AN ACT Relating to the enhancement of timber employment based on revenues derived at existing tax rates; amending RCW 84.33.041, 84.33.081, and 75.08.065; adding a new section to chapter 43.63A RCW; adding a new section to chapter 84.33 RCW; adding a new chapter to Title 50 RCW; adding a new chapter to Title 76 RCW; creating a new section; and making appropriations.

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

NEW SECTION. Sec. 1. The legislature finds and declares that:

(1) Since the timber boom of 1977 to 1979, the severe loss of timber employment in the state has precipitated an economic decline in timber communities. This decline has resulted in timber communities becoming economically distressed areas, increased state social welfare costs, and decreased state revenues.

(2) Timber employment has traditionally been cyclical. In addition, market and production changes have contributed to the structural decline of timber employment, leaving many unemployed timber workers unable to regain employment in the timber industry during the next cyclic upturn.

(3) There is promise for future industry growth due to long-run changes in timber market competition. The timber industry must be prepared to meet new opportunities when they arise.

(4) Therefore, it is in the interest of the state to modify the negative impact of the down cycles in timber employment, to assist the structurally unemployed in obtaining employment in new industries, and to assist firms in meeting new opportunities.

Sec. 2. Section 2, chapter 204, Laws of 1984 as amended by section 87, chapter 57, Laws of 1985 and RCW 84.33.041 are each amended to read as follows:

(1) An excise tax is imposed on every person engaging in this state in business as a harvester of timber on privately or publicly owned land. The tax is equal to the stumpage value of timber harvested for sale or for commercial or industrial use multiplied by the rate provided in this chapter.

(2) A credit is allowed against the tax imposed under this section for any tax paid under RCW 84.33.051.

(3) Moneys received as payment for the tax imposed under this section and RCW 84.33.051 shall be deposited in the timber tax distribution account hereby established in the state treasury.

(4) All earnings of investments of balances in the timber tax distribution account shall be credited to the ((~~general fund~~)) timber jobs enhancement account.

Sec. 3. Section 9, chapter 204, Laws of 1984 as amended by section 1, chapter 184, Laws of 1985 and RCW 84.33.081 are each amended to read as follows:

(1) On the last business day of the second month of each calendar quarter, the state treasurer shall distribute from the timber tax distribution account to each county the amount of tax collected on behalf of each county under RCW 84.33.051, less each county's proportionate share of appropriations for collection and administration activities under RCW 84.33.051, and shall transfer to the ((~~state general fund~~)) timber jobs enhancement account the amount of tax collected on behalf of the state under RCW 84.33.041, less the state's proportionate share of appropriations for collection and administration activities under RCW 84.33.041. The county treasurer shall deposit moneys received under this section in a county timber tax account which shall be established by each county. Following receipt of moneys under this section, the county treasurer shall make distributions from any moneys available in the county timber tax account to taxing districts in the county, except the state, under subsections (2) through (4) of this section.

(2) From moneys available, there first shall be a distribution to each taxing district having debt service payments due during the calendar year, based upon bonds issued under authority of a vote of the people conducted pursuant to RCW 84.52.056 and based upon excess levies for a capital project fund authorized pursuant to RCW 84.52.053, of an amount equal to the timber assessed value of the district multiplied by the tax rate levied for payment of the debt service and capital projects: PROVIDED, That in respect to levies for a debt service or capital project fund authorized before July 1, 1984, the amount allocated shall not be less than an amount equal to the same percentage of such debt service or capital project fund represented by timber tax allocations to such payments in calendar year 1984. Distribution under this subsection (2) shall be used only for debt service and capital projects payments. The distribution under this subsection shall be made as follows: One-half of such amount shall be distributed in the first quarter of the year and one-half shall be distributed in the third quarter of the year.

(3) From the moneys remaining after the distributions under subsection (2) of this section, the county treasurer shall distribute to each school district an amount equal to one-half of the timber assessed value of the district or eighty percent of the timber roll of such district in calendar year 1983 as determined under this chapter, whichever is greater, multiplied by the tax rate, if any, levied by the district under RCW 84.52.052 or 84.52.053 for purposes other than debt service payments and capital projects supported under subsection (2) of this section. The distribution under this subsection shall be made as follows: One-half of such amount shall be distributed in the first quarter of the year and one-half shall be distributed in the third quarter of the year.

(4) After the distributions directed under subsections (2) and (3) of this section, if any, each taxing district shall receive an amount equal to the timber assessed value of the district multiplied by the tax rate, if any, levied as a regular levy of the district or as a special levy not included in subsection (2) or (3) of this section.

