BP BHEAD INT H [atlas:bill]

AN ACT Relating to establishing a linked deposit program for dislocated workers; amending RCW 43.86A.030 and 43.86A.070; and adding a new section to chapter 43.86A RCW.

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

Sec. 1. RCW 43.86A.030 and 1993 c 512 s 33 are each amended to read as follows:

(1) Funds held in public depositaries not as demand deposits as provided in RCW 43.86A.020 and 43.86A.030, shall be available for a time certificate of deposit investment program according to the following formula: The state treasurer shall apportion to all participating depositaries an amount equal to five percent of the three year average mean of general state revenues as certified in accordance with Article VIII, section 1(b) of the state Constitution, or fifty percent of the total surplus treasury investment availability, whichever is less. Within thirty days after certification, those funds determined to be available according to this formula for the time certificate of deposit investment program shall be deposited in qualified public depositaries. These deposits shall be allocated among the participating depositaries on a basis to be determined by the state treasurer.

(2) The state treasurer may use up to fifty million dollars per year of all funds available under this section for the purposes of RCW 43.86A.060. The amounts made available to these public depositaries shall be equal to the amounts of outstanding loans made under RCW 43.86A.060.

(3) In addition to the funds in subsection (2) of this section, the state treasurer may use up to twenty million dollars per year of all funds available under this section for the purposes of section 2 of this act. The amounts made available to these public depositaries shall be equal to the amounts of outstanding loans made under section 2 of this act.

(4) The formula so devised shall be a matter of public record giving consideration to, but not limited to deposits, assets, loans, capital structure, investments or some combination of these factors. However, if in the judgment of the state treasurer the amount of allocation for certificates of deposit as determined by this section will impair the cash flow needs of the state treasury, the state treasurer may adjust the amount of the allocation accordingly.

NEW SECTION. Sec. 2. A new section is added to chapter 43.86A RCW to read as follows:

(1) In addition to the linked deposit program under RCW 43.86A.060, the state treasurer shall establish a linked deposit program for investment of deposits in qualified public depositaries for dislocated workers. As a condition of participating in the program under this section, qualified public depositaries must make qualifying loans as provided in this section. The state treasurer may purchase a certificate of deposit that is equal to the amount of the qualifying loan made by the qualified public depositary or may purchase a certificate of deposit that is equal to the aggregate amount of two or more qualifying loans made by one or more qualified public depositaries.

(2) Qualifying loans made under this section are those that:

(a) Are loans that have terms that do not exceed ten years;

(b) Are made to a dislocated worker as defined under RCW 50.04.075 and certified as such by the employment security department;

(c) Are loans that do not exceed twenty-two times the qualified individual's insurance weekly benefit amount as determined by the employment security department;

(d) Are loans for education or retraining;

(e) Are made where the interest rate on the loan to the dislocated worker does not exceed an interest rate that is two hundred basis points below the interest rate the qualified public depositary would charge for a loan for a similar purpose and a similar term; and

(f) Are made where the points or fees charged at loan closing do not exceed one percent of the loan amount.

(3) In setting interest rates of time certificates of deposit, the state treasurer shall offer rates so that a two hundred basis point preference will be given to the qualified public depositary.

Sec. 3. RCW 43.86A.070 and 1993 c 512 s 34 are each amended to read as follows:

The state and those acting as its agents are not liable in any manner for payment of the principal or interest on qualifying loans made under RCW 43.86A.060 or section 2 of this act. Any delay in payments or defaults on the part of the borrower does not in any manner affect the deposit agreement between the qualified public depositary and the state treasurer.