Read first time 01/14/14.   Referred to Committee on Natural Resources & Parks.

     AN ACT Relating to lake and beach management districts; amending RCW 36.61.010, 36.61.020, 36.61.070, 36.61.220, 36.61.250, 36.61.260, 36.61.030, and 36.61.170; and adding new sections to chapter 36.61 RCW.

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

Sec. 1   RCW 36.61.010 and 2008 c 301 s 1 are each amended to read as follows:
     (1) The legislature finds that the environmental, recreational, and aesthetic values of many of the state's lakes are threatened by eutrophication and other deterioration and that existing governmental authorities are unable to adequately improve and maintain the quality of the state's lakes.
     (2) The legislature intends that an ecosystem-based beach management approach should be used to help promote the health of aquatic ecosystems and that such a management approach be undertaken in a manner that retains ecosystem values within the state. This management approach should use long-term strategies that focus on reducing nutrient inputs from human activities affecting the aquatic ecosystem, such as decreasing nutrients into storm water sewers, decreasing fertilizer application, promoting the proper disposal of pet waste, promoting the use of vegetative borders, promoting the reduction of nutrients from on-site septic systems where appropriate, and protecting riparian areas. Organic debris, including vegetation, driftwood, seaweed, kelp, and organisms, are extremely important to beach ecosystems.
     (3) The legislature further finds that it is in the public interest to promote the conservation and stewardship of shorelines and upland properties adjoining lakes and beaches in order to: (a) Conserve natural or scenic resources; (b) protect riparian habitats and water quality; (c) promote conservation of soils, wetlands, shorelines, or tidal marshes; (d) enhance the value of lakes or beaches to the public as well as the benefit of abutting or neighboring parks, forests, wildlife preserves, nature reservations or sanctuaries, or other open space; (e) enhance recreation opportunities; (f) preserve historic sites; and (g) protect visual quality along highway, road, street, trail, recreational, and other corridors or scenic vistas.
     (4) It is the purpose of this chapter to establish a governmental mechanism by which property owners can embark on a program of lake or beach improvement and maintenance for their and the general public's benefit, health, and welfare. Public property, including state property, shall be considered the same as private property in this chapter, except liens for special assessments and liens for rates and charges shall not extend to public property. Lake bottom property and marine property below the line of the ordinary high water mark shall not be considered to be benefitted, shall not be subject to special assessments or rates and charges, and shall not receive voting rights under this chapter.

Sec. 2   RCW 36.61.020 and 2008 c 301 s 3 are each amended to read as follows:
     (1) Any county may create lake or beach management districts to finance: (a) The improvement and maintenance of lakes or beaches located within or partially within the boundaries of the county; and (b) the acquisition of real property or property rights within or outside a lake or beach management district including, by way of example, conservation easements authorized under RCW 64.04.130, and to promote the conservation and stewardship of shorelines as well as the conservation and stewardship of upland properties adjoining lakes or beaches for conservation or for minimal development. All or a portion of a lake or beach and the adjacent land areas may be included within one or more lake or beach management districts. More than one lake or beach, or portions of lakes or beaches, and the adjacent land areas may be included in a single lake or beach management district.
     (2) For the purposes of this chapter, the term "improvement" includes, among other things, the acquisition of real property and property rights within or outside a lake or beach management district for the purposes set forth in RCW 36.61.010 and this section.
     (3) Special assessments or rates and charges may be imposed on the property included within a lake or beach management district to finance lake or beach improvement and maintenance activities, including: (((1))) (a) Controlling or removing aquatic plants and vegetation; (((2))) (b) improving water quality; (((3))) (c) controlling water levels; (((4))) (d) treating and diverting storm water; (((5))) (e) controlling agricultural waste; (((6))) (f) studying lake or marine water quality problems and solutions; (((7))) (g) cleaning and maintaining ditches and streams entering the lake or marine waters or leaving the lake; (((8))) (h) monitoring air quality; (i) the acquisition of real property and property rights; and (((9))) (j) the related administrative, engineering, legal, and operational costs, including the costs of creating the lake or beach management district.
     (4) Special assessments or rates and charges may be imposed annually on all the land in a lake or beach management district for the duration of the lake or beach management district without a related issuance of lake or beach management district bonds or revenue bonds. Special assessments also may be imposed in the manner of special assessments in a local improvement district with each landowner being given the choice of paying the entire special assessment in one payment, or to paying installments, with lake or beach management district bonds being issued to obtain moneys not derived by the initial full payment of the special assessments, and the installments covering all of the costs related to issuing, selling, and redeeming the lake or beach management district bonds.

