Effective Date of Rule: Thirty-one days after filing.

     Purpose: To provide a more clearly defined distribution of harbor area lease proceeds in Washington state.

     Citation of Existing Rules Affected by this Order: Amending WAC 332-100-040.

     Statutory Authority for Adoption: RCW 79.64.040.

      Adopted under notice filed as WSR 05-17-184 on August 24, 2005.

     Changes Other than Editing from Proposed to Adopted Version: The changes to the amended rule are in subsection (2); see strikethrough, below:

     (2) The department of natural resources shall deduct the maximum percentages as provided for in RCW 69.64.040 [79.64.040] and related statutes except that deductions from the gross proceeds of harbor area leases shall be at twenty percent.

     By removing this section of the sentence, the deduction from harbor area leases will no longer be 20%. Instead, the deduction will be based on RCW 69.64.040 [79.64.040], in which the maximum amount DNR can deduct from the gross proceeds on state-owned aquatic lands within harbor areas is 25%. This is consistent with the deduction rates for all other transactions on state-owned aquatic lands. This change will also help cover the rising costs associated with managing harbor area leases.

     Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted on the Agency's Own Initiative: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 1, Repealed 0.

     Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0;      Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 0, Amended 0, Repealed 0.

     Date Adopted: February [January] 6, 2006.

Doug Sutherland

Commissioner of

Public Lands

OTS-8561.1

AMENDATORY SECTION(Amending Order 398, Resolution No. 419, filed 5/6/83, effective 6/30/83)

WAC 332-100-040   Deduction determination.   (1) The board of natural resources hereby determines that a deduction from the gross proceeds of all leases, sales, contracts, licenses, permits, easements, and rights of way issued by the department of natural resources and affecting public lands as provided for in subsection (2) hereof is necessary in order to achieve the purposes of chapter 79.64 RCW.

     (2) The department of natural resources shall deduct the maximum percentages as provided for in RCW 79.64.040 and related statutes ((except that deductions from the gross proceeds of harbor area leases shall be at twenty percent)). Except for transactions involving aquatic lands, harbor areas and trust land categories that have a deficit revenue/expenditure status, the deductions may be temporarily discontinued by a resolution of the board of natural resources at such times as the balance in the resource management cost account exceeds an amount equal to twelve months operating expenses for the department of natural resources or when the board determines such discontinuation is in the best interest of the trust beneficiaries. The board shall specify the trust lands subject to such discontinuation. The duration of such orders shall be for a specified time period calculated to allow a reduction of the resource management cost account balance to an amount approximately equal to three months operating expenses for the department. Operating expense needs will be determined by the board based on pro rata increments of biennial legislative appropriations. All sums so deducted shall be paid into the resource management cost account in the state general fund created by chapter 79.64 RCW.

[Statutory Authority: RCW 79.64.040. 83-11-008 (Order 398, Resolution No. 419), § 332-100-040, filed 5/6/83, effective 6/30/83; 78-10-039 (Order 308, Resolution No. 241), § 332-100-040, filed 9/18/78.]