BILL REQ. #:  S-5087.1 

Read first time 02/27/12.   Referred to Committee on Ways & Means.

     AN ACT Relating to liquor revenue; amending RCW 82.08.160, 43.110.030, 66.08.190, 66.08.196, 66.08.200, 66.08.210, 35A.66.020, 36.70A.340, 70.94.390, 70.96A.087, and 43.63A.190; creating new sections; repealing RCW 82.08.170, 82.08.180, 43.110.050, and 43.110.060; and providing an effective date.

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

Sec. 1   RCW 82.08.160 and 2011 1st sp.s. c 50 s 969 are each amended to read as follows:
     (((1))) On or before the twenty-fifth day of each month, all taxes collected under RCW 82.08.150 during the preceding month must be remitted to the state department of revenue, to be deposited ((with the state treasurer. Except as provided in subsection (2) of this section, upon receipt of such moneys the state treasurer must credit sixty-five percent of the sums collected and remitted under RCW 82.08.150 (1) and (2) and one hundred percent of the sums collected and remitted under RCW 82.08.150 (3) and (4) to the state general fund and thirty-five percent of the sums collected and remitted under RCW 82.08.150 (1) and (2) to a fund which is hereby created to be known as the "liquor excise tax fund."
     (2) During the 2011-2013 fiscal biennium, 66.19 percent of the sums collected and remitted under RCW 82.08.150 (1) and (2) must be deposited in the state general fund and the remainder collected and remitted under RCW 82.08.150 (1) and (2) must be deposited in the liquor excise tax fund)) into the general fund.

NEW SECTION.  Sec. 2   The following acts or parts of acts are each repealed:
     (1) RCW 82.08.170 (Apportionment and distribution from liquor excise tax fund) and 2002 c 38 s 3, 1997 c 437 s 4, 1983 c 3 s 215, & 1961 c 15 s 82.08.170; and
     (2) RCW 82.08.180 (Apportionment and distribution from liquor excise tax fund -- Withholding for noncompliance) and 1991 sp.s. c 32 s 36.

NEW SECTION.  Sec. 3   All moneys remaining in the liquor excise tax fund on July 1, 2012, must be deposited by the state treasurer into the general fund.

Sec. 4   RCW 43.110.030 and 2010 c 271 s 701 are each amended to read as follows:
     (1) The department of commerce ((shall)) must contract for the provision of municipal research and services to cities, towns, and counties. Contracts for municipal research and services ((shall)) must be made with state agencies, educational institutions, or private consulting firms, that in the judgment of the department are qualified to provide such research and services. Contracts for staff support may be made with state agencies, educational institutions, or private consulting firms that in the judgment of the department are qualified to provide such support.
     (2) Municipal research and services ((shall)) consists of:
     (a) Studying and researching city, town, and county government and issues relating to city, town, and county government;
     (b) Acquiring, preparing, and distributing publications related to city, town, and county government and issues relating to city, town, and county government;
     (c) Providing educational conferences relating to city, town, and county government and issues relating to city, town, and county government; and
     (d) Furnishing legal, technical, consultative, and field services to cities, towns, and counties concerning planning, public health, utility services, fire protection, law enforcement, public works, and other issues relating to city, town, and county government.
     (3) Requests for legal services by county officials ((shall)) must be sent to the office of the county prosecuting attorney. Responses by the department of commerce to county requests for legal services ((shall)) must be provided to the requesting official and the county prosecuting attorney.
     (4) The department of commerce ((shall)) must coordinate with the association of Washington cities and the Washington state association of counties in carrying out the activities in this section. ((Services to cities and towns shall be based upon the moneys appropriated to the department from the city and town research services account under RCW 43.110.060. Services to counties shall be based upon the moneys appropriated to the department from the county research services account under RCW 43.110.050.))

NEW SECTION.  Sec. 5   The following acts or parts of acts are each repealed:
     (1) RCW 43.110.050 (County research services account) and 2002 c 38 s 1 & 1997 c 437 s 3; and
     (2) RCW 43.110.060 (City and town research services account) and 2010 c 271 s 702, 2002 c 38 s 4, & 2000 c 227 s 1.

NEW SECTION.  Sec. 6   All moneys remaining in the county research services account and city and town research services account on July 1, 2012, must be deposited by the state treasurer into the general fund.

