AN ACT Relating to local government service agreements; adding a new chapter to Title 36 RCW; adding a new section to chapter 36.93 RCW; adding new sections to chapter 43.63A RCW; adding a new section to chapter 46.68 RCW; adding a new section to chapter 66.08 RCW; adding new sections to chapter 82.14 RCW; adding a new section to chapter 82.44 RCW; making an appropriation; and providing a contingent effective date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. The purpose of this act is to partially implement the provisions of Article XI, section 17 (HJR 4277), of the Washington state Constitution, by establishing a process and incentives by which local government service agreements can be established between local governments to determine which local governments should provide what services within specified geographic areas.

NEW SECTION. Sec. 2. Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

(1) "City" means any city or town, including any city operating under Title 35A RCW.

(2) "Department" means the department of community development.

(3) "Director" means the director of community development.

(4) "Governmental service" includes any service provided by government, and any facilities and equipment related to the provision of such services, including utility services, health services, social services, law enforcement services, fire prevention and suppression services, community development activities, environmental protection activities, economic development activities, and transportation services.

(5) "Initial meeting" means the meeting of local governments convened pursuant to section 3 or 11 of this act to establish a starting date to commence the development of local government service agreements.

(6) "Local government" means any county, city, or special district.

(7) "Local government service agreements" means agreements between local governments established pursuant to this chapter.

(8) "Special district" means any municipal or quasi- municipal corporation in the state, other than a county, city, or school district, that has a governing body to which all the members are elected directly and independently by the voters of the special district, or all of the members are appointed to the governing body and none of whom are officials of another local government.

(9) "Starting date" means the date selected to begin the process of developing proposed local government service agreements as provided in section 5 of this act.

NEW SECTION. Sec. 3. The county legislative authority of each county shall convene an initial meeting of all local governments located all or partially within the county to establish a starting date to commence the process to develop local government service agreements. This initial meeting shall be convened within ninety days of the effective date of this section.

Notice of the initial meeting shall be published at least once a week for at least four consecutive weeks prior to the initial meeting in a newspaper or newspapers of general circulation throughout the county. Notice of the initial meeting shall be mailed at least forty-five days prior to the initial meeting to the governing body, or a member of the governing body, of each local government located within the county.

The notices shall describe the purpose of the initial meeting, and indicate the time, date, and location of the initial meeting.

Failure to strictly comply with the notice requirements shall not affect the validity of the initial meeting.

NEW SECTION. Sec. 4. A representative of each local government shall be designated to represent the local government at this initial meeting. The governing body of a special district shall designate by resolution its representative. The county legislative authority of a county shall designate by resolution its representative, except that the executive of a charter county shall designate the county's representative in the manner the executive is authorized to make appointments, if the charter provides for an executive and grants the executive the general authority to make appointments. The mayor of a city with a mayor/council form of government shall designate the city's representative. The council of a city with a council/manager form of government, and the commission of a city with a commission form of government, shall designate by resolution the city's representative. A representative may be a member, an elected official of the local government, an employee of the local government, or any other person so designated.

The following local governments shall be considered to be formally participating in the process: (1) The county; (2) each city located all or partially within the county; (3) each special district located all or partially within the county that had its representative attend and be recognized at this initial meeting by signing in or otherwise recording the representative's presence; and (4) any other special district located all or partially within the county that is authorized to formally participate, as provided in this section.

A special district that fails to have a representative attend and be recognized at this initial meeting loses the authority to formally participate in any proceedings under the local government service agreement process, unless such participation is authorized by the representatives of local governments formally participating in the process prior to the establishment of a starting date for this process, as provided in section 5 of this act, or such participation is authorized by being included in a group developing proposed local government service agreements, as provided in section 6 of this act.

NEW SECTION. Sec. 5. A starting date for the process to develop proposed local government service agreements is established after the initial meeting upon the approval of: (1) The county representative; (2) the representative or representatives of a city or cities that include at least fifty percent of the total population of the county residing within incorporated areas; and (3) the representative or representatives of at least twenty percent of all special districts that are formally participating in the process.

The authority to establish a starting date shall lapse if such action has not been approved by the requisite local governments within not later than sixty days after the date of the initial meeting, unless a subsequent initial meeting is called as provided in section 11 of this act.

NEW SECTION. Sec. 6. After a starting date has been established, the local governments formally participating in the process to develop local government service agreements shall define a process to formally adopt binding local government service agreements.

Defining the process to develop local government service agreements includes: (1) Specifying the membership of the group or groups that will develop proposed local government service agreements; (2) specifying the voting authority of such members; (3) specifying the geographic area within the county that will be subject to the purview of each separate group, if more than a single group is to be established; and (4) establishing the method or methods by which local government service agreements are adopted formally and become binding.

The process to develop proposed local government service agreements may be altered at any time prior to the formal adoption of such agreements by action of the group charged with developing the proposals.

