AN ACT Relating to encouraging economic growth throughout the state; amending RCW 43.31.524, 43.31.526, 43.210.010, 43.210.020, 43.31.005, 43.31.035, 43.63A.065, 43.155.070, 43.160.060, and 43.168.050; amending section 1, chapter 417, Laws of 1989 (uncodified); adding new sections to chapter 43.31 RCW; adding a new section to chapter 43.63A RCW; creating new sections; and making an appropriation.

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

NEW SECTION. Sec. 1. The legislature finds that the Puget Sound region is experiencing economic prosperity and the challenges associated with rapid growth; much of the rest of the state is not experiencing economic prosperity, and faces challenges associated with slow economic growth. It is the intent of the legislature to encourage economic prosperity and balanced economic growth throughout the state.

In order to accomplish this goal, growth must be managed more effectively in the Puget Sound region, and rural areas must build local capacity to accommodate additional economic activity in their communities. Where possible, rural economies should be linked with prosperous urban economies to share economic growth for the benefit of both these areas and the state.

To accomplish this goal it is the intent of the legislature to: (1) Assure equitable opportunities to secure prosperity for distressed areas, rural communities, and disadvantaged populations by promoting urban-rural economic links, and by promoting value-added product development, business networks, and increased exports from rural areas; (2) improve the economic development service delivery system to be better able to serve these areas, communities, and populations; (3) redirect the priorities of the state's economic development programs to focus economic development efforts into areas and sectors of the greatest need; (4) build local capacity so that communities are better able to plan for growth and achieve self-reliance; (5) administer grant programs to promote new feasibility studies and project development on projects of interest to rural areas or areas outside of the Puget Sound region; and (6) develop a coordinated economic investment strategy involving state economic development programs, businesses, educational and vocational training institutions, local governments and local economic development organizations, ports, and others.

Sec. 2. Section 1, chapter 417, Laws of 1989 (uncodified) is amended to read as follows:

The legislature finds and declares that substantial benefits in increased employment and business activity can be obtained by assisting businesses in identifying opportunities to purchase the goods and services they need from ((~~in-state~~)) Washington suppliers rather than from out-of-state suppliers and in identifying new markets for which Washington businesses can provide goods and services. The replacement of out-of-state imports with services and manufactured goods produced in-state can be an important source of economic growth in a local community especially in rural areas. Businesses in the state are often unaware that goods and services they purchase from out-of-state suppliers are available from in-state firms with substantial advantages in responsiveness, service, and price. Increasing the economic partnerships between businesses in Washington state can build bridges between urban and rural communities and can result in the identification of additional opportunities for successful economic development initiatives. Providing additional information to businesses regarding in-state sources of goods and services can be a particularly valuable component of revitalization strategies in economically distressed areas. The legislature finds and declares that it is the policy of the state to strengthen the economies of local communities by increasing the economic partnerships between in-state businesses and creating programs to assist businesses in identifying in-state sources of goods and services, and in addition to identify new markets for Washington firms to provide goods and services.

Sec. 3. Section 3, chapter 417, Laws of 1989 and RCW 43.31.524 are each amended to read as follows:

There is established a Washington marketplace program within the business assistance center established under RCW 43.31.083. The program shall assist ((~~Washington~~)) businesses to competitively meet their needs for goods and services within Washington by providing information relating to the replacement of out-of-state imports or the fulfillment of new requirements for goods or services with ((~~in-state~~)) Washington products. The program shall place special emphasis on strengthening rural economies in ((~~economically distressed~~)) eligible areas of the state as defined in RCW 82.60.020(3). The Washington marketplace program shall consult with the community revitalization team established pursuant to chapter 43.165 RCW.

