AN
ACT Relating to community empowerment zones; amending RCW 43.63A.700,
43.63A.710, and 82.60.049; adding a new chapter to Title 43 RCW; creating a new
section; and recodifying RCW 43.63A.700 and 43.63A.710.
BE IT ENACTED BY THE
LEGISLATURE OF THE STATE OF WASHINGTON:
NEW
SECTION. Sec. 1. (1)
The legislature finds that:
(a)
There are geographic areas within communities that are characterized by a lack
of employment opportunities, an average income level that is below the median
income level for the surrounding community, a lack of affordable housing,
deteriorating infrastructure, and a lack of facilities for community services,
job training, and education;
(b)
Strategies to encourage reinvestment in these areas by assisting local
businesses to become stronger and area residents to gain economic power involve
a variety of activities and partnerships;
(c)
Reinvestment in these areas cannot be accomplished with only governmental
resources and require a comprehensive approach that integrates various
incentives, programs, and initiatives to meet the economic, physical, and
social needs of the area;
(d)
Successful reinvestment depends on a local government's ability to coordinate
public resources in a cohesive, comprehensive strategy that is designed to
leverage long-term private investment in an area;
(e)
Reinvestment can strengthen the overall tax base through increased tax revenue
from expanded and new business activities and physical property improvement;
(f)
Local governments, in cooperation with area residents, can provide leadership
as well as planning and coordination of resources and necessary supportive
services to address reinvestment in the area; and
(g)
It is in the public interest to adopt a targeted approach to revitalization and
enlist the resources of all levels of government, the private sector,
community-based organizations, and community residents to revitalize an area.
(2)
The legislature declares that the purposes of the community empowerment zone
act are to:
(a)
Encourage reinvestment through strong partnerships and cooperation between all
levels of government, community-based organizations, area residents, and the
private sector;
(b)
Involve the private sector and stimulate private reinvestment through the
judicious use of public resources;
(c)
Target governmental resources to those areas of greatest need; and
(d)
Include all levels of government, community individuals, organizations, and the
private sector in the policy-making process.
NEW
SECTION. Sec. 2. The
definitions in this section apply throughout this chapter unless the context
clearly requires otherwise:
(1)
"Area" means a geographic area within a local government that is
described by a close perimeter boundary.
(2)
"Community empowerment zone" means an area meeting the requirements
of RCW 43.63A.700 (as recodified by this act) and officially designated by the
director.
(3)
"Department" means the department of community, trade, and economic
development.
(4)
"Director" means the director of the department of community, trade,
and economic development.
(5)
"Local government" means a city, code city, town, or county.
Sec.
3. RCW
43.63A.700 and 1994 sp.s. c 7 s 702 are each amended to read as follows:
(1)
The department, in cooperation with the department of revenue, the employment
security department, and the office of financial management, ((shall)) may
approve applications submitted by local governments for an area's
designation as a community empowerment zone under this ((section)) chapter.
The application for designation shall be in the form and manner and
contain such information as the department may prescribe, provided that the
application ((for designation)) shall:
(a)
Contain information sufficient for the director to determine if the criteria
established in RCW 43.63A.710 (as recodified by this act) have been
met((.));
(b)
Be submitted on behalf of the local government by its chief elected official,
or, if none, by the governing body of the local government((.));
(c)
Contain a five-year community empowerment plan that ((describes the proposed
designated community empowerment zone's community development needs and present
a strategy for meeting those needs. The plan shall address the following
categories: Housing needs; public infrastructure needs, such as
transportation, water, sanitation, energy, and drainage/flood control; other
public facilities needs, such as neighborhood facilities or facilities for
provision of health, education, recreation, public safety, or other services;
community economic development needs, such as commercial/industrial
revitalization, job creation and retention considering the unemployment and
underemployment of area residents, accessibility to financial resources by area
residents and businesses, investment within the area, or other related
components of community economic development; and social service needs.
The
local government is required to provide a description of its strategy for meeting
the needs identified in this subsection (1)(c). As part of the strategy, the
local government is required to identify the needs for which specific plans are
currently in place and the source of funds expected to be used. For the
balance of the area's needs, the local government must identify the source of
funds expected to become available during the next two-year period and actions
the local government will take to acquire those funds.)) meets
the requirements of section 5 of this act; and
(d)
Certify that ((neighborhood)) area residents were given the
opportunity to participate in the development of the five-year community
empowerment strategy required under (((c) of this subsection)) section
5 of this act.
(2)
No local government shall submit more than two ((neighborhoods)) areas
to the department for possible designation as a ((designated)) community
empowerment zone under this ((section)) chapter.
