BILL REQ. #:  H-4425.1 

Read first time 01/18/08.   Referred to Committee on Local Government.

     AN ACT Relating to port districts; amending RCW 53.12.260, 53.12.270, 53.08.120, 39.04.010, 53.36.030, and 84.55.092; reenacting and amending RCW 39.04.155; adding a new section to chapter 53.12 RCW; adding a new section to chapter 53.08 RCW; adding a new chapter to Title 53 RCW; creating a new section; and prescribing penalties.

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

Sec. 1   RCW 53.12.260 and 2007 c 469 s 3 are each amended to read as follows:
     (1) Each commissioner of a port district shall receive ninety dollars per day or portion thereof spent (a) in actual attendance at official meetings of the port district commission, or (b) in performance of other official services or duties on behalf of the district. The total per diem compensation of a port commissioner shall not exceed eight thousand six hundred forty dollars in a year, or ten thousand eight hundred dollars in any year for a port district with gross operating income of twenty-five million or more in the preceding calendar year. This subsection does not apply to port districts subject to subsection (7) of this section.
     (2) Except as required by subsection (7) of this section, port commissioners shall receive additional compensation as follows: (a) Each commissioner of a port district with gross operating revenues of twenty-five million dollars or more in the preceding calendar year shall receive a salary of five hundred dollars per month; and (b) each commissioner of a port district with gross operating revenues of from one million dollars to less than twenty-five million dollars in the preceding calendar year shall receive a salary of two hundred dollars per month.
     (3) Except as required by subsection (7) of this section, in lieu of the compensation specified in this section, a port commission may set compensation to be paid to commissioners.
     (4) For any commissioner who has not elected to become a member of public employees retirement system before May 1, 1975, the compensation provided pursuant to this section shall not be considered salary for purposes of the provisions of any retirement system created pursuant to the general laws of this state nor shall attendance at such meetings or other service on behalf of the district constitute service as defined in RCW 41.40.010(9): PROVIDED, That in the case of a port district when commissioners are receiving compensation and contributing to the public employees retirement system, these benefits shall continue in full force and effect notwithstanding the provisions of RCW 53.12.260 and 53.12.265.
     (5) The dollar thresholds established in subsections (1) and (2) of this section must be adjusted for inflation by the office of financial management every five years, beginning July 1, 2008, based upon changes in the consumer price index during that time period. "Consumer price index" means, for any calendar year, that year's annual average consumer price index, for Washington state, for wage earners and clerical workers, all items, compiled by the bureau of labor and statistics, United States department of labor. If the bureau of labor and statistics develops more than one consumer price index for areas within the state, the index covering the greatest number of people, covering areas exclusively within the boundaries of the state, and including all items shall be used for the adjustments for inflation in this section. The office of financial management must calculate the new dollar threshold and transmit it to the office of the code reviser for publication in the Washington State Register at least one month before the new dollar threshold is to take effect.
     (6) A person holding office as commissioner for two or more special purpose districts shall receive only that per diem compensation authorized for one of his or her commissioner positions as compensation for attending an official meeting or conducting official services or duties while representing more than one of his or her districts. However, such commissioner may receive additional per diem compensation if approved by resolution of all boards of the affected commissions.
     (7) Each commissioner of a port district in a county with one million or more residents must serve in a full-time employment capacity and must be compensated for the performance of his or her official services and duties at an amount equaling the salary paid to members of the county legislative authority of the county in which the port is located.

Sec. 2   RCW 53.12.270 and 1975 1st ex.s. c 12 s 1 are each amended to read as follows:
     (1) The commission may delegate to the managing official of a port district such administerial powers and duties of the commission as it may deem proper for the efficient and proper management of port district operations. Any such delegation shall be authorized by appropriate resolution of the commission, which resolution must also establish guidelines and procedures for the managing official to follow.
     (2) Nothing in this section allows the managing official or employees of a port district to waive policies related to competition in the procurement of goods and services without receiving prior approval, by resolution, from the commission.
     (3) Nothing in this section allows the managing official of a port district to supervise or otherwise direct administrative staff and confidential assistants hired under section 3 of this act.