Sec. 4. Section 4, chapter 417, Laws of 1989 and RCW 43.31.526 are each amended to read as follows:

(1) The department shall contract with local nonprofit organizations in at least ((~~four economically distressed~~)) three eligible areas of the state, as defined in RCW 82.60.020(3), to implement the Washington marketplace program in these areas. The department, in order to foster cooperation and linkages between distressed and nondistressed areas and urban and rural areas, may enter into joint contracts with multiple nonprofit organizations. ((Each joint contract must include at least one nonprofit organization that is located in a distressed area. No joint contract may include more than one nonprofit organization located in an urban location.)) In contracting with local nonprofit organizations, the department shall:

(a) Award contracts based on a competitive bidding process, pursuant to chapter 43.19 RCW;

(b) Give preference to nonprofit organizations representing a broad spectrum of community support; ((~~and~~))

(c) Ensure that each location contain sufficient business activity to permit effective program operation and contribute at least twenty percent local funding; and

(d) Require that rural marketplace programs, assisted by the department when possible, seek to establish links with urban businesses.

(2) The contracts with local nonprofit organizations shall ((~~be for~~)) include but not be limited to the performance of the following services for the Washington marketplace program:

(a) Contacting Washington businesses to identify goods and services they are currently buying or are planning in the future to buy out-of-state and determine which of these goods and services could be purchased on competitive terms within the state;

(b) Identifying locally sold goods and services which are currently provided by out-of-state businesses;

(c) Determining, in consultation with local business, goods and services for which the business is willing to make contract agreements;

(d) Advertising market opportunities described in (c) of this subsection; ((~~and~~)) or

(e) Receiving bid responses from potential suppliers and sending them to that business for final selection.

(3) Contracts may include provisions for charging service fees of businesses that profit as a result of participation in the program.

(4) The center shall also perform the following activities in order to promote the goals of the program:

(a) Prepare promotional materials or conduct seminars to inform communities and organizations about the Washington marketplace program;

(b) Provide technical assistance to communities and organizations interested in developing an import replacement program;

(d) Provide continuing management and technical assistance to local contractors; and

(e) Report by December 31 of each year to the senate economic development and labor committee and to the house of representatives trade and economic development committee describing the activities of the Washington marketplace program.

Sec. 5. Section 1, chapter 20, Laws of 1983 1st ex. sess. as amended by section 1, chapter 231, Laws of 1985 and RCW 43.210.010 are each amended to read as follows:

The legislature finds:

(1) The exporting of goods and services from Washington to international markets is an important economic stimulus to the growth, development, and stability of the state's businesses in both urban and rural areas, and that these economic activities create needed jobs for Washingtonians.

(2) Impediments to the entry of many small and medium-sized businesses into export markets have restricted growth in exports from the state.

(3) Particularly significant impediments for many small and medium-sized businesses are the lack of easily accessible information about export opportunities and financing alternatives.

(4) There is a need for a small business export finance assistance center which will specialize in providing export assistance to small and medium-sized businesses throughout the state in acquiring information about export opportunities and financial alternatives for exporting.

Sec. 6. Section 2, chapter 20, Laws of 1983 1st ex. sess. as amended by section 2, chapter 231, Laws of 1985 and RCW 43.210.020 are each amended to read as follows:

A nonprofit corporation, to be known as the small business export finance assistance center, and branches subject to its authority, may be formed under chapter 24.03 RCW for the following public purposes:

(1) To assist small and medium-sized businesses in both urban and rural areas in the financing of export transactions.

(2) To provide, singly or in conjunction with other organizations, information and assistance to these businesses about export opportunities and financing alternatives.

(3) To provide information to and assist those businesses interested in exporting products, including the opportunities available to them in organizing export trading companies under the United States export trading company act of 1982, for the purpose of increasing their comparative sales volume and ability to export their products to foreign markets.

NEW SECTION. Sec. 7. A new section is added to chapter 43.63A RCW to read as follows:

(1) The department shall administer a grant program which makes grants to local nonprofit organizations for rural economic development or for sharing economic growth outside the Puget Sound region. The grants shall be used to: (a) Develop urban-rural links; (b) build local capacity for economic growth; or (c) improve the export of products or services from rural areas to locations outside the United States.