Sec. 7   RCW 66.08.190 and 2011 1st sp.s. c 50 s 960 are each amended to read as follows:
     (1) ((Except for revenues generated by the 2003 surcharge of $0.42/liter on retail sales of spirits that must be distributed to the state general fund during the 2003-2005 biennium, when excess funds are distributed, all moneys subject to distribution must be disbursed as follows:
     (a) Three-tenths of one percent to border areas under RCW 66.08.195; and
     (b) Except as provided in subsection (4) of this section, from the amount remaining after distribution under (a) of this subsection, (i) fifty percent to the general fund of the state, (ii) ten percent to the counties of the state, and (iii) forty percent to the incorporated cities and towns of the state.
     (2) During the months of June, September, December, and March of each year, prior to disbursing the distribution to incorporated cities and towns under subsection (1)(b) of this section, the treasurer must deduct from that distribution an amount that will fund that quarter's allotments under RCW 43.88.110 from any legislative appropriation from the city and town research services account. The treasurer must deposit the amount deducted into the city and town research services account.
     (3) The governor may notify and direct the state treasurer to withhold the revenues to which the counties and cities are entitled under this section if the counties or cities are found to be in noncompliance pursuant to RCW 36.70A.340.
     (4) During the 2011-2013 fiscal biennium, from the amount remaining after distribution under subsection (1)(a) of this section, (a) 51.7 percent to the general fund of the state, (b) 9.7 percent to the counties of the state, and (c) 38.6 percent to the incorporated cities and towns of the state)) During the months of June, September, December, and March of each year, quarterly distributions must be made to border areas, counties, cities, and towns as provided in section 302 of Initiative Measure No. 1183; and
     (2) The amount remaining after distribution under subsection (1) of this section must be deposited into the general fund.

Sec. 8   RCW 66.08.196 and 2001 c 8 s 2 are each amended to read as follows:
     (1) Distribution of funds to border areas under RCW 66.08.190 and 66.24.290 (1)(((a))) (c) and (4) ((shall be)) is as follows:
     (((1))) (a) Sixty-five percent of the funds ((shall)) must be distributed to border areas ratably based on border area traffic totals;
     (((2))) (b) Twenty-five percent of the funds ((shall)) must be distributed to border areas ratably based on border-related crime statistics; and
     (((3))) (c) Ten percent of the funds ((shall)) must be distributed to border areas ratably based upon border area per capita law enforcement spending.
     (2) Distributions to an unincorporated area ((shall)) must be made to the county in which such an area is located and may only be spent on services provided to that area.

Sec. 9   RCW 66.08.200 and 1979 c 151 s 167 are each amended to read as follows:
     With respect to the ((ten percent share coming)) distribution of funds to the counties under RCW 66.24.290(1)(c), the computations for distribution ((shall)) must be made by the state agency responsible for collecting the same as follows:
     (1) The share coming to each eligible county ((shall)) must be determined by a division among the eligible counties according to the relation which the population of the unincorporated area of such eligible county, as last determined by the office of financial management, bears to the population of the total combined unincorporated areas of all eligible counties, as determined by the office of financial management((: PROVIDED, That)). However, no county in which the sale of liquor is forbidden in the unincorporated area thereof as the result of an election ((shall be)) is entitled to share in such distribution. "Unincorporated area" means all that portion of any county not included within the limits of incorporated cities and towns.
     (2) When a special county census has been conducted for the purpose of determining the population base of a county's unincorporated area for use in the distribution of liquor funds, the census figure ((shall)) becomes effective for the purpose of distributing funds as of the official census date once the census results have been certified by the office of financial management and officially submitted to the office of the secretary of state.

Sec. 10   RCW 66.08.210 and 1979 c 151 s 168 are each amended to read as follows:
     (1) With respect to the ((forty percent share coming)) distribution of funds to the incorporated cities and towns under RCW 66.24.290(1)(c), the computations for distribution ((shall)) must be made by the state agency responsible for collecting the same as ((follows:)) provided in subsection (2) of this section.
     (2) The share coming to each eligible city or town ((shall)) must be determined by a division among the eligible cities and towns within the state ratably on the basis of population as last determined by the office of financial management((: AND PROVIDED, That)). However, no city or town in which the sale of liquor is forbidden as the result of an election ((shall be)) is entitled to any share in such distribution.

Sec. 11   RCW 35A.66.020 and 1967 ex.s. c 119 s 35A.66.020 are each amended to read as follows:
     The qualified electors of any code city may petition for an election upon the question of whether the sale of liquor ((shall be)) is permitted within the boundaries of such city as provided by chapter 66.40 RCW, and ((shall be)) is governed by the procedure therein, and may regulate music, dancing and entertainment as authorized by RCW 66.28.080((: PROVIDED, That)). However, every code city ((shall)) must enforce state laws relating to the investigation and prosecution of all violations of Title 66 RCW relating to control of alcoholic beverages and ((shall be)) is entitled to retain the fines collected therefrom as therein provided. Every code city ((shall)) must also share in the allocation and distribution of liquor profits and excise as provided in RCW ((82.08.170,)) 66.08.190((,)) and 66.08.210, and make reports of seizure as required by RCW 66.32.090, and otherwise regulate by ordinances not in conflict with state law or liquor board regulations.

