HJ 2003X 030

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FIFTY EIGHTH LEGISLATURE - FIRST SPECIAL SESSION

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THIRTIETH DAY

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House Chamber, Olympia, Tuesday, June 10, 2003

The House was called to order at 10:00 a.m. by the Speaker (Representative Lovick presiding). The Clerk called the roll and a quorum was present.

The flag was escorted to the rostrum by a Sergeant at Arms Color Guard, Comil Padayao and Bill Baxter. The Speaker (Representative Lovick presiding) led the Chamber in the Pledge of Allegiance. Prayer was offered by Representative Lynn Kessler.

Reading of the Journal of the previous day was dispensed with and it was ordered to stand approved.

MESSAGES FROM THE SENATE

June 9, 2003

Mr. Speaker:

The President has signed:

ENGROSSED SUBSTITUTE SENATE BILL NO. 5908,

SENATE BILL NO. 6087,

SENATE BILL NO. 6092,

and the same are herewith transmitted.

Milt H. Doumit, Secretary

June 9, 2003

Mr. Speaker:

The President has signed SENATE BILL NO. 6059, and the same is herewith transmitted.

Milt H. Doumit, Secretary

INTRODUCTION & FIRST READING

HB 2294 By Representatives Pettigrew, Priest, Morris and Hinkle; by request of Governor Locke

AN ACT Relating to retaining and attracting the aerospace industry to Washington state; amending RCW 82.04.260, 82.04.260, 82.04.270, and 82.04.440; reenacting and amending RCW 82.04.250; adding new sections to chapter 82.04 RCW; adding new sections to chapter 82.08 RCW; adding new sections to chapter 82.12 RCW; adding a new section to chapter 82.29A RCW; adding a new section to chapter 84.36 RCW; adding a new section to chapter 82.32 RCW; creating a new section; providing a contingent effective date; and providing expiration dates.

There being no objection, HOUSE BILL NO. 2294 was read the first time, the rules were suspended and the bill was placed on the Second Reading calendar.

There being no objection, the House advanced to the sixth order of business.

SECOND READING

HOUSE BILL NO. 2294, By Representatives Pettigrew, Priest, Morris and Hinkle; by request of Governor Locke

Providing tax incentives for the retention and expansion of the aerospace industry in Washington state.

The bill was read the second time.

Representative Ericksen moved the adoption of amendment (590):

On page 6, line 1, after "such airplanes," insert "and upon every direct service industrial customer as defined in RCW 82.04.447,"

On page 10, line 15, after "such airplanes," insert "and upon every direct service industrial customer as defined in RCW 82.04.447,"

POINT OF ORDER

Representative Kessler requested a ruling on scope and object of amendment (590) to House Bill No. 2294.

SPEAKER'S RULING

The Speaker (Representative Lovick presiding): "House Bill No. 2294 is entitled an act relating to "retaining and attracting the aerospace industry to Washington state." The bill provides a number of tax incentives for manufacturers of commercial airplanes or commercial airplane components contingent upon the siting of a significant commercial airplane final assembly plant in Washington.

Amendment (590) provides tax preferences to persons other than manufacturers of commercial airplanes or commercial airplane components and is therefore beyond the scope and object of the bill.

Representative Kessler, your point of order is well taken."

With the consent of the House, amendment (589) was withdrawn.

Representative Condotta moved the adoption of amendment (591):

On page 22, after line 28, insert:

"NEW SECTION. Sec. 18. Unless Senate Bill No. 6097 is enacted by July 1, 2003, this act is null and void."

POINT OF ORDER

Representative Kessler request a ruling on scope and object of amendment (591) to House Bill No. 2294.

SPEAKER'S RULING

Amendment (591) makes the bill contingent upon enactment of a bill concerning unemployment insurance that would affect persons other than manufacturers of commercial airplanes or commercial airplane components. The amendment is beyond the scope and object of the bill.

Representative Kessler, your point of order is well taken."

Representative Armstrong moved the adoption of amendment (592):

On page 22, after line 28, insert:

"NEW SECTION. Sec. 18. Unless Senate Bill Nos. 5378 and 5271 are enacted by July 1, 2003, this act is null and void."

POINT OF ORDER

Representative Kessler requested a ruling on scope and object to amendment (592) to House Bill No. 2294.

SPEAKER'S RULING

Amendment (592) makes the bill contingent upon the enactment of two bills concerning the workers compensation system. As with amendment (591), these bills affect persons other than manufacturers of commercial airplanes or commercial airplane components, and the amendment is therefore beyond the scope and object of the bill.

Representative Kessler, your point of order is well taken."

Representative Anderson moved the adoption of amendment (593):

On page 22, after line 28, insert:

"NEW SECTION. Sec. 18. Unless Senate Bill No. 5530 is enacted by July 1, 2003, this act is null and void."

POINT OF ORDER

Representative Kessler requested a ruling on scope and object to amendment (593) to House Bill No. 2294.

SPEAKER'S RULING

Amendment (593) makes the bill contingent upon the enactment of a bill concerning tax preferences for persons other manufacturers of commercial airplanes or commercial airplane components. The amendment is therefore beyond the scope and object of the bill.

Representative Kessler, your point of order is well taken."

With the consent of the House, amendment (594) was withdrawn.

Representative Orcutt moved the adoption of amendment (595):

On page 22, after line 28, insert:

"NEW SECTION. Sec. 18. A new section is added to chapter 82.04 RCW to read as follows:

(1) Effective October 1, 2005, all tax rates in effect under this chapter shall be reduced by twelve and one-half percent. Effective on the later of July 1, 2007, or the date final assembly of a superefficient airplane begins in Washington state, as determined under section 17 of this act, all tax rates in effect under this chapter shall be reduced by forty percent compared to the rates in effect September 30, 2005.

(2) The rate reductions under this section do not apply to the rates in RCW 82.04.260(13)."

POINT OF ORDER

Representative Kessler requested a ruling on scope and object to amendment (595) to House Bill No. 2294.

SPEAKER'S RULING

Amendment (595) extends business and occupation tax preferences to persons other than manufacturers of commercial airplanes or commercial airplane components, and is therefore beyond the scope and object of the bill.

Representative Kessler , your point of order is well taken."

Representative Orcutt moved adoption of amendment (596):

Beginning on page 2, line 3 strike all of sections 2 through 6 and insert the following:

"Sec. 2. RCW 82.04.230 and 1993 sp.s. c 25 s 101 are each amended to read as follows:

Upon every person engaging within this state in business as an extractor; as to such persons the amount of the tax with respect to such business shall be equal to the value of the products, including byproducts, extracted for sale or for commercial or industrial use, multiplied by the rate of 0.484 percent through September 30, 2005; multiplied by the rate of 0.4235 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.2904 percent effective July 1, 2007.

The measure of the tax is the value of the products, including byproducts, so extracted, regardless of the place of sale or the fact that deliveries may be made to points outside the state.

Sec. 3. RCW 82.04.240 and 2003 c 149 (SB 5725) s 3 are each amended to read as follows:

(1) Upon every person engaging within this state in business as a manufacturer, except persons taxable as manufacturers under other provisions of this chapter; as to such persons the amount of the tax with respect to such business shall be equal to the value of the products, including byproducts, manufactured, multiplied by the rate of 0.484 percent through September 30, 2005; multiplied by the rate of 0.4235 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.2904 percent effective July 1, 2007.

(2) Upon every person engaging within this state in the business of manufacturing semiconductor materials, as to such persons the amount of tax with respect to such business shall, in the case of manufacturers, be equal to the value of the product manufactured, or, in the case of processors for hire, be equal to the gross income of the business, multiplied by the rate of 0.275 percent until October 1, 2005; multiplied by the rate of 0.2406 percent effective October 1, 2005, until July 1, 2007; and multiplied by the rate of 0.1650 percent effective July 1, 2007. For the purposes of this subsection "semiconductor materials" means silicon crystals, silicon ingots, raw polished semiconductor wafers, compound semiconductors, integrated circuits, and microchips. This subsection (2) expires twelve years after July 27, 2003.