Any action to define or alter a process to develop proposed local government service agreements must be approved by the same approval method by which a starting date is established under section 5 of this act.

NEW SECTION. Sec. 7. Each group that is charged with developing proposed local government service agreements shall develop a work plan. A work plan includes: (1) Specifying the subject areas or problems that local government service agreements will address; (2) establishing goals and objectives; (3) establishing the process the group shall follow to develop proposed local governmental service agreements; and (4) establishing milestones for developing the proposed local governmental service agreements.

A work plan may be altered by the group charged with developing proposed local government service agreements at any time during the process to develop the proposed agreements.

Each work plan, and altered work plan, shall be submitted to the department within ten days of its adoption.

NEW SECTION. Sec. 8. A local government service agreement may include, but is not limited to, any or all of the following matters:

(1) A description of the provision of governmental services within the area covered by the agreement, including: (a) Which, if any, governmental services or portions of governmental services are subject to the agreement; (b) which local government or local governments should provide each of these included governmental services or portions of governmental services in which parts of the geographic area covered by the agreement, including which governmental services or portion of governmental services should be provided by an area-wide local government; and (c) whether and when a change in the provision of these or other governmental services or portions of governmental services is to be made.

(2) A dispute resolution arrangement, including use of mediation services made available by the department of community development pursuant to section 17 of this act, that can be used to resolve disputes over any matter addressed under subsection (1) of this section.

(3) How joint land use planning and zoning controls by the county and a city or cities, or by two or more cities may be established, made binding, and enforced.

(4) How common development standards between the county and a city or cities, or between two or more cities, may be established, made binding, and enforced.

(5) How capital improvement plans of the county, cities, and special districts may be coordinated.

(6) A transfer of revenues between local governments in relationship to their obligations for providing facilities and services. Such transfers of revenue could include, but not be limited to: (a) Tax-base sharing; (b) reallocating the distribution of state collected tax receipts that are distributed to the county and cities within the county pursuant to RCW 46.68.100 through 46.68.124, 66.08.200, 66.08.210, and 82.44.150; (c) reallocating the sales tax equalization receipts provided for in RCW 82.14.200 and 82.14.210 for which the county and cities within the county are eligible; (d) altering or eliminating the percentage of a city's sales and use tax receipts that are distributed to the county pursuant to RCW 82.14.030(2); and (e) altering the rate of a city sales and use tax that is imposed under RCW 82.14.030(1), not to exceed a rate of five-tenths of one percent.

(7) The establishment of urban area definitions to include all areas that are urban or designated to become urban, and which should be eventually located within a city or cities.

(8) The designation of additional area-wide governmental services to be provided by the county.

NEW SECTION. Sec. 9. It is the intent of the legislature to permit the creation of a flexible process to establish local government service agreements and that local governments possess broad authority to shape a variety of local government service agreements to meet their local needs and local circumstances. However, it is noted that in general, cities are the unit of local government most appropriate to provide urban services, counties are the unit of local government most appropriate to provide area-wide services, and some special districts are the units of local government most appropriate to provide those services transitionally required by a growing population and not otherwise available from counties or cities in a given area.

The process to establish local government service agreements should assure that all local governments, and Indian tribes at their option, are allowed to be heard on issues relevant to them.

NEW SECTION. Sec. 10. A single contiguous multicounty area, that includes all or part of two or more counties, may be included in a single process to establish local government service agreements in this multicounty area. The legislative authority of each county that includes an area proposed to be included in such a process to establish such multicounty local government service agreements must approve the inclusion of this area. Any area of a county that is included in a multicounty area to develop local government service agreements shall not be included with the remaining areas of the county to develop intracounty local government service agreements, unless expressly included in this additional intracounty process.

The process to establish such multicounty local government service agreements shall proceed in the same manner as in a single county area, except that: (1) The local governments formally participating in the process shall be each included county, each city located all or partially within the included multicounty area, and each special district located all or partially within the included multicounty area that had a representative attend and be recognized at this initial meeting; and (2) the approval process described under section 5 of this act must be by the representative of each included county, the representatives of those cities that include at least fifty percent of the total incorporated population of the included multicounty area, and representatives of at least twenty percent of all special districts that are formally participating in the process.

NEW SECTION. Sec. 11. At any time after a starting date has not been established as the result of an initial meeting, the county legislative authority of a county, or the council or councils of any city or cities with a population of at least fifty percent of the total incorporated population of a county, may call another initial meeting of all local governments located all or partially within the county to establish the process to develop local government service agreements. The provisions of sections 3 through 13 of this act shall otherwise control any other initial meeting called pursuant to this section.

NEW SECTION. Sec. 12. A local government service agreement process must be commenced in each county within six years of the effective date of this section if the legislature appropriates moneys for local governments to conduct these activities.

NEW SECTION. Sec. 13. Any local government service agreement that has been adopted formally shall be submitted to the department. The department shall review each submitted local government service agreement for conformance with the requirements of this chapter, including the requirement that governmental services be addressed in a comprehensive manner.