NEW SECTION.  Sec. 3   A new section is added to chapter 36.61 RCW to read as follows:
     A proposal to acquire real property or property rights within or outside of a lake or beach management district in accordance with RCW 36.61.020 is subject to the following limitations and requirements: (1) The real property or property rights proposed for acquisition must be in a county located west of the crest of the Cascade mountain range that plans under RCW 36.70A.040 and has a population of more than forty thousand and fewer than sixty-five thousand persons as of April 1, 2013, as determined by the office of financial management; and (2) prior to the acquisition of real property or property rights, the proposal must have the written approval of a majority of the property owners of the district, as determined by the tax rolls of the county assessor.

Sec. 4   RCW 36.61.070 and 2008 c 301 s 9 are each amended to read as follows:
     (1) After the public hearing, the county legislative authority may adopt a resolution submitting the question of creating the lake or beach management district to the owners of land within the proposed lake or beach management district, including publicly owned land, if the county legislative authority finds that it is in the public interest to create the lake or beach management district and the financing of the lake or beach improvement and maintenance activities is feasible. The resolution shall also include: (((1))) (a) A plan describing the proposed lake or beach improvement and maintenance activities which avoid adverse impacts on fish and wildlife and provide for appropriate measures to protect and enhance fish and wildlife; (((2))) (b) the number of years the lake or beach management district will exist; (((3))) (c) the amount to be raised by special assessments or rates and charges; (((4))) (d) if special assessments are to be imposed, whether the special assessments shall be imposed annually for the duration of the lake or beach management district or only once with the possibility of installments being imposed and lake or beach management bonds being issued, or both, and, if both types of special assessments are proposed to be imposed, the lake or beach improvement or maintenance activities proposed to be financed by each type of special assessment; (((5))) (e) if rates and charges are to be imposed, a description of the proposed rates and charges and the possibility of revenue bonds being issued that are payable from the rates and charges; and (((6))) (f) the estimated special assessment or rate and charge proposed to be imposed on each parcel included in the proposed lake or beach management district.
     (2) No lake or beach management district may be created by a county that includes territory located in another county without the approval of the legislative authority of the other county.

Sec. 5   RCW 36.61.220 and 2008 c 301 s 21 are each amended to read as follows:
     Within ((fifteen)) thirty days after a county creates a lake or beach management district, the county shall cause to be filed with the county treasurer, a description of the lake or beach improvement and maintenance activities proposed that the lake or beach management district finances, the lake or beach management district number, and a copy of the diagram or print showing the boundaries of the lake or beach management district and preliminary special assessment roll or abstract of the same showing thereon the lots, tracts, parcels of land, and other property that will be specially benefitted thereby and the estimated cost and expense of such lake or beach improvement and maintenance activities to be borne by each lot, tract, parcel of land, or other property. The treasurer shall immediately post the proposed special assessment roll upon his or her index of special assessments against the properties affected by the lake or beach improvement or maintenance activities.

Sec. 6   RCW 36.61.250 and 1985 c 398 s 25 are each amended to read as follows:
     Except when lake or beach management district bonds are outstanding or when an existing contract might otherwise be impaired, the county legislative authority may stop the imposition of annual special assessments if, in its opinion, the public interest will be served by such action.