(2) The department shall consult with, and if necessary form an advisory committee including, a diverse group of private sector representatives including, but not limited to, major corporations, commercial financial institutions, venture capitalists, small businesses, natural resource businesses, and developers to determine what opportunities for new investment and business growth might be available for areas outside high-growth counties. The department shall also consult with the department of trade and economic development. The department shall seek to maximize and link new investment opportunities to grant projects under this section.

(3) The department may enact rules to carry out this section.

Sec. 8. Section 1, chapter 466, Laws of 1985 and RCW 43.31.005 are each amended to read as follows:

The legislature of the state of Washington finds that economic development is an essential public purpose which requires the active involvement of state government. The state's primary economic strategy is to encourage the retention and expansion of existing businesses, to attract new businesses and industries, ((~~and~~)) to foster the formation of new businesses, and to economically link rural communities with urban areas. In order to aid the citizens of Washington to obtain desirable employment and achieve adequate incomes, it is necessary for the state to encourage balanced growth and economic prosperity and to promote a more diversified and healthy economy throughout the state.

The legislature finds that the state needs to improve its level of employment, business activity, and revenue growth. In order to increase job opportunities and revenues, a broader and more stable economic base is needed. The state shall take primary responsibility to encourage the balanced growth of the economy consistent with the preservation of Washington's quality of life and environment. A healthy economy can be achieved through partnership efforts with the private sector to facilitate increased investment in Washington. It is the policy of the state of Washington to encourage and promote an economic development program that provides sufficient employment opportunities for our current resident work force and those individuals who will enter the state's work force in the future.

The legislature finds that the state of Washington has the potential to become a major world trade gateway. In order for Washington to fulfill its potential and compete successfully with other states and provinces, it must articulate a consistent, long-term trade policy. It is the responsibility of the state to monitor and ensure that such traditional functions of state government as transportation, infrastructure, education, taxation, regulation and public expenditures contribute to the international trade focus the state of Washington must develop.

Sec. 9. Section 4, chapter 466, Laws of 1985 and RCW 43.31.035 are each amended to read as follows:

The department shall pursue a coordinated approach for the state's economic development policies and programs to achieve a more diversified and healthy economy. The department shall support and work cooperatively with other state agencies, public and private organizations, and units of local government, as well as the federal government, to strengthen and coordinate economic development programs ((in)) throughout the state. The department's activities shall include, but not be limited to:

(1) Providing economic development advisory assistance to the governor, other state agencies, and the legislature on economic-related issues, and other matters affecting the economic well-being of the state and all its citizens.

(2) Providing staff and support to cabinet level interagency economic development coordinating activities.

(3) Representing and monitoring the state's interests with the federal government in its formulation of policies and programs in economic development.

(4) Assisting in the development and implementation of a long-term economic strategy for the state that encourages a balance in economic growth between urban and rural areas and that stimulates economic development in areas not experiencing problems associated with rapid growth, and assisting the continual update of information and strategies contained in the long-term economic program for the state.

Sec. 10. Section 5, chapter 125, Laws of 1984 as amended by section 137, chapter 266, Laws of 1986 and RCW 43.63A.065 are each amended to read as follows:

The department shall have the following functions and responsibilities:

(1) Cooperate with and provide technical and financial assistance to the local governments and to the local agencies serving the communities of the state for the purpose of aiding and encouraging orderly, productive, and coordinated development of the state, and, unless stipulated otherwise, give priority to local communities with the greatest relative need and the fewest resources.

(2) Administer state and federal grants and programs which are assigned to the department by the governor or the legislature.

(3) Administer community services programs through private, nonprofit organizations and units of general purpose local government; these programs are directed to the poor and infirm and include community-based efforts to foster self-sufficiency and self-reliance, energy assistance programs, head start, and weatherization.

(4) Study issues affecting the structure, operation, and financing of local government as well as those state activities which involve relations with local government and report the results and recommendations to the governor, legislature, local government, and citizens of the state.