The financial incentives provided for in HB ______ shall be available for the county and local governments located within the area subject to the agreement if the department certifies that the agreement conforms with the requirements of this chapter.

NEW SECTION. Sec. 14. A new section is added to chapter 36.93 RCW to read as follows:

A boundary review board in a county shall be abolished if all of the following occur:

(1) The director of community development certifies that a local government service agreement has been adopted formally for the county that is in conformance with the requirements of chapter __ RCW (sections 1 through 13 of this act) and includes a dispute resolution arrangement adequate to resolve disputes over matters within the purview of a boundary review board; and

(2) Resolutions providing for the dissolution of the boundary review board have been adopted by the county legislative authority of a county and the council or councils of the city or cities that constitute at least fifty percent of the population of the county residing within cities.

A boundary review board that is so dissolved shall retain jurisdiction over any matter over which it has taken jurisdiction prior to the adoption of these resolutions and the certification by the director of community development.

NEW SECTION. Sec. 15. A new section is added to chapter 43.63A RCW to read as follows:

The department shall make grants from the moneys appropriated for such purpose to each county to assist in the development of proposed local government service agreements. Such grants shall be made to a county for this purpose only if the director certifies that: (1) An adequate work plan was submitted to the department; (2) the work plan was used to formally adopt a local government service agreement or agreements for an area or areas within the county that meets the requirements of this chapter within three years of the date of the initial meeting at which the process to develop the agreement commenced; and (3) any agreement addresses services within the included area on a comprehensive basis. However, the director may extend the three-year limitation when circumstances warrant such an extension.

The department shall make rules concerning such grants pursuant to chapter 34.04 RCW.

NEW SECTION. Sec. 16. A new section is added to chapter 43.63A RCW to read as follows:

The department shall design, and make available to local governments, a financial methodology or methodologies to assist local governments in assessing the need for, and the appropriate extent of, financial adjustments between local governments that arise from implementing local government service agreements or from annexations or incorporations of areas by cities.

NEW SECTION. Sec. 17. A new section is added to chapter 43.63A RCW to read as follows:

The department shall develop the capacity for and provide mediation services to local governments participating in the local government service agreement process, which may include a hearings officer, to resolve disputes between local governments arising over any matter addressed under section 8(1) of this act.

NEW SECTION. Sec. 18. A new section is added to chapter 46.68 RCW to read as follows:

Any funds that are distributed to counties, cities, or towns pursuant to chapter 46.68 RCW may be transferred by the recipient county, city, or town to another unit of local government pursuant to a local government service agreement as provided in section 8 of this act.

NEW SECTION. Sec. 19. A new section is added to chapter 66.08 RCW to read as follows:

Any funds that are distributed to counties, cities, or towns pursuant to chapter 66.08 RCW may be transferred by the recipient county, city, or town to another unit of local government pursuant to a local government service agreement as provided in section 8 of this act.

NEW SECTION. Sec. 20. A new section is added to chapter 82.14 RCW to read as follows:

The rate of sales and use tax imposed by a city under RCW 82.14.030(1) may be altered not to exceed a rate of five-tenths of one percent of the selling price (in the case of a sales tax) or value (in the case of a use tax) pursuant to a local government service agreement as provided in section 8 of this act.

NEW SECTION. Sec. 21. A new section is added to chapter 82.14 RCW to read as follows:

The percentage of a city's sales and use tax receipts that a county receives under RCW 82.14.030(2) may be altered or eliminated pursuant to a local government service agreement as provided in section 8 of this act.

NEW SECTION. Sec. 22. A new section is added to chapter 82.14 RCW to read as follows:

Any funds that are distributed to counties or cities pursuant to RCW 82.14.200 or 82.14.210 may be transferred by the recipient county or city to another unit of local government pursuant to a local government service agreement as provided in section 8 of this act.

NEW SECTION. Sec. 23. A new section is added to chapter 82.44 RCW to read as follows:

Any funds that are distributed to cities or towns pursuant to RCW 82.44.150 may be transferred by the recipient city or town to another unit of local government pursuant to a local government service agreement as provided in section 8 of this act.

NEW SECTION. Sec. 24. Seven hundred fifty thousand dollars, or so much thereof as may be necessary, is appropriated from the general fund to the department of community development for the biennium ending June 30, 1989, to implement this act.

NEW SECTION. Sec. 25. This act shall take effect on the same date as the proposed amendment to Article XI of the state Constitution, authorizing the legislature to establish processes by which citizens and local officials can alter their local governments, is validly submitted and is approved and ratified by the voters of the state at a general election held in November, 1988. If this proposed constitutional amendment is not so approved and ratified, this act shall be null and void in its entirety.

NEW SECTION. Sec. 26. Sections 1 through 13 of this act shall constitute a new chapter in Title 36 RCW.