AN ACT Relating to imposing fines, withholding taxes, and other measures to encourage local jurisdictions to timely file state-required reports; amending RCW 36.96.010, 43.09.230, 57.90.010, 68.52.290, 27.12.050, 84.52.063, and 36.69.145; and adding a new section to chapter 43.09 RCW.

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

NEW SECTION.  Sec. 1.  A new section is added to chapter 43.09 RCW to read as follows:

(1) By October 1, 2015, and by October 1st of every year thereafter, the state auditor must notify the state and county treasurers of any special purpose districts that have not timely filed the annual financial report required under RCW 43.09.230 for the current year. If a special purpose district submits the report after the state auditor has notified the state and county treasurers, the state auditor, within thirty days, must notify treasurers that the district is compliant as long as the fee under RCW 43.09.230 has also been paid.

(2) Beginning with distributions made in October, the state treasurer may not distribute any local sales and use taxes imposed by the special purpose district to the district until the state treasurer is notified that the district is compliant as provided in subsection (1) of this section. The state treasurer must remit all withheld funds; however, the distribution may not include interest.

(3) Beginning with distributions made in October, county treasurers may not distribute any regular property taxes imposed by the special purpose district, or any other charges that the county collects on behalf of the district, to the district until the county treasurer is notified that the district is compliant as provided in subsection (1) of this section. A county treasurer must remit all withheld funds; however, the distribution may not include interest.

(4) For the purpose of this section, "special purpose district" means cemetery districts, metropolitan park districts, water-sewer districts, fire protection districts, port districts, public utility districts, county park and recreation service areas, park and recreation districts, flood control zone districts, diking districts, drainage improvement districts, solid waste collection districts, mosquito districts, and transportation benefit areas.

Sec. 2.  RCW 36.96.010 and 1999 c 153 s 50 are each amended to read as follows:

((As used in this chapter, unless the context requires otherwise:)) The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.

(1) "Special purpose district" means every municipal and quasi-municipal corporation other than counties, cities, and towns. Such special purpose districts ((shall)) include, but are not limited to, water-sewer districts, fire protection districts, port districts, public utility districts, county park and recreation service areas, flood control zone districts, diking districts, drainage improvement districts, and solid waste collection districts, but ((shall)) does not include industrial development districts created by port districts, and ((shall)) do not include local improvement districts, utility local improvement districts, and road improvement districts((;)).

(2) "Governing authority" means the commission, council, or other body which directs the affairs of a special purpose district((;)).

(3)(a) "Inactive" means that a special purpose district, other than a public utility district, is characterized by either of the following criteria:

(((a))) (i) Has not carried out any of the special purposes or functions for which it was formed within the preceding consecutive five-year period; ((or

(b))) (ii) No election has been held for the purpose of electing a member of the governing body within the preceding consecutive seven-year period or, in those instances where members of the governing body are appointed and not elected, where no member of the governing body has been appointed within the preceding seven-year period; or

(iii) The special purpose district has not timely filed with the state auditor in two or more years, beginning with reports required to be filed in 2015, the local government annual financial report required under RCW 43.09.230.

(b) A public utility district is inactive when it is characterized by both criteria (a) ((and (b))) (i) and (ii) of this subsection.

Sec. 3.  RCW 43.09.230 and 1995 c 301 s 12 are each amended to read as follows:

(1) The state auditor ((shall)) must require from every local government financial reports covering the full period of each fiscal year, in accordance with the forms and methods prescribed by the state auditor, which ((shall)) must be uniform for all accounts of the same class.

((Such)) (2) The reports ((shall)) must be prepared, certified, and filed with the state auditor within one hundred fifty days after the close of each fiscal year. A local government is subject to a five hundred dollar fine if the report is filed after the one hundred fifty day period.

(3) The reports ((shall)) must contain accurate statements, in summarized form, of all collections made, or receipts received, by the officers from all sources; all accounts due the public treasury, but not collected; and all expenditures for every purpose, and by what authority authorized; and also: (((1))) (a) A statement of all costs of ownership and operation, and of all income, of each and every public service industry owned and operated by a local government; (((2))) (b) a statement of the entire public debt of every local government, to which power has been delegated by the state to create a public debt, showing the purpose for which each item of the debt was created, and the provisions made for the payment thereof; (((3))) (c) a classified statement of all receipts and expenditures by any public institution; and (((4))) (d) a statement of all expenditures for labor relations consultants, with the identification of each consultant, compensation, and the terms and conditions of each agreement or arrangement; together with such other information as may be required by the state auditor.

(4) The reports ((shall)) must be certified as to their correctness by the state auditor, the state auditor's deputies, or other person legally authorized to make such certification.

((Their)) (5) The reports' substance ((shall)) must be published in an annual volume of comparative statistics at the expense of the state as a public document.

