) Pursue joint industry-university research in computing, manufacturing efficiency, materials/structures innovation, and other new technologies that can be used in aerospace firms;
     (b) Enhance the education of students in the engineering departments of the University of Washington, Washington State University, and other participating institutions through industry-focused research; and
     (c) Work directly with existing small, medium-sized, and large aerospace firms and aerospace industry associations to identify research needs and opportunities to transfer off-the-shelf technologies that would benefit such firms.
     (2) The center shall be operated and administered as a multi-institutional education and research center, conducting research and development programs in various locations within Washington under the joint authority of the University of Washington and Washington State University. The initial administrative offices of the center shall be west of the crest of the Cascade mountains. In order to meet aerospace industry needs, the facilities and resources of the center must be made available to all four-year institutions of higher education as defined in RCW 28B.10.016. Resources include, but are not limited to, internships, on-the-job training, and research opportunities for undergraduate and graduate students and faculty.
     (3) The powers of the center are vested in and shall be exercised by a board of directors. The board shall consist of nine members appointed by the governor. The governor shall appoint a nonvoting chair. Of the eight voting members, one member shall represent small aerospace firms, one member shall represent medium-sized firms, one member shall represent large aerospace firms, one member shall represent labor, two members shall represent aerospace industry associations, and two members shall represent higher education. The terms of the initial members shall be staggered.
     (4) The board shall hire an executive director. The executive director shall hire such staff as the board deems necessary to operate the center. Staff support may be provided from among the cooperating institutions through cooperative agreements to the extent funds are available. The executive director may enter into cooperative agreements for programs and research with public and private organizations including state and nonstate agencies consistent with policies of the participating institutions.
     (5) The board must:
     (a) Work with aerospace industry associations and aerospace firms of all sizes to identify the research areas that will benefit the intermediate and long-term economic vitality of the Washington aerospace industry;
     (b) Identify entrepreneurial researchers to join or lead research teams in the research areas specified in (a) of this subsection and the steps the University of Washington and Washington State University will take to recruit such researchers;
     (c) Assist firms to integrate existing technologies into their operations and align the activities of the center with those of impact Washington ((and innovate Washington)) to enhance services available to aerospace firms;
     (d) Develop internships, on-the-job training, research, and other opportunities and ensure that all undergraduate and graduate students enrolled in an aerospace engineering curriculum have direct experience with aerospace firms;
     (e) Assist researchers and firms in safeguarding intellectual property while advancing industry innovation;
     (f) Develop and strengthen university-industry relationships through promotion of faculty collaboration with industry, and sponsor((, in collaboration with innovate Washington,)) at least one annual symposium focusing on aerospace research in the state of Washington;
     (g) Encourage a full range of projects from small research projects that meet the specific needs of a smaller company to large scale, multipartner projects;
     (h) Develop nonstate support of the center's research activities through leveraging dollars from federal and private for-profit and nonprofit sources;
     (i) Leverage its financial impact through joint support arrangements on a project-by-project basis as appropriate;
     (j) Establish mechanisms for soliciting and evaluating proposals and for making awards and reporting on technological progress, financial leverage, and other measures of impact;
     (k) By June 30, 2013, develop an operating plan that includes the specific processes, methods, or mechanisms the center will use to accomplish each of its duties as set out in this subsection; and
     (l) Report biennially to the legislature and the governor about the impact of the center's work on the state's economy and the aerospace sector, with projections of future impact, providing indicators of its impact, and outlining ideas for enhancing benefits to the state. The report must be coordinated with the governor's office, ((the Washington economic development commission,)) and the department of commerce((, and innovate Washington)).

Sec. 103   RCW 28C.18.060 and 2012 c 229 s 579 are each amended to read as follows:
     The board, in cooperation with the operating agencies of the state training system and private career schools and colleges, shall:
     (1) Concentrate its major efforts on planning, coordination evaluation, policy analysis, and recommending improvements to the state's training system;
     (2) Advocate for the state training system and for meeting the needs of employers and the workforce for workforce education and training;
     (3) Establish and maintain an inventory of the programs of the state training system, and related state programs, and perform a biennial assessment of the vocational education, training, and adult basic education and literacy needs of the state; identify ongoing and strategic education needs; and assess the extent to which employment, training, vocational and basic education, rehabilitation services, and public assistance services represent a consistent, integrated approach to meet such needs;
     (4) Develop and maintain a state comprehensive plan for workforce training and education, including but not limited to, goals, objectives, and priorities for the state training system, and review the state training system for consistency with the state comprehensive plan. In developing the state comprehensive plan for workforce training and education, the board shall use, but shall not be limited to: Economic, labor market, and populations trends reports in office of financial management forecasts; joint office of financial management and employment security department labor force, industry employment, and occupational forecasts; the results of scientifically based outcome, net-impact and cost-benefit evaluations; the needs of employers as evidenced in formal employer surveys and other employer input; and the needs of program participants and workers as evidenced in formal surveys and other input from program participants and the labor community;
     (5) In consultation with the student achievement council, review and make recommendations to the office of financial management and the legislature on operating and capital facilities budget requests for operating agencies of the state training system for purposes of consistency with the state comprehensive plan for workforce training and education;
     (6) Provide for coordination among the different operating agencies and components of the state training system at the state level and at the regional level;
     (7) Develop a consistent and reliable database on vocational education enrollments, costs, program activities, and job placements from publicly funded vocational education programs in this state;
     (8)(a) Establish standards for data collection and maintenance for the operating agencies of the state training system in a format that is accessible to use by the board. The board shall require a minimum of common core data to be collected by each operating agency of the state training system;
     (b) Develop requirements for minimum common core data in consultation with the office of financial management and the operating agencies of the training system;
     (9) Establish minimum standards for program evaluation for the operating agencies of the state training system, including, but not limited to, the use of common survey instruments and procedures for measuring perceptions of program participants and employers of program participants, and monitor such program evaluation;
     (10) Every two years administer scientifically based outcome evaluations of the state training system, including, but not limited to, surveys of program participants, surveys of employers of program participants, and matches with employment security department payroll and wage files. Every five years administer scientifically based net-impact and cost-benefit evaluations of the state training system;
     (11) In cooperation with the employment security department, provide for the improvement and maintenance of quality and utility in occupational information and forecasts for use in training system planning and evaluation. Improvements shall include, but not be limited to, development of state-based occupational change factors involving input by employers and employees, and delineation of skill and training requirements by education level associated with current and forecasted occupations;
     (12) Provide for the development of common course description formats, common reporting requirements, and common definitions for operating agencies of the training system;
     (13) Provide for effectiveness and efficiency reviews of the state training system;
     (14) In cooperation with the student achievement council, facilitate transfer of credit policies and agreements between institutions of the state training system, and encourage articulation agreements for programs encompassing two years of secondary workforce education and two years of postsecondary workforce education;
     (15) In cooperation with the student achievement council, facilitate transfer of credit policies and agreements between private training institutions and institutions of the state training system;
     (16) Develop policy objectives for the workforce investment act, P.L. 105-220, or its successor; develop coordination criteria for activities under the act with related programs and services provided by state and local education and training agencies; and ensure that entrepreneurial training opportunities are available through programs of each local workforce investment board in the state;
     (17) Make recommendations to the commission of student assessment, the state board of education, and the superintendent of public instruction, concerning basic skill competencies and essential core competencies for K-12 education. Basic skills for this purpose shall be reading, writing, computation, speaking, and critical thinking, essential core competencies for this purpose shall be English, math, science/technology, history, geography, and critical thinking. The board shall monitor the development of and provide advice concerning secondary curriculum which integrates vocational and academic education;
     (18) Establish and administer programs for marketing and outreach to businesses and potential program participants;
     (19) Facilitate the location of support services, including but not limited to, child care, financial aid, career counseling, and job placement services, for students and trainees at institutions in the state training system, and advocate for support services for trainees and students in the state training system;
     (20) Facilitate private sector assistance for the state training system, including but not limited to: Financial assistance, rotation of private and public personnel, and vocational counseling;
     (21) Facilitate the development of programs for school-to-work transition that combine classroom education and on-the-job training, including entrepreneurial education and training, in industries and occupations without a significant number of apprenticeship programs;
     (22) Include in the planning requirements for local workforce investment boards a requirement that the local workforce investment boards specify how entrepreneurial training is to be offered through the one-stop system required under the workforce investment act, P.L. 105-220, or its successor;
     (23) Encourage and assess progress for the equitable representation of racial and ethnic minorities, women, and people with disabilities among the students, teachers, and administrators of the state training system. Equitable, for this purpose, shall mean substantially proportional to their percentage of the state population in the geographic area served. This function of the board shall in no way lessen more stringent state or federal requirements for representation of racial and ethnic minorities, women, and people with disabilities;
     (24) Participate in the planning and policy development of governor set-aside grants under P.L. 97-300, as amended;
     (25) Administer veterans' programs, licensure of private vocational schools, the job skills program, and the Washington award for vocational excellence;
     (26) Allocate funding from the state job training trust fund;
     (27) Work with the director of commerce ((and the economic development commission)) to ensure coordination among workforce training priorities((, the long-term economic development strategy of the economic development commission,)) and economic development and entrepreneurial development efforts, including but not limited to assistance to industry clusters;
     (28) Conduct research into workforce development programs designed to reduce the high unemployment rate among young people between approximately eighteen and twenty-four years of age. In consultation with the operating agencies, the board shall advise the governor and legislature on policies and programs to alleviate the high unemployment rate among young people. The research shall include disaggregated demographic information and, to the extent possible, income data for adult youth. The research shall also include a comparison of the effectiveness of programs examined as a part of the research conducted in this subsection in relation to the public investment made in these programs in reducing unemployment of young adults. The board shall report to the appropriate committees of the legislature by November 15, 2008, and every two years thereafter. Where possible, the data reported to the legislative committees should be reported in numbers and in percentages;
     (29) Adopt rules as necessary to implement this chapter.
     The board may delegate to the director any of the functions of this section.

Sec. 104   RCW 28C.18.080 and 2009 c 421 s 6, 2009 c 151 s 7, and 2009 c 92 s 1 are each reenacted and amended to read as follows:
     (1) The board shall develop a state comprehensive plan for workforce training and education for a ten-year time period. The board shall submit the ten-year state comprehensive plan to the governor and the appropriate legislative policy committees. Every four years by December 1st, beginning December 1, 2012, the board shall submit an update of the ten-year state comprehensive plan for workforce training and education to the governor and the appropriate legislative policy committees. Following public hearings, the legislature shall, by concurrent resolution, approve or recommend changes to the initial plan and the updates. The plan shall then become the state's workforce training policy unless legislation is enacted to alter the policies set forth in the plan.
     (2) The comprehensive plan shall include workforce training role and mission statements for the workforce development programs of operating agencies represented on the board and sufficient specificity regarding expected actions by the operating agencies to allow them to carry out actions consistent with the comprehensive plan.
     (3) Operating agencies represented on the board shall have operating plans for their workforce development efforts that are consistent with the comprehensive plan and that provide detail on implementation steps they will take to carry out their responsibilities under the plan. Each operating agency represented on the board shall provide an annual progress report to the board.
     (4) The comprehensive plan shall include recommendations to the legislature and the governor on the modification, consolidation, initiation, or elimination of workforce training and education programs in the state.
     (5) The comprehensive plan shall identify the strategic industry clusters targeted by the workforce development system. In identifying the strategic clusters, the board shall consult with the ((economic development commission)) department of commerce to identify clusters that meet the criteria identified by the working group convened by the ((economic development commission)) department of commerce and the workforce training and education coordinating board under RCW 43.330.280.
     (6) The board shall report to the appropriate legislative policy committees by December 1st of each year on its progress in implementing the comprehensive plan and on the progress of the operating agencies in meeting their obligations under the plan.

