H-1016              _______________________________________________

                                                   HOUSE BILL NO. 1197

                        _______________________________________________

State of Washington                              49th Legislature                              1985 Regular Session

By Representatives Grimm and Sayan

Read first time 2/8/85 and referred to Committee on Ways & Means.

AN ACT Relating to retirement of pension unfunded liabilities; amending RCW 82.12.020; reenacting and amending RCW 82.08.020; adding a new section to chapter 43.79 RCW; and providing an effective date.

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

        Sec. 1.  Section 82.08.020, chapter 15, Laws of 1961 as last amended by section 62, chapter 3, Laws of 1983 2nd ex. sess. and RCW 82.08.020 are each reenacted and amended to read as follows:

          (1) There is levied and there shall be collected a tax on each retail sale in this state equal to six ((and five-tenths)) percent of the selling price.

          (2) The tax imposed under this chapter shall apply to successive retail sales of the same property.

          (3) The rate provided in this section applies to taxes imposed under chapter 82.12 RCW as provided in RCW 82.12.020.

(4) There is levied and there shall be collected an additional tax on each retail sale in this state equal to five-tenths percent of the selling price.  The revenue from this additional tax shall be deposited in the pension unfunded liability account under section 2 of this 1985 act.  The additional tax imposed under this subsection shall terminate as provided in section 2 of this 1985 act.

NEW SECTION. Sec. 2.  A new section is added to chapter 43.79 RCW to read as follows:

          (1) The pension unfunded liability account is hereby created in the state general fund.  Interest earned by investment of the money in the account shall be credited to the account.  On the last day of the calendar quarter when the balance in the account first equals ..... dollars, the state treasurer shall transfer the money in the account to the retirement systems in proportion to each system's unfunded liability, the account shall be abolished, and the additional tax imposed under RCW 82.08.020(4) shall terminate.

          (2) As used in this section:

          (a) "Retirement system" means a pension or retirement system established under the statutes of this state, to which the state contributes five percent or more of the funds of the system.

          (b) "Unfunded liability" means the unfunded system benefits of the retirement system, as calculated on the last day of the system's fiscal year that ended during 1984.

        Sec. 3.  Section 82.12.020, chapter 15, Laws of 1961 as last amended by section 7, chapter 7, Laws of 1983 and RCW 82.12.020 are each amended to read as follows:

          There is hereby levied and there shall be collected from every person in this state a tax or excise for the privilege of using within this state as a consumer any article of tangible personal property purchased at retail, or acquired by lease, gift, repossession, or bailment, or extracted or produced or manufactured by the person so using the same, or otherwise furnished to a person engaged in any business taxable under RCW 82.04.280, subsections (2) or (7).  This tax will not apply with respect to the use of any article of tangible personal property purchased, extracted, produced or manufactured outside this state until the transportation of such article has finally ended or until such article has become commingled with the general mass of property in this state.  This tax shall apply to the use of every article of tangible personal property, including property acquired at a casual or isolated sale, and including byproducts used by the manufacturer thereof, except as hereinafter provided, irrespective of whether the article or similar articles are manufactured or are available for purchase within this state.  Except as provided in RCW 82.12.0252, payment by one purchaser or user of tangible personal property of the tax imposed by chapter 82.08 or 82.12 RCW shall not have the effect of exempting any other purchaser or user of the same property from the taxes imposed by such chapters.  The tax shall be levied and collected in an amount equal to the value of the article used by the taxpayer multiplied by the total of the rates in effect for the retail sales tax under RCW 82.08.020, as now or hereafter amended, in the county in which the article is used.

NEW SECTION. Sec. 4.     This act shall take effect July 1, 1987, if the proposed amendment to Article XXX of the state Constitution providing for the funding of retirement system benefits is validly submitted to and is approved and ratified by the voters at a general election held in November 1985.  If the proposed amendment is not so approved and ratified, this act shall be null and void in its entirety.