Declares that by August 1st, November 1st, February 1st, and May 1st of every year, the department of transportation shall notify the state treasurer in writing of the amount of state sales and use tax paid under chapters 82.08 and 82.12 RCW by the Washington state ferries on the purchase of fuel for the preceding calendar quarter. By September 1st, December 1st, March 1st, and June 1st of every year, the state treasurer shall transfer an amount equal to the amount indicated by the department in their notification to the treasurer into the passenger ferry account created in RCW 47.60.645.

Provides that a public transportation benefit area seeking grant funding as described in RCW 47.01.350 for a passenger-only ferry route between Kingston and Seattle shall first receive approval from the governor after submitting a complete business plan to the governor and the legislature by November 1, 2007.

Declares that the tax levied by RCW 82.08.020 shall not apply to sales of motor vehicle and special fuel if the fuel is purchased by a public transportation benefit area created under chapter 36.57A RCW or a county-owned ferry or county ferry district created under chapter 36.54 RCW for use in passenger-only ferry vessels.