"NEW SECTION.  Sec. 1   (1) The legislature finds that Washington has long been a national and international leader on energy conservation and environmental stewardship, including air quality protection, renewable energy development and generation, emission standards for fossil-fuel based energy generation, energy efficiency programs, natural resource conservation, vehicle emission standards, and the use of biofuels. Washington is also unique among most states in that in addition to its commitment to reduce emissions of greenhouse gases, it has established goals to grow the clean energy sector and reduce the state's expenditures on imported fuels.
     (2) The legislature further finds that Washington should continue its leadership on climate change policy by developing and implementing a system for monitoring and reporting greenhouse gas emissions, participating in the design of a regional multisector market-based system, and ensuring the state has a well-trained workforce for our clean energy future.
     (3) In the event the state elects to participate in a regional multisector market-based system, it is the intent of the legislature that the system will become effective by January 1, 2012, after authority is provided to the department for its implementation. By acting now, Washington businesses and citizens will have adequate time and opportunities to be well-positioned to take advantage of the low-carbon economy and to make necessary investments in low-carbon technology.
     (4) It is also the intent of the legislature that the regional multisector market-based system recognize Washington's unique emissions portfolio, including the state's hydroelectric system, the opportunities presented by Washington's abundant forest resources and agriculture land, and the state's leadership in energy efficiency and the actions it has already taken that have reduced its generation of greenhouse gas emissions and that entities receive appropriate credit for early actions to reduce greenhouse gases.
     (5) If any revenues that accrue to the state are created by a market system, they must be used to further the state's efforts to increase investment in the clean energy economy particularly for communities and workers that have suffered from heavy job losses and chronic unemployment and underemployment.
     (6) It is the policy of the state to participate in the development of a federal climate change program and in doing so shall seek consistency to avoid duplication and to avoid any federal preemption of the state's climate change program.

NEW SECTION.  Sec. 2   The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
     (1) "Carbon dioxide equivalents" means a metric measure used to compare the emissions from various greenhouse gases based upon their global warming potential.
     (2) "Climate advisory team" means the stakeholder group formed in response to executive order 07-02.
     (3) "Climate impacts group" means the University of Washington's climate impacts group.
     (4) "Department" means the department of ecology.
     (5) "Direct emissions" means emissions of greenhouse gases from sources of emissions, including stationary combustion sources, mobile combustion emissions, process emissions, and fugitive emissions.
     (6) "Director" means the director of the department.
     (7) "Greenhouse gas" and "greenhouse gases" includes carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride, and except for purposes of reporting, does not include emissions of carbon dioxide from industrial combustion of biomass in the form of fuel wood and wood waste that is offset by the growth of new biomass.
     (8) "Indirect emissions" means emissions of greenhouse gases associated with the purchase of electricity, heating, cooling, or steam.
     (9) "Person" means an individual, partnership, franchise holder, association, corporation, a state, a city, a county, or any subdivision or instrumentality of the state.
     (10) "Program" means the department's climate change program.
     (11) "Total emissions of greenhouse gases" means all direct emissions and all indirect emissions.
     (12) "Western climate initiative" means the collaboration of states, Canadian provinces, Mexican states, and tribes to design a multisector market-based mechanism as directed under the western regional climate action initiative signed by the governor on February 22, 2007.

NEW SECTION.  Sec. 3   (1)(a) The director shall develop, in coordination with the western climate initiative, a design for a regional multisector market-based system to limit and reduce emissions of greenhouse gases.
     (b) By December 1, 2008, the director and the director of the department of community, trade, and economic development shall deliver to the legislature specific recommendations for implementing the preferred design of a regional multisector market-based system. These recommendations must include:
     (i) Proposed legislation, necessary funding, and the schedule necessary to implement the preferred design by January 1, 2012;
     (ii) Any changes determined necessary to the reporting requirements established under RCW 70.94.151; and
     (iii) Actions that the state should take to prevent manipulation of the multisector market-based system designed under this section.
     (2) In developing the design for the regional multisector market-based system under subsections (1) and (3) of this section, the department shall consult with affected state agencies, cities, and counties, and provide opportunity for public review and comment.
     (3)(a) In developing the design for the regional multisector market-based system, the department shall allow for entities to receive appropriate credit for early actions to reduce greenhouse gases.
     (b) Pursuant to executive order 07-02, greenhouse gas emission reductions attributable to at least the following policies count as reductions in an amount equal to at least sixty percent of the 2020 goal:
     (i) Tailpipe emission standards under chapter 70.120A RCW;
     (ii) Biofuels standards under chapter 19.112 RCW;
     (iii) Renewable energy and conservation standards under chapter 19.285 RCW;
     (iv) High-performance green building codes under chapters 39.35, 39.35A, 39.35C, and 39.35D RCW;
     (v) Appliance efficiency standards under chapter 19.260 RCW;
     (vi) Energy freedom projects under chapter 43.63A RCW;
     (vii) Water conservation projects under chapter 90.90 RCW;
     (viii) Enhanced building codes under chapter 19.27A RCW;
     (ix) Emission performance standards under chapter 80.80 RCW;
     (x) Programs for retrofitting diesel engines in school buses and local government vehicles as acknowledged under executive order 07-02; and
     (xi) Sustainability and efficiency goals for state operations under executive order 05-01.
     (4) In addition to the information required under subsection (1)(b) of this section, the director and the director of the department of community, trade, and economic development shall submit the following to the legislature by December 1, 2008:
     (a) Information on progress to date in achieving the requirements of this act;
     (b) The final recommendations of the climate advisory team, including recommended most promising actions to reduce emissions of greenhouse gases or otherwise respond to climate change;
     (c) A request for additional resources and statutory authority needed to limit and reduce emissions of greenhouse gas consistent with this act including implementation of the most promising recommendations of the climate advisory team;
     (d) Recommendations on how local governments could participate in the multisector market-based system designed under subsection (1) of this section; and
     (e) Recommendations developed in consultation with the department of natural resources and the department of agriculture regarding how forestry and agricultural lands and practices may participate voluntarily as an offset or other credit program in the regional multisector market-based system. These recommendations must address:
     (i) Commercial and other working forests, forest products, and agricultural land and practices, including sequestration of carbon on timber lands managed under forest practices rules adopted pursuant to chapter 76.09 RCW;
     (ii) Forest and agriculture lands that are set aside or managed for conservation; and
     (iii) Reforestation and afforestation projects.