(5) Assist the governor in coordinating the activities of state agencies which have an impact on local governments and communities.

(6) Provide technical assistance to the governor and the legislature on community development policies for the state.

(7) Assist in the production, development, rehabilitation, and operation of owner-occupied or rental housing for low and moderate income persons, and qualify as a participating state agency for all programs of the Department of Housing and Urban Development or its successor.

(8) Support and coordinate local efforts to promote volunteer activities throughout the state.

(9) Participate with other states or subdivisions thereof in interstate programs and assist cities, counties, municipal corporations, governmental conferences or councils, and regional planning commissions to participate with other states or their subdivisions.

(10) Hold public hearings and meetings to carry out the purposes of this chapter.

(11) Provide a comprehensive state-level focus for state fire protection services, funding, and policy.

(12) Administer a program to identify, evaluate, and protect properties which reflect outstanding elements of the state's cultural heritage.

(13) Coordinate a comprehensive state program for mitigating, preparing for, responding to, and recovering from emergencies and disasters.

NEW SECTION. Sec. 11. A new section is added to chapter 43.31 RCW to read as follows:

(1) There is established in the department the local economic development service program. This program shall coordinate the delivery of economic development services to local communities or regional areas. It shall encourage a partnership between the public and private sectors and between state and local officials to encourage appropriate economic growth in communities throughout the state.

(2) The department's local economic development service program shall promote local economic development by assisting businesses to start-up, maintain, or expand their operations, by encouraging public infrastructure investment and private capital investment in local communities, and by expanding employment opportunities.

(3) The department's local economic development service program shall, among other things, (a) contract with local economic development nonprofit corporations, called "associate development organizations," for the delivery of economic development services to local communities or regional areas; (b) enter into interagency agreements with appropriate state agencies, such as the department of community development, the department of agriculture, and the employment security department, to coordinate the delivery of economic development services to local communities or regional areas; (c) enter into agreements with other public organizations or institutions that provide economic development services, such as the small business development center, the Washington technology center, community colleges, vocational-technical institutes, the University of Washington, Washington State University, four-year colleges and universities, the federal small business administration, ports, and others, to coordinate the delivery of economic development services to local communities and regional areas; and (d) provide training, through contracts with public or private organizations, and other assistance to associate development organizations to the extent resources allow.

(4) It is the intent of the legislature that the associate development organizations shall promote and coordinate, through local service agreements or other methods, the delivery of economic development services in their areas that are provided by public and private organizations, including state agencies.

(5) The legislature encourages local associate development organizations to form partnerships with other associate development organizations in their region to combine resources for better access to available services, to encourage regional delivery of state services, and to more effectively build the local capacity of communities in the region.

NEW SECTION. Sec. 12. The service delivery task force is established. The purpose of the task force is to review the current system for delivering economic development services in Washington and to make recommendations for improving the effectiveness of state economic development services, especially in rural areas.

(1) The task force shall consider existing studies and reports in its analysis, and shall seek input from the key persons or organizations delivering and receiving state economic development services. These key organizations include: (a) The University of Washington and Washington State University, (b) ports, (c) community colleges, (d) vocational-technical institutes, (e) the small business administration, (f) the Washington technology center, (g) nonprofit community action organizations, (h) local businesses and chambers of commerce.

(2) The recommendations shall consider, but not be limited to, the following: (a) What should be the structure for delivering state economic development services to enhance local capacity? and (b) How can state programs be better coordinated to avoid duplication and fragmentation of services?

(3) The task force shall consist of: (a) Four legislators, one from each major caucus in the house of representatives appointed by the speaker of the house and one from each major caucus in the senate appointed by the president of the senate; (b) one citizen member involved in economic development appointed by the governor; (c) the director, or the director's designee, of each of the following departments: (i) The department of trade and economic development, (ii) the department of community development, (iii) the department of agriculture, and (iv) the employment security department; (d) two representatives of local governments appointed by the governor in consultation with the association of Washington cities and the Washington state association of counties, with one from east of the Cascades; (e) two representatives of associate development organizations, appointed by the chair of the associate development organization state council, with one representative from east of the Cascades; (f) two representatives of small businesses appointed by the governor, with one representative from east of the Cascades; and (g) one representative each from the Northwest policy center at the University of Washington and the public policy institute at The Evergreen State College appointed by their directors.

