BILL REQ. #:  H-1353.1 

Read first time 02/12/2003.   Referred to Committee on Transportation.

     AN ACT Relating to transportation funding; amending RCW 46.68.080, 82.38.080, and 82.08.0255; adding a new section to chapter 82.08 RCW; repealing RCW 82.36.029; repealing 1998 c 115 s 5 (uncodified); and providing an effective date.

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

Sec. 1   RCW 46.68.080 and 1961 c 12 s 46.68.080 are each amended to read as follows:
     All motor vehicle license fees and all motor vehicle fuel tax directly or indirectly paid by the residents of those counties composed entirely of islands and which have neither a fixed physical connection with the mainland nor any state highways on any of the islands of which they are composed, shall be paid into the ((motor vehicle fund of the state of Washington and shall monthly, as they accrue, and after deducting therefrom the expenses of issuing such licenses and the cost of collecting such motor vehicle fuel tax, be paid to the county treasurer of each such county to be by him disbursed as hereinafter provided)) Puget Sound ferry operations account and be used to fund the ferry service provided to those islands.
     One-half of all motor vehicle license fees and motor vehicle fuel tax directly or indirectly paid by the residents of those counties composed entirely of islands and which have either a fixed physical connection with the mainland or state highways on any of the islands of which they are composed, shall be paid into the ((motor vehicle fund of the state of Washington and shall monthly, as they accrue, and after deducting therefrom the expenses of issuing such licenses and the cost of collecting such motor vehicle fuel tax, be paid to the county treasurer of each such county to be by him disbursed as hereinafter provided)) Puget Sound ferry operations account and be used to fund the ferry service provided to those islands.
     ((All funds paid to the county treasurer of the counties of either class above referred to as in this section provided, shall be by such county treasurer distributed and credited to the several road districts of each such county and paid to the city treasurer of each incorporated city and town within each such county, in the direct proportion that the assessed valuation of each such road district and incorporated city and town shall bear to the total assessed valuation of each such county.
     The amount of motor vehicle fuel tax paid by the residents of those counties composed entirely of islands shall, for the purposes of this section, be that percentage of the total amount of motor vehicle fuel tax collected in the state that the motor vehicle license fees paid by the residents of counties composed entirely of islands bears to the total motor vehicle license fees paid by the residents of the state.))

