SENATE BILL REPORT
SB 5872
BYSenators Anderson, Smitherman, Lee, Murray, West, McMullen, Benitz, Saling, Barr and Patterson
Establishing a rural affairs revitalization committee and undertaking rural development projects.
Senate Committee on Economic Development & Labor
Senate Hearing Date(s):February 17, 1989; February 20, 1989
Majority Report: Do pass and be referred to Committee on Ways & Means.
Signed by Senators Anderson, Vice Chairman; McMullen, Matson, Murray, Saling, Smitherman, Williams.
Senate Staff:Patrick Woods (786-7430)
February 20, 1989
Senate Committee on Ways & Means
Senate Hearing Date(s):February 22, 1989; April 3, 1989
Majority Report: That Substitute Senate Bill No. 5872 be substituted therefor, and the substitute bill do pass.
Signed by Senators McDonald, Chairman; Craswell, Vice Chairman; Amondson, Bailey, Bauer, Bluechel, Cantu, Hayner, Johnson, Lee, Matson, Moore, Newhouse, Smith, Talmadge, Williams.
Senate Staff:Lynn French (786-7715)
April 6, 1989
AS REPORTED BY COMMITTEE ON WAYS & MEANS, APRIL 3, 1989
BACKGROUND:
During the last decade, the state's rural counties experienced continued economic downturns that proved disproportionately severe as compared with the urbanized counties in the central Puget Sound region. Twenty-two of the state's 39 counties, all of which are rural, fall within the category "distressed" as defined under several state programs. It is estimated that distressed counties have lost approximately 14,000 jobs between 1980 and 1986 as opposed to a net gain of 185,000 jobs in the rest of the state. The contrast between the two regions is further demonstrated by the difference in per capita income with the central Puget Sound having 15 percent over the state's average income level, and other regions having 10 percent below the average level (1987 average state per capita income was $12,615). The reasons for the economic disparity within the state are complex and varied. However, the dependence of rural regions on agriculture, timber, fishing and resource-based industries, along with the depressed markets for the majority of these products during the 1980s, is considered to be a major factor driving this phenomena. In an effort to promote rural economic development, the Legislature established a number of programs administered by several agencies including the Department of Community Development, the Department of Trade and Economic Development and the Department of Agriculture.
Numerous industrialized nations have utilized the technical and academic expertise of research institutions to promote economic growth and increase industrial productivity. In recent years, several states have established industrial extension services modeled after the rural extension program to improve the competitiveness of their industries.
SUMMARY:
There is established the Rural Revitalization Interagency Committee within the Department of Community Development to provide policy direction and promote coordination of the state's rural development programs. The committee is comprised of state government agencies that provide services to rural areas.
The Department of Community Development, in consultation with the committee and other interest groups, is directed to develop a rural development plan and establish four pilot revitalization projects modeled after the Tri-Cities Diversification Act. The goals of the projects are to encourage the formation of new businesses and industries in rural areas; retain existing businesses; maintain and develop infrastructure conducive to revitalization; and build local development capacity with an emphasis on local decision making. The department in consultation with the committee is authorized to develop an application and evaluation process for the projects. The committee, in choosing project sites, is to consider the degree of economic distress in an area and the feasibility of significantly impacting the community's economy. The types of development activities that may be undertaken include export promotion, import substitution, tourism development, maintenance and improvement of essential public services and a university industrial extension assistance program which is a required activity.
A local revitalization board is established to assist the department in carrying out the projects. Its approval is required prior to undertaking any development activities. The board is comprised of local representatives of the business community, labor, government and development organizations. The Department of Community Development is responsible for oversight and administration of the projects.
An industrial extension program is established within the Business Assistance Center of the Department of Trade and Economic Development. The center is authorized to select institutions of higher education to undertake industrial extension programs in each of the rural revitalization sites. The selected institutions are required to demonstrate the participation of local educational institutions and development groups; provide the services of industrial engineers and other technicians familiar with industry modernization needs; and develop mechanisms to provide information on new manufacturing technologies.
The Business Assistance Center is authorized to work with the selected institutions to review mechanisms for establishing flexible manufacturing networks through which small firms cooperatively access modernization marketing and training services.
The Department of Community Development and the Business Assistance Center are required to report to the appropriate Senate and House standing committees outlining the number of jobs generated or retained, the result of client satisfaction surveys, and any recommendations on the program.
The 1990 termination date of the Tri-Cities diversification program is rescheduled to 1991.
EFFECT OF PROPOSED SUBSTITUTE:
The requirement that revitalization projects be scheduled is removed.
The provisions establishing an industrial extension program and studying flexible manufacturing networks are deleted.
The program's direct appropriation is removed and sections 1-13 are made contingent upon funding in the budget.
Appropriation: $400,000 to the Department of Community Development; $400,000 to the Business Assistance Center.
Revenue: none
Fiscal Note: requested February 17, 1989
Senate Committee - Testified: ECONOMIC DEVELOPMENT & LABOR: Meg VanSchoorl, Department of Community Development
Senate Committee - Testified: WAYS & MEANS: No one