NEW SECTION.  Sec. 3   A new section is added to chapter 53.12 RCW to read as follows:
     (1) Each commissioner of a port district in a county with one million or more residents must have at least one full-time administrative staff member and one full-time confidential assistant. Administrative staff and confidential assistants hired under this section: (a) Must assist the commissioner in the performance of his or her official services and duties; (b) must be subject to terms of employment established in accordance with RCW 53.08.170; and (c) may not be supervised or otherwise directed by the managing official of the port.
     (2) Each commission of a port district in a county with one million or more residents must make public findings regarding the number of administrative staff that are necessary to provide financial oversight of the district. If the number of administrative staff recommended in the findings exceeds the number hired under subsection (1) of this section, the commission must hire additional administrative staff until: (a) Each commissioner has an equal number of administrative staff; and (b) the number of hired administrative staff equals or exceeds the number recommended in the findings.

NEW SECTION.  Sec. 4   (1)(a) The legislative task force on port district structure and operation is established, with members as provided in this subsection:
     (i) One member from each of the two largest caucuses of the house of representatives, appointed by the speaker of the house of representatives;
     (ii) One member from each of the two largest caucuses of the senate, appointed by the president of the senate;
     (iii) One member from the Washington public ports association, appointed by the governor;
     (iv) One member from the freight mobility strategic investment board, appointed by the governor;
     (v) One member from county government, appointed by the Washington state association of counties; and
     (vi) One member from city government, appointed by the association of Washington cities.
     (b) The governor shall select a chair from among its legislative membership.
     (2) The task force shall consult with individuals from the public and private sectors and other interested parties, as may be appropriate, for technical advice and assistance and may ask those individuals to establish advisory committees or work groups that report to the task force.
     (3) The task force shall:
     (a) Examine the constitutional and statutory authorities and duties of port districts;
     (b) Examine the structure and management of ports in Washington and those of other states and countries that compete with Washington's ports;
     (c) Examine revenue authorities of ports and consider alternative funding schemes;
     (d) Consider the benefits and detriments associated with consolidating large port districts, their operations, or both;
     (e) Consider the benefits and detriments associated with separating air and sea port operations; and
     (f) Consider whether large port districts should be governed wholly or partially by county legislative authorities.
     (4) The task force shall use legislative facilities, and staff support shall be provided by the house of representatives office of program research, senate committee services, and the office of financial management.
     (5) Legislative members of the task force must be reimbursed for travel expenses in accordance with RCW 44.04.120. Nonlegislative members, except those representing an employer or organization, are entitled to be reimbursed for travel expenses in accordance with RCW 43.03.050 and 43.03.060.
     (6) The expenses of the task force must be paid jointly by the house of representatives, the senate, and the office of financial management. Task force expenditures are subject to approval by the senate facilities and operations committee and the house of representatives executive rules committee, or their successor committees.
     (7) The task force shall report upon its initial actions to the governor and appropriate committees of the house of representatives and the senate by December 1, 2008.
     (8) The task force shall report its findings and recommendations to the governor and the appropriate committees of the house of representatives and the senate by December 1, 2009.
     (9) The task force expires May 1, 2010.

Sec. 5   RCW 53.08.120 and 2000 c 138 s 210 are each amended to read as follows:
     ((All material required by a port district may be procured in the open market or by contract and all work ordered may be done by contract or day labor. All such contracts for work)) (1) All contracts related to work meeting the definition of "public work" in RCW 39.04.010(4), the estimated cost of which exceeds two hundred thousand dollars, shall be bid using a competitive sealed bid process. The contract must be let at public bidding upon notice published in a newspaper of general circulation in the district at least thirteen days before the last date upon which bids will be received, calling for sealed bids upon the work, plans and specifications for which shall then be on file in the office of the commission for public inspection. The same notice may call for bids on such work or material based upon plans and specifications submitted by the bidder. The competitive bidding requirements for purchases or public works may be waived pursuant to RCW 39.04.280 if an exemption contained within that section applies to the purchase or public work.
     ((However)) (2) For all contracts related to work meeting a definition of "public work" in RCW 39.04.010(4) that are estimated at less than two hundred thousand dollars, a port district may let contracts using the small works roster process under RCW 39.04.155 in lieu of calling for sealed bids. Whenever possible, the managing official shall invite at least one proposal from a minority contractor who shall otherwise qualify under this section.
     When awarding such a contract for work, when utilizing proposals from the small works roster, the managing official shall give weight to the contractor submitting the lowest and best proposal, and whenever it would not violate the public interest, such contracts shall be distributed equally among contractors, including minority contractors, on the small works roster.

