SENATE BILL REPORT

HB 1014

BYRepresentative Haugen

Allowing certain public corporations to use local improvement district financing.

House Committe on Local Government

Senate Committee on Governmental Operations

Senate Hearing Date(s):March 26, 1987

Majority Report:  Do pass.

      Signed by Senators Halsan, Chairman; Garrett, Vice Chairman; DeJarnatt, Talmadge, Zimmerman.

Senate Staff:Walt Corneille (786-7452); Sam Thompson (786-7754)

                  March 26, 1987

AS REPORTED BY COMMITTEE ON GOVERNMENTAL OPERATIONS, MARCH 26, 1987

BACKGROUND:

Cities, towns, and counties are authorized to create public corporations to carry out federal programs, or improve governmental efficiencies, and the living conditions in urban areas.  Under this grant of authority, Seattle has created several public corporations, including one to operate the Pike Place Market.

Cities and towns are authorized to finance a wide variety of public improvements with local improvement districts (LID's), if they are of a special benefit to the nearby property.  The determination of whether an improvement confers special benefits to nearby property is a judicial test.  The State Supreme Court has held that a library can not be financed with a LID because the benefits are general and not special.  The court in that decision cited other authorities indicating that the following may not be financed with a LID:  war memorials, public auditoriums, a court house, and public school buildings.

Legislation enacted in 1985 allows:  (1) local governments to jointly perform LID's, (2) one local government to create a LID to finance another local government's public improvements, or (3) one local government to construct or acquire a public improvement for another.

SUMMARY:

It is a policy of the state that public improvements owned and operated by public corporations, which confer special benefits on property, should be able to be financed by local improvement districts (LID's).  As a part of state public policy, it is implied that museums and cultural or arts facilities confer special benefit to property.

Cities and towns are authorized to use LID's to finance facilities of any value for public corporations.  Cities and towns are authorized to construct facilities for public corporations, that are financed by LID's, using their own work forces if the lowest bid for the work that was received exceeds the preliminary cost estimate for the project by 10 or more percent.  The legal, financial and other expenses incurred by a public corporation that relate to a public improvement may be included as part of special assessment.

Public corporations are authorized to create joint LID's with local governments, have another local government create an LID for its projects, and allow another local government to construct its improvements.

Fiscal Note:      none requested

Senate Committee - Testified: Joe Daniels, WSAWWD; Dorothy Simpson, Museum Development Authority; Gerry Johnson, Museum Development Authority