Sec. 2   RCW 82.38.080 and 1998 c 176 s 60 are each amended to read as follows:
     (1) ((There is)) The use of fuel for the following purposes is fully exempted from the tax imposed by this chapter((, the use of fuel for)):
     (a) Street and highway construction and maintenance purposes in motor vehicles owned and operated by the state of Washington, or any county or municipality;
     (b) Publicly owned fire fighting equipment;
     (c) Special mobile equipment as defined in RCW 46.04.552;
     (d) Power pumping units or other power take-off equipment of any motor vehicle which is accurately measured by metering devices that have been specifically approved by the department or which is established by any of the following formulae:
     (i) Pumping propane, or fuel or heating oils or milk picked up from a farm or dairy farm storage tank by a power take-off unit on a delivery truck, at a rate determined by the department: PROVIDED, That claimant when presenting his or her claim to the department in accordance with this chapter, shall provide to the claim, invoices of propane, or fuel or heating oil delivered, or such other appropriate information as may be required by the department to substantiate his or her claim;
     (ii) Operating a power take-off unit on a cement mixer truck or a load compactor on a garbage truck at the rate of twenty-five percent of the total gallons of fuel used in such a truck; or
     (iii) The department is authorized to establish by rule additional formulae for determining fuel usage when operating other types of equipment by means of power take-off units when direct measurement of the fuel used is not feasible. The department is also authorized to adopt rules regarding the usage of on board computers for the production of records required by this chapter;
     (e) Motor vehicles owned and operated by the United States government;
     (f) Heating purposes;
     (g) ((Moving a motor vehicle on a public highway between two pieces of private property when said moving is incidental to the primary use of the motor vehicle)) Ferry service owned and operated by the state of Washington;
     (h) Transportation services for persons with special transportation needs by a private, nonprofit transportation provider regulated under chapter 81.66 RCW;
     (i) Vehicle refrigeration units, mixing units, or other equipment powered by separate motors from separate fuel tanks; and
     (j) The operation of a motor vehicle as a part of or incidental to logging operations upon a highway under federal jurisdiction within the boundaries of a federal area if the federal government requires a fee for the privilege of operating the motor vehicle upon the highway, the proceeds of which are reserved for constructing or maintaining roads in the federal area, or requires maintenance or construction work to be performed on the highway for the privilege of operating the motor vehicle on the highway.
     (2) There is exempted from the tax imposed by this chapter the removal or entry of special fuel under the following circumstances and conditions:
     (a) If it is the removal from a terminal or refinery of, or the entry or sale of, a special fuel if all of the following apply:
     (i) The person otherwise liable for the tax is a licensee other than a dyed special fuel user or international fuel tax agreement licensee;
     (ii) For a removal from a terminal, the terminal is a licensed terminal; and
     (iii) The special fuel satisfies the dyeing and marking requirements of this chapter;
     (b) If it is an entry or removal from a terminal or refinery of taxable special fuel transferred to a refinery or terminal and the persons involved, including the terminal operator, are licensed; and
     (c)(i) If it is a special fuel that, under contract of sale, is shipped to a point outside this state by a supplier by means of any of the following:
     (A) Facilities operated by the supplier;
     (B) Delivery by the supplier to a carrier, customs broker, or forwarding agent, whether hired by the purchaser or not, for shipment to the out-of-state point;
     (C) Delivery by the supplier to a vessel clearing from port of this state for a port outside this state and actually exported from this state in the vessel.
     (ii) For purposes of this subsection (2)(c):
     (A) "Carrier" means a person or firm engaged in the business of transporting for compensation property owned by other persons, and includes both common and contract carriers; and
     (B) "Forwarding agent" means a person or firm engaged in the business of preparing property for shipment or arranging for its shipment.
     (3) Notwithstanding any provision of law to the contrary, every urban passenger transportation system and carriers as defined by chapters 81.68 and 81.70 RCW shall be exempt from the provisions of this chapter requiring the payment of special fuel taxes. For the purposes of this section "urban passenger transportation system" means every transportation system, publicly or privately owned, having as its principal source of revenue the income from transporting persons for compensation by means of motor vehicles and/or trackless trolleys, each having a seating capacity for over fifteen persons over prescribed routes in such a manner that the routes of such motor vehicles and/or trackless trolleys, either alone or in conjunction with routes of other such motor vehicles and/or trackless trolleys subject to routing by the same transportation system, shall not extend for a distance exceeding twenty-five road miles beyond the corporate limits of the county in which the original starting points of such motor vehicles are located: PROVIDED, That no refunds or credits shall be granted on special fuel used by any urban transportation vehicle or vehicle operated pursuant to chapters 81.68 and 81.70 RCW on any trip where any portion of said trip is more than twenty-five road miles beyond the corporate limits of the county in which said trip originated.

Sec. 3   RCW 82.08.0255 and 1998 c 176 s 4 are each amended to read as follows:
     (1) The tax levied by RCW 82.08.020 shall not apply to sales of:
     (a) Motor vehicle fuel used in aircraft by the manufacturer thereof for research, development, and testing purposes; and
     (b) Motor vehicle and special fuel if:
     (i) The fuel is purchased for the purpose of public transportation and the purchaser is entitled to a refund or an exemption under RCW 82.36.275 or 82.38.080(3); or
     (ii) The fuel is purchased by a private, nonprofit transportation provider certified under chapter 81.66 RCW and the purchaser is entitled to a refund or an exemption under RCW 82.36.285 or 82.38.080(1)(h); or
     (iii) The fuel is taxable under chapter 82.36 or 82.38 RCW; or
     (iv) The fuel is purchased and used by the Washington state ferries.
     (2) Any person who has paid the tax imposed by RCW 82.08.020 on the sale of special fuel delivered in this state shall be entitled to a credit or refund of such tax with respect to fuel subsequently established to have been actually transported and used outside this state by persons engaged in interstate commerce. The tax shall be claimed as a credit or refunded through the tax reports required under RCW 82.38.150.

NEW SECTION.  Sec. 4   A new section is added to chapter 82.08 RCW to read as follows:
     Sales tax revenue generated from motor vehicle leases must be deposited into the multimodal transportation account.

NEW SECTION.  Sec. 5   The following acts or parts of acts are each repealed:
     (1) RCW 82.36.029 (Deductions -- Handling losses -- Reports) and 1998 c 176 s 10; and
     (2) 1998 c 115 s 5 (uncodified).

NEW SECTION.  Sec. 6   This act takes effect August 1, 2003.