NEW SECTION.  Sec. 6   A new section is added to chapter 53.08 RCW to read as follows:
     By January 1, 2010, each port shall maintain a database on a public web site of all contracts, including public works and personal services. At a minimum, the database shall identify the contractor, the purpose of the contract, effective dates and periods of performance, the cost of the contract and funding source, any modifications to the contract, and whether the contract was competitively procured or awarded on a sole source basis.

NEW SECTION.  Sec. 7   The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
     (1) "Commission" means the elected oversight body of an individual port.
     (2) "Competitive solicitation" means a documented formal process providing an equal and open opportunity to qualified parties and culminating in a selection based on criteria which may include such factors as the consultant's fees or costs, ability, capacity, experience, reputation, responsiveness to time limitations, responsiveness to solicitation requirements, quality of previous performance, and compliance with statutes and rules relating to contracts or services.
     (3) "Consultant" means an independent individual or firm contracting with a port to perform a service or render an opinion or recommendation according to the consultant's methods and without being subject to the control of the port except as to the result of the work. The port monitors progress under the contract and authorizes payment.
     (4) "Emergency" means a set of unforeseen circumstances beyond the control of the port that either:
     (a) Present a real, immediate threat to the proper performance of essential functions; or
     (b) May result in material loss or damage to property, bodily injury, or loss of life if immediate action is not taken.
     (5) "Evidence of competition" means documentation demonstrating that the port has solicited responses from multiple firms in selecting a consultant.
     (6) "Personal service" means professional or technical expertise provided by a consultant to accomplish a specific study, project, task, or other work statement. "Personal service" does not include purchased services as defined under subsection (8) of this section.
     (7) "Personal service contract" means an agreement, or any amendment thereto, with a consultant for the rendering of personal services to the port.
     (8) "Purchased services" means services provided by a vendor to accomplish routine, continuing, and necessary functions. "Purchased services" includes, but is not limited to, services for equipment maintenance and repair; operation of a physical plant; security; computer hardware and software maintenance; data entry; key punch services; and computer time-sharing, contract programming, and analysis.
     (9) "Sole source" means a consultant providing professional or technical expertise of such a unique nature that the consultant is clearly and justifiably the only practicable source to provide the service. The justification shall be based on either the uniqueness of the service or sole availability at the location required.

NEW SECTION.  Sec. 8   Personal services may be procured only to resolve a particular port problem or issue or to expedite a specific project that is temporary in nature. A port may procure personal services only if it documents that:
     (1) The service is critical to port responsibilities or operations, or is mandated or authorized by the commission;
     (2) Sufficient staffing or expertise is not available within the port to perform the service; and
     (3) Other qualified public resources are not available to perform the service.

NEW SECTION.  Sec. 9   All personal service contracts shall be entered into pursuant to competitive solicitation, except for:
     (1) Emergency contracts;
     (2) Sole source contracts;
     (3) Contract amendments;
     (4) Contracts between a consultant and a port of less than twenty thousand dollars. However, contracts of five thousand dollars or greater but less than twenty thousand dollars shall have documented evidence of competition. Ports shall not structure contracts to evade these requirements; and
     (5) Other specific contracts or classes or groups of contracts exempted from the competitive solicitation process by the commission when it has been determined that a competitive solicitation process is not appropriate or cost-effective.

NEW SECTION.  Sec. 10   Emergency contracts shall be filed with the commission and made available for public inspection within three working days following the commencement of work or execution of the contract, whichever occurs first. Documented justification for emergency contracts shall be provided to the commission when the contract is filed.

