"NEW SECTION.  Sec. 1   (1) The legislature finds that in 2007 the legislature passed Substitute Senate Bill No. 5647, which expanded the allowable uses of lodging tax revenues for tourism promotion. The legislature further finds that the 2007 legislation was temporary but required the analysis of the economic impact of the expanded uses of lodging tax revenues. The legislature further finds that hoteliers are the cornerstone of the tourism industry and are the entities that generate lodging tax revenues that benefit the local jurisdictions throughout the state. The legislature further finds that lodging tax revenues stimulate economic activity when the use of revenues is specific and targeted based on the differing needs of local jurisdictions.
     (2) Because of the diverging needs of local jurisdictions, the legislature intends to continue to allow the expanded uses of lodging tax revenues to promote tourism and increase economic activity for local jurisdictions. The legislature further intends to subject the use of lodging tax revenues to a periodic review to ensure that the incremental economic benefit is measured and that the use of lodging tax revenues continues to increase tourism and generate revenue for local jurisdictions.

Sec. 2   RCW 67.28.1816 and 2008 c 28 s 1 are each amended to read as follows:
     (1) Lodging tax revenues under this chapter may be used, directly by local jurisdictions or indirectly through a convention and visitors bureau or destination marketing organization, for the marketing and operations of special events and festivals designed to attract tourists and local travelers and to support the operations and capital expenditures of tourism-related facilities, designed to attract tourists and local travelers, owned or operated by public entities, or nonprofit organizations described under section 501(c)(3) and section 501(c)(6) of the internal revenue code of 1986, as amended.
     (2) ((Local jurisdictions that use the lodging tax revenues under this section must submit an annual economic impact report to the department of community, trade, and economic development for expenditures made beginning January 1, 2008. These reports must include the expenditures by the local jurisdiction for tourism promotion purposes and what is used by a nonprofit organization exempt from taxation under 26 U.S.C. Sec. 501(c)(3) or 501(c)(6). This economic impact report, at a minimum, must include: (a) The total revenue received under this chapter for each year; (b) the list of festivals, special events, or nonprofit 501(c)(3) or 501(c)(6) organizations that received funds under this chapter; (c) the list of festivals, special events, or tourism facilities sponsored or owned by the local jurisdiction that received funds under this chapter; (d) the amount of revenue expended on each festival, special event, or tourism-related facility owned or sponsored by a nonprofit 501(c)(3) or 501(c)(6) organization or local jurisdiction; (e) the estimated number of tourists, persons traveling over fifty miles to the destination, persons remaining at the destination overnight, and lodging stays generated per festival, special event, or tourism-related facility owned or sponsored by a nonprofit 501(c)(3) or 501(c)(6) organization or local jurisdiction; and (f) any other measurements the local government finds that demonstrate the impact of the increased tourism attributable to the festival, special event, or tourism-related facility owned or sponsored by a nonprofit 501(c)(3) or 501(c)(6) organization or local jurisdiction.
     (3) The joint legislative audit and review committee must report to the legislature and the governor on the use and economic impact of lodging tax revenues by local jurisdictions since January 1, 2008, to support festivals, special events, and tourism-related facilities owned or sponsored by a nonprofit organization under section 501(c)(3) or 501(c)(6) of the internal revenue code of 1986, as amended, or a local jurisdiction, and the economic impact generated by these festivals, events, and facilities. This report shall be due September 1, 2012.
     (4) Reporting under this section must begin with calendar year 2008.
     (5) This section expires June 30, 2013.)) (a) Except as provided in (b) of this subsection, applicants applying for use of revenues in this chapter must provide the legislative body of the municipality to which they are applying estimates of how any moneys received will result in increases in:
     (i) The number of tourists and local travelers visiting the municipality including anticipated overnight stays; and
     (ii) Tourism-related and local traveler-related economic activity benefiting the municipality.
     (b) In a municipality with a population of five thousand or more, applicants applying for use of revenues in this chapter must submit their applications and estimates described under (a) of this subsection to the local lodging tax advisory committee.