Sec. 105   RCW 39.102.040 and 2007 c 229 s 2 are each amended to read as follows:
     (1) Prior to applying to the board to use local infrastructure financing, a sponsoring local government shall:
     (a) Designate a revenue development area within the limitations in RCW 39.102.060;
     (b) Certify that the conditions in RCW 39.102.070 are met;
     (c) Complete the process in RCW 39.102.080;
     (d) Provide public notice as required in RCW 39.102.100; and
     (e) Pass an ordinance adopting the revenue development area as required in RCW 39.102.090.
     (2) Any local government that has created an increment area under chapter 39.89 RCW and has not issued bonds to finance any public improvement may apply to the board and have its increment area considered for approval as a revenue development area under this chapter without adopting a new revenue development area under RCW 39.102.090 and 39.102.100 if it amends its ordinance to comply with RCW 39.102.090(1) and otherwise meets the conditions and limitations under this chapter.
     (3) As a condition to imposing a sales and use tax under RCW 82.14.475, a sponsoring local government, including any cosponsoring local government seeking authority to impose a sales and use tax under RCW 82.14.475, must apply to the board and be approved for a project award amount. The application shall be in a form and manner prescribed by the board and include but not be limited to information establishing that the applicant is an eligible candidate to impose the local sales and use tax under RCW 82.14.475, the anticipated effective date for imposing the tax, the estimated number of years that the tax will be imposed, and the estimated amount of tax revenue to be received in each fiscal year that the tax will be imposed. The board shall make available forms to be used for this purpose. As part of the application, each applicant must provide to the board a copy of the ordinance or ordinances creating the revenue development area as required in RCW 39.102.090. A notice of approval to use local infrastructure financing shall contain a project award that represents the maximum amount of state contribution that the applicant, including any cosponsoring local governments, can earn each year that local infrastructure financing is used. The total of all project awards shall not exceed the annual state contribution limit. The determination of a project award shall be made based on information contained in the application and the remaining amount of annual state contribution limit to be awarded. Determination of a project award by the board is final.
     (4)(a) Sponsoring local governments, and any cosponsoring local governments, applying in calendar year 2007 for a competitive project award, must submit completed applications to the board no later than July 1, 2007. By September 15, 2007, in consultation with the department of revenue and the department of ((community, trade, and economic development)) commerce, the board shall approve competitive project awards from competitive applications submitted by the 2007 deadline. No more than two million five hundred thousand dollars in competitive project awards shall be approved in 2007. For projects not approved by the board in 2007, sponsoring and cosponsoring local governments may apply again to the board in 2008 for approval of a project.
     (b) Sponsoring local governments, and any cosponsoring local governments, applying in calendar year 2008 for a competitive project award, must submit completed applications to the board no later than July 1, 2008. By September 18, 2008, in consultation with the department of revenue and the department of ((community, trade, and economic development)) commerce, the board shall approve competitive project awards from competitive applications submitted by the 2008 deadline.
     (c) Except as provided in RCW 39.102.050(2), a total of no more than five million dollars in competitive project awards shall be approved for local infrastructure financing.
     (d) The project selection criteria and weighting developed prior to July 22, 2007, for the application evaluation and approval process shall apply to applications received prior to November 1, 2007. In evaluating applications for a competitive project award after November 1, 2007, the board shall((, in consultation with the Washington state economic development commission,)) develop the relative weight to be assigned to the following criteria:
     (i) The project's potential to enhance the sponsoring local government's regional and/or international competitiveness;
     (ii) The project's ability to encourage mixed use and transit-oriented development and the redevelopment of a geographic area;
     (iii) Achieving an overall distribution of projects statewide that reflect geographic diversity;
     (iv) The estimated wages and benefits for the project is greater than the average labor market area;
     (v) The estimated state and local net employment change over the life of the project;
     (vi) The current economic health and vitality of the proposed revenue development area and the contiguous community and the estimated impact of the proposed project on the proposed revenue development area and contiguous community;
     (vii) The estimated state and local net property tax change over the life of the project;
     (viii) The estimated state and local sales and use tax increase over the life of the project;
     (ix) An analysis that shows that, over the life of the project, neither the local excise tax allocation revenues nor the local property tax allocation revenues will constitute more than eighty percent of the total local funds as described in RCW 39.102.020(((29)(c))) (28)(b); and
     (x) If a project is located within an urban growth area, evidence that the project utilizes existing urban infrastructure and that the transportation needs of the project will be adequately met through the use of local infrastructure financing or other sources.
     (e)(i) Except as provided in this subsection (4)(e), the board may not approve the use of local infrastructure financing within more than one revenue development area per county.
     (ii) In a county in which the board has approved the use of local infrastructure financing, the use of such financing in additional revenue development areas may be approved, subject to the following conditions:
     (A) The sponsoring local government is located in more than one county; and
     (B) The sponsoring local government designates a revenue development area that comprises portions of a county within which the use of local infrastructure financing has not yet been approved.
     (iii) In a county where the local infrastructure financing tool is authorized under RCW 39.102.050, the board may approve additional use of the local infrastructure financing tool.
     (5) Once the board has approved the sponsoring local government, and any cosponsoring local governments, to use local infrastructure financing, notification must be sent by the board to the sponsoring local government, and any cosponsoring local governments, authorizing the sponsoring local government, and any cosponsoring local governments, to impose the local sales and use tax authorized under RCW 82.14.475, subject to the conditions in RCW 82.14.475.

Sec. 106   RCW 43.84.092 and 2012 c 198 s 2, 2012 c 196 s 7, 2012 c 187 s 14, and 2012 c 83 s 4 are each reenacted and amended to read as follows:
     (1) All earnings of investments of surplus balances in the state treasury shall be deposited to the treasury income account, which account is hereby established in the state treasury.
     (2) The treasury income account shall be utilized to pay or receive funds associated with federal programs as required by the federal cash management improvement act of 1990. The treasury income account is subject in all respects to chapter 43.88 RCW, but no appropriation is required for refunds or allocations of interest earnings required by the cash management improvement act. Refunds of interest to the federal treasury required under the cash management improvement act fall under RCW 43.88.180 and shall not require appropriation. The office of financial management shall determine the amounts due to or from the federal government pursuant to the cash management improvement act. The office of financial management may direct transfers of funds between accounts as deemed necessary to implement the provisions of the cash management improvement act, and this subsection. Refunds or allocations shall occur prior to the distributions of earnings set forth in subsection (4) of this section.
     (3) Except for the provisions of RCW 43.84.160, the treasury income account may be utilized for the payment of purchased banking services on behalf of treasury funds including, but not limited to, depository, safekeeping, and disbursement functions for the state treasury and affected state agencies. The treasury income account is subject in all respects to chapter 43.88 RCW, but no appropriation is required for payments to financial institutions. Payments shall occur prior to distribution of earnings set forth in subsection (4) of this section.
     (4) Monthly, the state treasurer shall distribute the earnings credited to the treasury income account. The state treasurer shall credit the general fund with all the earnings credited to the treasury income account except:
     (a) The following accounts and funds shall receive their proportionate share of earnings based upon each account's and fund's average daily balance for the period: The aeronautics account, the aircraft search and rescue account, the Alaskan Way viaduct replacement project account, the budget stabilization account, the capital vessel replacement account, the capitol building construction account, the Cedar River channel construction and operation account, the Central Washington University capital projects account, the charitable, educational, penal and reformatory institutions account, the cleanup settlement account, the Columbia river basin water supply development account, the Columbia river basin taxable bond water supply development account, the Columbia river basin water supply revenue recovery account, the common school construction fund, the county arterial preservation account, the county criminal justice assistance account, the deferred compensation administrative account, the deferred compensation principal account, the department of licensing services account, the department of retirement systems expense account, the developmental disabilities community trust account, the drinking water assistance account, the drinking water assistance administrative account, the drinking water assistance repayment account, the Eastern Washington University capital projects account, the Interstate 405 express toll lanes operations account, the education construction fund, the education legacy trust account, the election account, the energy freedom account, the energy recovery act account, the essential rail assistance account, The Evergreen State College capital projects account, the federal forest revolving account, the ferry bond retirement fund, the freight congestion relief account, the freight mobility investment account, the freight mobility multimodal account, the grade crossing protective fund, the public health services account, the high capacity transportation account, the state higher education construction account, the higher education construction account, the highway bond retirement fund, the highway infrastructure account, the highway safety ((account [fund])) fund, the high occupancy toll lanes operations account, the hospital safety net assessment fund, the industrial insurance premium refund account, the judges' retirement account, the judicial retirement administrative account, the judicial retirement principal account, the local leasehold excise tax account, the local real estate excise tax account, the local sales and use tax account, the marine resources stewardship trust account, the medical aid account, the mobile home park relocation fund, the motor vehicle fund, the motorcycle safety education account, the multimodal transportation account, the municipal criminal justice assistance account, the natural resources deposit account, the oyster reserve land account, the pension funding stabilization account, the perpetual surveillance and maintenance account, the public employees' retirement system plan 1 account, the public employees' retirement system combined plan 2 and plan 3 account, the public facilities construction loan revolving account beginning July 1, 2004, the public health supplemental account, the public transportation systems account, the public works assistance account, the Puget Sound capital construction account, the Puget Sound ferry operations account, the Puyallup tribal settlement account, the real estate appraiser commission account, the recreational vehicle account, the regional mobility grant program account, the resource management cost account, the rural arterial trust account, the rural mobility grant program account, the rural Washington loan fund, the site closure account, the skilled nursing facility safety net trust fund, the small city pavement and sidewalk account, the special category C account, the special wildlife account, the state employees' insurance account, the state employees' insurance reserve account, the state investment board expense account, the state investment board commingled trust fund accounts, the state patrol highway account, the state route number 520 civil penalties account, the state route number 520 corridor account, the state wildlife account, the supplemental pension account, the Tacoma Narrows toll bridge account, the teachers' retirement system plan 1 account, the teachers' retirement system combined plan 2 and plan 3 account, the tobacco prevention and control account, the tobacco settlement account, the toll facility bond retirement account, the transportation 2003 account (nickel account), the transportation equipment fund, the transportation fund, the transportation improvement account, the transportation improvement board bond retirement account, the transportation infrastructure account, the transportation partnership account, the traumatic brain injury account, the tuition recovery trust fund, the University of Washington bond retirement fund, the University of Washington building account, the volunteer firefighters' and reserve officers' relief and pension principal fund, the volunteer firefighters' and reserve officers' administrative fund, the Washington judicial retirement system account, the Washington law enforcement officers' and firefighters' system plan 1 retirement account, the Washington law enforcement officers' and firefighters' system plan 2 retirement account, the Washington public safety employees' plan 2 retirement account, the Washington school employees' retirement system combined plan 2 and 3 account, ((the Washington state economic development commission account,)) the Washington state health insurance pool account, the Washington state patrol retirement account, the Washington State University building account, the Washington State University bond retirement fund, the water pollution control revolving fund, and the Western Washington University capital projects account. Earnings derived from investing balances of the agricultural permanent fund, the normal school permanent fund, the permanent common school fund, the scientific permanent fund, the state university permanent fund, and the state reclamation revolving account shall be allocated to their respective beneficiary accounts.
     (b) Any state agency that has independent authority over accounts or funds not statutorily required to be held in the state treasury that deposits funds into a fund or account in the state treasury pursuant to an agreement with the office of the state treasurer shall receive its proportionate share of earnings based upon each account's or fund's average daily balance for the period.
     (5) In conformance with Article II, section 37 of the state Constitution, no treasury accounts or funds shall be allocated earnings without the specific affirmative directive of this section.

Sec. 107   RCW 43.84.092 and 2012 c 198 s 2, 2012 c 196 s 7, 2012 c 187 s 14, 2012 c 83 s 4, and 2012 c 36 s 5 are each reenacted and amended to read as follows:
     (1) All earnings of investments of surplus balances in the state treasury shall be deposited to the treasury income account, which account is hereby established in the state treasury.
     (2) The treasury income account shall be utilized to pay or receive funds associated with federal programs as required by the federal cash management improvement act of 1990. The treasury income account is subject in all respects to chapter 43.88 RCW, but no appropriation is required for refunds or allocations of interest earnings required by the cash management improvement act. Refunds of interest to the federal treasury required under the cash management improvement act fall under RCW 43.88.180 and shall not require appropriation. The office of financial management shall determine the amounts due to or from the federal government pursuant to the cash management improvement act. The office of financial management may direct transfers of funds between accounts as deemed necessary to implement the provisions of the cash management improvement act, and this subsection. Refunds or allocations shall occur prior to the distributions of earnings set forth in subsection (4) of this section.
     (3) Except for the provisions of RCW 43.84.160, the treasury income account may be utilized for the payment of purchased banking services on behalf of treasury funds including, but not limited to, depository, safekeeping, and disbursement functions for the state treasury and affected state agencies. The treasury income account is subject in all respects to chapter 43.88 RCW, but no appropriation is required for payments to financial institutions. Payments shall occur prior to distribution of earnings set forth in subsection (4) of this section.
     (4) Monthly, the state treasurer shall distribute the earnings credited to the treasury income account. The state treasurer shall credit the general fund with all the earnings credited to the treasury income account except:
     (a) The following accounts and funds shall receive their proportionate share of earnings based upon each account's and fund's average daily balance for the period: The aeronautics account, the aircraft search and rescue account, the Alaskan Way viaduct replacement project account, the budget stabilization account, the capital vessel replacement account, the capitol building construction account, the Cedar River channel construction and operation account, the Central Washington University capital projects account, the charitable, educational, penal and reformatory institutions account, the cleanup settlement account, the Columbia river basin water supply development account, the Columbia river basin taxable bond water supply development account, the Columbia river basin water supply revenue recovery account, the Columbia river crossing project account, the common school construction fund, the county arterial preservation account, the county criminal justice assistance account, the deferred compensation administrative account, the deferred compensation principal account, the department of licensing services account, the department of retirement systems expense account, the developmental disabilities community trust account, the drinking water assistance account, the drinking water assistance administrative account, the drinking water assistance repayment account, the Eastern Washington University capital projects account, the Interstate 405 express toll lanes operations account, the education construction fund, the education legacy trust account, the election account, the energy freedom account, the energy recovery act account, the essential rail assistance account, The Evergreen State College capital projects account, the federal forest revolving account, the ferry bond retirement fund, the freight congestion relief account, the freight mobility investment account, the freight mobility multimodal account, the grade crossing protective fund, the public health services account, the high capacity transportation account, the state higher education construction account, the higher education construction account, the highway bond retirement fund, the highway infrastructure account, the highway safety ((account [fund])) fund, the high occupancy toll lanes operations account, the hospital safety net assessment fund, the industrial insurance premium refund account, the judges' retirement account, the judicial retirement administrative account, the judicial retirement principal account, the local leasehold excise tax account, the local real estate excise tax account, the local sales and use tax account, the marine resources stewardship trust account, the medical aid account, the mobile home park relocation fund, the motor vehicle fund, the motorcycle safety education account, the multimodal transportation account, the municipal criminal justice assistance account, the natural resources deposit account, the oyster reserve land account, the pension funding stabilization account, the perpetual surveillance and maintenance account, the public employees' retirement system plan 1 account, the public employees' retirement system combined plan 2 and plan 3 account, the public facilities construction loan revolving account beginning July 1, 2004, the public health supplemental account, the public transportation systems account, the public works assistance account, the Puget Sound capital construction account, the Puget Sound ferry operations account, the Puyallup tribal settlement account, the real estate appraiser commission account, the recreational vehicle account, the regional mobility grant program account, the resource management cost account, the rural arterial trust account, the rural mobility grant program account, the rural Washington loan fund, the site closure account, the skilled nursing facility safety net trust fund, the small city pavement and sidewalk account, the special category C account, the special wildlife account, the state employees' insurance account, the state employees' insurance reserve account, the state investment board expense account, the state investment board commingled trust fund accounts, the state patrol highway account, the state route number 520 civil penalties account, the state route number 520 corridor account, the state wildlife account, the supplemental pension account, the Tacoma Narrows toll bridge account, the teachers' retirement system plan 1 account, the teachers' retirement system combined plan 2 and plan 3 account, the tobacco prevention and control account, the tobacco settlement account, the toll facility bond retirement account, the transportation 2003 account (nickel account), the transportation equipment fund, the transportation fund, the transportation improvement account, the transportation improvement board bond retirement account, the transportation infrastructure account, the transportation partnership account, the traumatic brain injury account, the tuition recovery trust fund, the University of Washington bond retirement fund, the University of Washington building account, the volunteer firefighters' and reserve officers' relief and pension principal fund, the volunteer firefighters' and reserve officers' administrative fund, the Washington judicial retirement system account, the Washington law enforcement officers' and firefighters' system plan 1 retirement account, the Washington law enforcement officers' and firefighters' system plan 2 retirement account, the Washington public safety employees' plan 2 retirement account, the Washington school employees' retirement system combined plan 2 and 3 account, ((the Washington state economic development commission account,)) the Washington state health insurance pool account, the Washington state patrol retirement account, the Washington State University building account, the Washington State University bond retirement fund, the water pollution control revolving fund, and the Western Washington University capital projects account. Earnings derived from investing balances of the agricultural permanent fund, the normal school permanent fund, the permanent common school fund, the scientific permanent fund, the state university permanent fund, and the state reclamation revolving account shall be allocated to their respective beneficiary accounts.
     (b) Any state agency that has independent authority over accounts or funds not statutorily required to be held in the state treasury that deposits funds into a fund or account in the state treasury pursuant to an agreement with the office of the state treasurer shall receive its proportionate share of earnings based upon each account's or fund's average daily balance for the period.
     (5) In conformance with Article II, section 37 of the state Constitution, no treasury accounts or funds shall be allocated earnings without the specific affirmative directive of this section.

