SENATE BILL REPORT

SB 6474

BYSenators Williams, von Reichbauer, Moore, Rinehart, Niemi, Talmadge and Murray

Changing provisions relating to purchase and sale of property and policy decisions by certain public corporations.

Senate Committee on Financial Institutions & Insurance

Senate Hearing Date(s):January 23, 1990; February 2, 1990

Majority Report:  That Substitute Senate Bill No. 6474 be substituted therefor, and the substitute bill do pass.

      Signed by Senators von Reichbauer, Chairman; Johnson, Vice Chairman; Fleming, McMullen, Moore, Sellar, Smitherman, West.

Senate Staff:Walt Corneille (786-7416)

                  February 8, 1990

AS REPORTED BY COMMITTEE ON FINANCIAL INSTITUTIONS & INSURANCE, FEBRUARY 2, 1990

BACKGROUND:

Counties, cities, and towns are authorized by state law to create public corporations.  These corporations may be empowered to administer and execute federal grants or programs and to receive and administer private funds, goods or services for any lawful public purpose, and basically perform any lawful public purpose or public function the county, city or town determines that the public corporation should perform.  The public corporation so created has the authority among other things to own and sell real and personal property.

Several cities have established public corporations called preservation and development authorities to manage public and private funds for the preservation of historic properties.  Several public corporations that manage historical properties have entered into agreements with investor groups to help finance their operations when public funding was inadequate.  Involved in these agreements was a transfer of an interest in the property managed by the corporation.

It has been suggested that before any interest in property is transferred by a public corporation, a public hearing should be required.

SUMMARY:

A public corporation is empowered to sell real property only after a public hearing has been held.  Any county, city or town which creates a public corporation must review, approve, modify or disapprove any sale of real property or real property interest that has been transferred by the city, county or town to the public corporation.  A city, county or town must adopt a procedure to hear appeals and to review and approve or disapprove decisions by the public corporation on any matter.  The county, city or town may limit the subject matter that it may review on appeal.

EFFECT OF PROPOSED SUBSTITUTE:

A city is required to impose deed restrictions that are necessary to ensure the continued use of any property transferred to a public corporation so that the property continues to be used for the public purpose for which it was transferred.  A city, county or town creating a public corporation must require the corporation to give 30 days written notice of any proposed sale or encumbrance of any real property that was transferred to the corporation from the county, city or town.  Notice must be sent to the chief executive and legislative body of the county, city or town, to each local newspaper of general circulation, and to each radio or television station that has filed a written request to be notified with the public corporation.

A public corporation may not sell or encumber any property that has been transferred to it by a city, county or town unless the sale or encumbrance has been approved by the governing body of the public corporation at a public meeting.  The meeting is subject to the notice requirements for special meetings under the Open Public Meetings Act.  The corporation also must advertise notice of a special meeting in a local newspaper of general circulation at least twice.

Added to the definition contained in the eminent domain statute is a definition of "public market."  A public market is defined to include all real or personal property located in a district or area designated by a city as a "public market," that is traditionally devoted to providing farmers, crafts vendors, and other merchants retail space.  A "public market" is not required to be exclusively or primarily used for traditional public market activities and may include areas used for other public purposes.

A first class city is given the power to establish a "public market" with the same definition in the eminent domain statute.  A city or town's authority to acquire and operate public markets is expanded to include the public market definition added to the eminent domain statute.

Appropriation:    none

Revenue:    none

Fiscal Note:      requested

Senate Committee - Testified: David Schaible, Chair, Pike Place Market Constituency (pro); Barbara Stenson, Historic Seattle PDA Council Member (con); Cathy Galbraith, Historic Seattle PDA, Executive Director (con); Karen Bean, Historic Seattle PDA Council Member (con); Dennis Gardner, Pike Place Market (con); Donald H. Stout, City of Seattle (con); Dorri Delgado, Historical Committee (pro); Rolf Nieuwejaar