SENATE BILL REPORT

SB 5174

BYSenators Hansen, Barr, Gaspard, Bauer, Anderson, Bailey, Warnke, Lee and von Reichbauer

Allowing the state investment board to invest in Washington land bank.

Senate Committee on Agriculture

Senate Hearing Date(s):January 22, 1987; January 27, 1987

Majority Report:  That Substitute Senate Bill No. 5174 be substituted therefor, and the substitute bill do pass.

      Signed by Senators Hansen, Chairman; Anderson, Bailey, Barr, Gaspard.

Senate Staff:Kaleen Cottingham (786-7415)

                  February 10, 1987

AS REPORTED BY COMMITTEE ON AGRICULTURE, JANUARY 27, 1987

BACKGROUND:

In 1986, the Legislature created the Washington Land Bank as a borrower-owned land bank patterned after the federal land bank.  The objective of the bank is to loan money to farmers and ranchers based on the long-term productivity of their land rather than short term cash flow.

The Washington Constitution prohibits the lending of state credit; thus, state sources of funding cannot be used to finance the land bank.

SUMMARY:

The state Investment Board is encouraged to consider investing money (such as pension funds) in the Washington Land Bank.

Several sections of the 1986 act are repealed relating to the deferral of interest and principal payments so as to enable the state Investment Board to consider investing in the land bank.

EFFECT OF PROPOSED SUBSTITUTE:

The state Investment Board is encouraged to consider investing money in the Washington Land Bank.  Deferrals of principal and/or interest which were allowed in the 1986 bill are still allowed only if approved by the Washington Land Bank.

Fiscal Note:      none requested

Senate Committee - Testified: David Weig, State Investment Board; Tom Oldfield, Division of Banking; Stu Trefry, Washington State Grange; Bill Roberts, Farm Bureau