(4) Staff services for the task force shall be jointly provided by the department of trade and economic development and the department of community development.

(5) The governor shall appoint the chair of the task force.

(6) Task force members may be reimbursed as provided by RCW 43.03.050 and 43.03.060.

(7) The task force may create subcommittees and may invite nonmembers of the task force to participate in the subcommittees.

(8) The task force shall report on its findings and make its recommendations to the house of representatives trade and economic development committee, the senate economic development and labor committee, and the governor by November 1, 1990, and shall expire on January 31, 1991.

NEW SECTION. Sec. 13. A new section is added to chapter 43.31 RCW to read as follows:

(1) The department shall administer a program to encourage more value-added manufacturing in Washington state. The department shall award grants on a competitive basis, and when funds are available, to local organizations or individuals to provide industry modernization services in targeted sectors or to form business networks or consortia in targeted sectors.

(2) To receive a grant under subsection (1) of this section, the applicant must demonstrate significant private sector interest from businesses in the targeted sector and must designate a field agent to coordinate the targeted sector effort. The field agent must be experienced in organizing business networks or business assistance projects and familiar with businesses in the targeted sector.

(3) The department may accept public and private funds to provide grants under subsection (1) of this section.

(4) The department's efforts under this section shall be coordinated with any department activities under RCW 43.31.434, 43.31.436, or 43.31.438.

NEW SECTION. Sec. 14. State agencies shall respond with an approval or denial of a permit request within thirty days of receiving the application for the permit. If the permit is denied by the state agency, a list of items necessary to meet the permit requirements shall be provided by the state agency.

NEW SECTION. Sec. 15. A new section is added to chapter 43.31 RCW to read as follows:

(1) The business assistance center shall assist businesses or local governments with the processing of permits that relate to economic development and are required by law to be issued by state agencies; state agencies shall assist the business assistance center to accomplish the purposes of this section consistent with subsection (3) of this section. The business assistance center shall, when requested or when necessary, enter into interagency contracts with state agencies responsible for issuing permits to develop a process that is coordinated and service oriented. A dispute resolution process should be part of the state permit process.

(2) The business assistance center shall make recommendations to the governor or the legislature regarding enhancing the processing of permits by state government.

(3) Nothing in this section is intended to weaken state laws or their effectiveness; the purpose of this section is to improve the administration of requests for state permits that are required by state law.

Sec. 16. Section 12, chapter 446, Laws of 1985 as last amended by section 3, chapter 93, Laws of 1988 and RCW 43.155.070 are each amended to read as follows:

(1) To qualify for loans or pledges under this chapter the board must determine that a local government meets all of the following conditions:

(a) The city or county must be imposing a tax under chapter 82.46 RCW at a rate of at least one-quarter of one percent;

(b) The local government must have developed a long-term plan for financing public works needs; and

(c) The local government must be using all local revenue sources which are reasonably available for funding public works, taking into consideration local employment and economic factors.

(2) The board shall develop a priority process for public works projects as provided in this section. The intent of the priority process is to maximize the value of public works projects accomplished with assistance under this chapter. The board shall attempt to assure a geographical balance in assigning priorities to projects. The board shall consider at least the following factors in assigning a priority to a project:

(a) Whether the local government receiving assistance has experienced severe fiscal distress resulting from natural disaster or emergency public works needs;

(b) Whether the project is critical in nature and would affect the health and safety of a great number of citizens;

(d) The number of communities served by or funding the project;

(e) Whether the project is located in an area of high unemployment, compared to the average state unemployment; and

(f) ((~~Other criteria that the board considers advisable~~)) The relative benefit of the project to the community, considering the present level of economic activity in the community and the existing local capacity to increase local economic activity in communities that have low economic growth.