Sec. 4   RCW 43.350.030 and 2005 c 424 s 4 are each amended to read as follows:
     In addition to other powers and duties prescribed in this chapter, the authority is empowered to:
     (1) Use public moneys in the life sciences discovery fund, leveraging those moneys with amounts received from other public and private sources in accordance with contribution agreements, to promote life sciences research;
     (2) Solicit and receive gifts, grants, and bequests, and enter into contribution agreements with private entities and public entities other than the state to receive moneys in consideration of the authority's promise to leverage those moneys with amounts received through appropriations from the legislature and contributions from other public entities and private entities, in order to use those moneys to promote life sciences research. Nonstate moneys received by the authority for this purpose shall be deposited in the life sciences discovery fund created in RCW 43.350.070;
     (3) Hold funds received by the authority in trust for their use pursuant to this chapter to promote life sciences research;
     (4) Manage its funds, obligations, and investments as necessary and as consistent with its purpose including the segregation of revenues into separate funds and accounts;
     (5) Make grants to entities pursuant to contract for the promotion of life sciences research to be conducted in the state. Grant agreements shall specify deliverables to be provided by the recipient pursuant to the grant. The authority shall solicit requests for funding and evaluate the requests by reference to factors such as: (a) The quality of the proposed research; (b) its potential to improve health outcomes, with particular attention to the likelihood that it will also lower health care costs, substitute for a more costly diagnostic or treatment modality, or offer a breakthrough treatment for a particular disease or condition; (c) its potential for leveraging additional funding; (d) its potential to provide health care benefits or benefit human learning and development; (e) its potential to stimulate the health care delivery, biomedical manufacturing, and life sciences related employment in the state; (f) its potential to promote renewable energy development and generation, reduce greenhouse gas emissions, and lower dependence on imported fuels; (g) the geographic diversity of the grantees within Washington; (((g))) (h) evidence of potential royalty income and contractual means to recapture such income for purposes of this chapter; and (((h))) (i) evidence of public and private collaboration;
     (6) Create one or more advisory boards composed of scientists, industrialists, and others familiar with life sciences research; and
     (7) Adopt policies and procedures to facilitate the orderly process of grant application, review, and reward.