Sec. 7   RCW 36.61.260 and 2008 c 301 s 23 are each amended to read as follows:
     (1) Counties may issue lake or beach management district revenue bonds in accordance with this section. Lake or beach management district bonds may be issued to obtain money sufficient to cover that portion of the special assessments that are not paid within the thirty-day period provided in RCW 36.61.190.
     (2) Whenever lake or beach management district revenue bonds are proposed to be issued, the county legislative authority shall create a special fund or funds for the lake or beach management district from which all or a portion of the costs of the lake or beach improvement and maintenance activities shall be paid. Lake or beach management district bonds shall not be issued in excess of the costs and expenses of the lake or beach improvement and maintenance activities and shall not be issued prior to twenty days after the thirty days allowed for the payment of special assessments without interest or penalties.
     (3) Lake or beach management district revenue bonds shall be exclusively payable from the special fund or funds and from a guaranty fund that the county may have created out of a portion of proceeds from the sale of the lake or beach management district bonds.
     (((2))) (4)(a) Lake or beach management district revenue bonds shall not constitute a general indebtedness of the county issuing the bond nor an obligation, general or special, of the state. The owner of any lake or beach management district revenue bond shall not have any claim for the payment thereof against the county that issues the bonds except for: (i) With respect to revenue bonds payable from special assessments, payment from the special assessments made for the lake or beach improvement or maintenance activities for which the lake or beach management district bond was issued and from the special fund or funds, and a lake or beach management district guaranty fund, that may have been created; and (ii) with respect to revenue bonds payable from rates and charges, payment from rates and charges deposited in the special fund or funds that the county may have created for that purpose. Revenue bonds may be payable from both special assessments and from rates and charges. The county shall not be liable to the owner of any lake or beach management district bond for any loss to ((the)) a lake or beach management district guaranty fund occurring in the lawful operation of the fund. The owner of a lake or beach management district bond shall not have any claim against the state arising from the lake or beach management district bond, rates and charges, special assessments, or guaranty fund. Tax revenues shall not be used to secure or guarantee the payment of the principal of or interest on lake or beach management district bonds. Notwithstanding the provisions of this subsection, nothing in this section may be interpreted as limiting a county's issuance of bonds pursuant to RCW 36.67.010 in order to assist in the financing of improvements to lakes or beaches located within or partially within the boundaries of the county, including without limitation lakes or beaches located within a lake or beach management district.
     (b) The substance of the limitations included in this subsection (4) shall be plainly printed, written, engraved, or reproduced on: (((a))) (i) Each lake or beach management district bond that is a physical instrument; (((b))) (ii) the official notice of sale; and (((c))) (iii) each official statement associated with the lake or beach management district bonds.
     (((3))) (5) If the county fails to make any principal or interest payments on any lake or beach management district bond or to promptly collect any special assessment securing ((the)) lake or beach management district revenue bonds when due, the owner of the lake or beach management district revenue bond may obtain a writ of mandamus from any court of competent jurisdiction requiring the county to collect the special assessments, foreclose on the related lien, and make payments out of the special fund or guaranty fund if one exists. Any number of owners of lake or beach management districts may join as plaintiffs.
     (((4))) (6) A county may create a lake or beach management district bond guaranty fund for each issue of lake or beach management district bonds. The guaranty fund shall only exist for the life of the lake or beach management district bonds with which it is associated. A portion of the bond proceeds may be placed into a guaranty fund. Unused moneys remaining in the guaranty fund during the last two years of the installments shall be used to proportionally reduce the required level of installments and shall be transferred into the special fund into which installment payments are placed. A county may, in the discretion of the legislative authority of the county, deposit amounts into a lake or beach management district bond guaranty fund from any money legally available for that purpose. Any amounts remaining in the guaranty fund after the repayment of all revenue bonds secured thereby and the payment of assessment installments, may be applied to lake or beach improvement and maintenance activities or to other district purposes.
     (((5))) (7) Lake or beach management district bonds shall be issued and sold in accordance with chapter 39.46 RCW. The authority to create a special fund or funds shall include the authority to create accounts within a fund.

Sec. 8   RCW 36.61.030 and 2008 c 301 s 5 are each amended to read as follows:
     A lake or beach management district may be initiated upon either the adoption of a resolution of intention by a county legislative authority or the filing of a petition signed by ten landowners or the owners of at least ((fifteen)) twenty percent of the acreage contained within the proposed lake or beach management district, whichever is greater. A petition or resolution of intention shall set forth: (1) The nature of the lake or beach improvement or maintenance activities proposed to be financed; (2) the amount of money proposed to be raised by special assessments or rates and charges; (3) if special assessments are to be imposed, whether the special assessments will be imposed annually for the duration of the lake or beach management district, or the full special assessments will be imposed at one time, with the possibility of installments being made to finance the issuance of lake or beach management district bonds, or both methods; (4) if rates and charges are to be imposed, the annual amount of revenue proposed to be collected and whether revenue bonds payable from the rates and charges are proposed to be issued; (5) the number of years proposed for the duration of the lake or beach management district; and (6) the proposed boundaries of the lake or beach management district.
     The county legislative authority may require the posting of a bond of up to five thousand dollars before the county considers the proposed creation of a lake or beach management district initiated by petition. The bond may only be used by the county to finance its costs in studying, holding hearings, making notices, preparing special assessment rolls or rolls showing the rates and charges on each parcel, and conducting elections related to the lake or beach management district if the proposed lake or beach management district is not created.
     A resolution of intention shall also designate the number of the proposed lake or beach management district, and fix a date, time, and place for a public hearing on the formation of the proposed lake or beach management district. The date for the public hearing shall be at least thirty days and no more than ninety days after the adoption of the resolution of intention unless an emergency exists.
     Petitions shall be filed with the county legislative authority. The county legislative authority shall determine the sufficiency of the signatures, which shall be conclusive upon all persons. No person may withdraw his or her name from a petition after it is filed. If the county legislative authority determines a petition to be sufficient and the proposed lake or beach management district appears to be in the public interest and the financing of the lake or beach improvement or maintenance activities is feasible, it shall adopt a resolution of intention, setting forth all of the details required to be included when a resolution of intention is initiated by the county legislative authority.

