BILL REQ. #:  H-0872.1 

Read first time 01/29/2007.   Referred to Committee on Community & Economic Development & Trade.

     AN ACT Relating to the distribution of funds from excise tax collections on the sale of real property for jobs, economic development, and local capital projects; amending RCW 82.45.060, 43.160.080, and 82.46.010; reenacting and amending RCW 82.46.035 and 43.155.050; adding a new section to chapter 43.160 RCW; repealing 2005 c 425 s 6 (uncodified); and providing effective dates.

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

Sec. 1   RCW 82.45.060 and 2005 c 450 s 1 are each amended to read as follows:
     There is imposed an excise tax upon each sale of real property at the rate of one and twenty-eight one-hundredths percent of the selling price.
     (1) An amount equal to six and one-tenth percent of the proceeds of this tax to the state treasurer shall be deposited in the public works assistance account created in RCW 43.155.050.
     (2) An amount equal to one and six-tenths percent of the proceeds of this tax to the state treasurer shall be deposited in the city-county assistance account created in RCW 43.08.290.
     (3) An amount equal to three and three-tenths percent of the proceeds of this tax to the state treasurer shall be deposited into the public facilities construction loan revolving account created in RCW 43.160.080.

Sec. 2   RCW 43.160.080 and 1998 c 321 s 30 are each amended to read as follows:
     There shall be a fund in the state treasury known as the public facilities construction loan revolving account, which shall consist of all moneys collected under this chapter, except moneys of the board collected in connection with the issuance of industrial development revenue bonds and moneys deposited in the distressed county public facilities construction loan account under RCW 43.160.220, and any moneys appropriated to it by law: PROVIDED, That seventy-five percent of all principal and interest payments on loans made with the proceeds deposited in the account under section 901, chapter 57, Laws of 1983 1st ex. sess. shall be deposited in the general fund as reimbursement for debt service payments on the bonds authorized in RCW 43.83.184. Disbursements from the revolving account shall be on authorization of the board. In order to maintain an effective expenditure and revenue control, the public facilities construction loan revolving account shall be subject in all respects to chapter 43.88 RCW.
     Of the funds deposited into the public facilities construction loan revolving account from RCW 82.45.060(3), sixty percent will be placed in the job development fund under section 3 of this act and forty percent will be placed in the economic development account under RCW 43.160.200.

NEW SECTION.  Sec. 3   A new section is added to chapter 43.160 RCW to read as follows:
     The job development fund is created as a subaccount within the public facilities construction loan revolving account under RCW 43.160.080. Moneys in the account may be spent only after appropriation. Expenditures from the account may be used solely for job development fund program grants and administrative expenses related to the administration of the job development fund program created in RCW 43.160.230.

Sec. 4   RCW 82.46.010 and 1994 c 272 s 1 are each amended to read as follows:
     (1) The legislative authority of any county or city shall identify in the adopted budget the capital projects funded in whole or in part from the proceeds of the tax authorized in this section, and shall indicate that such tax is intended to be in addition to other funds that may be reasonably available for such capital projects.
     (2)(a) The legislative authority of any county or any city may impose an excise tax on each sale of real property in the unincorporated areas of the county for the county tax and in the corporate limits of the city for the city tax at a rate not exceeding one-quarter of one percent of the selling price. The revenues from this tax shall be used by any city or county with a population of five thousand or less and any city or county that does not plan under RCW 36.70A.040 for any capital purpose identified in a capital improvements plan and local capital improvements, including those listed in RCW 35.43.040.
     (b)(i) After April 30, 1992, revenues generated from the tax imposed under this subsection in counties over five thousand population and cities over five thousand population that are required or choose to plan under RCW 36.70A.040 shall be used solely for financing: (A) Capital projects specified in a capital facilities plan element or a housing element of a comprehensive plan; and (B) housing relocation assistance under RCW 59.18.440 and 59.18.450.
     (ii) However, revenues (((a))) (A) pledged by such counties and cities to debt retirement prior to April 30, 1992, may continue to be used for that purpose until the original debt for which the revenues were pledged is retired, or (((b))) (B) committed prior to April 30, 1992, by such counties or cities to a project may continue to be used for that purpose until the project is completed.
     (3) In lieu of imposing the tax authorized in RCW 82.14.030(2), the legislative authority of any county or any city may impose an additional excise tax on each sale of real property in the unincorporated areas of the county for the county tax and in the corporate limits of the city for the city tax at a rate not exceeding one-half of one percent of the selling price.
     (4) Taxes imposed under this section shall be collected from persons who are taxable by the state under chapter 82.45 RCW upon the occurrence of any taxable event within the unincorporated areas of the county or within the corporate limits of the city, as the case may be.
     (5) Taxes imposed under this section shall comply with all applicable rules, regulations, laws, and court decisions regarding real estate excise taxes as imposed by the state under chapter 82.45 RCW.
     (6) As used in this section, "city" means any city or town and "capital project" means those public works projects of a local government for planning, acquisition, construction, reconstruction, repair, replacement, rehabilitation, or improvement of streets; roads; highways; sidewalks; street and road lighting systems; traffic signals; bridges; domestic water systems; storm and sanitary sewer systems; parks; recreational facilities; law enforcement facilities; fire protection facilities; trails; libraries; administrative and/or judicial facilities; housing projects; and river and/or waterway flood control projects by those jurisdictions that, prior to June 11, 1992, have expended funds derived from the tax authorized by this section for such purposes((; and, until December 31, 1995, housing projects for those jurisdictions that, prior to June 11, 1992, have expended or committed to expend funds derived from the tax authorized by this section or the tax authorized by RCW 82.46.035 for such purposes)).