NEW SECTION.  Sec. 11   (1) Sole source contracts shall be filed with the commission and made available for public inspection at least ten working days prior to the proposed starting date of the contract. Documented justification for sole source contracts shall be provided to the commission when the contract is filed. For sole source contracts of twenty thousand dollars or more, documented justification shall include evidence that the port attempted to identify potential consultants by advertising through statewide or regional newspapers.
     (2) The commission shall approve sole source contracts of twenty thousand dollars or more before any such contract becomes binding and before any services may be performed under the contract. These requirements shall also apply to sole source contracts of less than twenty thousand dollars if the total amount of such contracts between an agency and the same consultant is twenty thousand dollars or more within a fiscal year. Ports shall ensure that the costs, fees, or rates negotiated in filed sole source contracts of twenty thousand dollars or more are reasonable.

NEW SECTION.  Sec. 12   A port commissioner or employee shall not expend any funds for personal service contracts subject to this chapter unless the port has complied with the competitive procurement and other requirements of this chapter. The port commissioner or employee executing the personal service contracts is responsible for compliance with the requirements of this chapter. Failure to comply with the requirements of this chapter subjects the port commissioner or employee to a civil penalty in the amount of three hundred dollars. A consultant who knowingly violates this chapter in seeking or performing work under a personal services contract is subject to a civil penalty of three hundred dollars or twenty-five percent of the amount of the contract, whichever is greater. The state auditor is responsible for auditing violations of this chapter. The attorney general is responsible for prosecuting violations of this chapter.

NEW SECTION.  Sec. 13   (1) Substantial changes in either the scope of work specified in the contract or in the scope of work specified in the formal solicitation document must generally be awarded as new contracts. Substantial changes executed by contract amendments must be submitted to the commission, and are subject to approval by the commission.
     (2) An amendment or amendments to personal service contracts, if the value of the amendment or amendments, whether singly or cumulatively, exceeds fifty percent of the value of the original contract must be provided to the commission.
     (3) The commission shall approve amendments provided to it under this section before the amendments become binding and before services may be performed under the amendments.
     (4) The amendments must be filed with the commission and made available for public inspection at least ten working days prior to the proposed starting date of services under the amendments.
     (5) The commission shall approve amendments provided to it under this section only if they meet the criteria for approval of the amendments established by the commission.

NEW SECTION.  Sec. 14   This chapter does not apply to:
     (1) Contracts specifying a fee of less than five thousand dollars if the total of the contracts from that port with the contractor within a fiscal year does not exceed five thousand dollars;
     (2) Contracts awarded to companies that furnish a service where the tariff is established by the utilities and transportation commission or other public entity;
     (3) Intergovernmental agreements awarded to any governmental entity, whether federal, state, or local and any department, division, or subdivision thereof;
     (4) Contracts awarded for services to be performed for a standard fee, when the standard fee is established by the contracting agency or any other governmental entity and a like contract is available to all qualified applicants;
     (5) Contracts for services that are necessary to the conduct of collaborative research if prior approval is granted by the funding source;
     (6) Contracts for architectural and engineering services as defined in RCW 39.80.020, which shall be entered into under chapter 39.80 RCW; and
     (7) Contracts for the employment of expert witnesses for the purposes of litigation.

NEW SECTION.  Sec. 15   (1) Personal service contracts subject to competitive solicitation shall be (a) filed with the commission and made available for public inspection; and (b) reviewed and approved by the commission when those contracts provide services relating to management consulting, organizational development, marketing, communications, employee training, or employee recruiting.
     (2) Personal service contracts subject to competitive solicitation that provide services relating to management consulting, organizational development, marketing, communications, employee training, or employee recruiting shall be made available for public inspection at least ten working days before the proposed starting date of the contract. All other contracts shall be effective no earlier than the date they are filed with the commission.

