FINAL BILL REPORT

SHB 523

                                  C 436 L 87

BYHouse Committee on Environmental Affairs (originally sponsored by Representatives Hine and Allen)

Providing for the financing of pollution control facilities.

House Committe on Environmental Affairs

Senate Committee on Parks & Ecology

SYNOPSIS AS ENACTED

BACKGROUND:

In 1986, the legislature enacted the Water Quality Joint Development Act (WQJDA) which authorized public bodies to enter into service agreements with private parties operating sewage treatment plants.

Under the WQJDA, the legislature provided that public bodies which participate in private service agreements are eligible for all grants and loans that would otherwise be available to public bodies.  These grants or loans must be used either for a public ownership interest or to defray payments made to the service provider.

In 1980, the voters of the state approved Referendum 39 which authorized the state finance commission to issue up to $450 million in general obligation bonds to provide funds for the planning, design, construction, acquisition and improvement of public waste disposal facilities.  The proceeds, administered by the Department of Ecology and deposited in the Waste Disposal Facilities Revolving Account, are used in part for grants and loans to public bodies.

The Centennial Clean Water Act (CCWA) established the Water Quality Account administered by the Department of Ecology.  A fiscal year total of $40 million was guaranteed, funded by the cigarette and tobacco products tax, the sales tax recapture and General Fund money, if necessary.

The Attorney General's Office has concluded that funds otherwise available to public bodies under the CCWA cannot be used for grants or loans to public bodies entering into private service agreements under the WQJDA.  The definition of "water pollution control facilities" in the CCWA is limited to those "owned or operated by public bodies." Similarly, Referendum 39 defines "waste disposal and management facilities" as those owned or operated by public bodies.

Procurement procedures under the WQJDA include a bidder's conference and an opportunity for resubmittal of proposals. Service providers must prove that costs will be lower than if the project were done by a public body.  An appeal process exists to challenge the approval of a contract.  A public hearing must be conducted and written findings that the project is in the public interest must be made.

SUMMARY:

Funds in the Waste Disposal Facilities Revolving Account and the Water Quality Account may be used to assist a public body to obtain an ownership interest in waste disposal and management facilities or to defray a part of payments made under a service agreement to a private service provider. Funds used to pay a private service provider may be dispersed either periodically or in a lump sum and must be equivalent to a loan or grant that would otherwise be made.  A public body may not provide funds to a private entity before services are rendered or materials are provided. The state treasurer is authorized to issue warrants for loans and grants upon authentication and certification by the agency head or designee.

The definitions of "waste disposal and management facilities" in Referendum 39 and "water pollution control facilities" in the Centennial Clean Water Act are amended to eliminate the references to public operation and ownership.

Public bidding requirements otherwise applicable to first-class city and county agreements do not apply to agreements entered into in compliance with the procurement procedures set forth in the Water Quality Joint Development Act.

VOTES ON FINAL PASSAGE:

      House 93   0

      Senate    47     0(Senate amended)

      House 90   0(House concurred)

EFFECTIVE:May 18, 1987