AN ACT Relating to toll bridges and ferries; amending RCW 47.60.160, 47.60.326, 47.60.420, and 47.60.440; reenacting and amending RCW 47.60.150; and adding a new section to chapter 47.60 RCW.

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

Sec. 1. Section 47.60.150, chapter 13, Laws of 1961 as last amended by section 1, chapter 23, Laws of 1986 and by section 2, chapter 66, Laws of 1986 and RCW 47.60.150 are each reenacted and amended to read as follows:

Subject to the provisions of RCW 47.60.326, the schedule of charges for the services and facilities of the system shall be fixed and revised from time to time by the commission so that the tolls and revenues collected together with any moneys in the Puget Sound ferry operations account appropriated for maintenance and operation, and all moneys in the Puget Sound capital construction account available for debt service will yield annual revenue and income sufficient, after allowance for all operating, maintenance, and repair expenses to pay the interest and principal and sinking fund charges for all outstanding revenue bonds, and to create and maintain a fund for ordinary renewals and replacements: PROVIDED, That if provision is made by any resolution for the issuance of revenue bonds for the creation and maintenance of a special fund for rehabilitating, rebuilding, enlarging, or improving all or any part of the ferry system then such schedule of tolls and rates of charges shall be fixed and revised so that the revenue and income will also be sufficient to comply with such provision.

All income and revenues as collected shall be paid to the state treasurer for the account of the department as a separate trust fund and to be segregated and disbursed upon order of the department: PROVIDED, That the fund so segregated and set apart for the payment of the revenue bonds may be remitted to and held by a designated trustee in such manner and with such collateral as may be provided in the resolution authorizing the issuance of said bonds. No expenditure may be made from the revenue fund established under this section and the bond resolution without an appropriation by law. Nothing in this section requires tolls on the Hood Canal bridge except as may be required by any bond covenants.

Sec. 2. Section 47.60.160, chapter 13, Laws of 1961 as amended by section 312, chapter 7, Laws of 1984 and RCW 47.60.160 are each amended to read as follows:

If it be ascertained that any expense to the motor vehicle fund has been incurred in any manner under this chapter through the department or otherwise, all such expenses shall be promptly reimbursed to the motor vehicle fund out of tolls and revenues derived by the department through any or all of its operations hereunder. This section does not apply to payments of principal and interest on bonds, sinking fund requirements, and payments into reserves related to the ferry and Hood Canal refunding revenue bonds issued under RCW 47.60.400.

Sec. 3. Section 5, chapter 344, Laws of 1981 as amended by section 25, chapter 15, Laws of 1983 and RCW 47.60.326 are each amended to read as follows:

(1) In order to maintain an adequate, fair, and economically sound schedule of charges for the transportation of passengers, vehicles, and commodities on the Washington state ferries, ((~~including the Hood Canal bridge,~~)) the department of transportation each year shall conduct a full review of such charges.

(2) Prior to February 1st of each odd-numbered year the department shall transmit to the transportation commission a report of its review together with its recommendations for the revision of a schedule of charges for the ensuing biennium. The commission on or before July 1st of that year shall adopt as a rule, in the manner provided by the Washington administrative procedure act, a schedule of charges for the Washington state ferries for the ensuing biennium commencing July 1st. The schedule may initially be adopted as an emergency rule if necessary to take effect on, or as near as possible to, July 1st.

(3) The department in making its review and formulating recommendations and the commission in adopting a schedule of charges may consider any of the following factors:

(a) The amount of subsidy available to the ferry system for maintenance and operation;

(b) The time and distance of ferry runs;

(c) The maintenance and operation costs for ferry runs with a proper adjustment for higher costs of operating outmoded or less efficient equipment;

(d) The efficient distribution of traffic between cross-sound routes;

(e) The desirability of reasonable commutation rates for persons using the ferry system to commute daily to work;

(f) The effect of proposed fares in increasing walk-on and vehicular passenger use;

(g) The effect of proposed fares in promoting all types of ferry use during nonpeak periods;

(h) Such other factors as prudent managers of a major ferry system would consider.

(4) If at any time during the biennium it appears that projected toll revenues from the ferry system, together with the appropriation from the Puget Sound ferry operations account and any other operating subsidy available to the Washington state ferries, will be less than the projected total cost of maintenance and operation of the Washington state ferries for the biennium, the department shall forthwith undertake a review of its schedule of charges to ascertain whether or not the schedule of charges should be revised. The department shall, upon completion of its review report, submit its recommendation to the transportation commission which may in its sound discretion revise the schedule of charges as required to meet necessary maintenance and operation expenditures of the ferry system for the biennium or may defer action until the regular annual review and revision of ferry charges as provided in subsection (2) of this section.

(5) The provisions of RCW 47.60.330 relating to public participation shall apply to the process of revising ferry tolls under this section.

Sec. 4. Section 3, chapter 9, Laws of 1961 ex. sess. as last amended by section 4, chapter 66, Laws of 1986 and RCW 47.60.420 are each amended to read as follows:

To the extent that all revenues from the Washington state ferry system ((~~and the Hood Canal bridge~~)) available therefor are insufficient to provide for the payment of principal and interest on the bonds authorized and issued under RCW 47.60.400 through 47.60.470 and for sinking fund requirements established with respect thereto and for payment into such reserves as the department has established with respect to the securing of the bonds, there is imposed a first and prior charge against the Puget Sound capital construction account of the motor vehicle fund created by RCW 47.60.505 and, to the extent required, against all revenues required by RCW 46.68.100 to be deposited in the Puget Sound capital construction account.

To the extent that the revenues from the Washington state ferry system ((~~and the Hood Canal bridge~~)) available therefor are insufficient to meet required payments of principal and interest on bonds, sinking fund requirements, and payments into reserves, the department shall use moneys in the Puget Sound capital construction account for such purpose. ((Any moneys from the Puget Sound capital construction account used by the department to pay the obligations shall be repaid by the department to the motor vehicle fund from tolls of the Washington state ferry system and the Hood Canal bridge, and tolls shall be continued for any required additional length of time necessary for this purpose.))

Sec. 5. Section 5, chapter 9, Laws of 1961 ex. sess. as last amended by section 6, chapter 66, Laws of 1986 and RCW 47.60.440 are each amended to read as follows:

The Washington state ferry system shall be efficiently managed, operated, and maintained as a revenue-producing undertaking. Subject to the provisions of RCW 47.60.326 the commission shall maintain and revise from time to time as necessary a schedule of tolls and charges on said ferry system and, if necessary to comply with bond covenants, on the Hood Canal bridge which together with any moneys in the Puget Sound ferry operations account appropriated for maintenance and operation and all moneys in the Puget Sound capital construction account available for debt service will produce net revenue available for debt service, in each fiscal year, in an amount at least equal to minimum annual debt service requirements as hereinafter provided. Minimum annual debt service requirements as used in this section shall include required payments of principal and interest, sinking fund requirements, and payments into reserves on all outstanding revenue bonds authorized by RCW 47.60.400 through 47.60.470.

The provisions of law relating to the revision of tolls and charges to meet minimum annual debt service requirements from net revenues as required by this section shall be binding upon the commission but shall not be deemed to constitute a contract to that effect for the benefit of the holders of such bonds.

NEW SECTION. Sec. 6. A new section is added to chapter 47.60 RCW to read as follows:

Notwithstanding the provisions of RCW 47.56.245 the transportation commission shall not collect tolls on the Hood Canal bridge for any purpose except where necessary to comply with bond covenants.

The cost of maintenance, upkeep, and repair may be paid from funds appropriated for the construction and maintenance of the primary state highways of the state of Washington.