Sec. 5   RCW 70.94.151 and 2005 c 138 s 1 are each amended to read as follows:
     (1) The board of any activated authority or the department, may classify air contaminant sources, by ordinance, resolution, rule or regulation, which in its judgment may cause or contribute to air pollution, according to levels and types of emissions and other characteristics which cause or contribute to air pollution, and may require registration or reporting or both for any such class or classes. Classifications made pursuant to this section may be for application to the area of jurisdiction of such authority, or the state as a whole or to any designated area within the jurisdiction, and shall be made with special reference to effects on health, economic and social factors, and physical effects on property.
     (2) Except as provided in subsection (3) of this section, any person operating or responsible for the operation of air contaminant sources of any class for which the ordinances, resolutions, rules or regulations of the department or board of the authority, require registration ((and)) or reporting shall register therewith and make reports containing information as may be required by such department or board concerning location, size and height of contaminant outlets, processes employed, nature of the contaminant emission and such other information as is relevant to air pollution and available or reasonably capable of being assembled. In the case of emissions of greenhouse gases as defined in section 2 of this act the department shall adopt rules requiring reporting of those emissions. The department or board may require that such registration or reporting be accompanied by a fee, and may determine the amount of such fee for such class or classes: PROVIDED, That the amount of the fee shall only be to compensate for the costs of administering such registration or reporting program which shall be defined as initial registration and annual or other periodic reports from the source owner providing information directly related to air pollution registration, on-site inspections necessary to verify compliance with registration requirements, data storage and retrieval systems necessary for support of the registration program, emission inventory reports and emission reduction credits computed from information provided by sources pursuant to registration program requirements, staff review, including engineering or other reliable analysis for accuracy and currentness, of information provided by sources pursuant to registration program requirements, clerical and other office support provided in direct furtherance of the registration program, and administrative support provided in directly carrying out the registration program: PROVIDED FURTHER, That any such registration made with either the board or the department shall preclude a further registration and reporting with any other board or the department, except that emissions of greenhouse gases as defined in section 2 of this act must be reported as required under subsection (5) of this section.
     All registration program and reporting fees collected by the department shall be deposited in the air pollution control account. All registration program fees collected by the local air authorities shall be deposited in their respective treasuries.
     (3) If a registration or report has been filed for a grain warehouse or grain elevator as required under this section, registration, reporting, or a registration program fee shall not, after January 1, 1997, again be required under this section for the warehouse or elevator unless the capacity of the warehouse or elevator as listed as part of the license issued for the facility has been increased since the date the registration or reporting was last made. If the capacity of the warehouse or elevator listed as part of the license is increased, any registration or reporting required for the warehouse or elevator under this section must be made by the date the warehouse or elevator receives grain from the first harvest season that occurs after the increase in its capacity is listed in the license.
     This subsection does not apply to a grain warehouse or grain elevator if the warehouse or elevator handles more than ten million bushels of grain annually.
     (4) For the purposes of subsection (3) of this section:
     (a) A "grain warehouse" or "grain elevator" is an establishment classified in standard industrial classification (SIC) code 5153 for wholesale trade for which a license is required and includes, but is not limited to, such a licensed facility that also conducts cleaning operations for grain;
     (b) A "license" is a license issued by the department of agriculture licensing a facility as a grain warehouse or grain elevator under chapter 22.09 RCW or a license issued by the federal government licensing a facility as a grain warehouse or grain elevator for purposes similar to those of licensure for the facility under chapter 22.09 RCW; and
     (c) "Grain" means a grain or a pulse.
     (5)(a) The department shall adopt rules requiring the reporting of emissions of greenhouse gases as defined in section 2 of this act. The rules must include a de minimis amount of emissions below which reporting will not be required. The rules must require that emissions of greenhouse gases resulting from the burning of fossil fuels be reported separately from emissions of greenhouse gases resulting from the burning of biomass. Except as provided in (b) of this subsection, the department shall, under the authority granted in subsection (1) of this section, adopt rules requiring any person who operates or is responsible for: (i) Operation of a fleet of on-road motor vehicles that as a fleet emit at least twenty-five hundred metric tons of greenhouse gas annually in the state to report the emissions of greenhouse gases generated from or emitted by that fleet; or (ii) any other operations that emit at least ten thousand metric tons of greenhouse gas annually in the state to report their total annual emissions of greenhouse gases. In calculating emissions of greenhouse gases for purposes of determining whether or not reporting is required, only direct emissions shall be included. The emissions of greenhouse gases must be reported as carbon dioxide equivalents. The rules must require that persons report 2009 emissions starting in 2010. The rules must establish an annual reporting schedule that takes into account the time needed to allow the person reporting emissions of greenhouse gases to gather the information needed and to verify the emissions being reported. However, in no event may reports be submitted later than October 31st of the year in which the report is due. The department may phase in the reporting requirements for operations under (a)(ii) of this subsection until the reporting threshold is met, which must be met by January 1, 2012. The department may from time to time amend the rules to include other persons that emit less than the annual greenhouse gas emissions levels set out in this subsection if necessary to comply with any federal reporting requirements for emissions of greenhouse gases.
     (b) In its rules, the department may defer the reporting requirement under (a) of this subsection for emissions associated with interstate and international commercial aircraft, rail, trucks, or marine vessels until (i) there is a federal requirement to report these emissions; or (ii) the department finds that there is a generally accepted reporting protocol for determining interstate emissions from these sources.
     (c) The department shall share any reporting information reported to it with the local air authority in which the person reporting under the rules adopted by the department operates.
     (d) The fee provisions in subsection (2) of this section apply to reporting of emissions of greenhouse gases. Persons required to report under (a) of this subsection who fail to report or pay the fee required in subsection (2) of this section are subject to enforcement penalties under this chapter. The department shall enforce the reporting rule requirements unless it approves a local air authority's request to enforce the requirements for persons operating within the authority's jurisdiction.
     (e) The energy facility site evaluation council shall, simultaneously with the department, adopt rules that impose greenhouse gas reporting requirements in site certifications on persons operating or responsible for the operation of a facility permitted by the energy facility site evaluation council. The greenhouse gas reporting requirements imposed by the energy facility site evaluation council must be the same as the greenhouse gas reporting requirements imposed by the department. The department shall share any information reported to it from facilities permitted by the energy facility site evaluation council with the council, including notice of a facility that has failed to report as required. The energy facility site evaluation council shall contract with the department to monitor the reporting requirements adopted under this section.
     (f) In developing its rules, the department shall, with the assistance of the department of transportation, identify a mechanism to report an aggregate estimate of the annual emissions of greenhouse gases generated from or emitted by otherwise unreported on-road motor vehicles.
     (g) The inclusion or failure to include any person, classes of persons, or types of emissions of greenhouse gases into the department's rules for reporting under this section does not indicate whether such a person or category is appropriate for inclusion in the multisector market-based system designed under section 3 of this act.
     (h) Should the federal government adopt rules sufficient to track progress toward the emissions reductions required by this act governing the reporting of greenhouse gases, the department shall amend its rules, as necessary, to seek consistency with the federal rules to ensure duplicate reporting is not required.
     (i) The definitions in section 2 of this act apply throughout this subsection (5) unless the context clearly requires otherwise.

