Washington State

House of Representatives

Office of Program Research



Local Government & Housing Committee

HB 2990

This analysis was prepared by non-partisan legislative staff for the use of legislative members in their deliberations. This analysis is not a part of the legislation nor does it constitute a statement of legislative intent.

Brief Description: Addressing alternative city assumption and tax authority provisions pertaining to water-sewer districts.

Sponsors: Representatives Pettigrew, Santos, Simpson and Kenney.

Brief Summary of Bill

  • Authorizes a city to impose a tax on a water-sewer district (district) for revenues derived from the services provided by the district to city residents.

  • Requires that the taxation of a water-sewer district by a city be pursuant to an interlocal agreement between the city and the district.

  • Requires that a feasibility study meeting specified criteria be completed before a city that imposes a tax on a district may pursue the assumption of the district.

  • Requires the approval of the majority of the voters in the district before a city imposing a tax on district services may assume jurisdiction over the district.

Hearing Date: 1/28/10

Staff: Thamas Osborn (786-7129).


Overview of Water-Sewer Districts.

Water districts are units of local government initially authorized in 1913 to provide potable water facilities, sanitary sewers, drainage facilities, and street lighting. Sewer districts are units of local government initially authorized in 1941 to provide sanitary sewers, drainage facilities, and potable water facilities.  Legislation enacted in 1996 and effective July 1, 1997, consolidated water-district laws with sewer-district laws and made a number of technical changes to these laws. Among other changes, the term "sewer system," which had been defined to include both sanitary sewers and drainage systems, was altered to apply only to sanitary sewer systems, and separate provisions were added for drainage systems.

Water-sewer district (district) powers include the authority to purchase, construct, maintain, and supply waterworks to furnish water to inhabitants within and outside of the district, and to develop and operate systems of sewers and drainage. In addition, a district has broad authority to create facilities, systems, and programs for the collection, interception, treatment, and disposal of wastewater, and for the control of pollution from such wastewater.

Before implementing plans for the development of facilities or incurring any indebtedness, a district must adopt a general comprehensive plan for the types of services it proposes to provide. Such general comprehensive plans must be consistent with specified requirements.

Assumption of Jurisdiction Over a Water-Sewer District by a City or Town.

State law establishes legislative and electoral mechanisms, based upon geographic location and property valuation, for the assumption over jurisdiction of districts by cities or towns. This regulatory scheme provides several sets of requirements applicable to various types of assumptions occurring under specified circumstances, including the following:

Summary of Bill:

Interlocal Agreement for City Taxation of Services Provided by a Water-Sewer District.

Pursuant to an interlocal agreement between a city and a district, a city may impose a tax upon the gross revenues of a water-sewer system operating within its boundaries that are derived from services the district provides within the city. The district may include the cost of the tax in the rates or charges imposed on city residents receiving services from the district.

The interlocal agreement may include provisions addressing the assumption of the district by the city and the expenditure of the tax revenues within those areas of the city encompassed by the district.

Pre-Assumption Feasibility Study.A city that imposes a tax on the gross revenues of a district derived from the district's sale of services within the city, and which adopts a resolution to assume all or part of the district, is required to complete a feasibility study regarding the assumption. This feasibility study must comply with specified criteria and procedural requirements, including:

A feasibility study is not necessary if the board of commissioners of the water-sewer district consents to the assumption of jurisdiction by the city.

Voter Approval of a City's Assumption of a District.

A city imposing a tax on the services provided to city residents by a district may not assume jurisdiction over all or part of the district absent the approval of the voters residing within the district. For an assumption to take place, a ballot measure proposing such assumption must be approved by a majority of those district residents voting on the proposition.

Appropriation: None.

Fiscal Note: Requested on January 25, 2010.

Effective Date: The bill takes effect 90 days after adjournment of the session in which the bill is passed.