SENATE BILL REPORT

SB 5685

BYSenators Sellar, Hansen, Newhouse and Barr

Authorizing bonds for new facility for apple advertising commission.

Senate Committee on Agriculture

Senate Hearing Date(s):February 19, 1987

Majority Report:  Do pass and refer to Committee on Ways & Means.

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

Senate Staff:Tom McDonald (786-7404)

                  February 19, 1987

Senate Committee on Ways & Means

Senate Hearing Date(s):February 19, 1987

Majority Report:  Do pass.

      Signed by Senators McDermott, Chairman; Gaspard, Vice Chairman; Bauer, Bluechel, Cantu, Kreidler, Lee, McDonald, Moore, Owen, Rinehart, Talmadge.

Senate Staff:Gary Benson (786-7441)

                  February 23, 1987

AS PASSED SENATE, FEBRUARY 20, 1987

BACKGROUND:

The Apple Advertising Commission was created in 1937 and is currently the largest commodity commission in the state with an annual budget of $7.2 million.  The budget is completely funded by assessments on all fresh apple sales.

To further promote sales and otherwise efficiently fulfill the purposes of the Commission, a new building has been constructed for Commission offices, for warehouse space, and for a display room.  The Commission needs to establish a long term financing arrangement for the cost of acquiring the land and constructing and equipping the building.  The total cost of building the facility and administering the program to finance the facility is estimated to be approximately $1.3 million.  The Commission has $500,000 available in commission funds to apply to the project and seeks an additional $800,000.

SUMMARY:

The State Finance Committee is authorized to issue general obligation bonds up to $800,000 to provide partial financing of a new building for the Washington Apple Advertising Commission and to pay administrative expenses incidental to the bonding procedures.  The bonds are to be issued and sold in accordance with the general bonding requirements set forth in statute.

Proceeds from the sale of bonds are to be deposited with the State Treasurer in the state building construction account, and the proceeds shall be administered by the Apple Commission.  Debt service on the bonds is to be paid out of the general fund; however, the general fund is to be reimbursed by the Apple Commission.  Whenever the principal and interest on a bond are due, the Commission must pay from its general fund to the State Treasurer the amount due.

The bonds cannot be issued until:  (1) the Commission certifies that the net proceeds of the bonds, together with the other available funds, will be sufficient for the requirements of the capital project; and (2) the estimated future income from assessments levied by the Commission will maintain an adequate balance to enable the Commission to pay the principal and interest on the bonds as they become due.

Appropriation:    $800,000

Fiscal Note:      requested

Effective Date:The bill contains an emergency clause and takes effect immediately.

Senate Committee - Testified: AGRICULTURE:  Senator Sellar; Tim Kerr, Deputy State Treasurer, State Finance Committee; Jim Matson, Washington Apple Advertising Commission

Senate Committee - Testified: WAYS & MEANS:  Senator Sellar; Jim Matson, Washington Apple Advertising Commission