BILL REQ. #:  S-5273.1 

READ FIRST TIME 02/08/08.   

     AN ACT Relating to encouraging private investment in port terminal facilities with tax incentives to local governments; adding a new section to chapter 82.32 RCW; and providing an expiration date.

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

NEW SECTION.  Sec. 1   A new section is added to chapter 82.32 RCW to read as follows:
     (1) Subject to the requirements of this section, an amount equal to the estimated taxes collected under chapters 82.08 and 82.12 RCW on the sale or use of tangible personal property incorporated into, and labor and services rendered in respect to, the construction of a qualified port terminal, less estimated amounts of any local taxes that are credited against the state sales and use taxes, shall be distributed to a county or city within which a qualified port terminal is located.
     (2) To receive distributions under this section, the city or county must:
     (a) Submit an application to the department of community, trade, and economic development prior to the initiation of construction of the port terminal. The application shall be in a form and manner required by the department of community, trade, and economic development, but must include information that verifies that: (i) The construction of the port terminal is reasonably estimated to exceed one hundred fifty million dollars; and (ii) the date construction of the port terminal is expected to be completed. The department of community, trade, and economic development shall rule on the application within forty-five days and must notify the department of all approved applications;
     (b) Submit an expenditure plan to the department of community, trade, and economic development within one hundred twenty days of the submittal of the application under (a) of this subsection. The plan must be developed in consultation with any port authorities, tribal governments, or other local governments in close proximity to the proposed project as well as private entities involved with the qualified port terminal's development and operation. The plan must specify the use of funds distributed under this section, subject to (c) of this subsection. The department of community, trade, and economic development shall notify the city or county of any deficiencies in the expenditure plan within ninety days of the plan's submittal;
     (c) Use any distributions under this section exclusively for public infrastructure needs related to the qualified port terminal including, but not limited to: Street and road construction necessary to access and service the new terminal; rail construction necessary to access and service the new terminal; water and sewer system construction; construction of facilities for emergency services; construction of storm water and drainage management systems; and environmental impact mitigation.
     (3) The department of community, trade, and economic development must approve applications under this section only if it determines with a high degree of certainty that the qualified port terminal would be adding new jobs to the state of Washington, and that a collective bargaining agreement between the operators of the qualified terminal and organized labor is in place regarding the business operations to be conducted at the qualified terminal.
     (4) An entity constructing a qualified port terminal that will benefit from the public infrastructure built using distributions under this section must comply with the provisions of chapter 39.12 RCW in constructing the qualified port terminal.
     (5)(a) A port district or other person contracting for the construction of a qualified port terminal or any portion of a qualified port terminal must provide the city or county within whose jurisdiction the qualified port terminal is located, if the city or county is approved for distributions under this section, with documentation necessary to determine the amounts of distributions under this section, upon request of the city or county. Such documentation must include copies of construction contracts, tax returns, and other documents showing the amounts of sales and use taxes paid in respect to the construction of the qualified port terminal.
     (b) Annually, by March 31st, cities or counties approved for distributions under this section must provide such information to the department, as the department deems necessary, to determine the amount of the distributions under this section. Such information must be provided to the department in a form and manner required by the department. The department may request assistance from the department of community, trade, and economic development in determining the distributions under this section. The department must give cities and counties eligible for distributions under this section notice of the department's determination of the distribution amounts at least thirty days before the distributions under this section are required to be made under (c) of this subsection.
     (c) The department must notify the state treasurer of the amounts to be distributed under this section. Funds must be distributed to a city or county by July 1st of each year, beginning in the state fiscal year following the fiscal year in which initiation of construction of the port terminal begins. The state treasurer may not distribute funds under this section for construction occurring after the date of completion specified in subsection (2)(a)(ii) of this section has elapsed; however, the department of community, trade, and economic development may extend the date of completion for good cause shown. Distributions under this section are final. Errors in amounts distributed that are discovered after the distributions have been made may not be corrected.
     (6) The definitions in this subsection apply to this section.
     (a) "Port terminal" means a facility for cargo related maritime activities.
     (b) "Qualified port terminal" means a port terminal constructed after the effective date of this act that is reasonably estimated to cost over one hundred fifty million dollars to construct, built primarily with private investment, and located within thirty air miles of a major port terminal located outside of the United States.
     (7) Only one project may be selected by the department of community, trade, and economic development under the terms of this section. Upon final distribution of funds related to the single project, the department of community, trade, and economic development must submit a report to the legislature. The report must describe the details of the project, its overall economic development impact to the region, and an estimate of new construction and longshoremen jobs created because of the project. The department must also evaluate the funding mechanism for public infrastructure utilized in this section and make recommendations on whether it could be used to benefit other projects for economic development purposes.

NEW SECTION.  Sec. 2   This act expires June 30, 2018.