H-0195.1  _______________________________________________

                          HOUSE BILL 1833

          _______________________________________________

State of Washington      56th Legislature     1999 Regular Session

By Representatives Thomas, Lantz, Carlson, Keiser, Cairnes, H. Sommers, Talcott, Ogden, Quall, Dunshee, O'Brien, Murray, Cody, Pflug, Dunn, Santos, Schual‑Berke, Lovick, Edmonds, Wood, Haigh, Rockefeller, Conway, Stensen, Dickerson, Kessler and Esser

Read first time 02/08/1999.  Referred to Committee on Capital Budget.

Authorizing school districts to use 63-20 financing with nonprofit organizations.

    AN ACT Relating to alternate financing for schools; amending RCW 28A.335.170 and 84.52.053; and creating a new section.

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

NEW SECTION. Sec. 1.  The legislature finds that alternative financing agreements are available to provide practical options to school districts to finance new school buildings.  One alternative is authorized by federal internal revenue service rules, referred to as "63-20 financing," that allows nonprofit organizations to issue tax exempt bonds to pay for facilities that will ultimately be turned over to a governmental entity for ownership and operation.  The nonprofit organization is permitted to lease or sell the facility to the school district to pay off the bonds.  This arrangement would allow a school district or a private entity, such as a developer, to contract with nonprofit organizations to build new schools to serve the needs of the school district.  It is the intent of the legislature to authorize school districts to enter into such agreements.

    Sec. 2.  RCW 28A.335.170 and 1990 c 33 s 360 are each amended to read as follows:

    The board of directors of any school district may enter into contracts for their respective districts ((for periods not exceeding five years in duration)) with public and private persons, organizations, and entities for the following purposes:

    (1) To rent or lease building space((,)) and portable buildings((, security systems, computers and other equipment));

    (2) To rent security systems, computers, and other equipment or to  have maintained and repaired security systems, computers, and other equipment for periods not exceeding five years in duration; ((and))

    (3) To provide pupil transportation services for periods not exceeding five years in duration; and

(4) To lease, acquire, construct, or finance facilities with a nonprofit organization that qualifies under federal internal revenue service rules to issue tax exempt bonds for the purpose of acquiring or constructing a facility for the school district.

    No school district may enter into a contract for pupil transportation unless it has notified the superintendent of public instruction that, in the best judgment of the district, the cost of contracting will not exceed the projected cost of operating its own pupil transportation.

    The budget of each school district shall identify that portion of each contractual liability incurred pursuant to this section extending beyond the fiscal year by amount, duration, and nature of the contracted service and/or item in accordance with rules and regulations of the superintendent of public instruction adopted pursuant to RCW 28A.505.140 and 28A.310.330.

    The provisions of this section shall not have any effect on the length of contracts for school district employees specified by RCW 28A.400.300 and 28A.405.210.

    Sec. 3.  RCW 84.52.053 and 1997 c 260 s 1 are each amended to read as follows:

    The limitations imposed by RCW 84.52.050 through 84.52.056, and 84.52.043 shall not prevent the levy of taxes by school districts, when authorized so to do by the voters of such school district in the manner and for the purposes and number of years allowable under Article VII, section 2(a) of the Constitution of this state.  Elections for such taxes shall be held in the year in which the levy is made or, in the case of propositions authorizing two-year through four-year levies for maintenance and operation support of a school district, authorizing two-year levies for transportation vehicle funds established in RCW 28A.160.130, or authorizing two-year through six-year levies to support the construction, modernization, or remodeling of school facilities, in the year in which the first annual levy is made:  PROVIDED, That once additional tax levies have been authorized for maintenance and operation support of a school district for a two-year through four-year period, no further additional tax levies for maintenance and operation support of the district for that period may be authorized.  For purposes of this limitation, no two-year through six-year levy made under this section may be considered as a tax levy for maintenance and operation support.

    A special election may be called and the time therefor fixed by the board of school directors, by giving notice thereof by publication in the manner provided by law for giving notices of general elections, at which special election the proposition authorizing such excess levy shall be submitted in such form as to enable the voters favoring the proposition to vote "yes" and those opposed thereto to vote "no".

                            --- END ---