H-1382              _______________________________________________

                                                    HOUSE BILL NO. 596

                        _______________________________________________

State of Washington                              50th Legislature                              1987 Regular Session

By Representatives Valle, Grimm, Braddock, Winsley, Nelson, S. Wilson, Ebersole, Hankins, Locke, Bristow, Holland, May, Kremen, Unsoeld and Jesernig

Read first time 2/4/87 and referred to Committee on State Government.

AN ACT Relating to expenses incurred in the issuance of state general obligation bonds; and amending RCW 39.42.040 and 39.46.070.

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

        Sec. 1.  Section 4, chapter 184, Laws of 1971 ex. sess. and RCW 39.42.040 are each amended to read as follows:

(1) The proceeds of the sale of any bonds shall be used solely for the purposes, including any expense incurred in connection with the issuance and sale of such bonds, specified in the general statute or special act authorizing the issuance of such bonds.

(2) Subsection (1) of this section notwithstanding for bonds issued after the effective date of this 1987 section, legal services of bond counsel shall be paid from appropriations therefor  and not from the proceeds of the sale of the bonds for which they were incurred.

        Sec. 2.  Section 7, chapter 167, Laws of 1983 and RCW 39.46.070 are each amended to read as follows:

          The proceeds of any bonds issued by the state or a local government may be used to pay incidental costs and costs related to the sale and issuance of the bonds.  Such costs include payments for fiscal and legal expenses, obtaining bond ratings, printing, engraving, advertising, establishing and funding reserve accounts and other accounts, an amount for working capital, capitalized interest for up to six months, necessary and related engineering, architectural, planning, and inspection costs, and other similar activities or purposes:  PROVIDED, That for bonds issued by the state after the effective date of this 1987 section, legal expenses of bond counsel shall be paid as provided in RCW 39.42.040.