NEW SECTION.  Sec. 16   (1) The port shall maintain a publicly available list of all personal service contracts it entered into during each fiscal year. The list shall identify the contractor, the purpose of the contract, effective dates and periods of performance, the cost of the contract and funding source, any modifications to the contract, and whether the contract was competitively procured or awarded on a sole source basis. The commission shall also ensure that state accounting definitions and procedures are consistent with this chapter and permit the reporting of personal services expenditures by type of service. Designations of type of services shall include, but not be limited to, management and organizational services, legal and expert witness services, financial services, computer and information services, social or technical research, marketing, communications, and employee training or recruiting services.
     (2) The Washington public ports association shall report annually to the governor and the appropriate committees of the senate and house of representatives on sole source contracts filed under this chapter. The report shall describe: (a) The number and aggregate value of contracts for each category established in this section; (b) the number and aggregate value of contracts of five thousand dollars or greater but less than twenty thousand dollars; (c) the number and aggregate value of contracts of twenty thousand dollars or greater; (d) the justification provided by ports for the use of sole source contracts; and (e) any trends in the use of sole source contracts.

NEW SECTION.  Sec. 17   As requested by the state auditor, the ports shall provide information on contracts filed under this chapter for use in preparation of summary reports on personal services contracts.

NEW SECTION.  Sec. 18   (1) The Washington public ports association shall adopt uniform guidelines for the effective and efficient management of personal service contracts by all ports. The guidelines must, at a minimum, include:
     (a) Accounting methods, systems, measures, and principles to be used by agencies and contractors;
     (b) Precontract procedures for selecting potential contractors based on their qualifications and ability to perform;
     (c) Incorporation of performance measures and measurable benchmarks in contracts, and the use of performance audits;
     (d) Uniform contract terms to ensure contract performance and compliance with state and federal standards;
     (e) Proper payment and reimbursement methods to ensure that the state receives full value for taxpayer moneys, including cost settlements and cost allowance;
     (f) Postcontract procedures, including methods for recovering improperly spent or overspent moneys for disallowance and adjustment;
     (g) Adequate contract remedies and sanctions to ensure compliance;
     (h) Monitoring, fund tracking, risk assessment, and auditing procedures and requirements;
     (i) Financial reporting, record retention, and record access procedures and requirements;
     (j) Procedures and criteria for terminating contracts for cause or otherwise; and
     (k) Any other subject related to effective and efficient contract management.
     (2) The Washington public ports association shall submit the guidelines required by subsection (1) of this section to the governor and the appropriate standing committees of the legislature no later than December 1, 2008.
     (3) The Washington public ports association shall publish a guidebook for use by ports containing the guidelines required by subsection (1) of this section.

NEW SECTION.  Sec. 19   (1) A port entering into or renewing personal service contracts shall follow the guidelines required by section 18 of this act.
     (2) A port that has entered into or renewed personal service contracts during a calendar year shall, on or before January 1st of the following calendar year, provide the commission with a report detailing the procedures the port employed in entering into, renewing, and managing the contracts.
     (3) This section applies to ports entering into or renewing contracts after January 1, 2010.

NEW SECTION.  Sec. 20   (1) The Washington public ports association shall provide a training course for port personnel responsible for executing and managing personal service contracts. The course must contain training on effective and efficient contract management under the guidelines established under section 18 of this act. Ports shall require port employees responsible for executing or managing personal service contracts to complete the training course to the satisfaction of the commission. Beginning January 1, 2010, no port employee may execute or manage personal service contracts unless the employee has completed the training course. Any request for exception to this requirement shall be submitted to the commission in writing and shall be approved by the commission prior to the employee executing or managing the contract.
     (2)(a) The office of the state auditor shall conduct risk-based audits of the contracting practices associated with individual personal service from multiple port districts to ensure compliance with the guidelines established in sections 14 and 15 of this act. The office of the state auditor shall conduct the number of audits deemed appropriate by the state auditor based on funding provided.
     (b) The office of the state auditor shall forward the results of the audits conducted under this section to the governor, the appropriate standing committees of the legislature, and the joint legislative audit and review committee.

NEW SECTION.  Sec. 21   The state auditor and the attorney general shall annually by November 30th of each year provide a collaborative report of contract audit and investigative findings, enforcement actions, and the status of agency resolution to the governor and the policy and fiscal committees of the legislature.