Sec. 6   RCW 70.94.161 and 1993 c 252 s 5 are each amended to read as follows:
     The department of ecology, or board of an authority, shall require renewable permits for the operation of air contaminant sources subject to the following conditions and limitations:
     (1) Permits shall be issued for a term of five years. A permit may be modified or amended during its term at the request of the permittee, or for any reason allowed by the federal clean air act. The rules adopted pursuant to subsection (2) of this section shall include rules for permit amendments and modifications. The terms and conditions of a permit shall remain in effect after the permit itself expires if the permittee submits a timely and complete application for permit renewal.
     (2)(a) Rules establishing the elements for a statewide operating permit program and the process for permit application and renewal consistent with federal requirements shall be established by the department by January 1, 1993. The rules shall provide that every proposed permit must be reviewed prior to issuance by a professional engineer or staff under the direct supervision of a professional engineer in the employ of the permitting authority. The permit program established by these rules shall be administered by the department and delegated local air authorities. Rules developed under this subsection shall not preclude a delegated local air authority from including in a permit its own more stringent emission standards and operating restrictions.
     (b) The board of any local air pollution control authority may apply to the department of ecology for a delegation order authorizing the local authority to administer the operating permit program for sources under that authority's jurisdiction. The department shall, by order, approve such delegation, if the department finds that the local authority has the technical and financial resources, to discharge the responsibilities of a permitting authority under the federal clean air act. A delegation request shall include adequate information about the local authority's resources to enable the department to make the findings required by this subsection((; provided)). However, any delegation order issued under this subsection shall take effect ninety days after the environmental protection agency authorizes the local authority to issue operating permits under the federal clean air act.
     (c) Except for the authority granted the energy facility site evaluation council to issue permits for the new construction, reconstruction, or enlargement or operation of new energy facilities under chapter 80.50 RCW, the department may exercise the authority, as delegated by the environmental protection agency, to administer Title IV of the federal clean air act as amended and to delegate such administration to local authorities as applicable pursuant to (b) of this subsection.
     (3) In establishing technical standards, defined in RCW 70.94.030, the permitting authority shall consider and, if found to be appropriate, give credit for waste reduction within the process.
     (4) Operating permits shall apply to all sources (a) where required by the federal clean air act, and (b) for any source that may cause or contribute to air pollution in such quantity as to create a threat to the public health or welfare. Subsection (b) of this subsection is not intended to apply to small businesses except when both of the following limitations are satisfied: (i) The source is in an area exceeding or threatening to exceed federal or state air quality standards; and (ii) the department provides a reasonable justification that requiring a source to have a permit is necessary to meet a federal or state air quality standard, or to prevent exceeding a standard in an area threatening to exceed the standard. For purposes of this subsection "areas threatening to exceed air quality standards" shall mean areas projected by the department to exceed such standards within five years. Prior to identifying threatened areas the department shall hold a public hearing or hearings within the proposed areas.
     (5) Sources operated by government agencies are not exempt under this section.
     (6) Within one hundred eighty days after the United States environmental protection agency approves the state operating permit program, a person required to have a permit shall submit to the permitting authority a compliance plan and permit application, signed by a responsible official, certifying the accuracy of the information submitted. Until permits are issued, existing sources shall be allowed to operate under presently applicable standards and conditions provided that such sources submit complete and timely permit applications.
     (7) All draft permits shall be subject to public notice and comment. The rules adopted pursuant to subsection (2) of this section shall specify procedures for public notice and comment. Such procedures shall provide the permitting agency with an opportunity to respond to comments received from interested parties prior to the time that the proposed permit is submitted to the environmental protection agency for review pursuant to section 505(a) of the federal clean air act. In the event that the environmental protection agency objects to a proposed permit pursuant to section 505(b) of the federal clean air act, the permitting authority shall not issue the permit, unless the permittee consents to the changes required by the environmental protection agency.
     (8) The procedures contained in chapter 43.21B RCW shall apply to permit appeals. The pollution control hearings board may stay the effectiveness of any permit issued under this section during the pendency of an appeal filed by the permittee, if the permittee demonstrates that compliance with the permit during the pendency of the appeal would require significant expenditures that would not be necessary in the event that the permittee prevailed on the merits of the appeal.
     (9) After the effective date of any permit program promulgated under this section, it shall be unlawful for any person to: (a) Operate a permitted source in violation of any requirement of a permit issued under this section; or (b) fail to submit a permit application at the time required by rules adopted under subsection (2) of this section.
     (10) Each air operating permit shall state the origin of and specific legal authority for each requirement included therein. Every requirement in an operating permit shall be based upon the most stringent of the following requirements:
     (a) The federal clean air act and rules implementing that act, including provision of the approved state implementation plan;
     (b) This chapter and rules adopted thereunder;
     (c) In permits issued by a local air pollution control authority, the requirements of any order or regulation adopted by that authority;
     (d) Chapter 70.98 RCW and rules adopted thereunder; and
     (e) Chapter 80.50 RCW and rules adopted thereunder.
     (11) Consistent with the provisions of the federal clean air act, the permitting authority may issue general permits covering categories of permitted sources, and temporary permits authorizing emissions from similar operations at multiple temporary locations.
     (12) Permit program sources within the territorial jurisdiction of an authority delegated the operating permit program shall file their permit applications with that authority, except that permit applications for sources regulated on a statewide basis pursuant to RCW 70.94.395 shall be filed with the department. Permit program sources outside the territorial jurisdiction of a delegated authority shall file their applications with the department. Permit program sources subject to chapter 80.50 RCW shall, irrespective of their location, file their applications with the energy facility site evaluation council.
     (13) When issuing operating permits to coal fired electric generating plants, the permitting authority shall establish requirements consistent with Title IV of the federal clean air act.
     (14)(a) The department and the local air authorities are authorized to assess and to collect, and each source emitting one hundred tons or more per year of a regulated pollutant shall pay an interim assessment to fund the development of the operating permit program during fiscal year 1994.
     (b) The department shall conduct a workload analysis and prepare an operating permit program development budget for fiscal year 1994. The department shall allocate among all sources emitting one hundred tons or more per year of a regulated pollutant during calendar year 1992 the costs identified in its program development budget according to a three-tiered model, with each of the three tiers being equally weighted, based upon:
     (i) The number of sources;
     (ii) The complexity of sources; and
     (iii) The size of sources, as measured by the quantity of each regulated pollutant emitted by the source.
     (c) Each local authority and the department shall collect from sources under their respective jurisdictions the interim fee determined by the department and shall remit the fee to the department.
     (d) Each local authority may, in addition, allocate its fiscal year 1994 operating permit program development costs among the sources under its jurisdiction emitting one hundred tons or more per year of a regulated pollutant during calendar year 1992 and may collect an interim fee from these sources. A fee assessed pursuant to this subsection (14)(d) shall be collected at the same time as the fee assessed pursuant to (c) of this subsection.
     (e) The fees assessed to a source under this subsection shall be limited to the first seven thousand five hundred tons for each regulated pollutant per year.
     (15)(a) The department shall determine the persons liable for the fee imposed by subsection (14) of this section, compute the fee, and provide by November 1 ((of)), 1993, the identity of the fee payer with the computation of the fee to each local authority and to the department of revenue for collection. The department of revenue shall collect the fee computed by the department from the fee payers under the jurisdiction of the department. The administrative, collection, and penalty provisions of chapter 82.32 RCW shall apply to the collection of the fee by the department of revenue. The department shall provide technical assistance to the department of revenue for decisions made by the department of revenue pursuant to RCW 82.32.160 and 82.32.170. All interim fees collected by the department of revenue on behalf of the department and all interim fees collected by local authorities on behalf of the department shall be deposited in the air operating permit account. The interim fees collected by the local air authorities to cover their permit program development costs under subsection (14)(d) of this section shall be deposited in the dedicated accounts of their respective treasuries.
     (b) All fees identified in this section shall be due and payable on March 1 ((of)), 1994, except that the local air pollution control authorities may adopt by rule an earlier date on which fees are to be due and payable. The section 5, chapter 252, Laws of 1993 amendments to RCW 70.94.161 do not have the effect of terminating, or in any way modifying, any liability, civil or criminal, incurred pursuant to the provisions of RCW 70.94.161 (15) and (17) as they existed prior to July 25, 1993.
     (16) For sources or source categories not required to obtain permits under subsection (4) of this section, the department or local authority may establish by rule control technology requirements. If control technology rule revisions are made by the department or local authority under this subsection, the department or local authority shall consider the remaining useful life of control equipment previously installed on existing sources before requiring technology changes. The department or any local air authority may issue a general permit, as authorized under the federal clean air act, for such sources.
     (17) Emissions of greenhouse gases as defined in section 2 of this act must be reported as required by RCW 70.94.151. The reporting provisions of RCW 70.94.151 shall not apply to any other emissions from any permit program source after the effective date of United States environmental protection agency approval of the state operating permit program.