Sec. 108   RCW 43.160.060 and 2012 c 196 s 10 are each amended to read as follows:
     (1) The board is authorized to make direct loans to political subdivisions of the state and to federally recognized Indian tribes for the purposes of assisting the political subdivisions and federally recognized Indian tribes in financing the cost of public facilities, including development of land and improvements for public facilities, project-specific environmental, capital facilities, land use, permitting, feasibility, and marketing studies and plans; project design, site planning, and analysis; project debt and revenue impact analysis; as well as the construction, rehabilitation, alteration, expansion, or improvement of the facilities. A grant may also be authorized for purposes designated in this chapter, but only when, and to the extent that, a loan is not reasonably possible, given the limited resources of the political subdivision or the federally recognized Indian tribe and the finding by the board that financial circumstances require grant assistance to enable the project to move forward. However, no more than twenty-five percent of all financial assistance approved by the board in any biennium may consist of grants to political subdivisions and federally recognized Indian tribes.
     (2) Application for funds must be made in the form and manner as the board may prescribe. In making grants or loans the board must conform to the following requirements:
     (a) The board may not provide financial assistance:
     (i) For a project the primary purpose of which is to facilitate or promote a retail shopping development or expansion.
     (ii) For any project that evidence exists would result in a development or expansion that would displace existing jobs in any other community in the state.
     (iii) For a project the primary purpose of which is to facilitate or promote gambling.
     (iv) For a project located outside the jurisdiction of the applicant political subdivision or federally recognized Indian tribe.
     (b) The board may only provide financial assistance:
     (i) For a project demonstrating convincing evidence that a specific private development or expansion is ready to occur and will occur only if the public facility improvement is made that:
     (A) Results in the creation of significant private sector jobs or significant private sector capital investment as determined by the board ((and is consistent with the state comprehensive economic development plan developed by the Washington economic development commission pursuant to chapter 43.162 RCW, once the plan is adopted)); and
     (B) Will improve the opportunities for the successful maintenance, establishment, or expansion of industrial or commercial plants or will otherwise assist in the creation or retention of long-term economic opportunities;
     (ii) For a project that cannot meet the requirement of (b)(i) of this subsection but is a project that:
     (A) Results in the creation of significant private sector jobs or significant private sector capital investment as determined by the board ((and is consistent with the state comprehensive economic development plan developed by the Washington economic development commission pursuant to chapter 43.162 RCW, once the plan is adopted));
     (B) Is part of a local economic development plan consistent with applicable state planning requirements;
     (C) Can demonstrate project feasibility using standard economic principles; and
     (D) Is located in a rural community as defined by the board, or a rural county;
     (iii) For site-specific plans, studies, and analyses that address environmental impacts, capital facilities, land use, permitting, feasibility, marketing, project engineering, design, site planning, and project debt and revenue impacts, as grants not to exceed fifty thousand dollars.
     (c) The board must develop guidelines for local participation and allowable match and activities.
     (d) An application must demonstrate local match and local participation, in accordance with guidelines developed by the board.
     (e) An application must be approved by the political subdivision and supported by the local associate development organization or local workforce development council or approved by the governing body of the federally recognized Indian tribe.
     (f) The board may allow de minimis general system improvements to be funded if they are critically linked to the viability of the project.
     (g) An application must demonstrate convincing evidence that the median hourly wage of the private sector jobs created after the project is completed will exceed the countywide median hourly wage.
     (h) The board must prioritize each proposed project according to:
     (i) The relative benefits provided to the community by the jobs the project would create, not just the total number of jobs it would create after the project is completed, but also giving consideration to the unemployment rate in the area in which the jobs would be located;
     (ii) The rate of return of the state's investment, including, but not limited to, the leveraging of private sector investment, anticipated job creation and retention, and expected increases in state and local tax revenues associated with the project;
     (iii) Whether the proposed project offers a health insurance plan for employees that includes an option for dependents of employees;
     (iv) Whether the public facility investment will increase existing capacity necessary to accommodate projected population and employment growth in a manner that supports infill and redevelopment of existing urban or industrial areas that are served by adequate public facilities. Projects should maximize the use of existing infrastructure and provide for adequate funding of necessary transportation improvements;
     (v) Whether the applicant's permitting process has been certified as streamlined by the office of regulatory assistance; and
     (vi) Whether the applicant has developed and adhered to guidelines regarding its permitting process for those applying for development permits consistent with section 1(2), chapter 231, Laws of 2007.
     (i) A responsible official of the political subdivision or the federally recognized Indian tribe must be present during board deliberations and provide information that the board requests.
     (3) Before any financial assistance application is approved, the political subdivision or the federally recognized Indian tribe seeking the assistance must demonstrate to the community economic revitalization board that no other timely source of funding is available to it at costs reasonably similar to financing available from the community economic revitalization board.

Sec. 109   RCW 43.160.900 and 2008 c 327 s 9 are each amended to read as follows:
     (1) The community economic revitalization board shall conduct biennial outcome-based evaluations of the financial assistance provided under this chapter. The evaluations shall include information on the number of applications for community economic revitalization board assistance; the number and types of projects approved; the grant or loan amount awarded each project; the projected number of jobs created or retained by each project; the actual number and cost of jobs created or retained by each project; the wages and health benefits associated with the jobs; the amount of state funds and total capital invested in projects; the number and types of businesses assisted by funded projects; the location of funded projects; the transportation infrastructure available for completed projects; the local match and local participation obtained; the number of delinquent loans; and the number of project terminations. The evaluations may also include additional performance measures and recommendations for programmatic changes.
     (2)(((a) By September 1st of each even-numbered year, the board shall forward its draft evaluation to the Washington state economic development commission for review and comment, as required in section 10 of this act. The board shall provide any additional information as may be requested by the commission for the purpose of its review.
     (b) Any written comments or recommendations provided by the commission as a result of its review shall be included in the board's completed evaluation.)) The evaluation must be presented to the governor and appropriate committees of the legislature by December 31st of each even-numbered year. The initial evaluation must be submitted by December 31, 2010.

Sec. 110   RCW 43.330.050 and 2005 c 136 s 12 are each amended to read as follows:
     The department shall be responsible for promoting community and economic development within the state by assisting the state's communities to increase the quality of life of their citizens and their economic vitality, and by assisting the state's businesses to maintain and increase their economic competitiveness, while maintaining a healthy environment. Community and economic development efforts shall include: Efforts to increase economic opportunity; local planning to manage growth; the promotion and provision of affordable housing and housing-related services; providing public infrastructure; business and trade development; assisting firms and industrial sectors to increase their competitiveness; fostering the development of minority and women-owned businesses; facilitating technology development, transfer, and diffusion; community services and advocacy for low-income persons; and public safety efforts. The department shall have the following general functions and responsibilities:
     (1) Provide advisory assistance to the governor, other state agencies, and the legislature on community and economic development matters and issues;
     (2) Assist the governor in coordinating the activities of state agencies that have an impact on local government and communities;
     (3) Cooperate with ((the Washington state economic development commission,)) the legislature((,)) and the governor in the development and implementation of strategic plans for the state's community and economic development efforts;
     (4) Solicit private and federal grants for economic and community development programs and administer such programs in conjunction with other programs assigned to the department by the governor or the legislature;
     (5) Cooperate with and provide technical and financial assistance to local governments, businesses, and community-based organizations serving the communities of the state for the purpose of aiding and encouraging orderly, productive, and coordinated development of the state, and, unless stipulated otherwise, give additional consideration to local communities and individuals with the greatest relative need and the fewest resources;
     (6) Participate with other states or subdivisions thereof in interstate programs and assist cities, counties, municipal corporations, governmental conferences or councils, and regional planning commissions to participate with other states and provinces or their subdivisions;
     (7) Hold public hearings and meetings to carry out the purposes of this chapter;
     (8) Conduct research and analysis in furtherance of the state's economic and community development efforts including maintenance of current information on market, demographic, and economic trends as they affect different industrial sectors, geographic regions, and communities with special economic and social problems in the state; and
     (9) Develop a schedule of fees for services where appropriate.

Sec. 111   RCW 43.330.080 and 2012 c 195 s 1 are each amended to read as follows:
     (1)(a) The department must contract with county-designated associate development organizations to increase the support for and coordination of community and economic development services in communities or regional areas. The contracting organizations in each community or regional area must:
     (i) Be broadly representative of community and economic interests;
     (ii) Be capable of identifying key economic and community development problems, developing appropriate solutions, and mobilizing broad support for recommended initiatives;
     (iii) Work closely with the department to carry out state-identified economic development priorities;
     (iv) Work with and include local governments, local chambers of commerce, workforce development councils, port districts, labor groups, institutions of higher education, community action programs, and other appropriate private, public, or nonprofit community and economic development groups; and
     (v) Meet and share best practices with other associate development organizations at least two times each year.
     (b) The scope of services delivered under the contracts required in (a) of this subsection must include two broad areas of work:
     (i) Direct assistance, including business planning, to companies throughout the county who need support to stay in business, expand, or relocate to Washington from out of state or other countries. Assistance must comply with business recruitment and retention protocols established in RCW 43.330.062, and includes:
     (A) Working with the appropriate partners throughout the county including, but not limited to, local governments, workforce development councils, port districts, community and technical colleges and higher education institutions, export assistance providers, impact Washington, the Washington state quality award council, small business assistance programs, innovation partnership zones, and other federal, state, and local programs to facilitate the alignment of planning efforts and the seamless delivery of business support services within the entire county;
     (B) Providing information on state and local permitting processes, tax issues, export assistance, and other essential information for operating, expanding, or locating a business in Washington;
     (C) Marketing Washington and local areas as excellent locations to expand or relocate a business and positioning Washington as a globally competitive place to grow business, which may include developing and executing regional plans to attract companies from out of state;
     (D) Working with businesses on site location and selection assistance;
     (E) Providing business retention and expansion services throughout the county. Such services must include, but are not limited to, business outreach and monitoring efforts to identify and address challenges and opportunities faced by businesses, assistance to trade impacted businesses in applying for grants from the federal trade adjustment assistance for firms program, and the provision of information to businesses on:
     (I) Resources available for microenterprise development;
     (II) Resources available on the revitalization of commercial districts; and
     (III) The opportunity to maintain jobs through shared work programs authorized under chapter 50.60 RCW;
     (F) Participating in economic development system-wide discussions regarding gaps in business start-up assistance in Washington;
     (G) Providing or facilitating the provision of export assistance through workshops or one-on-one assistance; and
     (H) Using a web-based information system to track data on business recruitment, retention, expansion, and trade; and
     (ii) Support for regional economic research and regional planning efforts to implement target industry sector strategies and other economic development strategies, including cluster-based strategies. Research and planning efforts should support increased living standards and increased foreign direct investment, and be aligned with the statewide economic development strategy. Regional associate development organizations retain their independence to address local concerns and goals. Activities include:
     (A) Participating in regional planning efforts with workforce development councils involving coordinated strategies around workforce development and economic development policies and programs. Coordinated planning efforts must include, but not be limited to, assistance to industry clusters in the region;
     (B) Participating with the state board for community and technical colleges as created in RCW 28B.50.050, and any community and technical colleges in the coordination of the job skills training program and the customized training program within its region;
     (C) Collecting and reporting data as specified by the contract with the department for statewide systemic analysis. ((The department must consult with the Washington state economic development commission in the establishment of such uniform data as is needed to conduct a statewide systemic analysis of the state's economic development programs and expenditures.)) In cooperation with other local, regional, and state planning efforts, contracting organizations may provide insight into the needs of target industry clusters, business expansion plans, early detection of potential relocations or layoffs, training needs, and other appropriate economic information;
     (D) In conjunction with other governmental jurisdictions and institutions, ((participate [participating])) participating in the development of a countywide economic development plan((, consistent with the state comprehensive plan for economic development developed by the Washington state economic development commission)).
     (2) The department must provide business services training to the contracting organizations, including but not limited to:
     (a) Training in the fundamentals of export assistance and the services available from private and public export assistance providers in the state; and
     (b) Training in the provision of business retention and expansion services as required by subsection (1)(b)(i)(E) of this section.