(3)(a)
((Within ninety days after January 1, 1994,)) The director may
designate up to six ((designated)) community empowerment zones,
state-wide, from among the applications ((eligible)) submitted
for designation as a ((designated)) community empowerment zone.
(b)
The director shall make determinations of designated community empowerment
zones on the basis of the following factors:
(i)
The strength and quality of the local government commitments to meet the needs
identified in the five-year community empowerment plan required under ((this))
section 5 of this act.
(ii)
The level of private ((commitments by private entities)) sector
commitment of additional resources and contribution to the ((designated))
community empowerment zone.
(iii)
The potential for revitalization of the area as a result of designation as a ((designated))
community empowerment zone.
(iv)
Other factors the director deems necessary.
(c)
The determination of the director as to the areas designated as community
empowerment zones shall be final.
(4)
Except as provided in section 6 of this act, an area that was designated a
community empowerment zone before January 1, 1996, under this section,
automatically and without additional action by the local government continues
its designation under this chapter.
(5)
The department may not designate additional community empowerment zones after
January 1, 2004, but may amend or rescind designation of community empowerment
zones in accordance with section 6 of this act.
Sec.
4. RCW
43.63A.710 and 1994 sp.s. c 7 s 703 are each amended to read as follows:
(1)
The director may not designate an area as a ((designated)) community
empowerment zone unless that area meets the following requirements:
(a)
The area must be designated by the legislative authority of the local
government as an area to receive federal, state, and local assistance designed
to increase economic, physical, or social activity in the area;
(b)
The area must have at least fifty-one percent of the households in the area
with incomes at or below eighty percent of the county's median income, adjusted
for household size;
(c)
The average unemployment rate for the area, for the most recent twelve-month
period for which data is available must be at least one hundred twenty percent
of the average unemployment rate of the county; and
(d)
A five-year community empowerment plan for the area that meets the requirements
of ((RCW 43.63A.700(1)(c) and as further defined by the director)) section
5 of this act must be adopted.
(2)
The director may establish, by rule, such other requirements as the director
may reasonably determine necessary and appropriate to assure that the purposes
of this ((section)) chapter are satisfied.
(3)
In determining if an area meets the requirements of this section, the director
may consider data provided by the United States bureau of the census from the
most recent census or any other reliable data that the director determines to
be acceptable for the purposes for which the data is used.
NEW
SECTION. Sec. 5. (1)
The five-year community empowerment plan required under RCW 43.63A.700 (as
recodified by this act) shall contain information that describes the community
development needs of the proposed community empowerment zone and present a
strategy for meeting those needs. The plan shall address the following
categories:
(a)
Housing needs for all economic segments of the proposed community empowerment
zone;
(b)
Public infrastructure needs, such as transportation, water, sanitation, energy,
and drainage and flood control;
(c)
Other public facilities needs, such as neighborhood facilities or facilities
for the provision of health, education, recreation, public safety, and other
services;
(d)
Community economic development needs, such as commercial and industrial
revitalization, job creation and retention considering the unemployment and
underemployment of area residents, accessibility to financial resources by area
residents and businesses, investment within the area, and other related
components of community economic development; and
(e)
Social service needs of residents in the proposed community empowerment zone.
(2)
The local government must provide a description of its strategy for meeting the
needs identified in subsection (1) of this section. As part of the community
empowerment zone strategy, the local government must identify the needs for
which specific plans are currently in place and the source of funds expected to
be used. For the balance of the area's needs, the local government must
identify the source of funds expected to become available during the next
two-year period and actions the local government will take to acquire those
funds.
(3)
The local government must submit an annual progress report to the department
that details the extent to which the local government is working to meet the
needs identified in the five-year community empowerment plan. If applicable,
the progress report must also contain a discussion on the impediments to
meeting the needs outlined in the five-year community empowerment plan. The
department must determine the date the annual progress reports are due from
each local government.
NEW
SECTION. Sec. 6. (1)
The terms or conditions of a community empowerment zone approved under this
chapter may be amended to:
(a)
Alter the boundaries of the community empowerment zone; or
(b)
Terminate the designation of a community empowerment zone.
(2)(a)
A request for an amendment under subsection (1)(a) of this section may not be
in effect until the department issues an amended designation for the community
empowerment zone that approves the requested amendment. The local government
must promptly file with the department a request for approval that contains
information the department deems necessary to evaluate the proposed changes and
its impact on the area's designation as a community empowerment zone under RCW
43.63A.710 (as recodified by this act). The local government must hold at
least two public hearings on the proposed changes and include the information
in its request for an amendment to its community empowerment zone.