(3) The measure of the tax is the value of the products, including byproducts, so manufactured regardless of the place of sale or the fact that deliveries may be made to points outside the state.

Sec. 4. RCW 82.04.250 and 1998 c 343 s 5 and 1998 c 312 s 4 are each reenacted and amended to read as follows:

(1) Upon every person except persons taxable under RCW 82.04.260(5), 82.04.272, or subsection (2) of this section engaging within this state in the business of making sales at retail, as to such persons, the amount of tax with respect to such business shall be equal to the gross proceeds of sales of the business, multiplied by the rate of 0.471 percent through September 30, 2005; multiplied by the rate of 0.4121 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.2826 percent effective July 1, 2007.

(2) Upon every person engaging within this state in the business of making sales at retail that are exempt from the tax imposed under chapter 82.08 RCW by reason of RCW 82.08.0261, 82.08.0262, or 82.08.0263, as to such persons, the amount of tax with respect to such business shall be equal to the gross proceeds of sales of the business, multiplied by the rate of 0.484 percent through September 30, 2005; multiplied by the rate of 0.4235 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.2904 percent effective July 1, 2007.

Sec. 5. RCW 82.04.255 and 1997 c 7 s 1 are each amended to read as follows:

Upon every person engaging within the state as a real estate broker; as to such persons, the amount of the tax with respect to such business shall be equal to the gross income of the business, multiplied by the rate of 1.5 percent through September 30, 2005; multiplied by the rate of 1.3125 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.9000 percent effective July 1, 2007.

The measure of the tax on real estate commissions earned by the real estate broker shall be the gross commission earned by the particular real estate brokerage office including that portion of the commission paid to salesmen or associate brokers in the same office on a particular transaction: PROVIDED, HOWEVER, That where a real estate commission is divided between an originating brokerage office and a cooperating brokerage office on a particular transaction, each brokerage office shall pay the tax only upon their respective shares of said commission: AND PROVIDED FURTHER, That where the brokerage office has paid the tax as provided herein, salesmen or associate brokers within the same brokerage office shall not be required to pay a similar tax upon the same transaction.

Sec. 6. RCW 82.04.260 and 2003 c 261 (2SHB 1240) s 11 are each amended to read as follows:

(1) Upon every person engaging within this state in the business of manufacturing:

(a) Wheat into flour, barley into pearl barley, soybeans into soybean oil, canola into canola oil, canola meal, or canola byproducts, or sunflower seeds into sunflower oil; as to such persons the amount of tax with respect to such business shall be equal to the value of the flour, pearl barley, oil, canola meal, or canola byproduct manufactured, multiplied by the rate of 0.138 percent through September 30, 2005; multiplied by the rate of 0.1208 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.0828 percent effective July 1, 2007;

(b) Seafood products which remain in a raw, raw frozen, or raw salted state at the completion of the manufacturing by that person; as to such persons the amount of tax with respect to such business shall be equal to the value of the products manufactured, multiplied by the rate of 0.138 percent through September 30, 2005; multiplied by the rate of 0.1208 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.0828 percent effective July 1, 2007;

(c) By canning, preserving, freezing, processing, or dehydrating fresh fruits and vegetables, or selling at wholesale fresh fruits and vegetables canned, preserved, frozen, processed, or dehydrated by the seller and sold to purchasers who transport in the ordinary course of business the goods out of this state; as to such persons the amount of tax with respect to such business shall be equal to the value of the products canned, preserved, frozen, processed, or dehydrated multiplied by the rate of 0.138 percent through September 30, 2005; multiplied by the rate of 0.1208 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.0828 percent effective July 1, 2007. As proof of sale to a person who transports in the ordinary course of business goods out of this state, the seller shall annually provide a statement in a form prescribed by the department and retain the statement as a business record;

(d) Dairy products that as of September 20, 2001, are identified in 21 C.F.R., chapter 1, parts 131, 133, and 135, including byproducts from the manufacturing of the dairy products such as whey and casein; or selling the same to purchasers who transport in the ordinary course of business the goods out of state; as to such persons the tax imposed shall be equal to the value of the products manufactured multiplied by the rate of 0.138 percent through September 30, 2005; multiplied by the rate of 0.1208 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.0828 percent effective July 1, 2007. As proof of sale to a person who transports in the ordinary course of business goods out of this state, the seller shall annually provide a statement in a form prescribed by the department and retain the statement as a business record; and

(e) Alcohol fuel, biodiesel fuel, or biodiesel feedstock, as those terms are defined in RCW 82.29A.135; as to such persons the amount of tax with respect to the business shall be equal to the value of alcohol fuel, biodiesel fuel, or biodiesel feedstock manufactured, multiplied by the rate of 0.138 percent through September 30, 2005; multiplied by the rate of 0.1208 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.0828 percent effective July 1, 2007. This subsection (1)(e) expires July 1, 2009.

(2) Upon every person engaging within this state in the business of splitting or processing dried peas; as to such persons the amount of tax with respect to such business shall be equal to the value of the peas split or processed, multiplied by the rate of 0.138 percent through September 30, 2005; multiplied by the rate of 0.1208 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.0828 percent effective July 1, 2007.

(3) Upon every nonprofit corporation and nonprofit association engaging within this state in research and development, as to such corporations and associations, the amount of tax with respect to such activities shall be equal to the gross income derived from such activities multiplied by the rate of 0.484 percent through September 30, 2005; multiplied by the rate of 0.4235 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.2904 percent effective July 1, 2007.

(4) Upon every person engaging within this state in the business of slaughtering, breaking and/or processing perishable meat products and/or selling the same at wholesale only and not at retail; as to such persons the tax imposed shall be equal to the gross proceeds derived from such sales multiplied by the rate of 0.138 percent through September 30, 2005; multiplied by the rate of 0.1208 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.0828 percent effective July 1, 2007.

(5) Upon every person engaging within this state in the business of making sales, at retail or wholesale, of nuclear fuel assemblies manufactured by that person, as to such persons the amount of tax with respect to such business shall be equal to the gross proceeds of sales of the assemblies multiplied by the rate of 0.275 percent until October 1, 2005; multiplied by the rate of 0.2406 percent effective October 1, 2005, until July 1, 2007; and multiplied by the rate of 0.1650 percent effective July 1, 2007.

(6) Upon every person engaging within this state in the business of manufacturing nuclear fuel assemblies, as to such persons the amount of tax with respect to such business shall be equal to the value of the products manufactured multiplied by the rate of 0.275 percent until October 1, 2005; multiplied by the rate of 0.2406 percent effective October 1, 2005, until July 1, 2007; and multiplied by the rate of 0.1650 percent effective July 1, 2007.

(7) Upon every person engaging within this state in the business of acting as a travel agent or tour operator; as to such persons the amount of the tax with respect to such activities shall be equal to the gross income derived from such activities multiplied by the rate of 0.275 percent until October 1, 2005; multiplied by the rate of 0.2406 percent effective October 1, 2005, until July 1, 2007; and multiplied by the rate of 0.1650 percent effective July 1, 2007.

(8) Upon every person engaging within this state in business as an international steamship agent, international customs house broker, international freight forwarder, vessel and/or cargo charter broker in foreign commerce, and/or international air cargo agent; as to such persons the amount of the tax with respect to only international activities shall be equal to the gross income derived from such activities multiplied by the rate of 0.275 percent until October 1, 2005; multiplied by the rate of 0.2406 percent effective October 1, 2005, until July 1, 2007; and multiplied by the rate of 0.1650 percent effective July 1, 2007.