Sec. 112   RCW 43.330.082 and 2012 c 195 s 2 are each amended to read as follows:
     (1)(a) Contracting associate development organizations must provide the department with measures of their performance and a summary of best practices shared and implemented by the contracting organizations. Annual reports must include the following information to show the contracting organization's impact on employment and overall changes in employment: Current employment and economic information for the community or regional area produced by the employment security department; the net change from the previous year's employment and economic information using data produced by the employment security department; other relevant information on the community or regional area; the amount of funds received by the contracting organization through its contract with the department; the amount of funds received by the contracting organization((s)) through all sources; and the contracting organization's impact on employment through all funding sources. Annual reports may include the impact of the contracting organization on wages, exports, tax revenue, small business creation, foreign direct investment, business relocations, expansions, terminations, and capital investment. Data must be input into a common web-based business information system managed by the department. Specific measures, data standards, and data definitions must be developed in the contracting process between the department((, the economic development commission,)) and the contracting organization every two years. Except as provided in (b) of this subsection, performance measures should be consistent across regions to allow for statewide evaluation.
     (b) In addition to the measures required in (a) of this subsection, contracting associate development organizations in counties with a population greater than one million five hundred thousand persons must include the following measures in reports to the department:
     (i) The number of small businesses that received retention and expansion services, and the outcome of those services;
     (ii) The number of businesses located outside of the boundaries of the largest city within the contracting associate development organization's region that received recruitment, retention, and expansion services, and the outcome of those services.
     (2)(a) The department and contracting associate development organizations must agree upon specific target levels for the performance measures in subsection (1) of this section. Comparison of agreed thresholds and actual performance must occur annually.
     (b) Contracting organizations that fail to achieve the agreed performance targets in more than one-half of the agreed measures must develop remediation plans to address performance gaps. The remediation plans must include revised performance thresholds specifically chosen to provide evidence of progress in making the identified service changes.
     (c) Contracts and state funding must be terminated for one year for organizations that fail to achieve the agreed upon progress toward improved performance defined under (b) of this subsection. During the year in which termination for nonperformance is in effect, organizations must review alternative delivery strategies to include reorganization of the contracting organization, merging of previous efforts with existing regional partners, and other specific steps toward improved performance. At the end of the period of termination, the department may contract with the associate development organization or its successor as it deems appropriate.
     (3) The department must submit ((a preliminary report to the Washington economic development commission by September 1st of each even-numbered year, and)) a final report to the legislature ((and the Washington economic development commission)) by December 31st of each even-numbered year on the performance results of the contracts with associate development organizations.
     (((4) Contracting associate development organizations must provide the Washington state economic development commission with information to be used in the comprehensive statewide economic development strategy and progress report due under RCW 43.162.020, by the date determined by the commission.))

Sec. 113   RCW 43.330.090 and 2012 c 198 s 3 are each amended to read as follows:
     (1) The department shall work with private sector organizations, industry and sector associations, federal agencies, state agencies that use a sector-based approach to service delivery, local governments, local associate development organizations, and higher education and training institutions in the development of industry sector-based strategies to diversify the economy, facilitate technology transfer and diffusion, and increase value-added production. The industry sectors targeted by the department may include, but are not limited to, aerospace, agriculture, food processing, forest products, marine services, health and biomedical, software, digital and interactive media, transportation and distribution, and microelectronics. The department shall, on a continuing basis, evaluate the potential return to the state from devoting additional resources to an industry sector-based approach to economic development and identifying and assisting additional sectors.
     (2) The department's sector-based strategies shall include, but not be limited to, cluster-based strategies that focus on assisting regional industry sectors and related firms and institutions that meet the definition of an industry cluster in this section and based on criteria identified by the working group established in this chapter.
     (3)(a) The department shall promote, market, and encourage growth in the production of films and videos, as well as television commercials within the state; to this end the department is directed to assist in the location of a film and video production studio within the state.
     (b) The department may, in carrying out its efforts to encourage film and video production in the state, solicit and receive gifts, grants, funds, fees, and endowments, in trust or otherwise, from tribal, local, or other governmental entities, as well as private sources, and may expend the same or any income therefrom for the encouragement of film and video production. All revenue received for such purposes shall be deposited into the general fund.
     (4) In assisting in the development of regional and statewide industry cluster-based strategies, the department's activities shall include, but are not limited to:
     (a) Facilitating regional focus group discussions and conducting studies to identify industry clusters, appraise the current information linkages within a cluster, and identify issues of common concern within a cluster;
     (b) Supporting industry and cluster associations, publications of association and cluster directories, and related efforts to create or expand the activities of industry and cluster associations;
     (c) Administering a competitive grant program to fund economic development activities designed to further regional cluster growth. In administering the program, the department shall work with ((the economic development commission,)) the workforce training and education coordinating board, the state board for community and technical colleges, the employment security department, business, and labor.
     (i) The department shall seek recommendations on criteria for evaluating applications for grant funds and recommend applicants for receipt of grant funds. Criteria shall include not duplicating the purpose or efforts of industry skill panels.
     (ii) Applicants must include organizations from at least two counties and participants from the local business community. Eligible organizations include, but are not limited to, local governments, economic development councils, chambers of commerce, federally recognized Indian tribes, workforce development councils, and educational institutions.
     (iii) Applications must evidence financial participation of the partner organizations.
     (iv) Eligible activities include the formation of cluster economic development partnerships, research and analysis of economic development needs of the cluster, the development of a plan to meet the economic development needs of the cluster, and activities to implement the plan.
     (v) Priority shall be given to applicants that complement industry skill panels and will use the grant funds to build linkages and joint projects.
     (vi) The maximum amount of a grant is one hundred thousand dollars.
     (vii) A maximum of one hundred thousand dollars total can go to King, Pierce, Kitsap, and Snohomish counties combined.
     (viii) No more than ten percent of funds received for the grant program may be used by the department for administrative costs.
     (5) As used in this chapter, "industry cluster" means a geographic concentration of interconnected companies in a single industry, related businesses in other industries, including suppliers and customers, and associated institutions, including government and education.

Sec. 114   RCW 43.330.250 and 2011 1st sp.s. c 50 s 956 are each amended to read as follows:
     (1) The economic development strategic reserve account is created in the state treasury to be used only for the purposes of this section.
     (2) Only the governor, with the recommendation of the director of the department of commerce ((and the economic development commission)), may authorize expenditures from the account.
     (3) ((Expenditures from the account shall be made in an amount sufficient to fund a minimum of one staff position for the economic development commission and to cover any other operational costs of the commission.
     (4))) During the 2009-2011 and 2011-2013 fiscal biennia, moneys in the account may also be transferred into the state general fund.
     (((5))) (4) Expenditures from the account may be made to prevent closure of a business or facility, to prevent relocation of a business or facility in the state to a location outside the state, or to recruit a business or facility to the state. Expenditures may be authorized for:
     (a) Workforce development;
     (b) Public infrastructure needed to support or sustain the operations of the business or facility; and
     (c) Other lawfully provided assistance, including, but not limited to, technical assistance, environmental analysis, relocation assistance, and planning assistance. Funding may be provided for such assistance only when it is in the public interest and may only be provided under a contractual arrangement ensuring that the state will receive appropriate consideration, such as an assurance of job creation or retention.
     (((6))) (5) The funds shall not be expended from the account unless:
     (a) The circumstances are such that time does not permit the director of the department of commerce or the business or facility to secure funding from other state sources;
     (b) The business or facility produces or will produce significant long-term economic benefits to the state, a region of the state, or a particular community in the state;
     (c) The business or facility does not require continuing state support;
     (d) The expenditure will result in new jobs, job retention, or higher incomes for citizens of the state;
     (e) The expenditure will not supplant private investment; and
     (f) The expenditure is accompanied by private investment.
     (((7))) (6) No more than three million dollars per year may be expended from the account for the purpose of assisting an individual business or facility pursuant to the authority specified in this section.
     (((8))) (7) If the account balance in the strategic reserve account exceeds fifteen million dollars at any time, the amount in excess of fifteen million dollars shall be transferred to the education construction account.

Sec. 115   RCW 43.330.270 and 2012 c 225 s 1 are each amended to read as follows:
     (1) The department must design and implement an innovation partnership zone program through which the state will encourage and support research institutions, workforce training organizations, and globally competitive companies to work cooperatively in close geographic proximity to create commercially viable products and jobs.
     (2) The director must designate innovation partnership zones on the basis of the following criteria:
     (a) Innovation partnership zones must have three types of institutions operating within their boundaries, or show evidence of planning and local partnerships that will lead to dense concentrations of these institutions:
     (i) Research capacity in the form of a university or community college fostering commercially valuable research, nonprofit institutions creating commercially applicable innovations, or a national laboratory;
     (ii) An industry cluster as defined in RCW 43.330.090. The cluster must include a dense proximity of globally competitive firms in a research-based industry or industries or individual firms with innovation strategies linked to (a)(i) of this subsection. A globally competitive firm may be signified through international organization for standardization 9000 or 1400 certification, or evidence of sales in international markets; and
     (iii) Training capacity either within the zone or readily accessible to the zone. The training capacity requirement may be met by the same institution as the research capacity requirement, to the extent both are associated with an educational institution in the proposed zone.
     (b) The support of a local jurisdiction, a research institution, an educational institution, an industry or cluster association, a workforce development council, and an associate development organization, port, or chamber of commerce;
     (c) Identifiable boundaries for the zone within which the applicant will concentrate efforts to connect innovative researchers, entrepreneurs, investors, industry associations or clusters, and training providers. The geographic area defined should lend itself to a distinct identity and have the capacity to accommodate firm growth;
     (d) The innovation partnership zone administrator must be an economic development council, port, workforce development council, city, or county.
     (3) With respect solely to the research capacity required in subsection (2)(a)(i) of this section, the director may waive the requirement that the research institution be located within the zone. To be considered for such a waiver, an applicant must provide a specific plan that demonstrates the research institution's unique qualifications and suitability for the zone, and the types of jointly executed activities that will be used to ensure ongoing, face-to-face interaction and research collaboration among the zone's partners.
     (4) On October 1st of each odd-numbered year, the director must designate innovation partnership zones on the basis of applications that meet the legislative criteria, estimated economic impact of the zone, evidence of forward planning for the zone, and other criteria as developed by the department ((in consultation with the Washington state economic development commission)). Estimated economic impact must include evidence of anticipated private investment, job creation, innovation, and commercialization. The director must require evidence that zone applicants will promote commercialization, innovation, and collaboration among zone residents.
     (5) Innovation partnership zones are eligible for funds and other resources as provided by the legislature or at the discretion of the governor.
     (6) If the innovation partnership zone meets the other requirements of the fund sources, then the zone is eligible for the following funds relating to:
     (a) The local infrastructure financing tools program;
     (b) The sales and use tax for public facilities in rural counties;
     (c) Job skills;
     (d) Local improvement districts; and
     (e) Community economic revitalization board projects under chapter 43.160 RCW.
     (7) An innovation partnership zone must be designated as a zone for a four-year period. At the end of the four-year period, the zone must reapply for the designation through the department.
     (8) If the director finds that an applicant does not meet all of the statutory criteria or additional criteria recommended by the department ((in consultation with the Washington state economic development commission)) to be designated as an innovation partnership zone, the department must:
     (a) Identify the deficiencies in the proposal and recommended steps for the applicant to take to strengthen the proposal;
     (b) Provide the applicant with the opportunity to appeal the decision to the director; and
     (c) Allow the applicant to reapply for innovation partnership designation on October 1st of the following calendar year or during any subsequent application cycle.
     (9) If the director finds at any time after the initial year of designation that an innovation partnership zone is failing to meet the performance standards required in its contract with the department, the director may withdraw such designation and cease state funding of the zone.
     (10) The department must convene annual information sharing events for innovation partnership zone administrators and other interested parties.
     (11) An innovation partnership zone must annually provide performance measures as required by the director, including but not limited to private investment measures, job creation measures, and measures of innovation such as licensing of ideas in research institutions, patents, or other recognized measures of innovation.
     (12) The department must compile a biennial report on the innovation partnership zone program by December 1st of every even- numbered year. The report must provide information for each zone on its: Objectives; funding, tax incentives, and other support obtained from public sector sources; major activities; partnerships; performance measures; and outcomes achieved since the inception of the zone or since the previous biennial report. ((The Washington state economic development commission must review the department's draft report and make recommendations on ways to increase the effectiveness of individual zones and the program overall.)) The department must submit the report((, including the commission's recommendations,)) to the governor and legislature beginning December 1, 2010.