NEW SECTION.  Sec. 9   A new section is added to chapter 36.61 RCW to read as follows:
     (1) In connection with the acquisition of real property or property rights within or outside a lake or beach management district, a county may: (a) Own real property and property rights, including without limitation conservation easements; (b) transfer real property and property rights to another state or local governmental entity; (c) contract with a public or private entity, including without limitation a financial institution with trust powers, a municipal corporation, or a nonprofit corporation, to hold real property or property rights such as conservation easements in trust for the purposes of the lake and beach management district, and, in connection with those services, to pay the reasonable costs of that financial institution or nonprofit corporation; (d) monitor and enforce the terms of a real property right such as a conservation easement, or for that purpose to contract with a public or private entity, including without limitation a financial institution with trust powers, a municipal corporation, or a nonprofit corporation; (e) impose terms, conditions, and encumbrances upon real property or property rights acquired in respect of a lake or beach management district, and amend the same; and (f) accept gifts, grants, and loans in connection with the acquisition of real property and property rights for lake or beach management district purposes.
     (2) If a county contracts with a financial institution, municipal corporation, or nonprofit corporation to hold that property or property rights in trust for purposes of the district, the terms of the contract must provide that the financial institution, municipal corporation, or nonprofit corporation may not sell, pledge, or hypothecate the property or property rights for any purpose, and must further provide for the return of the property or property rights back to the county in the event of a material breach of the terms of the contract.
     (3) Before a lake or beach management district in existence as of the effective date of this section exercises the powers set forth in this section, the legislative authority of the county must provide for an amended resolution of intention and modify the plan for the district, with a public hearing, all as provided in RCW 36.61.050.

Sec. 10   RCW 36.61.170 and 2008 c 301 s 18 are each amended to read as follows:
     (1) The total annual special assessments may not exceed the estimated cost of the lake or beach improvement or maintenance activities proposed to be financed by such special assessments, as specified in the resolution of intention. The total of special assessments imposed in a lake or beach management district that are of the nature of special assessments imposed in a local improvement district shall not exceed one hundred fifty percent of the estimated total cost of the lake or beach improvement or maintenance activities that are proposed to be financed by the lake or beach management district as specified in the resolution of intention.
     (2) After a lake or beach management district has been created, the resolution of intention may be amended to increase or otherwise modify the amount to be financed by the lake or beach management district by using the same procedure in which a lake or beach management district is created, including landowner approvals consistent with the procedures established in RCW 36.61.080 through 36.61.100.

NEW SECTION.  Sec. 11   A new section is added to chapter 36.61 RCW to read as follows:
     (1) Except when lake or beach management district bonds are outstanding or when an existing contract might otherwise be impaired, a lake or beach management district may be dissolved either by: The county legislative authority upon a finding that the purposes of the district have been accomplished; or a vote of the property owners within the district, if proposed by the legislative authority of the county or through the filing of a sufficient petition signed by the owners of at least twenty percent of the acreage within the district.
     (2) If the question of dissolution of a district is submitted to property owners, the balloting is subject to the following conditions, which must be included in the instructions mailed with each ballot, as provided in RCW 36.61.080:
     (a) A ballot must be mailed to each owner or reputed owner of any lot, tract, parcel of land, or other property within the district, with the ballot weighted so that a property owner has one vote for each dollar of special assessment or rates and charges imposed on his or her property;
     (b) A ballot must be signed by the owner or reputed owner of property according to the assessor's tax rolls;
     (c) Each ballot must be returned to the county legislative authority no later than 5:00 p.m. of a specified day, which must be at least twenty, but not more than thirty days after the ballots are mailed; and
     (d) Each property owner must mark his or her ballot for or against the dissolution of the district.
     (3) If, following the tabulation of the valid ballots, a simple majority of the votes cast are in favor of dissolving the district, the district must be dissolved on the date established in the ballot proposition.
     (4) A county, although not separately responsible for satisfying the financial obligations of a dissolved district, has full authority to continue imposing special assessments, rates, and charges for a dissolved district until all financial obligations of the district incurred prior to its dissolution have been extinguished or retired.