(9) Upon every person engaging within this state in the business of stevedoring and associated activities pertinent to the movement of goods and commodities in waterborne interstate or foreign commerce; as to such persons the amount of tax with respect to such business shall be equal to the gross proceeds derived from such activities multiplied by the rate of 0.275 percent until October 1, 2005; multiplied by the rate of 0.2406 percent effective October 1, 2005, until July 1, 2007; and multiplied by the rate of 0.1650 percent effective July 1, 2007. Persons subject to taxation under this subsection shall be exempt from payment of taxes imposed by chapter 82.16 RCW for that portion of their business subject to taxation under this subsection. Stevedoring and associated activities pertinent to the conduct of goods and commodities in waterborne interstate or foreign commerce are defined as all activities of a labor, service or transportation nature whereby cargo may be loaded or unloaded to or from vessels or barges, passing over, onto or under a wharf, pier, or similar structure; cargo may be moved to a warehouse or similar holding or storage yard or area to await further movement in import or export or may move to a consolidation freight station and be stuffed, unstuffed, containerized, separated or otherwise segregated or aggregated for delivery or loaded on any mode of transportation for delivery to its consignee. Specific activities included in this definition are: Wharfage, handling, loading, unloading, moving of cargo to a convenient place of delivery to the consignee or a convenient place for further movement to export mode; documentation services in connection with the receipt, delivery, checking, care, custody and control of cargo required in the transfer of cargo; imported automobile handling prior to delivery to consignee; terminal stevedoring and incidental vessel services, including but not limited to plugging and unplugging refrigerator service to containers, trailers, and other refrigerated cargo receptacles, and securing ship hatch covers.

(10) Upon every person engaging within this state in the business of disposing of low-level waste, as defined in RCW 43.145.010; as to such persons the amount of the tax with respect to such business shall be equal to the gross income of the business, excluding any fees imposed under chapter 43.200 RCW, multiplied by the rate of 3.3 percent.

If the gross income of the taxpayer is attributable to activities both within and without this state, the gross income attributable to this state shall be determined in accordance with the methods of apportionment required under RCW 82.04.460.

(11) Upon every person engaging within this state as an insurance agent, insurance broker, or insurance solicitor licensed under chapter 48.17 RCW; as to such persons, the amount of the tax with respect to such licensed activities shall be equal to the gross income of such business multiplied by the rate of 0.484 percent through September 30, 2005; multiplied by the rate of 0.4235 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.2904 percent effective July 1, 2007.

(12) Upon every person engaging within this state in business as a hospital, as defined in chapter 70.41 RCW, that is operated as a nonprofit corporation or by the state or any of its political subdivisions, as to such persons, the amount of tax with respect to such activities shall be equal to the gross income of the business multiplied by the rate of 0.75 percent through June 30, 1995, and 1.5 percent thereafter through September 30, 2005; multiplied by the rate of 1.3125 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.9000 percent effective July 1, 2007. The moneys collected under this subsection shall be deposited in the health services account created under RCW 43.72.900.

Sec. 7. RCW 82.04.260 and 2003 c 339 (EHB 2146) s 11 are each amended to read as follows:

(1) Upon every person engaging within this state in the business of manufacturing:

(e) Alcohol fuel or wood biomass fuel, as those terms are defined in RCW 82.29A.135; as to such persons the amount of tax with respect to the business shall be equal to the value of alcohol fuel or wood biomass fuel manufactured, multiplied by the rate of 0.138 percent through September 30, 2005; multiplied by the rate of 0.1208 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.0828 percent effective July 1, 2007.

Sec. 8. RCW 82.04.263 and 1996 c 112 s 3 are each amended to read as follows:

Upon every person engaging within this state in the business of cleaning up for the United States, or its instrumentalities, radioactive waste and other byproducts of weapons production and nuclear research and development; as to such persons the amount of the tax with respect to such business shall be equal to the value of the gross income of the business multiplied by the rate of 0.471 percent through September 30, 2005; multiplied by the rate of 0.4121 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.2826 percent effective July 1, 2007.

For the purposes of this chapter, "cleaning up radioactive waste and other byproducts of weapons production and nuclear research and development" means the activities of handling, storing, treating, immobilizing, stabilizing, or disposing of radioactive waste, radioactive tank waste and capsules, nonradioactive hazardous solid and liquid wastes, or spent nuclear fuel; spent nuclear fuel conditioning; removal of contamination in soils and ground water; decontamination and decommissioning of facilities; and activities integral and necessary to the direct performance of cleanup.

Sec. 9. RCW 82.04.270 and 2001 1st sp.s. c 9 s 3 are each amended to read as follows:

Upon every person except persons taxable under RCW 82.04.260(5), 82.04.298, or 82.04.272 engaging within this state in the business of making sales at wholesale; as to such persons the amount of tax with respect to such business shall be equal to the gross proceeds of sales of such business multiplied by the rate of 0.484 percent through September 30, 2005; multiplied by the rate of 0.4235 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.2904 percent effective July 1, 2007.

Sec. 10. RCW 82.04.272 and 1998 c 343 s 1 are each amended to read as follows:

(1) Upon every person engaging within this state in the business of warehousing and reselling prescription drugs; as to such persons, the amount of the tax shall be equal to the gross income of the business multiplied by the rate of 0.138 percent through September 30, 2005; multiplied by the rate of 0.1208 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.0828 percent effective July 1, 2007.

(2) For the purposes of this section:

(a) "Prescription drug" has the same meaning as that term is given in RCW 82.08.0281; and

(b) "Warehousing and reselling prescription drugs" means the buying of prescription drugs from a manufacturer or another wholesaler, and reselling of the drugs to persons selling at retail or to hospitals, clinics, health care providers, or other providers of health care services, by a wholesaler or retailer who is registered with the federal drug enforcement administration and licensed by the state board of pharmacy.

Sec. 11. RCW 82.04.280 and 1998 c 343 s 3 are each amended to read as follows:

Upon every person engaging within this state in the business of: (1) Printing, and of publishing newspapers, periodicals, or magazines; (2) building, repairing or improving any street, place, road, highway, easement, right of way, mass public transportation terminal or parking facility, bridge, tunnel, or trestle which is owned by a municipal corporation or political subdivision of the state or by the United States and which is used or to be used, primarily for foot or vehicular traffic including mass transportation vehicles of any kind and including any readjustment, reconstruction or relocation of the facilities of any public, private or cooperatively owned utility or railroad in the course of such building, repairing or improving, the cost of which readjustment, reconstruction, or relocation, is the responsibility of the public authority whose street, place, road, highway, easement, right of way, mass public transportation terminal or parking facility, bridge, tunnel, or trestle is being built, repaired or improved; (3) extracting for hire or processing for hire; (4) operating a cold storage warehouse or storage warehouse, but not including the rental of cold storage lockers; (5) representing and performing services for fire or casualty insurance companies as an independent resident managing general agent licensed under the provisions of RCW 48.05.310; (6) radio and television broadcasting, excluding network, national and regional advertising computed as a standard deduction based on the national average thereof as annually reported by the Federal Communications Commission, or in lieu thereof by itemization by the individual broadcasting station, and excluding that portion of revenue represented by the out-of-state audience computed as a ratio to the station's total audience as measured by the 100 micro-volt signal strength and delivery by wire, if any; (7) engaging in activities which bring a person within the definition of consumer contained in RCW 82.04.190(6); as to such persons, the amount of tax on such business shall be equal to the gross income of the business multiplied by the rate of 0.484 percent through September 30, 2005; multiplied by the rate of 0.4235 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.2904 percent effective July 1, 2007.

As used in this section, "cold storage warehouse" means a storage warehouse used to store fresh and/or frozen perishable fruits or vegetables, meat, seafood, dairy products, or fowl, or any combination thereof, at a desired temperature to maintain the quality of the product for orderly marketing.