Sec. 116   RCW 43.330.280 and 2012 c 229 s 708 are each amended to read as follows:
     (1) The ((Washington state economic development commission)) department shall((, with the advice of an innovation partnership advisory group selected by the commission: (a) Provide information and advice to the department of commerce to assist in the implementation of the innovation partnership zone program, including criteria to be used in the selection of grant applicants for funding;
     (b))) document clusters of companies throughout the state that have comparative competitive advantage or the potential for comparative competitive advantage, using the process and criteria for identifying strategic clusters developed by the working group specified in subsection (2) of this section((;
     (c) Conduct an innovation opportunity analysis to identify (i) the strongest current intellectual assets and research teams in the state focused on emerging technologies and their commercialization, and (ii) faculty and researchers that could increase their focus on commercialization of technology if provided the appropriate technical assistance and resources;
     (d) Based on its findings and analysis, and in conjunction with the research institutions:
     (i) Develop a plan to build on existing, and develop new, intellectual assets and innovation research teams in the state in research areas where there is a high potential to commercialize technologies. The commission shall present the plan to the governor and legislature by December 31, 2009. The publicly funded research institutions in the state shall be responsible for implementing the plan. The plan shall address the following elements and such other elements as the commission deems important:
     (A) Specific mechanisms to support, enhance, or develop innovation research teams and strengthen their research and commercialization capacity in areas identified as useful to strategic clusters and innovative firms in the state;
     (B) Identification of the funding necessary for laboratory infrastructure needed to house innovation research teams;
     (C) Specification of the most promising research areas meriting enhanced resources and recruitment of significant entrepreneurial researchers to join or lead innovation research teams;
     (D) The most productive approaches to take in the recruitment, in the identified promising research areas, of a minimum of ten significant entrepreneurial researchers over the next ten years to join or lead innovation research teams;
     (E) Steps to take in solicitation of private sector support for the recruitment of entrepreneurial researchers and the commercialization activity of innovation research teams; and
     (F) Mechanisms for ensuring the location of innovation research teams in innovation partnership zones;
     (ii) Provide direction for the development of comprehensive entrepreneurial assistance programs at research institutions. The programs may involve multidisciplinary students, faculty, entrepreneurial researchers, entrepreneurs, and investors in building business models and evolving business plans around innovative ideas. The programs may provide technical assistance and the support of an entrepreneur-in-residence to innovation research teams and offer entrepreneurial training to faculty, researchers, undergraduates, and graduate students. Curriculum leading to a certificate in entrepreneurship may also be offered;
     (e) Develop performance measures to be used in evaluating the performance of innovation research teams, the implementation of the plan and programs under (d)(i) and (ii) of this subsection, and the performance of innovation partnership zone grant recipients, including but not limited to private investment measures, business initiation measures, job creation measures, and measures of innovation such as licensing of ideas in research institutions, patents, or other recognized measures of innovation. The performance measures developed shall be consistent with the economic development commission's comprehensive plan for economic development and its standards and metrics for program evaluation. The commission shall report to the legislature and the governor by June 30, 2009, on the measures developed; and
     (f) Using the performance measures developed, perform a biennial assessment and report, the first of which shall be due December 31, 2012, on:
     (i) Commercialization of technologies developed at state universities, found at other research institutions in the state, and facilitated with public assistance at existing companies;
     (ii) Outcomes of the funding of innovation research teams and recruitment of significant entrepreneurial researchers;
     (iii) Comparison with other states of Washington's outcomes from the innovation research teams and efforts to recruit significant entrepreneurial researchers; and
     (iv) Outcomes of the grants for innovation partnership zones. The report shall include recommendations for modifications of chapter 227, Laws of 2007 and of state commercialization efforts that would enhance the state's economic competitiveness)).
     (2) The ((economic development commission)) department and the workforce training and education coordinating board shall jointly convene a working group to:
     (a) Specify the process and criteria for identification of substate geographic concentrations of firms or employment in an industry and the industry's customers, suppliers, supporting businesses, and institutions, which process will include the use of labor market information from the employment security department and local labor markets; and
     (b) Establish criteria for identifying strategic clusters which are important to economic prosperity in the state, considering cluster size, growth rate, and wage levels among other factors.

Sec. 117   RCW 43.330.310 and 2012 c 229 s 590 and 2012 c 198 s 12 are each reenacted and amended to read as follows:
     (1) The legislature establishes a comprehensive green economy jobs growth initiative based on the goal of, by 2020, increasing the number of green economy jobs to twenty-five thousand from the eight thousand four hundred green economy jobs the state had in 2004.
     (2) The department, in consultation with the employment security department, the state workforce training and education coordinating board, and the state board for community and technical colleges, shall develop a defined list of terms, consistent with current workforce and economic development terms, associated with green economy industries and jobs.
     (3)(a) The employment security department, in consultation with the department, the state workforce training and education coordinating board, the state board for community and technical colleges, Washington State University small business development center, and the Washington State University extension energy program, shall conduct labor market research to analyze the current labor market and projected job growth in the green economy, the current and projected recruitment and skill requirement of green economy industry employers, the wage and benefits ranges of jobs within green economy industries, and the education and training requirements of entry-level and incumbent workers in those industries.
     (i) The employment security department shall conduct an analysis of occupations in the forest products industry to: (A) Determine key growth factors and employment projections in the industry; and (B) define the education and skill standards required for current and emerging green occupations in the industry.
     (ii) The term "forest products industry" must be given a broad interpretation when implementing (a)(i) of this subsection and includes, but is not limited to, businesses that grow, manage, harvest, transport, and process forest, wood, and paper products.
     (b) The University of Washington business and economic development center shall: Analyze the current opportunities for and participation in the green economy by minority and women-owned business enterprises in Washington; identify existing barriers to their successful participation in the green economy; and develop strategies with specific policy recommendations to improve their successful participation in the green economy. The research may be informed by the research of the Puget Sound regional council prosperity partnership, as well as other entities. The University of Washington business and economic development center shall report to the appropriate committees of the house of representatives and the senate on their research, analysis, and recommendations by December 1, 2008.
     (4) Based on the findings from subsection (3) of this section, the employment security department, in consultation with the department and taking into account the requirements and goals of chapter 14, Laws of 2008 and other state clean energy and energy efficiency policies, shall propose which industries will be considered high-demand green industries, based on current and projected job creation and their strategic importance to the development of the state's green economy. The employment security department and the department shall take into account which jobs within green economy industries will be considered high-wage occupations and occupations that are part of career pathways to the same, based on family-sustaining wage and benefits ranges. These designations, and the results of the employment security department's broader labor market research, shall inform the planning and strategic direction of the department, the state workforce training and education coordinating board, and the state board for community and technical colleges.
     (5) The department shall identify emerging technologies and innovations that are likely to contribute to advancements in the green economy, including the activities in designated innovation partnership zones established in RCW 43.330.270.
     (6) The department((, consistent with the priorities established by the state economic development commission,)) shall:
     (a) Develop targeting criteria for existing investments, and make recommendations for new or expanded financial incentives and comprehensive strategies, to recruit, retain, and expand green economy industries and small businesses; and
     (b) Make recommendations for new or expanded financial incentives and comprehensive strategies to stimulate research and development of green technology and innovation, including designating innovation partnership zones linked to the green economy.
     (7) For the purposes of this section, "target populations" means (a) entry-level or incumbent workers in high-demand green industries who are in, or are preparing for, high-wage occupations; (b) dislocated workers in declining industries who may be retrained for high-wage occupations in high-demand green industries; (c) dislocated agriculture, timber, or energy sector workers who may be retrained for high-wage occupations in high-demand green industries; (d) eligible veterans or national guard members; (e) disadvantaged populations; or (f) anyone eligible to participate in the state opportunity grant program under RCW 28B.50.271.
     (8) The legislature directs the state workforce training and education coordinating board to create and pilot green industry skill panels. These panels shall consist of business representatives from: Green industry sectors, including but not limited to forest product companies, companies engaged in energy efficiency and renewable energy production, companies engaged in pollution prevention, reduction, and mitigation, and companies engaged in green building work and green transportation; labor unions representing workers in those industries or labor affiliates administering state-approved, joint apprenticeship programs or labor-management partnership programs that train workers for these industries; state and local veterans agencies; employer associations; educational institutions; and local workforce development councils within the region that the panels propose to operate; and other key stakeholders as determined by the applicant. Any of these stakeholder organizations are eligible to receive grants under this section and serve as the intermediary that convenes and leads the panel. Panel applicants must provide labor market and industry analysis that demonstrates high demand, or demand of strategic importance to the development of the state's clean energy economy as identified in this section, for high-wage occupations, or occupations that are part of career pathways to the same, within the relevant industry sector. The panel shall:
     (a) Conduct labor market and industry analyses, in consultation with the employment security department, and drawing on the findings of its research when available;
     (b) Plan strategies to meet the recruitment and training needs of the industry and small businesses; and
     (c) Leverage and align other public and private funding sources.

Sec. 118   RCW 43.330.375 and 2012 c 229 s 591 are each amended to read as follows:
     (1) The department and the workforce board must:
     (a) Coordinate efforts across the state to ensure that federal training and education funds are captured and deployed in a focused and effective manner in order to support green economy projects and accomplish the goals of the evergreen jobs initiative;
     (b) Accelerate and coordinate efforts by state and local organizations to identify, apply for, and secure all sources of funds, particularly those created by the 2009 American recovery and reinvestment act, and to ensure that distributions of funding to local organizations are allocated in a manner that is time-efficient and user-friendly for the local organizations. Local organizations eligible to receive support include but are not limited to:
     (i) Associate development organizations;
     (ii) Workforce development councils;
     (iii) Public utility districts; and
     (iv) Community action agencies;
     (c) Support green economy projects at both the state and local level by developing a process and a framework to provide, at a minimum:
     (i) Administrative and technical assistance;
     (ii) Assistance with and expediting of permit processes; and
     (iii) Priority consideration of opportunities leading to exportable green economy goods and services, including renewable energy technology;
     (d) Coordinate local and state implementation of projects using federal funds to ensure implementation is time-efficient and user-friendly for local organizations;
     (e) Emphasize through both support and outreach efforts, projects that:
     (i) Have a strong and lasting economic or environmental impact;
     (ii) Lead to a domestically or internationally exportable good or service, including renewable energy technology;
     (iii) Create training programs leading to a credential, certificate, or degree in a green economy field;
     (iv) Strengthen the state's competitiveness in a particular sector or cluster of the green economy;
     (v) Create employment opportunities for veterans, members of the national guard, and low-income and disadvantaged populations;
     (vi) Comply with prevailing wage provisions of chapter 39.12 RCW;
     (vii) Ensure at least fifteen percent of labor hours are performed by apprentices;
     (f) Identify emerging technologies and innovations that are likely to contribute to advancements in the green economy, including the activities in designated innovation partnership zones established in RCW 43.330.270;
     (g) Identify barriers to the growth of green jobs in traditional industries such as the forest products industry;
     (h) Identify statewide performance metrics for projects receiving agency assistance. Such metrics may include:
     (i) The number of new green jobs created each year, their wage levels, and, to the extent determinable, the percentage of new green jobs filled by veterans, members of the national guard, and low-income and disadvantaged populations;
     (ii) The total amount of new federal funding secured, the respective amounts allocated to the state and local levels, and the timeliness of deployment of new funding by state agencies to the local level;
     (iii) The timeliness of state deployment of funds and support to local organizations; and
     (iv) If available, the completion rates, time to completion, and training-related placement rates for green economy postsecondary training programs;
     (i) Identify strategies to allocate existing and new funding streams for green economy workforce training programs and education to emphasize those leading to a credential, certificate, or degree in a green economy field;
     (j) Identify and implement strategies to allocate existing and new funding streams for workforce development councils and associate development organizations to increase their effectiveness and efficiency and increase local capacity to respond rapidly and comprehensively to opportunities to attract green jobs to local communities;
     (k) Develop targeting criteria for existing investments that are consistent with ((the economic development commission's economic development strategy and)) the goals of this section and RCW 28C.18.170, 28B.50.281, and 49.04.200; and
     (l) Make and support outreach efforts so that residents of Washington, particularly members of target populations, become aware of educational and employment opportunities identified and funded through the evergreen jobs act.
     (2) The department and the workforce board must provide semiannual performance reports to the governor and appropriate committees of the legislature on:
     (a) Actual statewide performance based on the performance measures identified in subsection (1)(h) of this section;
     (b) How the state is emphasizing and supporting projects that lead to a domestically or internationally exportable good or service, including renewable energy technology;
     (c) A list of projects supported, created, or funded in furtherance of the goals of the evergreen jobs initiative and the actions taken by state and local organizations, including the effectiveness of state agency support provided to local organizations as directed in subsection (1)(b) and (c) of this section;
     (d) Recommendations for new or expanded financial incentives and comprehensive strategies to:
     (i) Recruit, retain, and expand green economy industries and small businesses; and
     (ii) Stimulate research and development of green technology and innovation, which may include designating innovation partnership zones linked to the green economy;
     (e) Any information that associate development organizations and workforce development councils choose to provide to appropriate legislative committees regarding the effectiveness, timeliness, and coordination of support provided by state agencies under this section and RCW 28C.18.170, 28B.50.281, and 49.04.200; and
     (f) Any recommended statutory changes necessary to increase the effectiveness of the evergreen jobs initiative and state responsiveness to local agencies and organizations.
     (3) The definitions, designations, and results of the employment security department's broader labor market research under RCW 43.330.010 shall inform the planning and strategic direction of the department, the state workforce training and education coordinating board, the state board for community and technical colleges, and the student achievement council.

