BILL REQ. #:  H-1058.1 

Read first time 02/01/11.   Referred to Committee on Local Government.

     AN ACT Relating to the authorization of bonds issued by Washington local governments; amending RCW 39.46.040, 35.33.131, 35.34.220, 35A.33.130, and 35A.34.220; and creating a new section.

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

Sec. 1   RCW 39.46.040 and 1983 c 167 s 4 are each amended to read as follows:
     (1) A local government authorized to issue bonds ((shall)) must determine for the bond issue its amount, date or dates, terms not in excess of the maximum term otherwise provided in law, conditions, bond denominations, interest rate or rates, which may be fixed or variable, interest payment dates, maturity or maturities, redemption rights, registration privileges, manner of execution, price, manner of sale, covenants, and form, including registration as to principal and interest, registration as to principal only, or bearer. Registration may be as provided in RCW 39.46.030.
     (2) If an ordinance or resolution approving the issuance of bonds authorizes an officer or employee of the local government to serve as its designated representative and to accept, on behalf of the local government, an offer to purchase those bonds, the acceptance of the offer by the designated representative must be consistent with terms established by the ordinance or resolution, and with additional parameters set by the governing body of the local government in the ordinance or resolution. That ordinance or resolution must establish the following terms for the bonds or set forth parameters with respect thereto: The amount, date or dates, denominations, interest rate or rates (or mechanism for determining interest rate or rates), payment dates, final maturity, redemption rights, price, minimum savings for refunding bonds (if the refunding bonds are issued for savings purposes), and any other terms and conditions deemed appropriate by the legislative body of the local government. For a noncharter county, the designated representative must be the county treasurer.

Sec. 2   RCW 35.33.131 and 1969 ex.s. c 95 s 19 are each amended to read as follows:
     Moneys received from the sale of bonds or warrants ((shall)) must be used for no other purpose than that for which they were issued ((and no expenditure shall be made for that purpose until the bonds have been duly authorized)). If any unexpended fund balance remains from the proceeds realized from the bonds or warrants after the accomplishment of the purpose for which they were issued it ((shall)) must be used for the ((redemption of such bond or warrant indebtedness)) payment of principal of or interest on such indebtedness consistent with applicable provisions of federal tax law. Where a budget contains an expenditure program to be partially or wholly financed from a bond issue to be authorized thereafter, ((no such expenditure shall)) expenditures of amounts anticipated to be reimbursed from the proceeds of the issuance and sale of such bonds must be made or incurred ((until after the bonds have been duly authorized)) consistent with any applicable federal tax law requirements.

Sec. 3   RCW 35.34.220 and 1985 c 175 s 25 are each amended to read as follows:
     Moneys received from the sale of bonds or warrants ((shall)) must be used for no other purpose than that for which they were issued ((and no expenditure shall be made for that purpose until the bonds have been duly authorized)). If any unexpended fund balance remains from the proceeds realized from the bonds or warrants after the accomplishment of the purpose for which they were issued, it ((shall)) must be used for the ((redemption of such bond or warrant indebtedness)) payment of principal of or interest on such indebtedness consistent with applicable provisions of federal tax law. Where a budget contains an expenditure program to be partially or wholly financed from a bond issue to be authorized thereafter, ((no such expenditure shall)) expenditures of amounts anticipated to be reimbursed from the proceeds of the issuance and sale of such bonds must be made or incurred ((until after the bonds have been duly authorized)) consistent with any applicable federal tax law requirements.

Sec. 4   RCW 35A.33.130 and 1967 ex.s. c 119 s 35A.33.130 are each amended to read as follows:
     Moneys received from the sale of bonds or warrants ((shall)) must be used for no other purpose than that for which they were issued ((and no expenditure shall be made for that purpose until the bonds have been duly authorized)). If any unexpended fund balance remains from the proceeds realized from the bonds or warrants after the accomplishment of the purpose for which they were issued it ((shall)) must be used for the ((redemption of such bond or warrant indebtedness)) payment of principal of or interest on such indebtedness consistent with applicable provisions of federal tax law. Where a budget contains an expenditure program to be partially or wholly financed from a bond issue to be authorized thereafter, ((no such expenditure shall)) expenditures of amounts anticipated to be reimbursed from the proceeds of the issuance and sale of such bonds must be made or incurred ((until after the bonds have been duly authorized)) consistent with any applicable federal tax law requirements.

Sec. 5   RCW 35A.34.220 and 1985 c 175 s 54 are each amended to read as follows:
     Moneys received from the sale of bonds or warrants ((shall)) must be used for no other purpose than that for which they were issued ((and no expenditure shall be made for that purpose until the bonds have been duly authorized)). If any unexpended fund balance remains from the proceeds realized from the bonds or warrants after the accomplishment of the purpose for which they were issued, it ((shall)) must be used for the ((redemption of such bond or warrant indebtedness)) payment of principal of or interest on such indebtedness consistent with applicable provisions of federal tax law. Where a budget contains an expenditure program to be partially or wholly financed from a bond issue to be authorized thereafter, ((no such expenditure shall)) expenditures of amounts anticipated to be reimbursed from the proceeds of the issuance and sale of such bonds must be made or incurred ((until after the bonds have been duly authorized)) consistent with any applicable federal tax law requirements.

NEW SECTION.  Sec. 6   All bonds previously issued and any reimbursements previously made with bond proceeds by any local government and consistent with the provisions of this act are hereby validated, ratified, and confirmed.