AN ACT Relating to municipal utilities; amending RCW 35.67.030, 35.67.110, 35.92.070, and 35.92.080; adding a new section to chapter 35.67 RCW; and repealing RCW 35.67.070.

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

Sec. 1. Section 35.67.030, chapter 7, Laws of 1965 and RCW 35.67.030 are each amended to read as follows:

Whenever the legislative body of any city or town, shall deem it advisable that such city or town shall purchase, acquire or construct any public utility mentioned in RCW 35.67.020, or make any additions and betterments thereto, or extensions thereof, such legislative body shall provide therefor by ordinance, which shall specify and adopt the system or plan proposed, and declare the estimated cost thereof as near as may be((, and the same shall be submitted for ratification or rejection to the qualified voters of such city or town at a general or special election, except in the following cases where no submission shall be necessary:

~~(1) When the adoption of a system of sewerage or system for collection and disposal of refuse, and the construction and operation of same, has been required and ordered by the state board of health.~~

(2) When no general indebtedness is to be incurred by such city or town in the acquiring, construction, maintenance or operation of such public utility, or when the work proposed is an addition or extension thereto or betterment thereof for which no general indebtedness is to be incurred by such city or town.

If a general indebtedness is to be incurred, the amount of such indebtedness and the terms thereof shall be included in the proposition submitted to the qualified voters as aforesaid and such proposition shall be adopted and assented to by a three-fifths majority of the qualified voters of such city or town voting at said election. Ten days' notice of such election shall be given in the newspaper doing the city or town printing, by publication in each issue of said paper during said time: PROVIDED, HOWEVER, That where the proposition to be submitted includes a proposed levy of taxes in excess of the levy to which the same is or may be limited by statute or the Constitution of the state of Washington without a vote of the people, then the procedure to be followed in the holding of such election shall be as prescribed by such statutory or constitutional provision regulating the holding of special elections authorizing levies in excess of such limitation)).

NEW SECTION. Sec. 2. A new section is added to chapter 35.67 RCW to read as follows:

General obligation bonds issued by a city or town to pay for all or part of the costs of purchasing, acquiring, or constructing any public utility mentioned in RCW 35.67.020, or the costs of making any additions and betterments thereto, or extensions thereof, shall be issued and sold in accordance with chapter 39.46 RCW.

Sec. 3. Section 35.67.110, chapter 7, Laws of 1965 as amended by section 1, chapter 118, Laws of 1965 and RCW 35.67.110 are each amended to read as follows:

((There shall be levied each year upon all taxable property within the city or town a tax sufficient to pay the interest on the bonds and the principal thereof as the same matures. These taxes shall become due and collectible as other taxes. In addition thereto)) In addition to taxes pledged to pay the principal of and interest on general obligation bonds issued to pay for costs of purchasing, acquiring, or constructing any public utility mentioned in RCW 35.67.020, or to make any additions and betterments thereto, or extensions thereof, the city or town legislative body, may set aside into a special fund and pledge to the payment of such principal and interest any sums or amounts which may accrue from the collection of service rates and charges for the private and public use of said sewerage system or systems for the collection and disposal of refuse, in excess of the cost of operation and maintenance thereof as constructed or added to, and the same shall be applied solely to the payment of such interest and bonds. Such pledge of revenue shall constitute a binding obligation, according to its terms, to continue the collection of such revenue so long as such bonds or any of them are outstanding. If the rates and charges are sufficient to meet the debt service requirements on such bonds no general tax need be levied.

Sec. 4. Section 35.92.070, chapter 7, Laws of 1965 and RCW 35.92.070 are each amended to read as follows:

When the governing body of a city or town deems it advisable that the city or town purchase, acquire, or construct any such public utility ((~~or make any additions and betterments thereto or extensions thereof~~)), it shall provide therefor by ordinance, which shall specify and adopt the system or plan proposed, and declare the estimated cost thereof, as near as may be, and the ordinance shall be submitted for ratification or rejection ((to)) by majority vote of the voters of the city or town at a general or special election, except in the following cases where no submission shall be necessary:

(1) When the work proposed is an addition to, or betterment of, or extension of, or an increased water supply for, existing waterworks, or an addition, betterment, or extension of an existing system or plant of any other public utility ((~~for which no general indebtedness is to be incurred by the city or town~~));

(2) When in the charter of a city or town a provision has been adopted authorizing the corporate authorities thereof to provide by ordinance for acquiring, opening, or operating any of such public utilities((~~, for which no general indebtedness is to be incurred~~)); or

(3) When in the judgment of the corporate authority, the public health is being endangered by the discharge of raw or untreated sewage into any river or stream and the danger to the public health may be abated by the construction and maintenance of a sewage disposal plant ((~~for which no general indebtedness shall be incurred by the city or town responsible for such contamination.~~

If a general indebtedness is to be incurred, the amount and terms thereof shall be included in the proposition submitted to the voters and such proposition shall be adopted by three-fifths of the voters voting at such election.

~~If no general indebtedness is to be incurred the proposition may be adopted by a majority vote~~)).

Ten days' notice of the election shall be given in the newspaper doing the city or town printing, by publication in each issue of the paper during such time.

When a proposition has been adopted, or in the cases where no submission is necessary, the corporate authorities of the city or town may proceed forthwith to purchase, construct, and acquire the public utility or make additions, betterments, and extensions thereto and to make payment therefor.

Sec. 5. Section 35.92.080, chapter 7, Laws of 1965 as last amended by section 23, chapter 186, Laws of 1984 and RCW 35.92.080 are each amended to read as follows:

((~~When the voters have adopted a proposition for any public utility and have authorized a general indebtedness, general city or town bonds may be issued.~~)) General obligation bonds may be issued by a city or town for the purposes of providing all or part of the costs of purchasing, acquiring, or constructing a public utility or making any additions and betterments thereto, or extensions thereof. The bonds shall be issued and sold in accordance with chapter 39.46 RCW.

There shall be levied each year a tax upon the taxable property of the city or town sufficient to pay the interest on and principal of the bonds then due, which taxes shall become due and collectible as other taxes: PROVIDED, That it may pledge to the payment of such principal and interest the revenue of the public utility being acquired, constructed, or improved out of the proceeds of sale of such bonds. Such pledge of revenue shall constitute a binding obligation, according to its terms, to continue the collection of such revenue so long as such bonds or any of them are outstanding, and to the extent that revenues are insufficient to meet the debt service requirements on such bonds, the governing body of the municipality shall provide for the levy of taxes sufficient to meet such deficiency.

NEW SECTION. Sec. 6. Section 35.67.070, chapter 7, Laws of 1965, section 22, chapter 186, Laws of 1984 and RCW 35.67.070 are each repealed.