AN ACT Relating to economic development; adding new sections to chapter 82.04 RCW; adding a new section to chapter 82.08 RCW; adding a new section to chapter 82.12 RCW; adding a new section to chapter 84.36 RCW; adding a new section to Title 43 RCW; adding a new section to chapter 28B.50 RCW; adding a new section to chapter 28C.04 RCW; and creating a new section.

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

NEW SECTION. Sec. 1. It is the intent of the state of Washington to provide assistance to those economically distressed areas that do not have substantial means to attract and encourage new business into their communities and also to provide substantial financial incentives for business that will create new jobs within those distressed areas. It is further the intent that the state of Washington provide assistance through the appropriate agencies to expedite licensing and permitting processes without jeopardizing environmental concerns to create new jobs as quickly as possible.

NEW SECTION. Sec. 2. A new section is added to chapter 82.04 RCW to read as follows:

(1) "New businesses" means businesses as defined under RCW 82.04.140 which were first legally required to register with the department on or after the effective date of this act and which have been in business for less than five years.

(2) "Distressed areas" means:

(a) Any county which exceeds the state-wide annual unemployment average and any city with a population of forty thousand or less within such a county; and

(b) Any city with a population of forty thousand or less that can demonstrate that it is distressed by reason of recent business closures, or notices thereof, severe layoffs for periods in excess of six months, and any other criteria established by the department of commerce and economic development to identify an area as distressed.

NEW SECTION. Sec. 3. A new section is added to chapter 82.04 RCW to read as follows:

Persons engaging in new businesses in distressed areas shall be exempt during the first five years of business operation from the payment of fifty percent of the tax otherwise imposed under this chapter by reason of such activities.

NEW SECTION. Sec. 4. A new section is added to chapter 82.08 RCW to read as follows:

(1) The tax levied by RCW 82.08.020 shall not apply to sales of new equipment to new businesses in distressed areas.

(2) The tax levied by RCW 82.08.020 shall not apply to sales of new equipment to existing businesses in distressed areas if the taxpayer can demonstrate to the department of revenue that the purchase of such equipment will result in a net increase in employment by the taxpayer in that area.

(3) Application for exemption shall be made to the department before the taxable retail sale occurs in the form and manner prescribed by the department. No sale is exempt from tax under this section until the department has issued an approval of the exemption. (4) For the purposes of this section, "new businesses" and "distressed areas" have the meanings defined in section 2 of this act.

NEW SECTION. Sec. 5. A new section is added to chapter 82.12 RCW to read as follows:

(1) The provisions of this chapter shall not apply in respect to the use of new equipment by new businesses in distressed areas.

(2) The provisions of this chapter shall not apply in respect to the use of new equipment by existing businesses in distressed areas if the taxpayer can demonstrate to the department of revenue that the use of such equipment will result in a net increase in employment by the taxpayer in that area.

(3) Application for exemption shall be made to the department before the taxable use occurs in the form and manner prescribed by the department. No use is exempt from tax under this section until the department has issued an approval of the exemption. (4) For the purposes of this section, "new businesses" and "distressed areas" have the meanings defined in section 2 of this act.

NEW SECTION. Sec. 6. A new section is added to chapter 84.36 RCW to read as follows:

Any physical improvements to real property in distressed areas made by new businesses shall be exempt from taxation for up to five assessment years immediately subsequent to the completion of the improvement. A taxpayer desiring to obtain the exemption granted by this section must file notice of his or her intention to construct the improvement before the improvement is made on forms prescribed by the department of revenue and furnished to the taxpayer by the county assessor.

The department of revenue shall adopt such rules as are necessary to properly administer this section.

NEW SECTION. Sec. 7. A new section is added to Title 43 RCW to read as follows:

All state and local agencies processing or issuing business licenses, permits, or registrations shall take measures to expedite the processing and issuance of licenses, permits, and registrations to new businesses in distressed areas as defined in section 2 of this act.

NEW SECTION. Sec. 8. A new section is added to chapter 28B.50 RCW to read as follows:

Community college districts in distressed areas shall provide classes needed by new businesses and expanding businesses in such areas for their employees, and shall work with such businesses to establish programs for the conduct of training upon business premises. As used in this section, "distressed areas" and "new businesses" have the meanings defined in section 2 of this act.

NEW SECTION. Sec. 9. A new section is added to chapter 28C.04 RCW to read as follows:

The commission shall provide classes needed by new businesses and expanding businesses in distressed areas for their employees, and shall work with such businesses to establish programs for the conduct of training upon business premises. As used in this section, "new businesses" and "distressed areas" have the meanings defined in section 2 of this act.