As used in this section, "storage warehouse" means a building or structure, or any part thereof, in which goods, wares, or merchandise are received for storage for compensation, except field warehouses, fruit warehouses, fruit packing plants, warehouses licensed under chapter 22.09 RCW, public garages storing automobiles, railroad freight sheds, docks and wharves, and "self-storage" or "mini storage" facilities whereby customers have direct access to individual storage areas by separate entrance. "Storage warehouse" does not include a building or structure, or that part of such building or structure, in which an activity taxable under RCW 82.04.272 is conducted.

As used in this section, "periodical or magazine" means a printed publication, other than a newspaper, issued regularly at stated intervals at least once every three months, including any supplement or special edition of the publication.

Sec. 12. RCW 82.04.290 and 2001 1st sp.s. c 9 s 6 are each amended to read as follows:

(1) Upon every person engaging within this state in the business of providing international investment management services, as to such persons, the amount of tax with respect to such business shall be equal to the gross income or gross proceeds of sales of the business multiplied by a rate of 0.275 percent until October 1, 2005; multiplied by the rate of 0.2406 percent effective October 1, 2005, until July 1, 2007; and multiplied by the rate of 0.1650 percent effective July 1, 2007.

(2) Upon every person engaging within this state in any business activity other than or in addition to those enumerated in RCW 82.04.230, 82.04.240, 82.04.250, 82.04.255, 82.04.260, 82.04.270, 82.04.298, 82.04.2905, 82.04.280, 82.04.2907, and 82.04.272, and subsection (1) of this section; as to such persons the amount of tax on account of such activities shall be equal to the gross income of the business multiplied by the rate of 1.5 percent through September 30, 2005; multiplied by the rate of 1.3125 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.9000 percent effective July 1, 2007.

This section includes, among others, and without limiting the scope hereof (whether or not title to materials used in the performance of such business passes to another by accession, confusion or other than by outright sale), persons engaged in the business of rendering any type of service which does not constitute a "sale at retail" or a "sale at wholesale." The value of advertising, demonstration, and promotional supplies and materials furnished to an agent by his principal or supplier to be used for informational, educational and promotional purposes shall not be considered a part of the agent's remuneration or commission and shall not be subject to taxation under this section.

Sec. 13. RCW 82.04.2905 and 1998 c 312 s 7 are each amended to read as follows:

Upon every person engaging within this state in the business of providing child care for periods of less than twenty-four hours; as to such persons the amount of tax with respect to such business shall be equal to the gross proceeds derived from such sales multiplied by the rate of 0.484 percent through September 30, 2005; multiplied by the rate of 0.4235 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.2904 percent effective July 1, 2007.

Sec. 14. RCW 82.04.2907 and 2001 c 320 s 3 are each amended to read as follows:

Upon every person engaging within this state in the business of receiving income from royalties or charges in the nature of royalties for the granting of intangible rights, such as copyrights, licenses, patents, or franchise fees, the amount of tax with respect to such business shall be equal to the gross income from royalties or charges in the nature of royalties from the business multiplied by the rate of 0.484 percent through September 30, 2005; multiplied by the rate of 0.4235 percent effective October 1, 2005, through June 30, 2007; and multiplied by the rate of 0.2904 percent effective July 1, 2007.

"Royalties" means compensation for the use of intangible property, such as copyrights, patents, licenses, franchises, trademarks, trade names, and similar items. It does not include compensation for any natural resource or licensing of canned software to the end user."

Renumber the remaining sections consecutively, correct internal references accordingly, and correct the title.

On page 20, line 14, after "person" strike all material through "or"

On page 20, line 23, after "of a" strike all material through "or"

On page 20, beginning on line 25, after "a" strike all material through "or" on line 26

On page 21, beginning on line 33, strike all material through "department." on line 37

POINT OF ORDER

Representative Kessler requested a ruling on the scope and object of amendment (596) to House Bill No. 2294.

SPEAKER'S RULING

Amendment (596) provides business and occupation tax rate reductions to persons other than manufacturers of commercial airplanes or commercial airplane components. The Speaker therefore finds, as he has with the previous five amendments, that this amendment is beyond the scope and object of the bill.

Representative Kessler, your point of order is well taken."

There being no objection, the rules were suspended, the second reading considered the third and the bill was placed on final passage.

Representatives Pettigrew, Priest, Wallace, Clements, Orcutt, McIntire, Jarrett, Kessler, Veloria, Dunshee, Schual-Berke, McMahan, Anderson, Delvin, Flannigan, Morris, Sump and Carrell spoke in favor of passage of the bill.

Representatives Benson, Santos, Campbell, Ahern, Mielke, DeBolt, Armstrong, Chandler, Ericksen, Schindler and Nixon spoke against the passage of the bill.

MOTIONS

On motion of Representative Clements, Representatives Mastin, Roach, Schoesler and Sehlin were excused. On motion of Representative Santos, Representatives Eickmeyer and Gombosky were excused.

The Speaker (Representative Lovick presiding) stated the question before the House to be the final passage of House Bill No. 2294.

ROLL CALL

The Clerk called the roll on the final passage of House Bill No. 2294 and the bill passed the House by the following vote: Yeas - 79, Nays - 13, Absent - 0, Excused - 6.

Voting yea: Representatives Alexander, Anderson, Bailey, Benson, Berkey, Blake, Boldt, Buck, Bush, Cairnes, Campbell, Carrell, Chandler, Chase, Clements, Clibborn, Cody, Conway, Cooper, Darneille, DeBolt, Delvin, Dickerson, Dunshee, Edwards, Ericksen, Fromhold, Grant, Hankins, Hatfield, Hinkle, Holmquist, Hudgins, Hunt, Hunter, Jarrett, Kagi, Kenney, Kessler, Kristiansen, Lantz, Linville, Lovick, McCoy, McDermott, McDonald, McIntire, McMahan, McMorris, Miloscia, Moeller, Morrell, Morris, Murray, Newhouse, O'Brien, Orcutt, Pearson, Pettigrew, Pflug, Priest, Quall, Rockefeller, Romero, Ruderman, Schual-Berke, Shabro, Simpson, Skinner, Sommers, Sullivan, Sump, Talcott, Tom, Upthegrove, Veloria, Wallace, Woods and Mr. Speaker - 79.

Voting nay: Representatives Ahern, Armstrong, Condotta, Cox, Crouse, Flannigan, Haigh, Kirby, Mielke, Nixon, Santos, Schindler and Wood - 13.

Excused: Representatives Eickmeyer, Gombosky, Mastin, Roach, Schoesler and Sehlin - 6.

HOUSE BILL NO. 2294, having received the necessary constitutional majority, was declared passed.

STATEMENT FOR THE JOURNAL

Had I been present, I would have voted YEA on HOUSE BILL NO. 2294.

DAN ROACH, 31^st District

There being no objection, the House reverted to the fourth order of business.

INTRODUCTION & FIRST READING

ESSB 5028 By Senate Committee on Natural Resources, Energy & Water (originally sponsored by Senators Morton and Hale)

AN ACT Relating to water pollution; and amending RCW 90.48.010, 90.48.020, and 90.48.037.

There being no objection, ENGROSSED SUBSTITUTE SENATE BILL NO. 5028 was read the first time, the rules were suspended and the bill was placed on the Second Reading calendar.

There being no objection, the rules were suspended, the Rules Committee was relieved of ENGROSSED SUBSTITUTE HOUSE BILL NO. 1053 and the bill was placed on the Third Reading calendar.

There being no objection, the House advanced to the sixth order of business.

SECOND READING

ENGROSSED SUBSTITUTE SENATE BILL NO. 5028, By Senate Committee on Natural Resources, Energy & Water (originally sponsored by Senators Morton and Hale)

Clarifying the state's authority to regulate water pollution.

