FINAL BILL REPORT

SSB 6023

                                  C 289 L 87

BYSenate Committee on Agriculture (originally sponsored by Senators Hansen, Barr, Fleming and Newhouse)

Authorizing port districts to mortgage industrial development facilities, including agricultural facilities.

Senate Committee on Agriculture

House Committe on Trade & Economic Development

SYNOPSIS AS ENACTED

BACKGROUND:

Port districts may be established in counties for construction and maintenance of commercial facilities and industrial improvements.  Port districts may also establish industrial development districts.  Through specific authority granted under the port district statutes, or general authority under the Industrial Development Revenue Bonds Act, port districts may contract debt and issue bonds to finance industrial facilities.

Port districts have utilized the Industrial Development Revenue Bonds Act to issue revenue bonds because a provision of the Act allows bonds to be secured by mortgaging or encumbering facilities.  However, under their specific statutory authority, the districts cannot mortgage or encumber facilities to secure payment of bonds.

Revenue bonds sold through the Industrial Development Revenue Bonds Act must be tax exempt.  Because of the 1986 federal Tax Reform Act, revenue bonds issued for the purposes of the port districts will no longer be tax exempt.  Therefore, port districts can no longer use the Industrial Development Revenue Bonds Act to sell revenue bonds.

SUMMARY:

A port district has the authority to mortgage or otherwise encumber an industrial facility to secure payment of bonds sold to finance that facility.

The port property and facilities which port districts can finance through revenue bonds specifically includes facilities for freezing or processing agricultural products.

VOTES ON FINAL PASSAGE:

      Senate    42     1

      House 93   0 (House amended)

      Senate    37     1 (Senate concurred)

EFFECTIVE:July 26, 1987