Sec. 4.  RCW 57.90.010 and 2004 c 129 s 13 are each amended to read as follows:

(1) Water-sewer, park and recreation, metropolitan park, county rural library, cemetery, flood control, mosquito control, diking and drainage, irrigation or reclamation, weed, health, or fire protection districts, and any air pollution control authority or regional fire protection service authority, hereinafter referred to as "special districts," which are located wholly or in part within a county with a population of two hundred ten thousand or more may be disincorporated when the district has not actively carried out any of the special purposes or functions for which it was formed within the preceding consecutive five-year period.

Sec. 5.  RCW 68.52.290 and 1947 c 6 s 21 are each amended to read as follows:

(1) Annually, after the county board of equalization has equalized assessments for general tax purposes, the secretary of the district ((shall)) must prepare a budget of the requirements of the cemetery district fund, certify the same and deliver it to the board of county commissioners in ample time for such board to levy district taxes. At the time of making general tax levies in each year, the board of county commissioners ((shall)) must levy taxes required for cemetery district purposes against the real and personal property in the district in accordance with the equalized valuation thereof for general tax purposes, and as a part of said general taxes. Such levies shall be part of the general tax roll and be collected as a part of general taxes against the property in the district.

Sec. 6.  RCW 27.12.050 and 2009 c 306 s 2 are each amended to read as follows:

(1) After the board of county commissioners has declared a rural county library district established, it ((shall)) must appoint a board of library trustees and provide funds for the establishment and maintenance of library service for the district by making a tax levy on the property in the district of not more than fifty cents per thousand dollars of assessed value per year sufficient for the library service as shown to be required by the budget submitted to the board of county commissioners by the board of library trustees, and by making a tax levy in such further amount as ((shall be)) authorized pursuant to RCW 27.12.222 or 84.52.052 or 84.52.056. Such levies ((shall be)) are a part of the general tax roll and ((shall)) must be collected as a part of the general taxes against the property in the district.

(2) The initial levy rate may not exceed the rate limit in subsection (1) of this section or, if applicable, the initial maximum levy rate contained in the ballot proposition approved by the voters to create the district. In subsequent years, the levy rate may be increased as authorized under chapter 84.55 RCW.

Sec. 7.  RCW 84.52.063 and 2001 c 187 s 25 are each amended to read as follows:

(1) A rural library district may impose a regular property tax levy in an amount equal to that which would be produced by a levy of fifty cents per thousand dollars of assessed value multiplied by an assessed valuation equal to one hundred percent of the true and fair value of the taxable property in the rural library district, as determined by the department of revenue's indicated county ratio((: PROVIDED, That)). However, when any county assessor ((shall)) finds that the aggregate rate of levy on any property will exceed the limitation set forth in RCW 84.52.043 and 84.52.050, as now or hereafter amended, before recomputing and establishing a consolidated levy in the manner set forth in RCW 84.52.010, the assessor ((shall)) must first reduce the levy of any rural library district, by such amount as may be necessary, but the levy of any rural library district ((shall)) may not be reduced to less than fifty cents per thousand dollars against the value of the taxable property, as determined by the county, prior to any further adjustments pursuant to RCW 84.52.010. For purposes of this section "regular property tax levy" ((shall)) means a levy subject to the limitations provided for in Article VII, section 2 of the state Constitution and/or by statute.

Sec. 8.  RCW 36.69.145 and 2010 c 106 s 303 are each amended to read as follows:

(1) A park and recreation district may impose regular property tax levies in an amount equal to sixty cents or less per thousand dollars of assessed value of property in the district in each year for six consecutive years when specifically authorized so to do by a majority of at least three-fifths of the voters thereof approving a proposition authorizing the levies submitted at a special election or at the regular election of the district, at which election the number of voters voting "yes" on the proposition must constitute three-fifths of a number equal to forty per centum of the number of voters voting in such district at the last preceding general election when the number of voters voting on the proposition does not exceed forty per centum of the number of voters voting in such taxing district in the last preceding general election; or by a majority of at least three-fifths of the voters thereof voting on the proposition if the number of voters voting on the proposition exceeds forty per centum of the number of voters voting in such taxing district in the last preceding general election. A proposition authorizing the tax levies may not be submitted by a park and recreation district more than twice in any twelve-month period. Ballot propositions must conform with RCW 29A.36.210. In the event a park and recreation district is levying property taxes, which in combination with property taxes levied by other taxing districts subject to the one percent limitation provided for in Article 7, section 2, of our state Constitution result in taxes in excess of the limitation provided for in RCW 84.52.043(2), the park and recreation district property tax levy must be reduced or eliminated as provided in RCW 84.52.010.

(2) The limitation in RCW 84.55.010 does not apply to the first levy imposed under this section following the approval of the levies by the voters under subsection (1) of this section.

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