Sec. 119   RCW 50.38.050 and 2009 c 151 s 2 are each amended to read as follows:
     The department shall have the following duties:
     (1) Oversight and management of a statewide comprehensive labor market and occupational supply and demand information system, including development of a five-year employment forecast for state and labor market areas;
     (2) Produce local labor market information packages for the state's counties, including special studies and job impact analyses in support of state and local employment, training, education, and job creation programs, especially activities that prevent job loss, reduce unemployment, and create jobs;
     (3) Coordinate with the office of financial management and the office of the forecast council to improve employment estimates by enhancing data on corporate officers, improving business establishment listings, expanding sample for employment estimates, and developing business entry/exit analysis relevant to the generation of occupational and economic forecasts;
     (4) In cooperation with the office of financial management, produce long-term industry and occupational employment forecasts. These forecasts shall be consistent with the official economic and revenue forecast council biennial economic and revenue forecasts; and
     (5) Analyze labor market and economic data, including the use of input-output models, for the purpose of identifying industry clusters and strategic industry clusters that meet the criteria identified by the working group convened by the ((economic development commission)) department of commerce and the workforce training and education coordinating board under chapter 43.330 RCW.

Sec. 120   RCW 82.14.505 and 2010 c 164 s 8 are each amended to read as follows:
     (1) Demonstration projects are designated to determine the feasibility of local revitalization financing. For the purpose of this section, "annual state contribution limit" means four million two hundred thousand dollars statewide per fiscal year.
     (a) Notwithstanding RCW 39.104.100, the department must approve each demonstration project for 2009 as follows:
     (i) The Whitman county Pullman/Moscow corridor improvement project award may not exceed two hundred thousand dollars;
     (ii) The University Place improvement project award may not exceed five hundred thousand dollars;
     (iii) The Tacoma international financial services area/Tacoma dome project award may not exceed five hundred thousand dollars;
     (iv) The Bremerton downtown improvement project award may not exceed three hundred thirty thousand dollars;
     (v) The Auburn downtown redevelopment project award may not exceed two hundred fifty thousand dollars;
     (vi) The Vancouver Columbia waterfront/downtown project award may not exceed two hundred twenty thousand dollars; and
     (vii) The Spokane University District project award may not exceed two hundred fifty thousand dollars.
     (b) Notwithstanding RCW 39.104.100, the department must approve each demonstration project for 2010 meeting the requirements in subsection (2)(c) of this section as follows:
     (i) The Richland revitalization area for industry, science and education project award may not exceed three hundred thirty thousand dollars;
     (ii) The Lacey gateway town center project award may not exceed five hundred thousand dollars;
     (iii) The Mill Creek east gateway planned urban village revitalization area project award may not exceed three hundred thirty thousand dollars;
     (iv) The Puyallup river road revitalization area project award may not exceed two hundred fifty thousand dollars;
     (v) The Renton south Lake Washington project award may not exceed five hundred thousand dollars; and
     (vi) The New Castle downtown project (([award])) award may not exceed forty thousand dollars.
     (2)(a) Local government sponsors of demonstration projects under subsection (1)(a) of this section must submit to the department no later than September 1, 2009, documentation that substantiates that the project has met the conditions, limitations, and requirements provided in chapter 270, Laws of 2009.
     (b) Sponsoring local government of demonstration projects under subsection (1)(b) of this section must update and resubmit to the department no later than September 1, 2010, the application already on file with the department to substantiate that the project has met the conditions, limitations, and requirements provided in chapter 270, Laws of 2009 and chapter 164, Laws of 2010 and the project is substantially the same as the project in the original application submitted to the department in 2009.
     (c) The department must not approve any resubmitted application unless an economic analysis by a qualified researcher at the department of economics at the University of Washington confirms that there is an eighty-five percent probability that the application's assumptions and estimates of jobs created and increased tax receipts will be achieved by the project and determines that net state tax revenue will increase as a result of the project by an amount that equals or exceeds the award authorized in subsection (1)(b) of this section. ((Prior to submitting the economic analysis to the department, the qualified researcher must consult with the economic development commission established in chapter 43.162 RCW regarding his or her preliminary findings. The final economic analysis must include comments and recommendations of the economic development commission.))
     (3) Within ninety days of such submittal, the economic analysis in subsection (2)(c) of this section must be completed and the department must either approve demonstration projects that have met these conditions, limitations, and requirements or deny resubmitted applications that have not met these conditions, limitations, and requirements.
     (4) Local government sponsors of demonstration projects may elect to decline the project awards as designated in this section, and may elect instead to submit applications according to the process described in RCW 39.104.100.
     (5) If a demonstration project listed in subsection (1)(b) of this section does not update and resubmit its application to the department by the deadline specified in subsection (2)(b) of this section or if the demonstration project withdraws its application, the associated dollar amounts may not be approved for another project and may not be considered part of the annual state contribution limit under RCW 39.104.020(1).

Sec. 121   RCW 82.33A.010 and 2007 c 232 s 8 are each amended to read as follows:
     (1) The economic climate council is hereby created.
     (2) The council shall((, in consultation with the Washington economic development commission,)) select a series of benchmarks that characterize the competitive environment of the state. The benchmarks should be indicators of the cost of doing business; the education and skills of the workforce; a sound infrastructure; and the quality of life. In selecting the appropriate benchmarks, the council shall use the following criteria:
     (a) The availability of comparative information for other states and countries;
     (b) The timeliness with which benchmark information can be obtained; and
     (c) The accuracy and validity of the benchmarks in measuring the economic climate indicators named in this section.
     (3) Each year the council shall prepare an official state economic climate report on the present status of benchmarks, changes in the benchmarks since the previous report, and the reasons for the changes. The reports shall include current benchmark comparisons with other states and countries, and an analysis of factors related to the benchmarks that may affect the ability of the state to compete economically at the national and international level.
     (4) All agencies of state government shall provide to the council immediate access to all information relating to economic climate reports.

Sec. 122   RCW 43.131.418 and 2012 c 242 s 4 are each amended to read as follows:
     The following acts or parts of acts, as now existing or hereafter amended, are each repealed, effective July 1, 2016:
     (1) RCW 28B.155.010 and 2013 c ... s 2 (section 102 of this act) and 2012 c 242 s 1; and
     (2) RCW 28B.155.020 and 2012 c 242 s 2.

NEW SECTION.  Sec. 123   The following acts or parts of acts are each repealed:
     (1) RCW 43.162.005 (Findings -- Intent) and 2011 c 311 s 1, 2007 c 232 s 1, & 2003 c 235 s 1;
     (2) RCW 43.162.010 (Washington state economic development commission -- Membership -- Policies and procedures) and 2011 c 311 s 2, 2007 c 232 s 2, & 2003 c 235 s 2;
     (3) RCW 43.162.012 ("Commission" defined) and 2011 c 311 s 3;
     (4) RCW 43.162.015 (Executive director) and 2011 c 311 s 4 & 2007 c 232 s 3;
     (5) RCW 43.162.020 (Duties -- Biennial comprehensive statewide economic development strategy -- Report -- Biennial budget request--Memorandum of understanding -- Performance evaluation -- Gifts, grants, donations) and 2012 c 195 s 3, 2011 c 311 s 5, 2009 c 151 s 9, 2007 c 232 s 4, & 2003 c 235 s 3;
     (6) RCW 43.162.025 (Additional authority) and 2011 c 311 s 6 & 2007 c 232 s 5;
     (7) RCW 43.162.030 (Authority of governor and department of commerce not affected) and 2011 c 311 s 7, 2007 c 232 s 7, & 2003 c 235 s 4;
     (8) RCW 43.162.040 (Washington state economic development commission account) and 2011 c 311 s 8; and
     (9) RCW 82.33A.020 (Consulting with Washington economic development commission) and 2007 c 232 s 9 & 1996 c 152 s 4.

Sec. 201   RCW 28B.50.902 and 2011 1st sp.s. c 14 s 6 are each amended to read as follows:
     (1) The college board, in consultation with business, industry, labor, the workforce training and education coordinating board, the department of commerce, the employment security department, and community and technical colleges, shall designate centers of excellence and allocate funds to existing and new centers of excellence based on a competitive basis.
     (2) Eligible applicants for the program established under this section include community and technical colleges. Priority shall be given to applicants that have an established education and training program serving the targeted industry and that have in their home district or region an industry cluster with the same targeted industry at its core.
     (3) It is the role of centers of excellence to employ strategies to:
     (a) Create educational efficiencies;
     (b) Build a diverse, competitive workforce for strategic industries;
     (c) Maintain an institutional reputation for innovation and responsiveness;
     (d) Develop innovative curriculum and means of delivering education and training;
     (e) Act as brokers of information and resources related to community and technical college education and training and assistance available for firms in a targeted industry((, including working with innovate Washington to develop methods to identify businesses within a targeted industry that could benefit from the services offered by innovate Washington under chapter 43.333 RCW)); and
     (f) Serve as partners with workforce development councils, associate development organizations, and other workforce and economic development organizations.
     (4) Examples of strategies under subsection (3) of this section include but are not limited to: Sharing curriculum and other instructional resources, to ensure cost savings to the system; delivering collaborative certificate and degree programs; and holding statewide summits, seminars, conferences, and workshops on industry trends and best practices in community and technical college education and training.

Sec. 202   RCW 42.30.110 and 2011 1st sp.s. c 14 s 14 are each amended to read as follows:
     (1) Nothing contained in this chapter may be construed to prevent a governing body from holding an executive session during a regular or special meeting:
     (a) To consider matters affecting national security;
     (b) To consider the selection of a site or the acquisition of real estate by lease or purchase when public knowledge regarding such consideration would cause a likelihood of increased price;
     (c) To consider the minimum price at which real estate will be offered for sale or lease when public knowledge regarding such consideration would cause a likelihood of decreased price. However, final action selling or leasing public property shall be taken in a meeting open to the public;
     (d) To review negotiations on the performance of publicly bid contracts when public knowledge regarding such consideration would cause a likelihood of increased costs;
     (e) To consider, in the case of an export trading company, financial and commercial information supplied by private persons to the export trading company;
     (f) To receive and evaluate complaints or charges brought against a public officer or employee. However, upon the request of such officer or employee, a public hearing or a meeting open to the public shall be conducted upon such complaint or charge;
     (g) To evaluate the qualifications of an applicant for public employment or to review the performance of a public employee. However, subject to RCW 42.30.140(4), discussion by a governing body of salaries, wages, and other conditions of employment to be generally applied within the agency shall occur in a meeting open to the public, and when a governing body elects to take final action hiring, setting the salary of an individual employee or class of employees, or discharging or disciplining an employee, that action shall be taken in a meeting open to the public;
     (h) To evaluate the qualifications of a candidate for appointment to elective office. However, any interview of such candidate and final action appointing a candidate to elective office shall be in a meeting open to the public;
     (i) To discuss with legal counsel representing the agency matters relating to agency enforcement actions, or to discuss with legal counsel representing the agency litigation or potential litigation to which the agency, the governing body, or a member acting in an official capacity is, or is likely to become, a party, when public knowledge regarding the discussion is likely to result in an adverse legal or financial consequence to the agency.
     This subsection (1)(i) does not permit a governing body to hold an executive session solely because an attorney representing the agency is present. For purposes of this subsection (1)(i), "potential litigation" means matters protected by RPC 1.6 or RCW 5.60.060(2)(a) concerning:
     (i) Litigation that has been specifically threatened to which the agency, the governing body, or a member acting in an official capacity is, or is likely to become, a party;
     (ii) Litigation that the agency reasonably believes may be commenced by or against the agency, the governing body, or a member acting in an official capacity; or
     (iii) Litigation or legal risks of a proposed action or current practice that the agency has identified when public discussion of the litigation or legal risks is likely to result in an adverse legal or financial consequence to the agency;
     (j) To consider, in the case of the state library commission or its advisory bodies, western library network prices, products, equipment, and services, when such discussion would be likely to adversely affect the network's ability to conduct business in a competitive economic climate. However, final action on these matters shall be taken in a meeting open to the public;
     (k) To consider, in the case of the state investment board, financial and commercial information when the information relates to the investment of public trust or retirement funds and when public knowledge regarding the discussion would result in loss to such funds or in private loss to the providers of this information;
     (l) To consider proprietary or confidential nonpublished information related to the development, acquisition, or implementation of state purchased health care services as provided in RCW 41.05.026;
     (m) To consider in the case of the life sciences discovery fund authority, the substance of grant applications and grant awards when public knowledge regarding the discussion would reasonably be expected to result in private loss to the providers of this information;
     (n) To consider in the case of a health sciences and services authority, the substance of grant applications and grant awards when public knowledge regarding the discussion would reasonably be expected to result in private loss to the providers of this information((;
     (o) To consider in the case of innovate Washington, the substance of grant or loan applications and grant or loan awards if public knowledge regarding the discussion would reasonably be expected to result in private loss to the providers of this information)).
     (2) Before convening in executive session, the presiding officer of a governing body shall publicly announce the purpose for excluding the public from the meeting place, and the time when the executive session will be concluded. The executive session may be extended to a stated later time by announcement of the presiding officer.