Sec. 22   RCW 39.04.010 and 2007 c 133 s 1 are each amended to read as follows:
     The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
     (1) "Award" means the formal decision by the state or municipality notifying a responsible bidder with the lowest responsive bid of the ((state)) state's or municipality's acceptance of the bid and intent to enter into a contract with the bidder.
     (2) "Contract" means a contract in writing for the execution of public work for a fixed or determinable amount duly awarded after advertisement and competitive bid, or a contract awarded under the small works roster process in RCW 39.04.155.
     (3) "Municipality" means every city, county, town, port district, district, or other public agency authorized by law to require the execution of public work, except drainage districts, diking districts, diking and drainage improvement districts, drainage improvement districts, diking improvement districts, consolidated diking and drainage improvement districts, consolidated drainage improvement districts, consolidated diking improvement districts, irrigation districts, or other districts authorized by law for the reclamation or development of waste or undeveloped lands.
     (4) "Public work" means all work, construction, alteration, repair, or improvement other than ordinary maintenance, executed at the cost of the state or of any municipality, or which is by law a lien or charge on any property therein. All public works, including maintenance when performed by contract shall comply with chapter 39.12 RCW. "Public work" does not include work, construction, alteration, repair, or improvement performed under contracts entered into under RCW 36.102.060(4) or under development agreements entered into under RCW 36.102.060(7) or leases entered into under RCW 36.102.060(8).
     (5) "Responsible bidder" means a contractor who meets the criteria in RCW 39.04.350.
     (6) "State" means the state of Washington and all departments, supervisors, commissioners, and agencies of the state.