(b)
The department shall approve or disapprove a proposed amendment to a community
empowerment zone within sixty days of its receipt of a request under subsection
(1)(a) of this section. The department may not approve changes to a community
empowerment zone that are not in conformity with this chapter.
(3)(a)
The termination of an area's designation as a community empowerment zone under
subsection (1)(b) of this section is not effective until the department issues
a finding stating the reasons for the termination, which may include lack of
commitment of resources to activities in the community empowerment zone by the
public, private, and community-based sectors. The local government may file an
appeal to the department's findings within sixty days of the notice to
terminate the area's designation. The department must notify the local
government of the results within thirty days of the filing of the appeal.
(b)
A termination of an area's designation as a community empowerment zone has no
effect on benefits previously extended to individual businesses. The local
government may not commit benefits to a business after the effective date of
the termination of an area's designation as a community empowerment zone.
(4)
The department may request applications from local governments for designation
as community empowerment zones under this chapter as a result of a termination
of an area's designation as a community empowerment zone under this section.
NEW
SECTION. Sec. 7. The
department must administer this chapter and has the following powers and
duties:
(1)
To monitor the implementation of chapter . . ., Laws of 2000 (this
act) and submit reports evaluating the effectiveness of the program and any
suggestions for legislative changes to the governor and legislature by December
1, 2000;
(2)
To develop evaluation and performance measures for local governments to measure
the effectiveness of the program at the local level on meeting the objectives
of this chapter;
(3)
To provide information and appropriate assistance to persons desiring to locate
and operate a business in a community empowerment zone;
(4)
To work with appropriate state agencies to coordinate the delivery of programs,
including but not limited to housing, community and economic development, small
business assistance, social service, and employment and training programs which
are carried on in a community empowerment zone; and
(5)
To develop rules necessary for the administration of this chapter.
NEW
SECTION. Sec. 8. The
administration of a community empowerment zone is under the jurisdiction of the
local government. Each local government must, by ordinance, designate a
community empowerment zone administrator for the area designated as a community
empowerment zone that is within its jurisdiction. A community empowerment zone
administrator must be an officer or employee of the local government. The
community empowerment zone administrator is the liaison between the local
government, the department, the business community, and labor and
community-based organizations within the community empowerment zone.
NEW
SECTION. Sec. 9. This
chapter may be known and cited as the Washington community empowerment zone
act.
NEW
SECTION. Sec. 10.
Sections 1, 2, and 5 through 9 of this act constitute a new chapter in Title 43
RCW.
NEW
SECTION. Sec. 11. RCW
43.63A.700 and 43.63A.710, as amended by this act, are each recodified as
sections in chapter 43.-- RCW (sections 1, 2, and 5 through 9 of this act).
NEW
SECTION. Sec. 12. If
any part of this act is found to be in conflict with federal requirements that
are a prescribed condition to the allocation of federal funds to the state, the
conflicting part of this act is inoperative solely to the extent of the
conflict and with respect to the agencies directly affected, and this finding
does not affect the operation of the remainder of this act in its application
to the agencies concerned. Rules adopted under this act must meet federal
requirements that are a necessary condition to the receipt of federal funds by
the state.
Sec.
13. RCW
82.60.049 and 1999 c 164 s 304 are each amended to read as follows:
(1)
For the purposes of this section:
(a)
"Eligible area" also means a designated community empowerment zone
approved before January 1, 2000, under RCW 43.63A.700 or a county
containing a community empowerment zone approved before January 1, 2000.
(b)
"Eligible investment project" also means an investment project in an
eligible area as defined in this section.
(2)
In addition to the provisions of RCW 82.60.040, the department shall issue a
sales and use tax deferral certificate for state and local sales and use taxes
due under chapters 82.08, 82.12, and 82.14 RCW, on each eligible investment
project that is located in an eligible area, if the applicant establishes that
at the time the project is operationally complete:
(a)
The applicant will hire at least one qualified employment position for each
seven hundred fifty thousand dollars of investment on which a deferral is
requested; and
(b)
The positions will be filled by persons who at the time of hire are residents
of the community empowerment zone in which the project is located. As used in
this subsection, "resident" means the person makes his or her home in
the community empowerment zone. A mailing address alone is insufficient to
establish that a person is a resident for the purposes of this section. The
persons must be hired after the date the application is filed with the
department.
(3)
All other provisions and eligibility requirements of this chapter apply to
applicants eligible under this section.
(4)
If a person does not meet the requirements of this section by the end of the
calendar year following the year in which the project is certified as
operationally complete, all deferred taxes are immediately due.
NEW SECTION. Sec. 14. If
any provision of this act or its application to any person or circumstance is
held invalid, the remainder of the act or the application of the provision to
other persons or circumstances is not affected.