     (c)(i) All recipients must submit a report to the legislative body of the municipality reporting pertinent data evaluating tourism and local visitor benefits resulting from the use of the funds as compared with the estimates contained in the application. The legislative body of the municipality receiving a report must: Make such report available to the public and furnish copies of the report to the joint legislative audit and review committee and members of the local lodging tax advisory committee by December 31st each year.
     (ii) On a biennial basis, and in compliance with RCW 43.01.036, the joint legislative audit and review committee must submit a report to the economic development committees of the legislature that details the use and economic impact of lodging tax revenues by local jurisdictions based on the reports furnished to the joint legislative audit and review committee under (c)(i) of this subsection. Reporting under this subsection must begin in calendar year 2015.
     (d) This section does not apply to the revenues of any lodging tax authorized under this chapter imposed by a county with a population of one million five hundred thousand or more.

Sec. 3   RCW 67.28.080 and 2007 c 497 s 1 are each reenacted and amended to read as follows:
     The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
     (1) "Acquisition" includes, but is not limited to, siting, acquisition, design, construction, refurbishing, expansion, repair, and improvement, including paying or securing the payment of all or any portion of general obligation bonds, leases, revenue bonds, or other obligations issued or incurred for such purpose or purposes under this chapter.
     (2) "Local traveler" means a person who travels less than fifty miles from their residence or business, or a person who travels by ferry, to attend a special event or festival.
     (3) "Local traveler economic impacts" means economic activity resulting from local travelers which may include meals, admissions fees, souvenirs, tours, and gifts.
     (4) "Municipality" means any county, city or town of the state of Washington.
     (((3))) (5) "Operation" includes, but is not limited to, operation, management, and marketing.
     (((4))) (6) "Person" means the federal government or any agency thereof, the state or any agency, subdivision, taxing district or municipal corporation thereof other than county, city or town, any private corporation, partnership, association, or individual.
     (((5))) (7) "Tourism" means economic activity resulting from tourists, which may include sales of overnight lodging, meals, tours, gifts, or souvenirs.
     (((6))) (8) "Tourism promotion" means activities, operations, and expenditures designed to increase tourism, including but not limited to advertising, publicizing, or otherwise distributing information for the purpose of attracting and welcoming tourists; developing strategies to expand tourism; operating tourism promotion agencies; and funding the marketing of or the operation of special events and festivals designed to attract tourists.
     (((7))) (9) "Tourism-related facility" means real or tangible personal property with a usable life of three or more years, or constructed with volunteer labor that is: (a)(i) Owned by a public entity; (ii) owned by a nonprofit organization described under section 501(c)(3) of the federal internal revenue code of 1986, as amended; or (iii) owned by a nonprofit organization described under section 501(c)(6) of the federal internal revenue code of 1986, as amended, a business organization, destination marketing organization, main street organization, lodging association, or chamber of commerce and (b) used to support tourism, performing arts, or to accommodate tourist activities.
     (((8))) (10) "Tourist" means a person who travels ((from a place of residence to a different town, city, county, state, or country, for purposes of business, pleasure, recreation, education, arts, heritage, or culture.
     (9) Amendments made in section 1, chapter 497, Laws of 2007 expire June 30, 2013)) for business or pleasure on a trip: Away from their place of residence or business and stays overnight in paid accommodations; to a place fifty miles or more one way from their place of residence or their business for the day or stays overnight; or from another country or state outside of their place of residence or their business.

Sec. 4   RCW 67.28.1817 and 1998 c 35 s 3 are each amended to read as follows:
     (1) ((Before proposing imposition of a new tax under this chapter, an increase in the rate of a tax imposed under this chapter, repeal of an exemption from a tax imposed under this chapter, or a change in the use of revenue received under this chapter, a municipality with a population of five thousand or more shall establish a lodging tax advisory committee under this section)) (a) A municipality with a population of five thousand or more must establish a lodging tax advisory committee under this section before either:
     (i) Proposing imposition of a new tax under this chapter, an increase in the rate of a tax imposed under this chapter, or a repeal of an exemption from a tax imposed under this chapter; or
     (ii) Approving an application for use of revenue received under this chapter.