The bill was read the second time.

There being no objection, the rules were suspended, the second reading considered the third and the bill was placed on final passage.

Representative Linville spoke in favor of passage of the bill.

POINT OF ORDER

Representative Dunshee indicated that he did not seen a copy of the bill and requested that copies be distributed and read before discussion was continued.

SPEAKER'S RULING

The Speaker (Representative Lovick presiding): "Representative Dunshee, we apologize for the oversight and order the bill be distributed. Your point is well taken."

Representatives Dunshee, McDermott, McCoy, Upthegrove, Romero and Dickerson spoke against the passage of the bill.

COLLOQUY

Representative Chandler: "Is there anything in this bill that precludes the Department of Ecology from fully utilizing the authority granted to the agency under the water codes to regulate water rights?"

Representative Rockefeller: "No, the bill does not impact the ability of the Department of Ecology to enforce the water codes or the water quality statutes. This bill simply ensures that a distinct line exists between the two bodies of law. All authority granted including the ability to condemn water rights for higher purposes as authorized by RCW 90.03.040 remain available to the Department of Ecology."

The Speaker (Representative Lovick presiding) stated the question before the House to be the final passage of Engrossed Substitute Senate Bill No. 5028.

ROLL CALL

The Clerk called the roll on the final passage of Engrossed Substitute Senate Bill No. 5028 and the bill passed the House by the following vote: Yeas - 61, Nays - 31, Absent - 0, Excused - 6.

Voting yea: Representatives Ahern, Alexander, Anderson, Armstrong, Bailey, Benson, Berkey, Blake, Boldt, Buck, Bush, Cairnes, Campbell, Carrell, Chandler, Clements, Clibborn, Cody, Condotta, Conway, Cox, Crouse, DeBolt, Delvin, Edwards, Ericksen, Flannigan, Grant, Haigh, Hankins, Hatfield, Hinkle, Jarrett, Kessler, Kirby, Kristiansen, Lantz, Linville, Lovick, McDonald, McMahan, McMorris, Mielke, Moeller, Morris, Newhouse, Orcutt, Pearson, Pflug, Priest, Quall, Rockefeller, Santos, Schindler, Shabro, Skinner, Sump, Talcott, Tom, Woods and Mr. Speaker - 61.

Voting nay: Representatives Chase, Cooper, Darneille, Dickerson, Dunshee, Fromhold, Holmquist, Hudgins, Hunt, Hunter, Kagi, Kenney, McCoy, McDermott, McIntire, Miloscia, Morrell, Murray, Nixon, O'Brien, Pettigrew, Romero, Ruderman, Schual-Berke, Simpson, Sommers, Sullivan, Upthegrove, Veloria, Wallace and Wood - 31.

Excused: Representatives Eickmeyer, Gombosky, Mastin, Roach, Schoesler and Sehlin - 6.

ENGROSSED SUBSTITUTE SENATE BILL NO. 5028, having received the necessary constitutional majority, was declared passed.

STATEMENT FOR THE JOURNAL

Had I been present, I would have voted YEA on ENGROSSED SUBSTITUTE SENATE BILL NO. 5028.

DAN ROACH, 31^st District

THIRD READING

ENGROSSED SUBSTITUTE HOUSE BILL NO. 1053, By House Committee on State Government (originally sponsored by Representatives Miloscia, Armstrong, Haigh, Simpson, Schoesler, Quall, O'Brien, Kirby, Cox, Eickmeyer, Berkey, McCoy, Ruderman, Hatfield, Sullivan, Morris, Linville, Ahern, Veloria, Bush, Conway, Dickerson, Lovick, Fromhold, Dunshee, Gombosky, Kenney, Kagi, Schual-Berke and Campbell)

Enhancing government accountability.

There being no objection, the rules were suspended, and ENGROSSED SUBSTITUTE HOUSE BILL NO. 1053 was returned to Second Reading for purpose of amendment.

SECOND READING

Enhancing government accountability.

Representative Haigh moved the adoption of the following amendment (599):

Strike everything after the enacting clause and insert the following:

"NEW SECTION. Sec. 1. The legislature finds that:

(1) Public confidence in government is essential. Public programs must continuously improve in quality, efficiency, and effectiveness in order to increase public trust;

(2) Washington state government and other entities that receive tax dollars must continuously improve the way they operate and deliver services so citizens receive maximum value for their tax dollars;

(3) An independent citizen oversight board is necessary to establish a program to ensure that government services, customer satisfaction, program efficiency, and management systems are world class in performance; and

(4) Fair, independent, professional performance audits of state agencies by the state auditor are essential to improving the efficiency and effectiveness of government.

NEW SECTION. Sec. 2. A new section is added to chapter 43.09 RCW to read as follows:

For purposes of sections 3 through 6 of this act:

(1) "Board" means the citizen oversight board created in section 3 of this act.

(2) "Draft work plan" means the work plan for conducting performance audits of state agencies proposed by the board and state auditor after the statewide performance review.

(3) "Final performance audit report" means a written document jointly released by the citizen oversight board and the state auditor that includes the findings and comments from the preliminary performance audit report.

(4) "Final work plan" means the work plan for conducting performance audits of state agencies adopted by the board and state auditor.

(5) "Performance audit" means an objective and systematic assessment of a state agency or any of its programs, functions, or activities by an independent evaluator in order to help public officials improve efficiency, effectiveness, and accountability. Performance audits include economy and efficiency audits and program audits.

(6) "Preliminary performance audit report" means a written document prepared after the completion of a performance audit to be submitted for comment before the final performance audit report. The preliminary performance audit report must contain the audit findings and any proposed recommendations to improve the efficiency, effectiveness, or accountability of the state agency being audited.

(7) "State agency" or "agency" means a state agency, department, office, officer, board, commission, bureau, division, institution, or institution of higher education. "State agency" includes all elective offices in the executive branch of state government.

NEW SECTION. Sec. 3. A new section is added to chapter 43.09 RCW to read as follows:

(1) The citizen oversight board is created to improve efficiency, effectiveness, and accountability in state government.

(2) The board shall consist of seven members as follows:

(a) One member shall be the state auditor, who shall be a nonvoting member;

(b) One member shall be the chair of the joint legislative audit and review committee, or his or her designee, who shall be a nonvoting member;

(c) Four of the members shall be selected by the governor as follows: Each major caucus of the house of representatives and the senate shall submit a list of three names. The lists may not include the names of members of the legislature. The governor shall select a person from each list provided by each caucus; and

(d) The governor shall select the fifth member.

(3) The board shall elect a chair. Neither the chair of the joint legislative audit and review committee nor the state auditor may serve as chair.

(4) Appointees shall be individuals who have a basic understanding of state government operations with knowledge and expertise in performance management, quality management, strategic planning, performance assessments, or closely related fields.

(5) Appointed members shall serve for terms of four years, with the terms expiring on June 30th on the fourth year of the term. However, in the case of the initial members, two members shall serve four-year terms, two members shall serve three-year terms, and one member shall serve a two-year term, with each of the terms expiring on June 30th of the applicable year. Appointees may be reappointed to serve more than one term.

(6) The office of the state auditor shall provide clerical, technical, and management personnel to the board to serve as the board's staff.

(7) The board shall meet at least once a quarter and may hold additional meetings at the call of the chair or by a majority vote of the members of the board.

(8) The members of the board shall be compensated in accordance with RCW 43.03.220 and reimbursed for travel expenses in accordance with RCW 43.03.050 and 43.03.060.

NEW SECTION. Sec. 4. A new section is added to chapter 43.09 RCW to read as follows:

(1) The board and the state auditor shall work together regarding performance audits of state government.