NEW SECTION.  Sec. 7   (1) The department shall expend two million dollars to designate a total of four new sites for water storage, two in western Washington and two in eastern Washington, including, but not limited to:
     (a) Identification of proper sites for water storage;
     (b) Development of plans for water storage at those sites; and
     (c) The formulation of a preliminary design for the water storage sites.
     (2) The department shall also assess decommissioned mine shafts for purposes of water storage.

NEW SECTION.  Sec. 8   Within eighteen months of the next and each successive global or national assessment of climate change science, the department shall consult with the climate impacts group at the University of Washington regarding the science on human-caused climate change and provide a report to the legislature summarizing that science and make recommendations for further reducing emissions of greenhouse gases.

NEW SECTION.  Sec. 9   A new section is added to chapter 43.330 RCW to read as follows:
     (1) The legislature establishes a comprehensive green economy jobs growth initiative based on the goal of, by 2020, increasing the number of green economy jobs to twenty-five thousand from the eight thousand four hundred green economy jobs the state had in 2004.
     (2) The department, in consultation with the employment security department, the state workforce training and education coordinating board, the state board of community and technical colleges, the higher education coordinating board, and the department of ecology, shall develop a defined list of terms, consistent with current workforce and economic development terms, associated with green economy industries and jobs.
     (3)(a) The employment security department, in consultation with the department, the state workforce training and education coordinating board, the state board for community and technical colleges, the higher education coordinating board, and the Washington State University extension energy program, shall conduct labor market research to analyze the current labor market and projected job growth in the green economy, the current and projected recruitment and skill requirement of green economy industry employers, the wage and benefits ranges of jobs within green economy industries, and the education and training requirements of entry-level and incumbent workers in those industries.
     (b) The University of Washington business and economic development center shall: Analyze the current opportunities for and participation in the green economy by minority and women-owned business enterprises in Washington; identify existing barriers to their successful participation in the green economy; and develop strategies with specific policy recommendations to improve their successful participation in the green economy. The research may be informed by the research of the Puget Sound regional council prosperity partnership, as well as other entities. The University of Washington business and economic development center shall report to the appropriate committees of the house of representatives and the senate on their research, analysis, and recommendations by December 1, 2008.
     (4) Based on the findings from subsection (3) of this section, the employment security department, in consultation with the department and the department of ecology and taking into account the requirements and goals of this act and other state clean energy and energy efficiency policies, shall propose which industries will be considered high-demand green industries, based on current and projected job creation and their strategic importance to the development of the state's green economy. The employment security department and the department shall take into account which jobs within green economy industries will be considered high-wage occupations and occupations that are part of career pathways to the same, based on family-sustaining wage and benefits ranges. These designations, and the results of the employment security department's broader labor market research, shall inform the planning and strategic direction of the department, the state workforce training and education coordinating board, the state board for community and technical colleges, and the higher education coordinating board.
     (5) The department shall identify emerging technologies and innovations that are likely to contribute to advancements in the green economy, including the activities in designated innovation partnership zones established in RCW 43.330.270.
     (6) The department, consistent with the priorities established by the state economic development commission, shall:
     (a) Develop targeting criteria for existing investments, and make recommendations for new or expanded financial incentives and comprehensive strategies, to recruit, retain, and expand green economy industries; and
     (b) Make recommendations for new or expanded financial incentives and comprehensive strategies to stimulate research and development of green technology and innovation, including designating innovation partnership zones linked to the green economy.
     (7) For the purposes of this section, "target populations" means (a) entry-level or incumbent workers in high-demand green industries who are in, or are preparing for, high-wage occupations; (b) dislocated workers in declining industries who may be retrained for high-wage occupations in high-demand green industries; (c) eligible veterans or national guard members; or (d) anyone eligible to participate in the state opportunity grant program under RCW 28B.50.271.
     (8) The legislature directs the state workforce training and education coordinating board to create and pilot green industry skill panels. These panels shall consist of business representatives from industry sectors related to clean energy, state and local veterans agencies, employer associations, educational institutions, and local workforce development councils within the region that the panels propose to operate, and other key stakeholders as determined by the applicant. Any of these stakeholder organizations are eligible to receive grants under this section and serve as the intermediary that convenes and leads the panel. Panel applicants must provide labor market and industry analysis that demonstrates high demand, or demand of strategic importance to the development of the state's clean energy economy as identified in this section, for high-wage occupations, or occupations that are part of career pathways to the same, within the relevant industry sector. The panel shall:
     (a) Conduct labor market and industry analyses, in consultation with the employment security department, and drawing on the findings of its research when available;
     (b) Plan strategies to meet the recruitment and training needs of the industry; and
     (c) Leverage and align other public and private funding sources.
     (9) The green industries jobs training account is created in the state treasury. Moneys from the account must be utilized to supplement the state opportunity grant program established under RCW 28B.50.271. All receipts from appropriations directed to the account must be deposited into the account. Expenditures from the account may be used only for the activities identified in this subsection. The state board for community and technical colleges, in consultation with the state workforce training and education coordinating board, informed by the research of the employment security department and the strategies developed in this section, may authorize expenditures from the account. The state board for community and technical colleges must distribute grants from the account on a competitive basis.
     (a)(i) Allowable uses of these grant funds, which should be used when other public or private funds are insufficient or unavailable, may include:
     (A) Curriculum development;
     (B) Transitional jobs strategies for dislocated workers in declining industries who may be retrained for high-wage occupations in green industries;
     (C) Workforce education to target populations; and
     (D) Adult basic and remedial education as necessary linked to occupation skills training.
     (ii) Allowable uses of these grant funds do not include student assistance and support services available through the state opportunity grant program under RCW 28B.50.271.
     (b) Applicants eligible to receive these grants may be any organization or a partnership of organizations that has demonstrated expertise in:
     (i) Implementing effective education and training programs that meet industry demand; and
     (ii) Recruiting and supporting, to successful completion of those training programs carried out under these grants, the target populations of workers.
     (c) In awarding grants from the green industries jobs training account, the state board for community and technical colleges shall give priority to applicants that demonstrate the ability to:
     (i) Use labor market and industry analysis developed by the employment security department and green industry skill panels in the design and delivery of the relevant education and training program, and otherwise utilize strategies developed by green industry skills panels;
     (ii) Leverage and align existing public programs and resources and private resources toward the goal of recruiting, supporting, educating, and training target populations of workers;
     (iii) Work collaboratively with other relevant stakeholders in the regional economy;
     (iv) Link adult basic and remedial education, where necessary, with occupation skills training;
     (v) Involve employers and, where applicable, labor unions in the determination of relevant skills and competencies and, where relevant, the validation of career pathways; and
     (vi) Ensure that supportive services, where necessary, are integrated with education and training and are delivered by organizations with direct access to and experience with the targeted population of workers.