Sec. 12   RCW 36.70A.340 and 2011 c 120 s 2 are each amended to read as follows:
     Upon receipt from the board of a finding that a state agency, county, or city is in noncompliance under RCW 36.70A.330, or as a result of failure to meet the requirements of RCW 36.70A.210, the governor may either:
     (1) Notify and direct the director of the office of financial management to revise allotments in appropriation levels;
     (2) Notify and direct the state treasurer to withhold the portion of revenues to which the county or city is entitled under one or more of the following: The motor vehicle fuel tax, as provided in chapter 82.36 RCW; the transportation improvement account, as provided in RCW 47.26.084; the rural arterial trust account, as provided in RCW 36.79.150; the sales and use tax, as provided in chapter 82.14 RCW; and the liquor profit tax, as provided in RCW 66.08.190((; and the liquor excise tax, as provided in RCW 82.08.170)); or
     (3) File a notice of noncompliance with the secretary of state and the county or city, which ((shall)) temporarily rescinds the county or city's authority to collect the real estate excise tax under RCW 82.46.030 until the governor files a notice rescinding the notice of noncompliance.

Sec. 13   RCW 70.94.390 and 1987 c 109 s 42 are each amended to read as follows:
     (1) The department may, at any time and on its own motion, hold a hearing to determine if the activation of an authority is necessary for the prevention, abatement and control of air pollution which exists or is likely to exist in any area of the state. Notice of such hearing shall be conducted in accordance with chapter 42.30 RCW and chapter 34.05 RCW. If at such hearing the department finds that air pollution exists or is likely to occur in a particular area, and that the purposes of this chapter and the public interest will be best served by the activation of an authority it ((shall)) must designate the boundaries of such area and set forth in a report to the appropriate county or counties recommendations for the activation of an authority((: PROVIDED, That)). However, if at such hearing the department determines that the activation of an authority is not practical or feasible for the reason that a local or regional air pollution control program cannot be successfully established or operated due to unusual circumstances and conditions, but that the control and/or prevention of air pollution is necessary for the purposes of this chapter and the public interest, it may assume jurisdiction and so declare by order. Such order ((shall)) must designate the geographic area in which, and the effective date upon which, the department will exercise jurisdiction for the control and/or prevention of air pollution. The department shall exercise its powers and duties in the same manner as if it had assumed authority under RCW 70.94.410.
     (2) All expenses incurred by the department in the control and prevention of air pollution in any county pursuant to the provisions of RCW 70.94.390 and 70.94.410 ((shall)) constitutes a claim against such county. The department ((shall)) must certify the expenses to the auditor of the county, who promptly ((shall)) must issue his warrant on the county treasurer payable out of the current expense fund of the county. In the event that the amount in the current expense fund of the county is not adequate to meet the expenses incurred by the department, ((the department shall certify to the state treasurer that they have a prior claim on any money in the "liquor excise tax fund" that is to be apportioned to that county by the state treasurer as provided in RCW 82.08.170. In the event that the amount in the "liquor excise tax fund" that is to be apportioned to that county by the state treasurer is not adequate to meet the expenses incurred by the department,)) the department ((shall)) must certify to the state treasurer that they have a prior claim on any excess funds from the liquor revolving fund that are to be distributed to that county as provided in RCW 66.08.190 through 66.08.220. All moneys that are collected as provided in this section ((shall)) must be placed in the general fund in the account of the office of air programs of the department.

Sec. 14   RCW 70.96A.087 and 1989 c 270 s 13 are each amended to read as follows:
     To be eligible to receive its share of liquor ((taxes and)) profits, each city and county ((shall)) must devote no less than two percent of its share of liquor ((taxes and)) profits to the support of a program of alcoholism and other drug addiction approved by the alcoholism and other drug addiction board authorized by RCW 70.96A.300 and the secretary.

Sec. 15   RCW 43.63A.190 and 1995 c 159 s 5 are each amended to read as follows:
     Funds appropriated by the legislature as supplemental resources for border areas ((shall)) must be distributed by the state treasurer pursuant to the formula for distributing funds ((from the liquor revolving fund)) to border areas, and expenditure requirements for such distributions, under RCW 66.08.196.

NEW SECTION.  Sec. 16   This act takes effect July 1, 2012.