(3) Existing debt or financial obligations of local governments shall not be refinanced under this chapter. Each local government applicant shall provide documentation of attempts to secure additional local or other sources of funding for each public works project for which financial assistance is sought under this chapter.

(4) Before November 1 of each year, the board shall develop and submit to the chairs of the ways and means committees of the senate and house of representatives a description of the emergency loans made under RCW 43.155.065 during the preceding fiscal year and a prioritized list of projects which are recommended for funding by the legislature, including one copy to the staff of each of the committees. The list shall include, but not be limited to, a description of each project and recommended financing, the terms and conditions of the loan or financial guarantee, the local government jurisdiction and unemployment rate, demonstration of the jurisdiction's critical need for the project and documentation of local funds being used to finance the public works project. The list shall also include measures of fiscal capacity for each jurisdiction recommended for financial assistance, compared to authorized limits and state averages, including local government sales taxes; real estate excise taxes; property taxes; and charges for or taxes on sewerage, water, garbage, and other utilities.

(5) The board shall not sign contracts or otherwise financially obligate funds from the public works assistance account before the legislature has appropriated funds for a specific list of public works projects. The legislature may remove projects from the list recommended by the board. The legislature shall not change the order of the priorities recommended for funding by the board.

(6) Subsections (4) and (5) of this section do not apply to loans made for emergency public works projects under RCW 43.155.065.

Sec. 17. Section 6, chapter 40, Laws of 1982 1st ex. sess. as last amended by section 62, chapter 431, Laws of 1989 and RCW 43.160.060 are each amended to read as follows:

The board is authorized to make direct loans to political subdivisions of the state for the purposes of assisting the political subdivisions in financing the cost of public facilities, including development of land and improvements for public facilities, as well as the acquisition, construction, rehabilitation, alteration, expansion, or improvement of the facilities. A grant may also be authorized for purposes designated in this chapter, but only when, and to the extent that, a loan is not reasonably possible, given the limited resources of the political subdivision.

Application for funds shall be made in the form and manner as the board may prescribe. In making grants or loans the board shall conform to the following requirements:

(1) The board shall not make a grant or loan:

(a) For a project the primary purpose of which is to facilitate or promote a retail shopping development or expansion.

(b) For any project that ((~~probably~~)) evidence exists would result in a development or expansion that would displace existing jobs in any other community in the state.

(2) The board shall only make grants or loans:

(a) For those projects which would result in specific private developments or expansions (i) in manufacturing, production, food processing, assembly, warehousing, and industrial distribution; (ii) for processing recyclable materials or for facilities that support recycling, including processes not currently provided in the state, including but not limited to, de-inking facilities, mixed waste paper, plastics, yard waste, and problem-waste processing; (iii) for manufacturing facilities that rely significantly on recyclable materials, including but not limited to waste tires and mixed waste paper; ((or)) (iv) which support the relocation of businesses from nondistressed urban areas to distressed rural areas; or (v) which substantially support the trading of goods or services outside of the state's borders.

(b) For projects which it finds will improve the opportunities for the successful maintenance, establishment, or expansion of industrial or commercial plants or will otherwise assist in the creation or retention of long-term economic opportunities.

(c) When the application includes convincing evidence that a specific private development or expansion is ready to occur and will occur only if the grant or loan is made.

(3) The board shall prioritize each proposed project according to the relative benefits provided to the community by the jobs the project would create, not just the total number of jobs it would create after the project is completed and according to the unemployment rate in the area in which the jobs would be located. As long as there is more demand for loans or grants than there are funds available for loans or grants, the board is instructed to fund projects in order of their priority.

(4) A responsible official of the political subdivision shall be present during board deliberations and provide information that the board requests.

Before any loan or grant application is approved, the political subdivision seeking the loan or grant must demonstrate to the community economic revitalization board that no other timely source of funding is available to it at costs reasonably similar to financing available from the community economic revitalization board.