Sec. 23   RCW 39.04.155 and 2007 c 218 s 87, 2007 c 210 s 1, and 2007 c 133 s 4 are each reenacted and amended to read as follows:
     (1) This section provides uniform small works roster provisions to award contracts for construction, building, renovation, remodeling, alteration, repair, or improvement of real property that may be used by state agencies and by any local government that is expressly authorized to use these provisions. These provisions may be used in lieu of other procedures to award contracts for such work with an estimated cost of two hundred thousand dollars or less. The small works roster process includes the limited public works process authorized under subsection (3) of this section and any local government authorized to award contracts using the small works roster process under this section may award contracts using the limited public works process under subsection (3) of this section.
     (2)(a) A state agency or authorized local government may create a single general small works roster, or may create a small works roster for different specialties or categories of anticipated work. Where applicable, small works rosters may make distinctions between contractors based upon different geographic areas served by the contractor. The small works roster or rosters shall consist of all responsible contractors who have requested to be on the list, and where required by law are properly licensed or registered to perform such work in this state. A state agency or local government establishing a small works roster or rosters may require eligible contractors desiring to be placed on a roster or rosters to keep current records of any applicable licenses, certifications, registrations, bonding, insurance, or other appropriate matters on file with the state agency or local government as a condition of being placed on a roster or rosters. At least once a year, the state agency or local government shall publish in a newspaper of general circulation within the jurisdiction a notice of the existence of the roster or rosters and solicit the names of contractors for such roster or rosters. In addition, responsible contractors shall be added to an appropriate roster or rosters at any time they submit a written request and necessary records. Master contracts may be required to be signed that become effective when a specific award is made using a small works roster.
     (b) A state agency establishing a small works roster or rosters shall adopt rules implementing this subsection. A local government establishing a small works roster or rosters shall adopt an ordinance or resolution implementing this subsection. Procedures included in rules adopted by the department of general administration in implementing this subsection must be included in any rules providing for a small works roster or rosters that is adopted by another state agency, if the authority for that state agency to engage in these activities has been delegated to it by the department of general administration under chapter 43.19 RCW. An interlocal contract or agreement between two or more state agencies or local governments establishing a small works roster or rosters to be used by the parties to the agreement or contract must clearly identify the lead entity that is responsible for implementing the provisions of this subsection.
     (c) Procedures shall be established for securing telephone, written, or electronic quotations from contractors on the appropriate small works roster to assure that a competitive price is established and to award contracts to the lowest responsible bidder, as defined in RCW 39.04.010. Invitations for quotations shall include an estimate of the scope and nature of the work to be performed as well as materials and equipment to be furnished. However, detailed plans and specifications need not be included in the invitation. This subsection does not eliminate other requirements for architectural or engineering approvals as to quality and compliance with building codes. Quotations may be invited from all appropriate contractors on the appropriate small works roster. As an alternative, quotations may be invited from at least five contractors on the appropriate small works roster who have indicated the capability of performing the kind of work being contracted, in a manner that will equitably distribute the opportunity among the contractors on the appropriate roster. However, if the estimated cost of the work is from one hundred thousand dollars to two hundred thousand dollars, a state agency or local government((, other than a port district,)) that chooses to solicit bids from less than all the appropriate contractors on the appropriate small works roster must also notify the remaining contractors on the appropriate small works roster that quotations on the work are being sought. The government has the sole option of determining whether this notice to the remaining contractors is made by: (i) Publishing notice in a legal newspaper in general circulation in the area where the work is to be done; (ii) mailing a notice to these contractors; or (iii) sending a notice to these contractors by facsimile or other electronic means. For purposes of this subsection (2)(c), "equitably distribute" means that a state agency or local government soliciting bids may not favor certain contractors on the appropriate small works roster over other contractors on the appropriate small works roster who perform similar services.
     (d) A contract awarded from a small works roster under this section need not be advertised.
     (e) Immediately after an award is made, the bid quotations obtained shall be recorded, open to public inspection, and available by telephone inquiry.
     (3) In lieu of awarding contracts under subsection (2) of this section, a state agency or authorized local government may award a contract for work, construction, alteration, repair, or improvement projects estimated to cost less than thirty-five thousand dollars using the limited public works process provided under this subsection. Public works projects awarded under this subsection are exempt from the other requirements of the small works roster process provided under subsection (2) of this section and are exempt from the requirement that contracts be awarded after advertisement as provided under RCW 39.04.010.
     For limited public works projects, a state agency or authorized local government shall solicit electronic or written quotations from a minimum of three contractors from the appropriate small works roster and shall award the contract to the lowest responsible bidder as defined under RCW 39.04.010. After an award is made, the quotations shall be open to public inspection and available by electronic request. A state agency or authorized local government shall attempt to distribute opportunities for limited public works projects equitably among contractors willing to perform in the geographic area of the work. A state agency or authorized local government shall maintain a list of the contractors contacted and the contracts awarded during the previous twenty-four months under the limited public works process, including the name of the contractor, the contractor's registration number, the amount of the contract, a brief description of the type of work performed, and the date the contract was awarded. For limited public works projects, a state agency or authorized local government may waive the payment and performance bond requirements of chapter 39.08 RCW and the retainage requirements of chapter 60.28 RCW, thereby assuming the liability for the contractor's nonpayment of laborers, mechanics, subcontractors, materialpersons, suppliers, and taxes imposed under Title 82 RCW that may be due from the contractor for the limited public works project, however the state agency or authorized local government shall have the right of recovery against the contractor for any payments made on the contractor's behalf.
     (4) The breaking of any project into units or accomplishing any projects by phases is prohibited if it is done for the purpose of avoiding the maximum dollar amount of a contract that may be let using the small works roster process or limited public works process.
     (5)(a) A state agency or authorized local government may use the limited public works process of subsection (3) of this section to solicit and award small works roster contracts to small businesses that are registered contractors with gross revenues under one million dollars annually as reported on their federal tax return.
     (b) A state agency or authorized local government may adopt additional procedures to encourage small businesses that are registered contractors with gross revenues under two hundred fifty thousand dollars annually as reported on their federal tax returns to submit quotations or bids on small works roster contracts.
     (6) As used in this section, "state agency" means the department of general administration, the state parks and recreation commission, the department of natural resources, the department of fish and wildlife, the department of transportation, any institution of higher education as defined under RCW 28B.10.016, and any other state agency delegated authority by the department of general administration to engage in construction, building, renovation, remodeling, alteration, improvement, or repair activities.

