HOUSE BILL REPORT

ESB 5232

BYSenators Bender, McMullen and Lee

Establishing the office of capital projects.

House Committe on Trade & Economic Development

Majority Report:  Do pass with amendments.  (11)

      Signed by Representatives Cantwell, Chair; Wineberry, Vice Chair; Doty, Ranking Republican Member; Kremen, Moyer, Rasmussen, Raiter, Rector, Tate, Walk and Youngsman.

House Staff:Bill Lynch (786-7092)

AS REPORTED BY COMMITTEE ON TRADE & ECONOMIC DEVELOPMENT

MARCH 29, 1989

BACKGROUND:

A considerable number of major urban and rural development projects which are often referred to as "capital projects" are undertaken each year throughout the world.  A large percentage of the projects are funded through international financial institutions such as the World Bank, Africa Bank or Asian Bank, and the projects are of such magnitude as to require the expertise and resources of a consortium of businesses.  Additionally, initial government involvement is often advantageous for businesses attempting to secure contracts for capital projects.

SUMMARY:

BILL AS AMENDED:  A pilot program named the Office of Capital Projects is established within the Department of Trade and Economic Development.  The office is required to assist Washington businesses in the development of consortiums, assist consortiums in Washington to market their products and services in international markets, compile information on capital project opportunities for Washington businesses, and provide initial assistance to consortiums in securing capital project contracts.

A "capital project" is defined as a major urban or rural economic development project.  A "consortium" is defined as a group of businesses acting as a unit for the purpose of securing a capital project.

The office may seek and receive funds from public and private sectors, and coordinate with other governmental agencies.  It may also charge reasonable fees for the use of its services.  Contracts entered into by consortiums do not constitute a contract with the state or a lending of the state's credit.  The office is prohibited from entering into a binding contract with foreign governments.

The office is scheduled to terminate under the sunset process on June 30, 1992.

AMENDED BILL COMPARED TO ENGROSSED BILL:  The provision requiring the Legislative Budget Committee to review the capital projects program in addition to the sunset review is deleted.  The sunset date is moved up from June 30, 1994 to June 30, 1992.

Appropriation:    $90,000 is appropriated from the General Fund to the Department of Trade and Economic Development.

Fiscal Note:      Available.

House Committee ‑ Testified For:    Senator Rick Bender, Prime Sponsor; Donald Lorentz and Stephen Odom, Department of Trade and Economic Development.

House Committee - Testified Against:      None Presented.

House Committee - Testimony For:    Many businesses are unaware of the many opportunities to bid on large projects, or lack knowledge on foreign tariffs or business requirements.  This office will open up many opportunities for Washington businesses to be awarded contracts on capital projects.

House Committee - Testimony Against:      None Presented.