(2) The board shall establish criteria for performance audits. Agencies shall be audited using criteria that include generally accepted government auditing standards as well as legislative mandates and performance objectives established by state agencies. Mandates include, but are not limited to, agency strategies, time lines, program objectives, and mission and goals as required in RCW 43.88.090.

(3) Using the criteria developed in subsection (2) of this section, the board and the state auditor shall complete a statewide performance review as a preliminary to a draft work plan for conducting performance audits. The board and the state auditor shall develop a schedule and common methodology for conducting these reviews.

(4) The board and the state auditor shall develop the draft work plan for performance audits based on input from citizens, state employees, state managers, the joint legislative audit and review committee, public officials, and others. The draft work plan may include a list of agencies, programs, or systems to be audited on a time line decided by the board and the state auditor based on a number of factors including risk, importance, and citizen concerns. All audits shall be designed to be completed within a six-month period.

(5) Before adopting the final work plan, the board shall consider other relevant audits, accreditation, and operational or management reviews and consult with the legislative auditor and other appropriate oversight and audit entities to coordinate work plans and avoid duplication of effort. The board shall defer to the joint legislative audit and review committee work plan if a similar performance audit is included on both work plans for auditing. The final work plan must be agreed upon by the board and the state auditor.

(6) The state auditor shall contract out for performance audits. In conducting the audits, agency front-line employees and internal auditors should be involved. The audits may include an evaluation of:

(a) Identification of programs and services that can be eliminated, reduced, consolidated, or enhanced;

(b) Identification of funding sources to the state agency, to programs, and to services that can be eliminated, reduced, consolidated, or enhanced;

(c) Analysis of gaps and overlaps in programs and services and recommendations for improving, dropping, blending, or separating functions to correct gaps or overlaps;

(d) Analysis and recommendations for pooling information technology systems used within the state agency, and evaluation of information processing and telecommunications policy, organization, and management;

(e) Analysis of the roles and functions of the state agency, its programs, and its services and their compliance with statutory authority and recommendations for eliminating or changing those roles and functions and ensuring compliance with statutory authority;

(f) Recommendations for eliminating or changing statutes, rules, and policy directives as may be necessary to ensure that the agency carry out reasonably and properly those functions vested in the agency by statute;

(g) Verification of the reliability and validity of agency performance data, self-assessments, and performance measurement systems as required under RCW 43.88.090;

(h) Identification of potential cost savings in the state agency, its programs, and its services;

(i) Identification and recognition of best practices;

(j) Evaluation of planning, budgeting, and program evaluation policies and practices;

(k) Evaluation of personnel systems operation and management;

(l) Evaluation of state purchasing operations and management policies and practices; and

(m) Evaluation of organizational structure and staffing levels, particularly in terms of the ratio of managers and supervisors to nonmanagement personnel.

(7) The state auditor and the board may develop a grading system for the audits. The audit report may include the agency grade, evaluation and identification of best practices, and findings and recommendations for efficiency and effectiveness of state programs. The board and the state auditor shall examine a system for grading the audits. The board shall report its findings to the legislature by December 31, 2003.

(8) The state auditor must solicit comments on preliminary performance audit reports from the audited state agency, the office of the governor, the office of financial management, the board, and the joint legislative audit and review committee for comment. Comments must be received within thirty days after receipt of the preliminary performance audit report unless a different time period is approved by the state auditor. All comments shall be incorporated into the final performance audit report. The final audit report shall include the objectives, scope, and methodology; the audit results, including findings and recommendations; conclusions; and identification of best practices.

(9) The final reports shall be submitted to the board by the state auditor. The board and the state auditor shall jointly release final reports to the citizens of Washington, the governor, and the appropriate legislative committees. Final performance audit reports shall be posted on the internet.

NEW SECTION. Sec. 5. A new section is added to chapter 43.09 RCW to read as follows:

The audited agency is responsible for follow-up and corrective action on all performance audit findings and recommendations. The audited agency's plan for addressing each audit finding and recommendation shall be included in the final audit report. The plan shall provide the name of the contact person responsible for each action, the action planned, and the anticipated completion date. If the audited agency does not agree with the audit findings and recommendations or believes action is not required, then the action plan shall include an explanation and specific reasons.

For agencies under the authority of the governor, the governor may require periodic progress reports from the audited agency until all resolution has occurred.

For agencies under the authority of an elected official other than the governor, the auditor and the board may require periodic reports of the action taken by the audited agency until all resolution has occurred.

The board may request status reports on specific audits or findings.

NEW SECTION. Sec. 6. A new section is added to chapter 43.88 RCW to read as follows:

In addition to the authority given the state auditor in RCW 43.88.160(6), the state auditor is authorized to contract out for performance audits identified in section 4 of this act.

NEW SECTION. Sec. 7. A new section is added to chapter 43.131 RCW to read as follows:

The citizen oversight board created in section 3 of this act and its powers and duties shall be terminated June 30, 2010, as provided in section 8 of this act. The joint legislative audit and review committee shall contract with a private entity for the review in this section.

NEW SECTION. Sec. 8. A new section is added to chapter 43.131 RCW to read as follows:

The following acts or parts of acts, as now existing or hereafter amended, are each repealed, effective June 30, 2011:

(1) Section 2 of this act;

(2) Section 3 of this act;

(3) Section 4 of this act;

(4) Section 5 of this act; and

(5) Section 6 of this act.

NEW SECTION. Sec. 9. (1) The sum of one hundred ninety-two thousand dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 2004, from the general fund to the state auditor for the purposes of this act.

(2) The sum of seven hundred sixty-eight thousand dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 2005, from the general fund to the state auditor for the purposes of this act.

(3) The sum of forty thousand dollars, or as much thereof as may be necessary, is appropriated for the fiscal year ending June 30, 2005, from the general fund to the joint legislative audit and review committee for the purposes of this act."

Correct the title.

Representatives Haigh and Armstrong spoke in favor of adoption of the amendment.

The amendment was adopted. The bill was ordered engrossed.

There being no objection, the rules were suspended, the second reading considered the third and the bill was placed on final passage.

Representatives Miloscia and Armstrong spoke in favor of passage of the bill.

The Speaker (Representative Lovick presiding) stated the question before the House to be the final passage of Second Engrossed Substitute House Bill No. 1053.

ROLL CALL

The Clerk called the roll on the final passage of Second Engrossed Substitute House Bill No. 1053 and the bill passed the House by the following vote: Yeas - 92, Nays - 0, Absent - 0, Excused - 6.

Voting yea: Representatives Ahern, Alexander, Anderson, Armstrong, Bailey, Benson, Berkey, Blake, Boldt, Buck, Bush, Cairnes, Campbell, Carrell, Chandler, Chase, Clements, Clibborn, Cody, Condotta, Conway, Cooper, Cox, Crouse, Darneille, DeBolt, Delvin, Dickerson, Dunshee, Edwards, Ericksen, Flannigan, Fromhold, Grant, Haigh, Hankins, Hatfield, Hinkle, Holmquist, Hudgins, Hunt, Hunter, Jarrett, Kagi, Kenney, Kessler, Kirby, Kristiansen, Lantz, Linville, Lovick, McCoy, McDermott, McDonald, McIntire, McMahan, McMorris, Mielke, Miloscia, Moeller, Morrell, Morris, Murray, Newhouse, Nixon, O'Brien, Orcutt, Pearson, Pettigrew, Pflug, Priest, Quall, Rockefeller, Romero, Ruderman, Santos, Schindler, Schual-Berke, Shabro, Simpson, Skinner, Sommers, Sullivan, Sump, Talcott, Tom, Upthegrove, Veloria, Wallace, Wood, Woods and Mr. Speaker - 92.

Excused: Representatives Eickmeyer, Gombosky, Mastin, Roach, Schoesler and Sehlin - 6.

SECOND ENGROSSED SUBSTITUTE HOUSE BILL NO. 1053, having received the necessary constitutional majority, was declared passed.