(5) If there are insufficient moneys in the county timber tax account to make full distribution under subsection (4) of this section, the county treasurer shall multiply the amount to be distributed to each taxing district under that subsection by a fraction. The numerator of the fraction is the county timber tax account balance before making the distribution under that subsection. The denominator of the fraction is the account balance which would be required to make full distribution under that subsection.

(6) After making the distributions under subsections (2) through (4) of this section in the full amount indicated for the calendar year, the county treasurer shall place any excess revenue up to twenty percent of the total distributions made for the year under subsections (2) through (4) of this section in a reserve status until the beginning of the next calendar year. Any moneys remaining in the county timber tax account after this amount is placed in reserve shall be distributed to each taxing district in the county in the same proportions as the distributions made under subsection (4) of this section.

NEW SECTION. Sec. 4. A new section is added to chapter 84.33 RCW to read as follows:

The timber jobs enhancement account is hereby established in the state treasury. All of the money collected under RCW 84.33.041 on behalf of the state, less the state's proportionate share of appropriations for collection and administration activities under RCW 84.33.041, shall go into the timber jobs enhancement account. Money in the account may be spent only after appropriation for the counter-cyclical employment program under chapter 76.-- RCW (sections 5 through 11 of this act), the dislocated timber worker assistance program under chapter 50.-- RCW (section 13 of this act), and the timber business assistance program under chapter 43.63A RCW.

NEW SECTION. Sec. 5. Unless the context clearly requires otherwise, the definitions in this section apply throughout sections 5 through 11 of this act:

(1) "Average employment" means the current point on the trend line of employment in forest products in Washington during the past thirty years as reported by the department of employment security.

(2) "Department" means the department of natural resources.

(3) "Forest products industry" means industries as defined by the United States office of management and budget within the standard industrial code numbers 8, 24, and 26.

(4) "Program" means the counter-cyclical employment program established under this chapter.

NEW SECTION. Sec. 6. The counter-cyclical employment program is established in the department of natural resources. The program shall provide employment for unemployed forest products workers during times of below average employment in the forest products industry. The department shall administer the program in consultation with the department of fisheries, the parks and recreation commission, and other state and federal agencies as required.

NEW SECTION. Sec. 7. (1) The counter-cyclical employment program shall begin after the completion of two consecutive quarters in which employment in the Washington forest products industry is below average employment in the Washington forest products industry. The department of employment security shall notify all forest products industry employees receiving unemployment benefits, or who have exhausted unemployment benefits, of their eligibility for the program when their unemployment benefits expire. The department of employment security shall register workers for the program. Thirty days after two consecutive quarters of below average employment in the Washington forest products industry, the affected agencies shall begin hiring workers. Full employment levels under the program may be achieved sixty days after two consecutive quarters of below average employment in the Washington forest products industry.

(2) The program shall terminate sixty days after the completion of two consecutive quarters of above average employment in the Washington forest products industry. Workers in the program who have not found alternative employment shall be notified by the department that they may be eligible for benefits under the dislocated timber worker assistance program.

NEW SECTION. Sec. 8. Employment activities under the counter-cyclical employment program shall consist of activities which enhance the value of state and federal lands and waters and associated improvements, with priority given to enhancing state lands and waters. These activities shall include, but are not limited to, thinning, slashing, reforestation, fire suppression, road and trail maintenance, maintenance of recreational facilities, dike repair, and the building of shellfish beds.

NEW SECTION. Sec. 9. The department of natural resources may enter into agreements with state agencies and the federal government to accomplish the purposes of the counter-cyclical employment program.

NEW SECTION. Sec. 10. (1) Eligibility for employment under the counter-cyclical employment program shall occur only upon exhaustion of unemployment insurance benefits received upon termination of employment in the Washington forest products industry.

(2) Employees under the counter-cyclical employment program, except administrative employees, shall not be considered state employees for the purposes of existing provisions of law with respect to hours of work, sick leave, vacation, and civil service. Employees under the program shall receive the same medical and dental benefits as state employees.

(3) Compensation for employees under the counter-cyclical employment program shall be eight dollars per hour of employment, except as to supervisory and administrative personnel.

(4) Employment under the program shall not result in the displacement or partial displacement, such as reduction of hours of nonovertime work, wages, or other employment benefits, of currently employed workers.

NEW SECTION. Sec. 11. The department of employment security shall calculate the trend line in section 5(1) of this act by formulating a regression line based on the number of Washington forest products employees during the past thirty years from the date of determination.

