BILL REQ. #:  H-1237.2 


State of Washington59th Legislature2005 Regular Session

By Representatives Ericks, Haler, Linville, Springer, Kilmer, Morrell, O'Brien, Schual-Berke, P. Sullivan, Simpson, Pettigrew, Jarrett, Wallace, Sells, Strow, Grant, Upthegrove, Kessler, Dunn, Fromhold, Appleton, Chase, Green, Moeller, Hasegawa and Takko

Read first time 02/09/2005.   Referred to Committee on Economic Development, Agriculture & Trade.

     AN ACT Relating to creating a job development fund; adding new sections to chapter 43.160 RCW; and creating a new section.


NEW SECTION.  Sec. 1   The legislature has and continues to recognize the vital importance of economic development to the health and prosperity of Washington state as indicated in RCW 43.160.010, 43.155.070(4)(g), 43.163.005, and 43.168.010. The legislature finds that current economic development programs and funding, which are primarily low-interest loan programs, can be enhanced by creating a grant program to assist local governments with public infrastructure projects that directly stimulate community and economic development by facilitating the creation of new jobs or the retention of existing jobs.

NEW SECTION.  Sec. 2   A new section is added to chapter 43.160 RCW to read as follows:
     (1) The job development fund is created in the state treasury. Money may be placed in the fund from the proceeds of bonds when authorized by the legislature or from any other lawful source. Moneys in the fund may be spent only after appropriation. Expenditures from the fund shall be used to make grants to local governments for public infrastructure projects to stimulate community and economic development as provided in this section.
     (2) The maximum grant from the job development fund for any one project is ten million dollars. Grant assistance from the job development fund may not exceed thirty-three percent of the total cost of the project. The nonstate portion of the total project cost may include cash, the value of real property when acquired solely for the purpose of the project, and in-kind contributions.
     (3) For the 2005-07 biennium, the board may solicit and rank applications as provided in section 3(2) of this act, and need not submit the list for approval to the legislature, to the extent funding is included in the 2005-07 capital budget for purposes of this section and to the extent the legislature has not specified otherwise in the appropriation.
     (4)(a) Beginning with the 2007-09 biennium, for seventy percent of any biennial appropriation, the board may not sign contracts or otherwise financially obligate funds until the legislature has approved a specific list of projects. Beginning with the 2007-09 biennium and thereafter, the board shall submit a prioritized list of recommended projects to the governor and the legislature. The legislature may remove projects from the list recommended by the board.
     The legislature may not change the order of the priorities recommended for funding by the board. For purposes of the biennial capital budget request, the board shall request fifty million dollars for purposes of this section. The total amount of the board's recommended state funding for projects on a biennial project list submitted by the board may not exceed thirty million dollars. The board may provide an additional alternate project list up to ten million dollars. The list shall include a description of each project, the amount of recommended state funding, and documentation of nonstate funds to be used for the project. The board shall also describe the expected community or economic development benefits for each of the recommended projects in its budget request.
     (b) The remaining funds not expended or obligated under (a) of this subsection may be expended or obligated by the board, after consultation with the legislature, for applications not on the list approved by the legislature if:
     (i) The application was submitted for consideration in the board's biennial application solicitation and ranking process but circumstances have subsequently changed that make the project more urgent and more highly ranked; or
     (ii) The application was submitted after the board's biennial application deadline through no fault of the applicant, the application would have ranked high on the list had it been submitted in time, and the applicant cannot wait for the next biennial application period due to exigent or emergency circumstances.
     (c) As used in (b) of this subsection, "consultation with the legislature" means the board notifies in writing the speaker of the house of representatives and majority leader of the senate and waits ten business days to give the legislature an opportunity to comment on the board's proposed action before the department expends or obligates the funds.
     (5) In contracts for grants authorized under this section, the board shall include provisions that if the grantee is found to be out of compliance with provisions of the contract, including agreed-to performance criteria, the grantee shall repay to the state general fund the principal amount of the grant plus interest calculated at the rate of interest on state of Washington general obligation bonds issued most closely to the date of authorization of the grant, or an amount otherwise agreed to by the department.
     (6) Grantees shall provide a report to the board by March 1st of each year. At a minimum, the report shall contain the following information:
     (a) The names of any businesses locating within the grantee's jurisdiction as a result of the public improvements undertaken by the grantee and financed in whole or in part by the job development fund;
     (b) The total number of permanent jobs created within the grantee's jurisdiction as a result of the public improvements financed in whole or in part by the job development fund; and
     (c) The average wages and benefits received by all employees of businesses within the grantee's jurisdiction as a result of the public improvements undertaken by the grantee and financed in whole or in part by the job development fund.
     (7) The board shall report to the governor and legislature on the implementation of this section by December 1, 2005, and by December 1st of each even-numbered year thereafter.

NEW SECTION.  Sec. 3   A new section is added to chapter 43.160 RCW to read as follows:
     (1) In administering the job development fund, the board shall establish a competitive process to request proposals for and prioritize projects the primary objective of which is to stimulate community and economic development through redevelopment projects as defined in RCW 35.81.015(18) and rehabilitation projects as defined in RCW 35.81.015(19).
     (2) The board shall conduct a statewide request for project applications from political subdivisions of the state and federally recognized Indian tribes. The board shall develop criteria on which to evaluate and rank applications, and shall develop performance and evaluation criteria to review how well successful applicants met the community and economic development objectives stated in their applications. Among the priorities for ranking projects, the board shall include consideration of:
     (a) The relative benefits provided to the community by the jobs the project would create, not just the total number of jobs it would create after the project is completed and according to the unemployment rate in the area in which the jobs would be located; and
     (b) The rate of return of the state's investment, that includes the expected increase in state and local tax revenues associated with the project.
     (3) At a minimum, applicants shall demonstrate that the requested assistance will directly stimulate community and economic development by facilitating the creation of new jobs or the retention of existing jobs. The evaluation and ranking process shall also include an examination of existing assets that applicants may apply to projects.
     (4) Before any grant is approved, the applicant shall demonstrate to the board that no other timely source of funding is available to it at costs reasonably similar to financing available from the board.
     (5) The board shall not provide financial assistance for any project for which evidence exists that the project would result in a development or expansion that would displace existing jobs in any other community in the state.

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