     (b)(i) A lodging tax advisory committee ((shall)) must consist of at least five members, appointed by the legislative body of the municipality, unless the municipality has a charter providing for a different appointment authority.
     (ii) The committee membership ((shall)) must include:
     (((a))) (A) At least two members who are representatives of businesses required to collect tax under this chapter; and
     (((b))) (B) At least two members who are persons involved in activities authorized to be funded by revenue received under this chapter. Persons who are eligible for appointment under (((a))) (b)(ii)(A) of this subsection are not eligible for appointment under (b)(ii)(B) of this subsection. Persons who are eligible for appointment under (b)(ii)(B) of this subsection are not eligible for appointment under (((a))) (b)(ii)(A) of this subsection.
     (c) Organizations representing businesses required to collect tax under this chapter, organizations involved in activities authorized to be funded by revenue received under this chapter, and local agencies involved in tourism promotion may submit recommendations for membership on the committee. The number of members who are representatives of businesses required to collect tax under this chapter ((shall)) must equal the number of members who are involved in activities authorized to be funded by revenue received under this chapter. One member ((shall)) must be an elected official of the municipality who ((shall)) must serve as chair of the committee. An advisory committee for a county may include one nonvoting member who is an elected official of a city or town in the county. An advisory committee for a city or town may include one nonvoting member who is an elected official of the county in which the city or town is located. The appointing authority ((shall)) must review the membership of the advisory committee annually and make changes as appropriate.
     (2)(a) Any municipality that: (i) Proposes imposition of a tax under this chapter, an increase in the rate of a tax imposed under this chapter, or a repeal of an exemption from a tax imposed under this chapter((, or a change in the)); or (ii) approves an application for use of revenue received under this chapter ((shall)), must submit ((the proposal)) all proposals and applications received pursuant to RCW 67.28.1816(2) to the lodging tax advisory committee for review ((and comment)). The submissions ((shall)) must occur at least forty-five days before final action on or passage of the proposal by the municipality.
     (b)(i) The advisory committee ((shall)) must submit comments on ((the)) any proposal ((in a timely manner through generally applicable public comment procedures. The comments shall include an analysis of the extent to which the proposal will accommodate activities for tourists or increase tourism, and the extent to which the proposal will affect the long-term stability of the fund created under RCW 67.28.1815. Failure of the advisory committee to submit comments before final action on or passage of the proposal shall not prevent the municipality from acting on the proposal. A municipality is not required to submit an amended proposal to an advisory committee under this section)) for imposition of a tax under this chapter, an increase in the rate of a tax imposed under this chapter, repeal of an exemption from a tax imposed under this chapter, or an approval of an application for use of revenue received under this chapter in a timely manner through generally applicable public comment procedures.
     (ii) The lodging tax advisory committee must prioritize all applications for use of revenue in this chapter and submit the prioritized list and funding levels to the legislative body of the municipality for final determination.
     (iii) The lodging tax advisory committee must consider the extent to which the proposed use of the funds will affect the long-term stability of the fund created under RCW 67.28.1815.
     (iv) The legislative body of the municipality may only choose recipients from the prioritized list of applications and funding levels provided by the local lodging tax advisory committee. The legislative body of the municipality may only change the funding level after the lodging tax advisory committee has been given the opportunity to review the proposed change.
     (v) Failure of the advisory committee to submit comments and a prioritized list before final action on a proposal or approval of applicants for use of the funds does not prevent the municipality from acting.
     (c) The legislative body of the municipality is not required to submit an amended proposal to an advisory committee under this section.
     (d) This section does not apply to any lodging tax authorized under this chapter imposed by a county with a population of one million five hundred thousand or more.

NEW SECTION.  Sec. 5   This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 1, 2013."