MESSAGES FROM THE SENATE

June 10, 2003

Mr. Speaker:

The Senate has passed:

HOUSE BILL NO. 2252,

ENGROSSED SUBSTITUTE SENATE BILL NO. 5071,

ENGROSSED SUBSTITUTE SENATE BILL NO. 5982,

and the same are herewith transmitted.

Milt H. Doumit, Secretary

June 10, 2003

Mr. Speaker:

The Senate has passed:

SECOND ENGROSSED SECOND SUBSTITUTE HOUSE BILL NO. 1336,

SECOND ENGROSSED SECOND SUBSTITUTE HOUSE BILL NO. 1338,

SECOND ENGROSSED SUBSTITUTE SENATE BILL NO. 5659,

ENGROSSED SENATE BILL NO. 6093,

and the same are herewith transmitted.

Milt H. Doumit, Secretary

There being no objection, the House reverted to the fourth order of business.

INTRODUCTION & FIRST READING

ESSB 5071 by Senate Committee on Ways & Means (originally sponsored by Senators Reardon, Schmidt, Shin, Stevens and Rasmussen)

AN ACT Relating to a business and occupation tax rate on certain FAR part 145 certificated repair stations; reenacting and amending RCW 82.04.250; adding a new section to chapter 82.32 RCW; providing an effective date; and providing an expiration date.

2ESSB 5659 by Senate Committee on Government Operations & Elections (originally sponsored by Senators Winsley, Kastama, Oke, Franklin, Swecker, Rasmussen, Regala and Kohl-Welles)

AN ACT Relating to authorizing additional funding for local governments; amending RCW 84.52.043; reenacting and amending RCW 84.52.010; adding a new section to chapter 82.14 RCW; adding a new section to chapter 84.52 RCW; and creating a new section.

ESSB 5982 By Senate Committee on Ways & Means (originally sponsored by Senators Prentice, Hewitt, Doumit, Horn and Reardon)

AN ACT Relating to the liquor control board fully implementing a retail business plan; amending RCW 66.08.030, 66.08.050, 66.08.060, and 41.06.380; adding new sections to chapter 66.08 RCW; adding a new section to chapter 66.16 RCW; creating a new section; and repealing RCW 66.16.080.

ESB 6093 by Senators Kohl-Welles, Sheahan, Hale, Brown, T. Sheldon, Spanel, Rossi, Zarelli, Benton, B. Sheldon and Shin

AN ACT Relating to funding and expenditures for official legislative association conferences; amending RCW 42.52.150; and adding a new section to chapter 42.52 RCW.

There being no objection, ENGROSSED SUBSTITUTE SENATE BILL NO. 5071 was read the first time, the rules were suspended and the bill was placed on the Second Reading calendar.

There being no objection, SECOND ENGROSSED SUBSTITUTE SENATE BILL NO. 5659 was read the first time, the rules were suspended and the bill was placed on the Second Reading calendar.

There being no objection, ENGROSSED SUBSTITUTE SENATE BILL NO. 5982 was read the first time, the rules were suspended and the bill was placed on the Second Reading calendar.

There being no objection, ENGROSSED SENATE BILL NO. 6093 was read the first time, the rules were suspended and the bill was placed on the Second Reading calendar.

There being no objection, House Rule 13(c) was suspended.

There being no objection, the House advanced to the sixth order of business.

SECOND READING

ENGROSSED SUBSTITUTE SENATE BILL NO. 5071, By Senate Committee on Ways & Means (originally sponsored by Senators Reardon, Schmidt, Shin, Stevens and Rasmussen)

Revising business and occupation taxation for certain aviation businesses.

The bill was read the second time.

There being no objection, the rules were suspended, the second reading considered the third and the bill was placed on final passage.

Representatives McIntire, Pearson and Berkey spoke in favor of passage of the bill.

The Speaker (Representative Lovick presiding) stated the question before the House to be the final passage of Engrossed Substitute Senate Bill No. 5071.

ROLL CALL

The Clerk called the roll on the final passage of Engrossed Substitute Senate Bill No. 5071 and the bill passed the House by the following vote: Yeas - 89, Nays - 3, Absent - 0, Excused - 6.

Voting yea: Representatives Ahern, Alexander, Anderson, Armstrong, Bailey, Benson, Berkey, Blake, Boldt, Buck, Bush, Cairnes, Campbell, Carrell, Chandler, Chase, Clements, Clibborn, Cody, Condotta, Conway, Cooper, Cox, Crouse, DeBolt, Delvin, Dunshee, Edwards, Ericksen, Flannigan, Fromhold, Grant, Haigh, Hankins, Hatfield, Hinkle, Holmquist, Hudgins, Hunt, Hunter, Jarrett, Kagi, Kenney, Kessler, Kirby, Kristiansen, Lantz, Linville, Lovick, McCoy, McDermott, McDonald, McIntire, McMahan, McMorris, Mielke, Miloscia, Moeller, Morrell, Morris, Murray, Newhouse, Nixon, O'Brien, Orcutt, Pearson, Pettigrew, Pflug, Priest, Quall, Rockefeller, Ruderman, Santos, Schindler, Schual-Berke, Shabro, Simpson, Skinner, Sommers, Sullivan, Sump, Talcott, Tom, Upthegrove, Veloria, Wallace, Wood, Woods and Mr. Speaker - 89.

Voting nay: Representatives Darneille, Dickerson and Romero - 3.

Excused: Representatives Eickmeyer, Gombosky, Mastin, Roach, Schoesler and Sehlin - 6.

ENGROSSED SUBSTITUTE SENATE BILL NO. 5071, having received the necessary constitutional majority, was declared passed.

STATEMENT FOR THE JOURNAL

Had I been present, I would have voted YEA on ENGROSSED SUBSTITUTE SENATE BILL NO. 5071.

DAN ROACH, 31^st District

ENGROSSED SENATE BILL NO. 6093, By Senators Kohl-Welles, Sheahan, Hale, Brown, T. Sheldon, Spanel, Rossi, Zarelli, Benton, B. Sheldon and Shin

Allowing soliciting to host official legislative conferences.

The bill was read the second time.

There being no objection, the rules were suspended, the second reading considered the third and the bill was placed on final passage.

Representatives Haigh and Armstrong spoke in favor of passage of the bill.

The Speaker (Representative Lovick presiding) stated the question before the House to be the final passage of Engrossed Senate Bill No. 6093.

ROLL CALL

The Clerk called the roll on the final passage of Engrossed Senate Bill No. 6093 and the bill passed the House by the following vote: Yeas - 92, Nays - 0, Absent - 0, Excused - 6.

Excused: Representatives Eickmeyer, Gombosky, Mastin, Roach, Schoesler and Sehlin - 6.

ENGROSSED SENATE BILL NO. 6093, having received the necessary constitutional majority, was declared passed.

STATEMENT FOR THE JOURNAL

Had I been present, I would have voted YEA on ENGROSSED SENATE BILL NO. 6093.

DAN ROACH, 31^st District

SECOND ENGROSSED SUBSTITUTE SENATE BILL NO. 5659, By Senate Committee on Government Operations & Elections (originally sponsored by Senators Winsley, Kastama, Oke, Franklin, Swecker, Rasmussen, Regala and Kohl-Welles)

Authorizing additional funding for local governments.

The bill was read the second time.

With the consent of the House, amendments (605), (609), (602), (608), (604), (607), (612) and (603) were withdrawn.

Representative Ericksen moved the adoption of amendment (611):

On page 2, after line 12, strike all of subsection (3) and insert the following:

"(3) The retail sale or use of motor vehicles, and the lease of motor vehicles for up to the first thirty-six months of the lease, are exempt from tax imposed under this section."

Representatives Ericksen and McIntire spoke in favor of the adoption of the amendment.