Sec. 10   RCW 28B.50.273 and 2007 c 277 s 201 are each amended to read as follows:
     The college board, in partnership with business, labor, and the workforce training and education coordinating board, shall:
     (1) Identify job-specific training programs offered by qualified postsecondary institutions that lead to a credential, certificate, or degree in green industry occupations as established in this act, and other high demand occupations, which are occupations where data show that employer demand for workers exceeds the supply of qualified job applicants throughout the state or in a specific region, and where training capacity is underutilized;
     (2) Gain recognition of the credentials, certificates, and degrees by Washington's employers and labor organizations. The college board shall designate these recognized credentials, certificates, and degrees as "opportunity grant-eligible programs of study"; and
     (3) Market the credentials, certificates, and degrees to potential students, businesses, and apprenticeship programs as a way for individuals to advance in their careers and to better meet the needs of industry.

NEW SECTION.  Sec. 11   A new section is added to chapter 82.16 RCW to read as follows:
     (1) A light and power business is allowed a credit against taxes due under this chapter in an amount equal to fifty percent of the cost of purchasing: (a) Carbon abatement equipment; (b) repair and replacement parts for carbon abatement equipment; and (c) labor and services rendered in respect to carbon abatement equipment.
     (2) The credit under this section is only available to light and power businesses subject to the annual reporting requirements under RCW 70.94.151(5).
     (3) Unused tax credit may be carried forward to subsequent tax reporting periods. No refunds shall be granted for credits under this section.
     (4) The definitions in this subsection apply throughout this section.
     (a) "Carbon abatement equipment" means control devices, disposal systems, machinery, equipment, and other tangible personal property acquired for the primary purpose of reducing or controlling emissions of greenhouse gases.
     (b) "Power plant" has the same meaning as defined in RCW 80.80.010.

NEW SECTION.  Sec. 12   A new section is added to chapter 82.08 RCW to read as follows:
     (1) The tax levied by RCW 82.08.020 does not apply to the sale of: (a) Carbon abatement equipment; (b) repair and replacement parts for carbon abatement equipment; and (c) labor and services rendered in respect to carbon abatement equipment.
     (2) An exemption is only available to a person subject to the annual reporting requirements under RCW 70.94.151(5).
     (3) An exemption is available only when the buyer provides the seller with an exemption certificate. The seller shall retain a copy of the certificate for the seller's files.
     (4) For the purposes of this section, "carbon abatement equipment" has the meaning as defined in section 11 of this act.

NEW SECTION.  Sec. 13   A new section is added to chapter 82.12 RCW to read as follows:
     (1) The provisions of this chapter do not apply in respect to the use of: (a) Carbon abatement equipment; (b) repair and replacement parts for carbon abatement equipment; and (c) labor and services rendered in respect to carbon abatement equipment.
     (2) The exemption under this section is only available to a person subject to the annual reporting requirements under RCW 70.94.151(5).
     (3) For the purposes of this section, "carbon abatement equipment" has the same meaning as defined in section 11 of this act.

NEW SECTION.  Sec. 14   A new section is added to chapter 84.36 RCW to read as follows:
     (1) Carbon abatement equipment, including repair and replacement parts for the equipment, used by a person subject to the annual reporting requirements under RCW 70.94.151(5) is exempt from taxation. To qualify for the exemption, the owner of the equipment shall apply to the county assessor in which the property is located prior to the initial installation of the carbon abatement equipment.
     (2) The exemption is available beginning in the calendar year that follows the calendar year in which initial application is made. Carbon abatement equipment is exempt from property tax for twenty years. Repair and replacement parts acquired after the exemption is first claimed are subject to the twenty-year requirement applicable to the initially installed carbon abatement equipment.
     (3) The application for exemption shall be made to the county assessor. The application shall be upon forms prescribed by the department of revenue and supplied by the county assessor. To claim an exemption for repair or replacement parts for carbon abatement equipment, an additional application shall be made to the county assessor.
     (4) For the purposes of this section, "carbon abatement equipment" has the same meaning as defined in section 11 of this act.

NEW SECTION.  Sec. 15   A new section is added to chapter 82.04 RCW to read as follows:
     (1) A person is allowed a credit against taxes due under this chapter in an amount equal to fifty percent of the cost of purchasing: (a) Carbon abatement equipment; (b) repair and replacement parts for carbon abatement equipment; and (c) labor and services rendered in respect to carbon abatement equipment.
     (2) The credit under this section is only available to a person subject to the annual reporting requirements under RCW 70.94.151(5).
     (3) Unused tax credit may be carried forward to subsequent tax reporting periods. No refunds shall be granted for credits under this section.
     (4) For the purposes of this section, "carbon abatement equipment" has the same meaning as defined in section 11 of this act.