Sec. 18. Section 5, chapter 164, Laws of 1985 as last amended by section 9, chapter 430, Laws of 1989 and RCW 43.168.050 are each amended to read as follows:

(1) The committee may only approve an application providing a loan for a project which the committee finds:

(a) Will result in the creation of employment opportunities or the maintenance of threatened employment;

(b) Has been approved by the director as conforming to federal rules and regulations governing the spending of federal community development block grant funds;

(c) Will be of public benefit and for a public purpose, and that the benefits, including increased or maintained employment, improved standard of living, and the employment of disadvantaged workers, will primarily accrue to residents of the area;

(d) Will probably be successful;

(e) Would probably not be completed without the loan because other capital or financing at feasible terms is unavailable or the return on investment is inadequate.

(2) The committee shall, subject to federal block grant criteria, give higher priority to economic development projects that contain provisions for child care.

(3) The committee may not approve an application if it fails to provide for adequate reporting or disclosure of financial data to the committee. The committee may require an annual or other periodic audit of the project books.

(4) The committee may require that the project be managed in whole or in part by a local development organization and may prescribe a management fee to be paid to such organization by the recipient of the loan or grant.

(5) (a) Except as provided in (b) of this subsection, the committee shall not approve any application which would result in a loan or grant in excess of three hundred fifty thousand dollars.

(b) The committee may approve an application which results in a loan or grant of up to seven hundred thousand dollars if the application has been approved by the director.

(6) The committee shall fix the terms and rates pertaining to its loans.

(7) Should there be more demand for loans than funds available for lending, the committee shall provide loans for those projects which will lead to the greatest amount of employment or benefit to a community. In determining the "greatest amount of employment or benefit" the committee shall also consider the employment which would be saved by its loan and the benefit relative to the community, not just the total number of new jobs or jobs saved.

(8) To the extent permitted under federal law the committee shall require applicants to provide for the transfer of all payments of principal and interest on loans to the Washington state development loan fund created under this chapter. Under circumstances where the federal law does not permit the committee to require such transfer, the committee shall give priority to applications where the applicants on their own volition make commitments to provide for the transfer.

(9) The committee shall not approve any application to finance or help finance a shopping mall.

(10) The committee shall make at least eighty percent of the appropriated funds available to projects located in distressed areas, and may make up to twenty percent available to projects located in areas not designated as distressed. The committee shall not make funds available to projects located in areas not designated as distressed if the fund's net worth is less than seven million one hundred thousand dollars.

(11) If an objection is raised to a project on the basis of unfair business competition, the committee shall evaluate the potential impact of a project on similar businesses located in the local market area. A grant may be denied by the committee if a project is not likely to result in a net increase in employment within a local market area.

NEW SECTION. Sec. 19. The sum of one million dollars, or as much thereof as may be necessary, is appropriated for the biennium ending June 30, 1991, from the general fund as follows: (1) One hundred fifty thousand dollars to the department of trade and economic development for the marketplace program under RCW 43.31.524 and 43.31.526 to establish urban-rural links and to provide more marketplace leads state-wide; (2) fifty thousand dollars to the department of trade and economic development for the local economic development service organization under section 11 of this act for additional staffing; (3) fifty thousand dollars to the department of trade and economic development for the expenses of the service delivery task force under section 12 of this act; (4) fifty thousand dollars to the department of community development to provide two additional staff persons for the department's community development finance program to assist rural communities. Criteria the department shall use to determine how to deploy these additional staff persons include: (a) The current level of service being provided by the department regarding its community finance, development loan fund, and community revitalization programs; (b) the additional staff time that will be available to other areas of the state for the department's finance programs; and (c) the benefits to rural communities; (5) one hundred thousand dollars to the department of trade and economic development for training for associate development organizations under section 11(3)(d) of this act; (6) one hundred thousand dollars to the department of trade and economic development for the purpose of section 13 of this act; and (7) five hundred thousand dollars to the department of community development for the purposes of section 7 of this act.