Sec. 12. Section 75.16.070, chapter 12, Laws of 1955 as last amended by section 7, chapter 458, Laws of 1985 and RCW 75.08.065 are each amended to read as follows:

(1) The director may enter into contracts and agreements with a person to secure food fish or shellfish or for the construction, operation, and maintenance of facilities for the propagation of food fish or shellfish.

(2) The director may enter into contracts and agreements to procure from private aquaculturists food fish or shellfish with which to stock state waters.

(3) The director may enter into contracts and agreements to carry out the purposes of the counter-cyclical employment program under chapter 76.-- RCW (sections 5 through 11 of this 1987 act).

NEW SECTION. Sec. 13. A new section is added as a new chapter to Title 50 RCW to read as follows:

(1) The dislocated timber worker assistance program is established in the department of employment security. The program shall offer services to prepare dislocated forest products industry employees for jobs that are new to them in the timber industry, or jobs in other industries.

(2) Services available under the program shall include the following: Coordination, marketing, outreach, assessment, counseling, basic education, vocational training, on-the-job training, family support services, entrepreneurial training and assistance, relocation assistance, job development, job placement, and job banks. Whenever possible, labor and management shall be involved in the planning and implementation of the services enumerated in this subsection.

(3) Eligible recipients of services under the program shall be unemployed persons from the forest products industry. Eligible persons shall include current recipients of unemployment insurance benefits and individuals who have exhausted such benefits.

NEW SECTION. Sec. 14. A new section is added to chapter 43.63A RCW to read as follows:

(1) The timber business assistance program is created in the department of community development. The program shall provide technical assistance to timber industry firms to increase their markets and diversify their business activities in wood products. The program shall strengthen and diversify local economies, assist in the retention of existing firms and employment, and shall provide assistance to create more stable, long-term employment in timber communities.

(2) The timber business assistance program shall provide the following assistance to timber industry firms:

(a) Technical assistance which may include business planning, accounting systems, and internal management;

(b) Access to information on new national and international markets which Washington timber industry firms may be able to utilize in order to strengthen existing operations and diversify their business activities in wood products;

(c) Undertake studies to identify the degree to which new market opportunities are feasible for Washington timber industry firms.

(3) The department shall undertake an entrepreneurial identification and development program in no more than two counties with significant timber industry employment. The program shall be designed to identify local entrepreneurs and to provide them with information useful for business development and for identifying potential sources of financial assistance.

(4) The department of community development shall coordinate the activities of the timber business assistance program with the activities of the department of trade and economic development, the center for international trade in forest products, the small business assistance center established under RCW 28B.30.530, and with other relevant state agencies and departments.

(5) The timber business assistance program advisory board is created in the department of community development. The advisory board shall consist of nine members appointed by the governor and shall include: Two members representing local government in the timber zone, two members representing timber industry firms, two members representing timber industry organized labor in the timber zone, and three members representing the general public. The chair shall be selected by the governor from the members representing the general public members.

The members shall be appointed to three-year terms, except initial members who may be appointed to staggered one-year, two-year, or three-year terms. Any vacancy shall be filled by appointment by the governor. An appointee to a vacancy shall serve for the remainder of the unexpired term.

The board shall meet on the call of the chair, or on the request of a majority of the board. Members shall serve without compensation but shall be reimbursed for their travel expenses under RCW 43.03.050 and 43.03.060.

NEW SECTION. Sec. 15. (1) There is hereby appropriated to the department of employment security from the timber jobs enhancement account for the biennium ending June 30, 1989, the sum of one million five hundred thousand dollars, or so much thereof as may be necessary, for the dislocated timber worker assistance program.

(2) There is hereby appropriated to the department of community development from the timber jobs enhancement account for the biennium ending June 30, 1989, the sum of one million five hundred thousand dollars, or so much thereof as may be necessary, for the timber business assistance program.

(3) There is hereby appropriated to the department of natural resources from the timber jobs enhancement account for the biennium ending June 30, 1989, the money remaining in the timber jobs enhancement account after the appropriations under subsection (1) and (2) of this section, or so much thereof as may be necessary, for the counter-cyclical employment program. In no single year may more than twenty-four million dollars be expended for the counter-cyclical employment program.

(4) Unused money in the timber jobs enhancement account shall accumulate in the account and shall be properly invested by the state treasurer. Revenues from investments shall return to the account.

NEW SECTION. Sec. 16. Sections 5 through 11 of this act shall constitute a new chapter in Title 76 RCW.

NEW SECTION. Sec. 17. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.