NEW SECTION.  Sec. 16   A new section is added to chapter 82.04 RCW to read as follows:
     (1) In computing the tax imposed under this chapter, a credit is allowed to offset the administrative burden of complying with the annual reporting requirements under RCW 70.94.151(5). The amount of the credit is equal to the cost of complying with these annual reporting requirements in the year in which the credit is claimed. A person may claim a credit under this section only if the person has submitted a report to the department of ecology or the energy facility site evaluation council under RCW 70.94.151(5) in the same calendar year in which the credit is claimed.
     (2) A credit earned during one calendar year may be carried over to be credited against taxes incurred in subsequent years. No refunds may be granted for credits under this section.

NEW SECTION.  Sec. 17   A new section is added to chapter 82.08 RCW to read as follows:
     (1) The tax levied by RCW 82.08.020 does not apply to sales of passenger vehicles if the purchaser trades in a passenger vehicle that is more than fifteen years old and the vehicle to be traded in is not compliant with United States environmental protection agency tier II emission standards.
     (2) For the purposes of this section, "passenger vehicle" has the same meaning as "passenger car" provided in RCW 46.04.382.
     (3) The exemption is available only if:
     (a) The passenger vehicle to be traded in has been licensed and registered for the twenty-four month period immediately preceding the sale and is in satisfactory operating condition; and
     (b) The new vehicle purchased has a United States environmental protection agency highway gasoline mileage rating of at least thirty miles per gallon.
     (4) Any trade-in property acquired from a person claiming the exemption in this section must be destroyed.
     (5) The total amount that may be taken by all purchasers as an exemption under this section and section 18 of this act is twenty-five million dollars per year. If the department determines that at least twenty-two million dollars has been taken as an exemption under this section and section 18 of this act, the department shall notify motor vehicle dealers, in a writing sent by certified mail, that requires dealers not to provide the exemption to motor vehicle purchasers beginning two weeks from the date the letter is postmarked.

NEW SECTION.  Sec. 18   A new section is added to chapter 82.12 RCW to read as follows:
     (1) The provisions of this chapter do not apply with respect to the use of passenger vehicles if the purchaser trades in a passenger vehicle to a motor vehicle dealer that is more than fifteen years old and the vehicle to be traded in is not compliant with United States environmental protection agency tier II emission standards.
     (2) "Passenger vehicle" has the same meaning as defined in section 17 of this act.
     (3) The exemption is available only if:
     (a) The passenger vehicle to be traded in has been licensed and registered for the twenty-four month period immediately preceding the sale and is in satisfactory operating condition; and
     (b) The new vehicle purchased has a United States environmental protection agency highway gasoline mileage rating of at least thirty miles per gallon.
     (4) Any trade-in property acquired from a person claiming the exemption in this section must be destroyed.

Sec. 19   RCW 19.285.040 and 2007 c 1 s 4 (Initiative Measure No. 937) are each amended to read as follows:
     (1) Each qualifying utility shall pursue all available conservation that is cost-effective, reliable, and feasible.
     (a) By January 1, 2010, using methodologies consistent with those used by the Pacific Northwest electric power and conservation planning council in its most recently published regional power plan, each qualifying utility shall identify its achievable cost-effective conservation potential through 2019. At least every two years thereafter, the qualifying utility shall review and update this assessment for the subsequent ten-year period.
     (b) Beginning January 2010, each qualifying utility shall establish and make publicly available a biennial acquisition target for cost-effective conservation consistent with its identification of achievable opportunities in (a) of this subsection, and meet that target during the subsequent two-year period. At a minimum, each biennial target must be no lower than the qualifying utility's pro rata share for that two-year period of its cost-effective conservation potential for the subsequent ten-year period.
     (c) In meeting its conservation targets, a qualifying utility may count high-efficiency cogeneration owned and used by a retail electric customer to meet its own needs. High-efficiency cogeneration is the sequential production of electricity and useful thermal energy from a common fuel source, where, under normal operating conditions, the facility has a useful thermal energy output of no less than thirty-three percent of the total energy output. The reduction in load due to high-efficiency cogeneration shall be: (i) Calculated as the ratio of the fuel chargeable to power heat rate of the cogeneration facility compared to the heat rate on a new and clean basis of a best-commercially available technology combined-cycle natural gas-fired combustion turbine; and (ii) counted towards meeting the biennial conservation target in the same manner as other conservation savings.
     (d) The commission may determine if a conservation program implemented by an investor-owned utility is cost-effective based on the commission's policies and practice.
     (e) The commission may rely on its standard practice for review and approval of investor-owned utility conservation targets.
     (2)(a) Each qualifying utility shall use eligible renewable resources or acquire equivalent renewable energy credits, or a combination of both, to meet the following annual targets:
     (i) At least three percent of its load by January 1, 2012, and each year thereafter through December 31, 2015;
     (ii) At least nine percent of its load by January 1, 2016, and each year thereafter through December 31, 2019; and
     (iii) At least fifteen percent of its load by January 1, 2020, and each year thereafter.
     (b) A qualifying utility may count distributed generation at double the facility's electrical output if the utility: (i) Owns or has contracted for the distributed generation and the associated renewable energy credits; or (ii) has contracted to purchase the associated renewable energy credits.
     (c) In meeting the annual targets in (a) of this subsection, a qualifying utility shall calculate its annual load based on the average of the utility's load for the previous two years.
     (d) A qualifying utility shall be considered in compliance with an annual target in (a) of this subsection if: (i) The utility's weather-adjusted load for the previous three years on average did not increase over that time period; (ii) after December 7, 2006, the utility did not commence or renew ownership or incremental purchases of electricity from resources other than renewable resources other than on a daily spot price basis and the electricity is not offset by equivalent renewable energy credits; and (iii) the utility invested at least one percent of its total annual retail revenue requirement that year on eligible renewable resources, renewable energy credits, or a combination of both.
     (e) The requirements of this section may be met with eligible renewable resources or renewable energy credits obtained for and used in an optional pricing program such as the program established in RCW 19.29A.090.
     (f) The requirements of this section may be met for any given year with renewable energy credits produced during that year, the preceding year, or the subsequent year. Each renewable energy credit may be used only once to meet the requirements of this section.
     (((f))) (g) In complying with the targets established in (a) of this subsection, a qualifying utility may not count((:
     (i))) eligible renewable resources or distributed generation where the associated renewable energy credits are owned by a separate entity((; or
     (ii) Eligible renewable resources or renewable energy credits obtained for and used in an optional pricing program such as the program established in RCW 19.29A.090)).
     (((g))) (h) Where fossil and combustible renewable resources are cofired in one generating unit located in the Pacific Northwest where the cofiring commenced after March 31, 1999, the unit shall be considered to produce eligible renewable resources in direct proportion to the percentage of the total heat value represented by the heat value of the renewable resources.
     (((h))) (i)(i) A qualifying utility that acquires an eligible renewable resource or renewable energy credit may count that acquisition at one and two-tenths times its base value:
     (A) Where the eligible renewable resource comes from a facility that commenced operation after December 31, 2005; and
     (B) Where the developer of the facility used apprenticeship programs approved by the council during facility construction.
     (ii) The council shall establish minimum levels of labor hours to be met through apprenticeship programs to qualify for this extra credit.
     (((i))) (j) A qualifying utility shall be considered in compliance with an annual target in (a) of this subsection if events beyond the reasonable control of the utility that could not have been reasonably anticipated or ameliorated prevented it from meeting the renewable energy target. Such events include weather-related damage, mechanical failure, strikes, lockouts, and actions of a governmental authority that adversely affect the generation, transmission, or distribution of an eligible renewable resource under contract to a qualifying utility.
     (3) Utilities that become qualifying utilities after December 31, 2006, shall meet the requirements in this section on a time frame comparable in length to that provided for qualifying utilities as of December 7, 2006.