Sec. 203   RCW 42.56.270 and 2011 1st sp.s. c 14 s 15 are each amended to read as follows:
     The following financial, commercial, and proprietary information is exempt from disclosure under this chapter:
     (1) Valuable formulae, designs, drawings, computer source code or object code, and research data obtained by any agency within five years of the request for disclosure when disclosure would produce private gain and public loss;
     (2) Financial information supplied by or on behalf of a person, firm, or corporation for the purpose of qualifying to submit a bid or proposal for (a) a ferry system construction or repair contract as required by RCW 47.60.680 through 47.60.750 or (b) highway construction or improvement as required by RCW 47.28.070;
     (3) Financial and commercial information and records supplied by private persons pertaining to export services provided under chapters 43.163 and 53.31 RCW, and by persons pertaining to export projects under RCW 43.23.035;
     (4) Financial and commercial information and records supplied by businesses or individuals during application for loans or program services provided by chapters 43.325, 43.163, 43.160, 43.330, and 43.168 RCW, or during application for economic development loans or program services provided by any local agency;
     (5) Financial information, business plans, examination reports, and any information produced or obtained in evaluating or examining a business and industrial development corporation organized or seeking certification under chapter 31.24 RCW;
     (6) Financial and commercial information supplied to the state investment board by any person when the information relates to the investment of public trust or retirement funds and when disclosure would result in loss to such funds or in private loss to the providers of this information;
     (7) Financial and valuable trade information under RCW 51.36.120;
     (8) Financial, commercial, operations, and technical and research information and data submitted to or obtained by the clean Washington center in applications for, or delivery of, program services under chapter 70.95H RCW;
     (9) Financial and commercial information requested by the public stadium authority from any person or organization that leases or uses the stadium and exhibition center as defined in RCW 36.102.010;
     (10)(a) Financial information, including but not limited to account numbers and values, and other identification numbers supplied by or on behalf of a person, firm, corporation, limited liability company, partnership, or other entity related to an application for a horse racing license submitted pursuant to RCW 67.16.260(1)(b), liquor license, gambling license, or lottery retail license;
     (b) Internal control documents, independent auditors' reports and financial statements, and supporting documents: (i) Of house-banked social card game licensees required by the gambling commission pursuant to rules adopted under chapter 9.46 RCW; or (ii) submitted by tribes with an approved tribal/state compact for class III gaming;
     (11) Proprietary data, trade secrets, or other information that relates to: (a) A vendor's unique methods of conducting business; (b) data unique to the product or services of the vendor; or (c) determining prices or rates to be charged for services, submitted by any vendor to the department of social and health services for purposes of the development, acquisition, or implementation of state purchased health care as defined in RCW 41.05.011;
     (12)(a) When supplied to and in the records of the department of commerce:
     (i) Financial and proprietary information collected from any person and provided to the department of commerce pursuant to RCW 43.330.050(8); and
     (ii) Financial or proprietary information collected from any person and provided to the department of commerce or the office of the governor in connection with the siting, recruitment, expansion, retention, or relocation of that person's business and until a siting decision is made, identifying information of any person supplying information under this subsection and the locations being considered for siting, relocation, or expansion of a business;
     (b) When developed by the department of commerce based on information as described in (a)(i) of this subsection, any work product is not exempt from disclosure;
     (c) For the purposes of this subsection, "siting decision" means the decision to acquire or not to acquire a site;
     (d) If there is no written contact for a period of sixty days to the department of commerce from a person connected with siting, recruitment, expansion, retention, or relocation of that person's business, information described in (a)(ii) of this subsection will be available to the public under this chapter;
     (13) Financial and proprietary information submitted to or obtained by the department of ecology or the authority created under chapter 70.95N RCW to implement chapter 70.95N RCW;
     (14) Financial, commercial, operations, and technical and research information and data submitted to or obtained by the life sciences discovery fund authority in applications for, or delivery of, grants under chapter 43.350 RCW, to the extent that such information, if revealed, would reasonably be expected to result in private loss to the providers of this information;
     (15) Financial and commercial information provided as evidence to the department of licensing as required by RCW 19.112.110 or 19.112.120, except information disclosed in aggregate form that does not permit the identification of information related to individual fuel licensees;
     (16) Any production records, mineral assessments, and trade secrets submitted by a permit holder, mine operator, or landowner to the department of natural resources under RCW 78.44.085;
     (17)(a) Farm plans developed by conservation districts, unless permission to release the farm plan is granted by the landowner or operator who requested the plan, or the farm plan is used for the application or issuance of a permit;
     (b) Farm plans developed under chapter 90.48 RCW and not under the federal clean water act, 33 U.S.C. Sec. 1251 et seq., are subject to RCW 42.56.610 and 90.64.190;
     (18) Financial, commercial, operations, and technical and research information and data submitted to or obtained by a health sciences and services authority in applications for, or delivery of, grants under RCW 35.104.010 through 35.104.060, to the extent that such information, if revealed, would reasonably be expected to result in private loss to providers of this information;
     (19) Information gathered under chapter 19.85 RCW or RCW 34.05.328 that can be identified to a particular business; and
     (20) Financial and commercial information submitted to or obtained by the University of Washington, other than information the university is required to disclose under RCW 28B.20.150, when the information relates to investments in private funds, to the extent that such information, if revealed, would reasonably be expected to result in loss to the University of Washington consolidated endowment fund or to result in private loss to the providers of this information((; and
     (21) Financial, commercial, operations, and technical and research information and data submitted to or obtained by innovate Washington in applications for, or delivery of, grants and loans under chapter 43.333 RCW, to the extent that such information, if revealed, would reasonably be expected to result in private loss to the providers of this information)).

Sec. 204   2012 c 63 s 1 (uncodified) is amended to read as follows:
     The legislature finds that Washington is becoming a leader in the development and commercialization of aviation biofuels due to its strong tradition of market innovation, a concentrated demand for sustainable aviation fuels, leading expertise and research capacity, an established aviation manufacturing sector, and the availability of a diverse range of feedstocks for the production of biofuels. The legislature also finds that the development of aviation biofuels has the potential to reduce dependence on foreign sources of fossil fuels, reduce greenhouse gas emissions, and promote economic development and jobs in Washington. The legislature intends to support the development of commercial-scale aviation biofuels production facilities in Washington by facilitating and streamlining the permitting process for new facilities and the expansion of existing facilities and by providing access to low-cost financing through the issuance of revenue bonds.
     The legislature finds that the 2012 Washington state energy strategy calls for a targeted, strategic policy focus on sustainable aviation biofuels to encourage the realization of Washington's potential. The legislature also finds that a regional stakeholder effort to explore the opportunities and challenges surrounding the production of sustainable aviation fuels, known as sustainable aviation biofuels northwest, urged policymakers in the Northwest to develop supportive public policies that will jump start the industry, attract investment, and accelerate industry growth. In order to provide focus and develop policy recommendations to support the sustainable aviation biofuels sector in Washington, the legislature intends to establish a sustainable aviation biofuels work group. ((Additionally, the legislature intends Innovate Washington, designated in 2011 as the lead agency for coordinating clean energy-related initiatives targeted at growing the clean energy sector, to convene the appropriate stakeholders and facilitate the opportunity for the state to realize the full economic growth impact to the state's economy.))

NEW SECTION.  Sec. 205   A new section is added to chapter 43.333 RCW to read as follows:
     (1) The innovate Washington program is created in the department to support business growth in the state's innovation and technology sectors and facilitate statewide technology transfer and commercialization activities, for the purpose of increasing the state's economic vitality.
     (2) The innovate Washington program shall:
     (a) Support businesses in securing federal and private funds to support product research and commercialization, developing and integrating technology in new or enhanced products and services, and launching those products and services in sustainable businesses in the state;
     (b) Establish public-private partnerships and programmatic activities that increase the competitiveness of state industries;
     (c) Work with utilities, district energy providers, the utilities and transportation commission, and the state energy office to improve the alignment of investments in clean energy technologies with existing state policies;
     (d) Administer technology and innovation grant and loan programs including bridge funding programs for the state's technology sector;
     (e) Work with impact Washington to ensure that customers have ready access to each other's services;
     (f) Develop and strengthen academic-industry relationships through research and assistance that is primarily of interest to existing small and medium-sized Washington-based companies; and
     (g) Reach out to firms operating in the state's innovation
partnership zones.
     (3) The innovate Washington program must be operated and the services for the program must be delivered through a contract with a 501(c)(3) nonprofit organization with a principal office located in Washington with experience facilitating interaction between the state's higher education institutions and the state's technology-based companies on commercialization and technology transfer activities. The department must provide oversight for the program.
     (4) The department must submit performance metrics for the innovate Washington program to the governor and the economic development committees of the legislature by January 1, 2014. The department must report the outcomes of the program against these metrics to the governor and the economic development committees of the legislature on December 1, 2014.

NEW SECTION.  Sec. 206   A new section is added to chapter 43.333 RCW to read as follows:
     The definitions in this section apply throughout this chapter unless the context clearly requires otherwise:
     (1) "Department" means the department of commerce.
     (2) "Innovate Washington program" or "program" means the program created in section 205 of this act.

Sec. 207   RCW 43.333.030 and 2011 1st sp.s. c 14 s 4 are each amended to read as follows:
     (1) The investing in innovation account is created in the custody of the state treasurer to receive state and federal funds, grants, private gifts, or contributions to further the purpose of ((innovate Washington)) growing the technology and innovation-based sectors of the state and supporting the commercialization of intellectual property and the manufacturing of innovative products in the state.
     (2) Expenditures from the account may be used only for the purposes of the investing in innovation programs established in chapter 70.210 RCW and any other purpose consistent with the innovate Washington program established in this chapter.
     (3) Only the ((executive)) director of ((innovate Washington)) commerce or the ((executive)) director's designee may authorize expenditures from the account. Funds may only be used for the contractor to provide services consistent with the purposes described in subsection (2) of this section. The account is subject to allotment procedures under chapter 43.88 RCW, but an appropriation is not required for expenditures.

Sec. 208   RCW 43.333.040 and 2011 1st sp.s. c 14 s 3 are each amended to read as follows:
     (1) To increase participation by Washington state small business innovators in federal small business research programs, the innovate Washington program shall provide ((or contract for the provision of)) a small business innovation assistance program. The assistance program must include a proposal review process and must train and assist Washington small business innovators to win awards from federal small business research programs. The assistance program must collaborate with small business development centers((, entrepreneur-in-residence programs,)) and other appropriate sources of technical assistance to ensure that small business innovators also receive the planning, counseling, and support services necessary to expand their businesses and protect their intellectual property.
     (2) ((In operating the program,)) The innovate Washington program must give priority to first-time applicants to the federal small business research programs, new businesses, and firms with fewer than ten employees, and may charge a fee for its services.
     (3) The definitions in this subsection apply throughout this section unless the context clearly requires otherwise.
     (a) "Federal small business research programs" means the programs, operating pursuant to the small business innovation development act of 1982, P.L. 97-219, and the small business technology transfer act of 1992, P.L. 102-564, title II, that provide funds to small businesses to conduct research having commercial application.
     (b) "Small business" means a corporation, partnership, sole proprietorship, or individual, operating a business for profit, with two hundred fifty employees or fewer, including employees employed in a subsidiary or affiliated corporation, that otherwise meets the requirements of federal small business research programs.

Sec. 209   RCW 43.333.050 and 2011 1st sp.s. c 14 s 13 are each amended to read as follows:
     (1) The innovate Washington program shall administer the investing in innovation program.
     (2) Not more than one percent of the available funds from the investing in innovation account may be used for administrative costs of the program.