Sec. 5   RCW 82.46.035 and 1992 c 221 s 3 and 1991 sp.s. c 32 s 33 are each reenacted and amended to read as follows:
     (1) The legislative authority of any county or city shall identify in the adopted budget the capital projects funded in whole or in part from the proceeds of the tax authorized in this section, and shall indicate that such tax is intended to be in addition to other funds that may be reasonably available for such capital projects.
     (2) The legislative authority of any county or any city that plans under RCW 36.70A.040(1) may impose an additional excise tax on each sale of real property in the unincorporated areas of the county for the county tax and in the corporate limits of the city for the city tax at a rate not exceeding one-quarter of one percent of the selling price. Any county choosing to plan under RCW 36.70A.040(2) and any city within such a county may only adopt an ordinance imposing the excise tax authorized by this section if the ordinance is first authorized by a proposition approved by a majority of the voters of the taxing district voting on the proposition at a general election held within the district or at a special election within the taxing district called by the district for the purpose of submitting such proposition to the voters.
     (3) Revenues generated from the tax imposed under subsection (2) of this section shall be used by such counties and cities solely for financing capital projects specified in a capital facilities plan element and a housing element of a comprehensive plan. However, revenues (a) pledged by such counties and cities to debt retirement prior to March 1, 1992, may continue to be used for that purpose until the original debt for which the revenues were pledged is retired, or (b) committed prior to March 1, 1992, by such counties or cities to a project may continue to be used for that purpose until the project is completed.
     (4) Revenues generated by the tax imposed by this section shall be deposited in a separate account.
     (5) As used in this section, "city" means any city or town and "capital project" means those public works projects of a local government for planning, acquisition, construction, reconstruction, repair, replacement, rehabilitation, or improvement of streets, roads, highways, sidewalks, street and road lighting systems, traffic signals, bridges, domestic water systems, storm and sanitary sewer systems, ((and planning, construction, reconstruction, repair, rehabilitation, or improvement of)) parks, recreational facilities, law enforcement facilities, fire protection facilities, trails, libraries, administrative and either judicial facilities and housing projects or both.
     (6) When the governor files a notice of noncompliance under RCW 36.70A.340 with the secretary of state and the appropriate county or city, the county or city's authority to impose the additional excise tax under this section shall be temporarily rescinded until the governor files a subsequent notice rescinding the notice of noncompliance.

Sec. 6   RCW 43.155.050 and 2005 c 488 s 925 and 2005 c 425 s 4 are each reenacted and amended to read as follows:
     (((1))) The public works assistance account is hereby established in the state treasury. Money may be placed in the public works assistance account from the proceeds of bonds when authorized by the legislature or from any other lawful source. Money in the public works assistance account shall be used to make loans and to give financial guarantees to local governments for public works projects. Moneys in the account may also be appropriated to provide for state match requirements under federal law for projects and activities conducted and financed by the board under the drinking water assistance account. Not more than fifteen percent of the biennial capital budget appropriation to the public works board from this account may be expended or obligated for preconstruction loans, emergency loans, or loans for capital facility planning under this chapter; of this amount, not more than ten percent of the biennial capital budget appropriation may be expended for emergency loans and not more than one percent of the biennial capital budget appropriation may be expended for capital facility planning loans. For the 2005-2007 biennium, moneys in the account may be used for grants for projects identified in section 138, chapter 488, Laws of 2005.
     (((2) The job development fund is hereby established in the state treasury. Up to fifty million dollars each biennium from the public works assistance account may be transferred into the job development fund. Money in the job development fund may be used solely for job development fund program grants, administrative expenses related to the administration of the job development fund program created in RCW 43.160.230, and for the report prepared by the joint legislative audit and review committee pursuant to RCW 44.28.801(2). Moneys in the job development fund may be spent only after appropriation. The board shall prepare a prioritized list of proposed projects of up to fifty million dollars as part of the department's 2007-09 biennial budget request. The board may provide an additional alternate job development fund project list of up to ten million dollars. The legislature may remove projects from the list recommended by the board. The legislature may not change the prioritization of projects recommended for funding by the board, but may add projects from the alternate list in order of priority, as long as the total funding does not exceed fifty million dollars.))

NEW SECTION.  Sec. 7   2005 c 425 s 6 (uncodified) is repealed.

NEW SECTION.  Sec. 8   Sections 1 through 3 and 6 of this act take effect July 1, 2009.

NEW SECTION.  Sec. 9   Section 7 of this act takes effect June 30, 2009.