Sec. 24   RCW 53.36.030 and 1996 c 66 s 1 are each amended to read as follows:
     (1)(a) Except as provided in (b) of this subsection, a port district may at any time contract indebtedness or borrow money for district purposes and may issue general obligation bonds therefor not exceeding an amount, together with any existing indebtedness of the district not authorized by the voters, of one-fourth of one percent of the value of the taxable property in the district.
     (b) Port districts having less than eight hundred million dollars in value of taxable property during 1991 may at any time contract indebtedness or borrow money for port district purposes and may issue general obligation bonds therefor not exceeding an amount, combined with existing indebtedness of the district not authorized by the voters, of three-eighths of one percent of the value of the taxable property in the district. Prior to contracting for any indebtedness authorized by this subsection (1)(b), the port district must have a comprehensive plan for harbor improvements or industrial development and a long-term financial plan approved by the department of community, trade, and economic development. The department of community, trade, and economic development is immune from any liability for its part in reviewing or approving port district's improvement or development plans, or financial plans. Any indebtedness authorized by this subsection (1)(b) may be used only to acquire or construct a facility, and, prior to contracting for such indebtedness, the port district must have a lease contract for a minimum of five years for the facility to be acquired or constructed by the debt.
     (2) With the assent of three-fifths of the voters voting thereon at a general or special port election called for that purpose, a port district may contract indebtedness or borrow money for district purposes and may issue general obligation bonds therefor provided the total indebtedness of the district at any such time shall not exceed three-fourths of one percent of the value of the taxable property in the district.
     (3) In addition to the indebtedness authorized under subsections (1) and (2) of this section, port districts having less than two hundred million dollars in value of taxable property and operating a municipal airport may at any time contract indebtedness or borrow money for airport capital improvement purposes and may issue general obligation bonds therefor not exceeding an additional one-eighth of one percent of the value of the taxable property in the district without authorization by the voters; and, with the assent of three-fifths of the voters voting thereon at a general or special port election called for that purpose, may contract indebtedness or borrow money for airport capital improvement purposes and may issue general obligation bonds therefor for an additional three-eighths of one percent provided the total indebtedness of the district for all port purposes at any such time shall not exceed one and one-fourth percent of the value of the taxable property in the district.
     (4) Any port district may issue general district bonds evidencing any indebtedness, payable at any time not exceeding fifty years from the date of the bonds. Any contract for indebtedness or borrowed money authorized by RCW 53.36.030(1)(b) shall not exceed twenty-five years. The bonds shall be issued and sold in accordance with chapter 39.46 RCW.
     (5) Elections required under this section shall be held as provided in RCW 39.36.050.
     (6) For the purpose of this section, "indebtedness of the district" shall not include any debt of a county-wide district with a population less than twenty-five hundred people when the debt is secured by a mortgage on property leased to the federal government; and the term "value of the taxable property" shall have the meaning set forth in RCW 39.36.015.
     (7) This section does not apply to a loan made under a loan agreement under chapter 39.69 RCW, and a computation of indebtedness under this chapter must exclude the amount of a loan under such a loan agreement.
     (8) A port district may not use property tax revenue derived from banked levy capacity under RCW 84.55.092 to pay, secure, or guarantee the payment of principal and interest on general obligation bonds issued after the effective date of this section without the approval of the governor. This subsection only applies to a port district in a county with a population of one million or more.

Sec. 25   RCW 84.55.092 and 1998 c 16 s 3 are each amended to read as follows:
     (1) Except as provided in subsection (2) of this section, the regular property tax levy for each taxing district other than the state may be set at the amount which would be allowed otherwise under this chapter if the regular property tax levy for the district for taxes due in prior years beginning with 1986 had been set at the full amount allowed under this chapter including any levy authorized under RCW 52.16.160 that would have been imposed but for the limitation in RCW 52.18.065, applicable upon imposition of the benefit charge under chapter 52.18 RCW.
     (2) A port district may not use levy proceeds derived from banked levy capacity under this section to pay, secure, or guarantee the payment of principal and interest on general obligation bonds issued after the effective date of this section unless the increased levy amount under this section is approved by the governor. This subsection only applies to a port district in a county with a population of one million or more.
     (3) The purpose of subsection (1) of this section is to remove the incentive for a taxing district to maintain its tax levy at the maximum level permitted under this chapter, and to protect the future levy capacity of a taxing district that reduces its tax levy below the level that it otherwise could impose under this chapter, by removing the adverse consequences to future levy capacities resulting from such levy reductions.

NEW SECTION.  Sec. 26   Sections 6 through 21 of this act constitute a new chapter in Title 53 RCW.