Sec. 210   RCW 43.333.800 and 2012 c 63 s 4 are each amended to read as follows:
     (1) The innovate Washington program shall convene a sustainable aviation biofuels work group.
     (2) The purpose of the work group is to:
     (a) Further the development of sustainable aviation fuel as a productive industry in Washington, using as a foundation the regional assessment prepared by the collaborative known as the sustainable aviation fuels northwest;
     (b) Facilitate communication and coordination among aviation biofuels stakeholders;
     (c) Provide a forum for discussion and problem-solving regarding potential and current barriers related to technology development, production, distribution, supply chain development, and commercialization of aviation biofuels; and
     (d) Provide recommendations to the legislature on potential legislation that will facilitate the technology development, production, distribution, and commercialization of aviation biofuels.
     (3) The innovate Washington program, in consultation with the legislative members, shall designate work group members that represent sectors involved in sustainable aviation biofuels research, development, production, and utilization. The work group shall include but not be limited to representatives from the following:
     (a) The Washington state senate;
     (b) The Washington state house of representatives;
     (c) An agriculture advocacy organization;
     (d) An airline operator;
     (e) An airplane manufacturer;
     (f) An airport operator located in western Washington and an airport operator located in eastern Washington;
     (g) Biofuels feedstock producers;
     (h) Two biofuels producers;
     (i) The department of agriculture;
     (j) ((The department of commerce;
     (k))) The department of natural resources;
     (((l))) (k) A sustainable energy advocacy organization;
     (((m))) (l) The United States department of defense;
     (((n))) (m) The University of Washington;
     (((o))) (n) Washington State University; and
     (((p))) (o) The Pacific Northwest national laboratory((; and
     (q) A member of the board of directors of Innovate Washington)).
     (4) The work group shall choose its chair from among its membership.
     (5) The work group may not meet more than twice a year.
     (6) The work group shall provide an annual update of its findings and recommendations to the governor and the appropriate committees of the legislature by December 1st of each year through 2014.
     (7) This section expires June 30, 2015.

Sec. 211   RCW 70.210.020 and 2011 1st sp.s. c 14 s 8 are each amended to read as follows:
     The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
     (((1) "Board" means the innovate Washington board of directors.
     (3) [(2)] "Innovate Washington" means the agency created in RCW 43.333.010.))
     (1) "Department" means the department of commerce.
     (2) "Innovate Washington program" means the program established at the department of commerce under chapter 43.333 RCW.

Sec. 212   RCW 70.210.030 and 2011 1st sp.s. c 14 s 9 are each amended to read as follows:
     (1) The investing in innovation program is established.
     (2) The innovate Washington program shall periodically make strategic assessments of the types of investments in research, technology, and industrial development in this state that would likely create new products, jobs, and business opportunities and produce the most beneficial long-term improvements to the lives and health of the citizens of the state. The assessments shall be available to the public and shall be used to guide decisions on awarding funds under this chapter.

Sec. 213   RCW 70.210.040 and 2011 1st sp.s. c 14 s 10 are each amended to read as follows:
     The ((board)) innovate Washington program shall:
     (1) Develop criteria for the awarding of loans or grants to qualifying universities, institutions, businesses, or individuals;
     (2) Make decisions regarding distribution of funds;
     (3) In making funding decisions and to the extent that economic impact is not diminished, provide priority to enterprises that:
     (a) Were created through, and have existing intellectual property agreements in place with, public and private research institutions in the state; and
     (b) Intend to produce new products or services, develop or expand facilities, or manufacture in the state; and
     (4) Specify in contracts awarding funds that recipients must utilize funding received to support operations in the state of Washington and must subsequently report on the impact of their research, development, and any subsequent production activities within Washington for a period of ten years following the award of funds, and that a failure to comply with this requirement will obligate the recipient to return the amount of the award plus interest as determined by the ((board)) department.

Sec. 214   RCW 70.210.050 and 2011 1st sp.s. c 14 s 11 are each amended to read as follows:
     (1) The ((board)) innovate Washington program may accept grant and loan proposals and establish a competitive process for the awarding of grants and loans.
     (2) The ((board)) innovate Washington program shall establish a peer review committee to include ((board members,)) scientists, engineers, and individuals with specific recognized expertise. The peer review committee shall provide to the ((board)) innovate Washington program an independent peer review of all proposals determined to be competitive for a loan or grant award that are submitted to the ((board)) innovate Washington program.
     (3) In the awarding of grants and loans, priority shall be given to proposals that leverage additional private and public funding resources.
     (((4) Innovate Washington may not be a direct recipient of funding under this chapter.))

Sec. 215   RCW 70.210.060 and 2011 1st sp.s. c 14 s 12 are each amended to read as follows:
     The ((board)) department shall establish performance benchmarks against which the program will be evaluated. The program shall be reviewed periodically by the ((board)) department. The ((board)) department shall report annually to the appropriate standing committees of the legislature on loans made and grants awarded and as appropriate on program reviews conducted by the ((board)) department.

NEW SECTION.  Sec. 216   The following acts or parts of acts are each repealed:
     (1) RCW 41.06.0711 (Innovate Washington -- Certain personnel exempted from chapter) and 2011 1st sp.s. c 14 s 5;
     (2) RCW 43.333.010 (Innovate Washington -- Created -- Mission -- Transfer of administrative responsibilities for facilities located at the Washington technology center and Spokane intercollegiate research and technology institute -- Five-year business plan requirements) and 2011 1st sp.s. c 14 s 1; and
     (3) RCW 43.333.020 (Board of directors -- Composition -- Meetings--Duties) and 2011 1st sp.s. c 14 s 2.

NEW SECTION.  Sec. 217   A new section is added to chapter 43.333 RCW to read as follows:
     (1) Innovate Washington is hereby abolished and its mission, powers, duties, and functions are hereby transferred to the department of commerce.
     (2)(a) All property of Innovate Washington, including real property, shall be assigned and transferred to the department of commerce. All reports, documents, surveys, books, records, files, papers, and written material, regardless of physical form or characteristics, in the possession of Innovate Washington shall be delivered to the department of commerce. All cabinets, furniture, office equipment, motor vehicles, and other tangible property employed by Innovate Washington shall be made available to the department of commerce. Except as provided in (b) of this subsection, all funds, credits, and other assets, tangible or intangible, held by Innovate Washington shall be assigned and transferred to the department of commerce.
     (b) The department of commerce shall honor any donor-imposed condition on the transfer of assets to Innovate Washington, consistent with chapter 14, Laws of 2011 1st sp. sess., returning any unused funds or other assets to the grantor or the grantor's successor in interest, if return of such funds or other assets is required in the grant or other instrument by which the asset was conveyed to Innovate Washington. Any donated assets, the use of which is limited by a donor-imposed restriction, shall be used only for the purposes specified in the granting instrument, and where the instrument restricts the use of such funds or other assets for the purposes of Innovate Washington, they shall be used by the department of commerce only for the purpose of growing the innovation-based economic sectors of the state and responding to the technology transfer needs of existing businesses in the state.
     (c) If any question arises as to the transfer of any asset used or held in the exercise of the powers and the performance of the duties and functions transferred, the director of financial management shall make a determination as to the proper allocation and certify the same to the state agencies concerned.
     (3) If apportionments of budgeted funds are required because of the transfers directed by this section, the director of financial management shall certify the apportionments to the agencies affected, the state auditor, and the state treasurer. Each of these shall make the appropriate transfer and adjustments in funds and appropriation accounts and equipment records in accordance with the certification.

NEW SECTION.  Sec. 218   A new section is added to chapter 43.333 RCW to read as follows:
     This chapter expires June 30, 2015.

NEW SECTION.  Sec. 219   A new section is added to chapter 70.210 RCW to read as follows:
     This chapter expires June 30, 2015.

Sec. 301   RCW 43.374.010 and 2010 1st sp.s. c 13 s 2 are each amended to read as follows:
     (1) The Washington global health technologies and product development competitiveness program is created.
     (2)(a) The program must be administered by a nonprofit organization ((exempt from income taxation under 26 U.S.C. Sec. 501(c)(6) of the federal internal revenue code)) whose board of directors is appointed by the governor. The governor must make the appointments after consultation with a statewide alliance of global health research, nonprofit, and private entities. ((The board consists of the following members:
     (i) Three members representing private companies engaged in the provision of global health products or services;
     (ii) Three members representing nonprofit organizations supporting global health research or providing global health products or services;
     (iii) Three members representing public research institutions engaged in global health research and education; and
     (iv) One member who is a former elected official.))
     (b) The governor must appoint the chair of the board from among the members. The governor must appoint the members to staggered terms and each appointment may not last more than three years, but an appointee may serve more than one term.
     (3) The ((board)) life sciences discovery fund authority must contract with the ((department of commerce for management services to assist the board in implementing)) board to implement and manage the program.
     (4) The life sciences discovery fund authority and the board ((must)) are empowered to solicit and receive gifts, grants, bequests, royalty payments, licensing income, and other funds from businesses, foundations, and the federal government to promote the development and delivery of global health technologies and products. All federal funds received must be deposited in the Washington global health technologies and product development account created in RCW 43.374.020. All remaining nonstate funds received must be deposited in an account that the board creates and administers to carry out the purposes of this section. Expenditures from the account created by the board may be used only for funding activities of the program created in this section. Of the total amounts deposited into these accounts, no more than ((three)) four percent of the total funds may be used for the ((department of commerce's management services and)) life sciences discovery fund authority's administrative expenses related to the program created in this section.
     (5) The board must establish eligibility criteria for global health technologies and product development grants and adopt policies and procedures to facilitate the orderly process of grant application, review, and reward.
     (6) In making grants to entities pursuant to contract for the development, production, promotion, and delivery of global health technologies and products, the board must consider the following:
     (a) The quality of the proposed research or the proposed technical assistance in product development or production process design. Any grant funds awarded for research activities must be awarded for nonbasic research which will assist in commercialization or manufacture of global health technologies;
     (b) The potential for the grant recipient to improve global health outcomes;
     (c) The potential for the grant to leverage additional funding for the development of global health technologies and products;
     (d) The potential for the grant to stimulate, or promote technical skills training for, employment in the development of global health technologies in the state;
     (e) The willingness of the grant recipient, when appropriate, to enter into royalty or licensing income agreements with the board; and
     (f) Any other factors, as the board determines.
     (7) Grant contracts must specify that award recipients must conduct their research, development, and any subsequent production activities within Washington, with the exception of activities such as clinical trials that must be carried out in developing countries, and that a failure to comply with this requirement will obligate the recipient to return the amount of the award plus interest as determined by the board.
     (8) ((Upon the recommendation of the Washington economic development commission, the board may provide funding for the recruitment and employment by public research institutions and global health nonprofit organizations in the state, of global health researchers with a history of commercialization of global health technologies.
     (9))) Each project receiving a grant under this section must report information to the board in the format and at the intervals as the board requires to provide accountability and to evaluate the effectiveness of the program. The information reported must include the amount of funding received; the funding, if any, leveraged by the grant; the number and types of jobs created as a result of the grant; and any other information that the board requires. The board must use the information to prepare an annual evaluation of the program for a report to the appropriate committees of the legislature and the governor, beginning December 1, 2012.

NEW SECTION.  Sec. 401   The following acts or parts of acts are each repealed:
     (1) RCW 43.336.010 (Definitions) and 2009 c 565 s 42 & 2007 c 228 s 101;
     (2) RCW 43.336.020 (Commission created -- Composition -- Terms--Executive director -- Rule-making authority) and 2011 1st sp.s. c 50 s 957, 2009 c 549 s 5178, & 2007 c 228 s 102;
     (3) RCW 43.336.030 (Tourism industry expansion -- Coordinated program -- Strategic plan -- Tourism marketing plan) and 2007 c 228 s 103;
     (4) RCW 43.336.040 (Tourism competitive grant program) and 2007 c 228 s 104;
     (5) RCW 43.336.050 (Tourism enterprise account) and 2011 c 5 s 914 & 2007 c 228 s 105;
     (6) RCW 43.336.060 (Tourism development program -- Report to the legislature) and 2009 c 518 s 13, 2007 c 228 s 107, & 1998 c 299 s 5; and
     (7) RCW 43.336.900 (Part headings not law -- 2007 c 228) and 2007 c 228 s 204.

Sec. 501   RCW 43.330.010 and 2011 c 286 s 4 are each amended to read as follows:
     Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.
     (1) "Associate development organization" means a local economic development nonprofit corporation that is broadly representative of community interests.
     (2) "Department" means the department of commerce.
     (3) "Director" means the director of the department of commerce.
     (4) "Financial institution" means a bank, trust company, mutual savings bank, savings and loan association, or credit union authorized to do business in this state under state or federal law.
     (5) (("Microenterprise development organization" means a community development corporation, a nonprofit development organization, a nonprofit social services organization or other locally operated nonprofit entity that provides services to low-income entrepreneurs.
     (6))) "Small business" has the same meaning as provided in RCW ((39.29.006)) 39.26.010.
     (((7) "Statewide microenterprise association" means a nonprofit entity with microenterprise development organizations as members that serves as an intermediary between the department of commerce and local microenterprise development organizations.))

NEW SECTION.  Sec. 502   RCW 43.330.290 (Microenterprise development program) and 2009 c 565 s 15 & 2007 c 322 s 3 are each repealed.

NEW SECTION.  Sec. 601   Section 105 of this act expires June 30, 2039.

NEW SECTION.  Sec. 602   Section 106 of this act expires on the date the requirements set out in section 7, chapter 36, Laws of 2012 are met.

NEW SECTION.  Sec. 603   Section 107 of this act takes effect on the date the requirements set out in section 7, chapter 36, Laws of 2012 are met.