The amendment was adopted.

Representative McMahan moved the adoption of amendment (606):

On page 2, line 24, after "distributed" strike "on a per capita basis to cities in the county" and insert "to cities in the county in proportion to the amount of the tax collected in each city"

Representatives McMahan and Lantz spoke in favor of the adoption of the amendment.

Representative McIntire spoke against the adoption of the amendment.

The amendment was not adopted.

There being no objection, the rules were suspended, the second reading considered the third and the bill as amended by the House, was placed on final passage.

Representative McIntire spoke in favor of passage of the bill.

Representative Orcutt spoke against the passage of the bill.

The Speaker (Representative Lovick presiding) stated the question before the House to be the final passage of Second Engrossed Substitute Senate Bill No. 5659 as amended by the House.

ROLL CALL

The Clerk called the roll on the final passage of Second Engrossed Substitute Senate Bill No. 5659, as amended by the House, and the bill passed the House by the following vote: Yeas - 52, Nays - 40, Absent - 0, Excused - 6.

Voting yea: Representatives Bailey, Berkey, Bush, Campbell, Chase, Clibborn, Cody, Conway, Cooper, Darneille, Dickerson, Dunshee, Edwards, Flannigan, Fromhold, Grant, Haigh, Hatfield, Hudgins, Hunt, Hunter, Jarrett, Kagi, Kenney, Kessler, Kirby, Lantz, Linville, Lovick, McCoy, McDermott, McIntire, Miloscia, Moeller, Murray, O'Brien, Pettigrew, Priest, Rockefeller, Ruderman, Santos, Schual-Berke, Simpson, Sommers, Sullivan, Talcott, Tom, Upthegrove, Veloria, Wallace, Wood and Mr. Speaker - 52.

Voting nay: Representatives Ahern, Alexander, Anderson, Armstrong, Benson, Blake, Boldt, Buck, Cairnes, Carrell, Chandler, Clements, Condotta, Cox, Crouse, DeBolt, Delvin, Ericksen, Hankins, Hinkle, Holmquist, Kristiansen, McDonald, McMahan, McMorris, Mielke, Morrell, Morris, Newhouse, Nixon, Orcutt, Pearson, Pflug, Quall, Romero, Schindler, Shabro, Skinner, Sump and Woods - 40.

Excused: Representatives Eickmeyer, Gombosky, Mastin, Roach, Schoesler and Sehlin - 6.

SECOND ENGROSSED SUBSTITUTE SENATE BILL NO. 5659, as amended by the House, having received the necessary constitutional majority, was declared passed.

STATEMENT FOR THE JOURNAL

Had I been present, I would have voted NAY on SECOND ENGROSSED SUBSTITUTE SENATE BILL NO. 5659.

DAN ROACH, 31^st District

MESSAGES FROM THE SENATE

June 10, 2003

Mr. Speaker:

The Senate has passed ENGROSSED SUBSTITUTE HOUSE BILL NO. 1989, with the following amendments:

On page 2, line 7, after "grade", strike "twelve" and insert "eleven".

Renumber the sections consecutively and correct any internal references accordingly.

On page 4, line 23, after "only." strike all material down and through "factor."

Renumber the sections consecutively and correct any internal references accordingly.

and the same is herewith transmitted.

Milt H. Doumit, Secretary

June 10, 2003

Mr. Speaker:

The President has signed:

ENGROSSED SUBSTITUTE SENATE BILL NO. 5028,

ENGROSSED SUBSTITUTE SENATE BILL NO. 5071,

ENGROSSED SENATE BILL NO. 6093,

and the same are herewith transmitted.

Milt H. Doumit, Secretary

June 10, 2003

Mr. Speaker:

The Senate has passed:

SENATE BILL NO. 5271,

ENGROSSED SENATE BILL NO. 6097,

ENGROSSED SECOND SUBSTITUTE SENATE BILL NO. 5364,

SECOND ENGROSSED SUBSTITUTE SENATE BILL NO. 5012,

and the same are herewith transmitted.

Milt H. Doumit, Secretary

The Speaker assumed the chair.

SIGNED BY THE SPEAKER

The Speaker signed:

SECOND ENGROSSED SECOND SUBSTITUTE HOUSE BILL NO. 1336,

SECOND ENGROSSED SECOND SUBSTITUTE HOUSE BILL NO. 1338,

HOUSE BILL NO. 2252,

HOUSE BILL NO. 2266,

ENGROSSED SECOND SUBSTITUTE SENATE BILL NO. 5028,

ENGROSSED SUBSTITUTE SENATE BILL NO. 5071,

ENGROSSED SUBSTITUTE SENATE BILL NO. 5908,

SENATE BILL NO. 6059,

SENATE BILL NO. 6087,

SENATE BILL NO. 6092,

ENGROSSED SENATE BILL NO. 6093,

There being no objection, the House reverted to the fourth order of business.

INTRODUCTION & FIRST READING

HCR 4410 By Representatives Kessler and DeBolt

Adjourning SINE DIE.

There being no objection, HOUSE CONCURRENT RESOLUTION NO. 4410 was read the first time, the rules were suspended and the concurrent resolution was placed on the Second Reading calendar.

There being no objection, the House advanced to the sixth order of business.

SECOND READING

HOUSE CONCURRENT RESOLUTION NO. 4410, By Representatives Kessler and DeBolt

Adjourning SINE DIE.

The concurrent resolution was read the second time.

There being no objection, the rules were suspended, the second reading considered the third and the concurrent resolution was placed on final passage.

HOUSE CONCURRENT RESOLUTION NO. 4410 was adopted.

MESSAGES FROM THE SENATE

June 10, 2003

Mr. Speaker:

The President has signed:

SECOND ENGROSSED SECOND SUBSTITUTE HOUSE BILL NO. 1336,

SECOND ENGROSSED SECOND SUBSTITUTE HOUSE BILL NO. 1338,

HOUSE BILL NO. 2252,

HOUSE BILL NO. 2266,

and the same are herewith transmitted.

Milt H. Doumit, Secretary

June 10, 2003

Mr. Speaker:

By motion of the Senate the following House Bills are returned:

SUBSTITUTE HOUSE BILL NO. 1013,

SECOND ENGROSSED SUBSTITUTE HOUSE BILL NO. 1053,

SECOND ENGROSSED SUBSTITUTE HOUSE BILL NO. 2195,

HOUSE BILL NO. 2294,

and the same are herewith transmitted.

Milt H. Doumit, Secretary

There being no objection, the following Senate Bills were returned to the Senate:

SECOND ENGROSSED SUBSTITUTE SENATE BILL NO. 5012,

SENATE BILL NO. 5271,

ENGROSSED SECOND SUBSTITUTE SENATE BILL NO. 5364,

ENGROSSED SUBSTITUTE SENATE BILL NO. 5982,

ENGROSSED SENATE BILL NO. 6084,

ENGROSSED SENATE BILL NO. 6097,

June 10, 2003

Mr. Speaker:

The Senate has adopted HOUSE CONCURRENT RESOLUTION NO. 4410, and the same is herewith transmitted.

Milt H. Doumit, Secretary

SIGNED BY THE SPEAKER

The Speaker signed:

HOUSE CONCURRENT RESOLUTION NO. 4410,

MESSAGE FROM THE SENATE

June 10, 2003

Mr. Speaker:

The President has signed HOUSE CONCURRENT RESOLUTION NO. 4410, and the same is herewith transmitted.

Milt H. Doumit, Secretary

There being no objection, the reading of the Journal of the 30^th day of the First Special Session of the 58^th Legislature was dispensed with and it was ordered to stand approved.

There being no objection, the House of Representatives of the First Special Session of the 58^th Legislature adjourned SINE DIE.

FRANK CHOPP, Speaker CYNTHIA ZEHNDER, Chief Clerk