Sec. 20   RCW 19.29A.090 and 2002 c 285 s 6 and 2002 c 191 s 1 are each reenacted and amended to read as follows:
     (1) Beginning January 1, 2002, each electric utility must provide to its retail electricity customers a voluntary option to purchase qualified alternative energy resources in accordance with this section.
     (2) Each electric utility must include with its retail electric customer's regular billing statements, at least quarterly, a voluntary option to purchase qualified alternative energy resources. The option may allow customers to purchase qualified alternative energy resources at fixed or variable rates and for fixed or variable periods of time, including but not limited to monthly, quarterly, or annual purchase agreements. A utility may provide qualified alternative energy resource options through either: (a) Resources it owns or contracts for; or (b) the purchase of credits issued by a clearinghouse or other system by which the utility may secure, for trade or other consideration, verifiable evidence that a second party has a qualified alternative energy resource and that the second party agrees to transfer such evidence exclusively to the benefit of the utility.
     (3) For the purposes of this section, a "qualified alternative energy resource" means the electricity produced from generation facilities that are fueled by: (a) Wind; (b) solar energy; (c) geothermal energy; (d) landfill gas; (e) wave or tidal action; (f) gas produced during the treatment of wastewater; (g) qualified hydropower; or (h) biomass energy based on animal waste or solid organic fuels from wood, forest, or field residues, or dedicated energy crops that do not include wood pieces that have been treated with chemical preservatives such as creosote, pentachlorophenol, or copper-chrome-arsenic.
     (4) For the purposes of this section, "qualified hydropower" means the energy produced either: (a) As a result of modernizations or upgrades made after June 1, 1998, to hydropower facilities operating on May 8, 2001, that have been demonstrated to reduce the mortality of anadromous fish; or (b) by run of the river or run of the canal hydropower facilities that are not responsible for obstructing the passage of anadromous fish.
     (5) The rates, terms, conditions, and customer notification of each utility's option or options offered in accordance with this section must be approved by the governing body of the consumer-owned utility or by the commission for investor-owned utilities. All costs and benefits associated with any option offered by an electric utility under this section must be allocated to the customers who voluntarily choose that option and may not be shifted to any customers who have not chosen such option. Utilities may pursue known, lawful aggregated purchasing of qualified alternative energy resources with other utilities to the extent aggregated purchasing can reduce the unit cost of qualified alternative energy resources, and are encouraged to investigate opportunities to aggregate the purchase of alternative energy resources by their customers. Aggregated purchases by investor-owned utilities must comply with any applicable rules or policies adopted by the commission related to least-cost planning or the acquisition of renewable resources.
     (6) Until December 31, 2018, utilities may promote voluntary programs to purchase qualified alternative energy resources and may recover their marketing and administrative costs plus a rate of return that reflects the amount the market will bear for the qualified alternative energy resource.
     (7) Each consumer-owned utility must report annually to the department and each investor-owned utility must report annually to the commission beginning October 1, 2002, until October 1, 2012, describing the option or options it is offering its customers under the requirements of this section, the rate of customer participation, the amount of qualified alternative energy resources purchased by customers, the amount of utility investments in qualified alternative energy resources, and the results of pursuing aggregated purchasing opportunities. The department and the commission together shall report annually to the legislature, beginning December 1, 2002, until December 1, 2012, with the results of the utility reports.

NEW SECTION.  Sec. 21   The joint transportation committee shall coordinate a study of the feasibility of utilizing magnetic levitation in the state of Washington in the movement of people and freight. The majority leaders and minority leaders in the house of representatives and senate shall select one legislative member from each of their respective caucuses to work with the joint transportation committee on the study. The study report must be submitted to the transportation committees of the house of representatives and senate on or before December 31, 2008, with findings and recommendations.

NEW SECTION.  Sec. 22   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.

NEW SECTION.  Sec. 23   Sections 1 through 3, 7, and 8 of this act constitute a new chapter in Title 70 RCW.

NEW SECTION.  Sec. 24   If specific funding for the purposes of this act, referencing this act by bill or chapter number, is not provided by June 30, 2008, in the omnibus appropriations act, this act is null and void."