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Laws of 2006, 2006 legislative session bills, and Initiatives of possible interest to local governments. Click on the chapter or bill number to link to additional information for that chapter or bill.
The 2006 Regular Session adjourned sine die on March 08, 2006.
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Chapter 3, Laws of 2006 (SHB 2370) - Funding low-income home energy assistance.
The sum of $7.6 million is appropriated from the Public Service Revolving Fund to the Washington Utilities and Transportation Commission for transfer to the Department of Community, Trade and Economic Development for the Low-Income Energy Assistance Program during the 2005-07 biennium. The appropriation may not be used for the DCTED's administrative costs. Votes on Final Passage:
House 97 0
Senate 48 0
Effective: January 12, 2006. Click here for additional information.
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Chapter 5, Laws of 2006 (SHB 2419) - Raising funds for hosting the national conference of lieutenant governors.
The State Ethics Act is changed to allow the Lieutenant Governor and his or her staff to solicit and accept gifts, grants, or donations beyond the $50 limitation for purposes of hosting the 2006 official conference of the National Lieutenant Governors' Association. Votes on Final Passage:
House 93 2
Senate 48 0
Effective: February 7, 2006 Click here for additional information.
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Chapter 6, Laws of 2006 (E2SHB 2860) - Regarding water resource management in the Columbia river basin.
Columbia River Water Supply Inventory
The Department is required to work with stakeholders in developing an initial Columbia River Water Supply Inventory (Inventory) and Water Demand Forecast by November 15, 2006. The Department must update the Inventory each year after 2006 and update the Water Demand Forecast every 5 years. The Inventory must identify potential conservation and storage projects in the Columbia River basin, as well as estimate the costs and benefits of the projects. The Inventory must also rank the identified projects in a number of different ways. This includes rankings of the projects in order of expense, benefits to fish, and benefits to out-of-stream needs.
Columbia River Basin Water Storage and Supply Account
The Columbia River Basin Water Supply Development Account (Account) is created. The Account is allowed to accept direct appropriations, payments made pursuant to voluntary regional agreements, and other sources.
Expenditures from the Account may be used to assess, plan, and develop new water storage, improve existing storage, fund conservation projects, and implement actions designed to provide new access to water in the Columbia River Basin.
Before any funds from the Account can be used for construction, the Department must evaluate the water uses the new facility will serve, the benefits and costs of the project, and alternative means of achieving the same goals.
The $10 million appropriation in the 2005 Capital Budget is amended to specify that the money may be used to begin implementing the goals of the Account. Specific water supply projects are identified for the Department as a focus of their implementation of the appropriation.
Allocation of "new" water
Water supplies that are developed and secured through projects funded by the Account must be used in specified ways. Two-thirds of this water must be dedicated to out-of-stream uses, while one-third must be used by the Department to enhance instream flows.
Voluntary regional agreements
The Department is given the specific authority to enter into voluntary regional agreements that establish the approval conditions for water withdrawals from the Columbia River and Snake River. These agreements must be limited to specific geographical areas and to parties that use or propose to use water from the mainstem of the Columbia and Snake rivers.
Prior to entering into a voluntary regional agreement, the Department must consult with the Department of Fish and Wildlife and watershed planning groups regarding the benefits that could be produced for fish, wildlife, and other instream values. Any draft agreements are subject to a 30-day public review and comment period. Before providing final consultation to the Department, the Department of Fish and Wildlife must consult with fisheries co-managers.
When voluntary regional agreements lead to the allocation of water for out-of-stream uses, the Department is given specific directions as to how the water is to be allocated. All allocations must ensure that water provided for out-of-stream uses does not cause a reduction in stream flows in the mainstem of the Columbia River during July or August, or in the Snake River between April and August. Water use applicants utilizing the voluntary regional agreement process to access new appropriations must agree to efficient water use practices.
The authority to enter into voluntary regional agreements expires on June 30, 2012. Any agreements entered into prior to the expiration date remain in effect subject to the terms of the agreement.
Conserved water
Except for water conserved within the federal Columbia Basin Reclamation project, when the state funds water conservation from the Account to benefit the mainstem of the Columbia River, conserved water must be held in trust by the Department in the same proportion as the share of funding that was provided by the state for the project that led to the water conservation. This portion of the conserved water must be used to improve instream flows to benefit fish and other instream values.
Columbia Mainstem Water Resources Information System
The Department must establish and maintain a Columbia Mainstem Water Resources Information System (System) to provide information necessary for effective resource planning and management on the mainstem of the Columbia River. In developing the System, the Department must consult with, and rely on information provided by, other public entities operating in the basin.
The System must address the total aggregate quantity of water rights on the Columbia River mainstem and the total volume metered and reported by water users.
The act is null and void if $200 million is not provided in a separate bond authorization act.
Votes on Final Passage:
House 94 4
Senate 48 0
Effective: July 1, 2006 Click here for additional information.
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Chapter 7, Laws of 2006, (HB 2424) - Providing sales and use tax exemptions for users of farm fuel.
Diesel and aircraft fuel used by farmers for non-highway farm activities is exempt from sales and use tax. The exemption also covers diesel and aircraft fuel used for soil preparation services, crop cultivation services, and crop harvesting services. The exemption does not cover fuel used for home heating. Votes on Final Passage:
House 96 1
Senate 44 4 (Senate amended)
House 97 1 (House concurred)
Effective: March 6, 2006 Click here for additional information.
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Chapter 8, Laws of 2006 (2SHB 2292) - Addressing health care liability reform.
The Legislature finds that addressing the issues of consumer access to health care and the increasing costs of medical malpractice insurance requires comprehensive solutions that encourage patient safety, increase oversight of medical malpractice insurance, and make the civil justice system more understandable, fair, and efficient.
PATIENT SAFETY
Statements of Apology. In a medical negligence action, a statement of fault, apology, or sympathy, or a statement of remedial actions that may be taken, is not admissible as evidence in a civil action if the statement was conveyed by a health care provider to the injured person or certain family members within 30 days of the act or omission, or the discovery of the act or omission, that is the basis for the claim.
Reports of Unprofessional Conduct. The statute granting immunity to a physician, dentist, or pharmacist who files charges or presents evidence about the incompetence or misconduct of another physician, dentist, or pharmacist is expanded to apply to any health care professional subject to the Uniform Disciplinary Act and to apply to reports or evidence relating to unprofessional conduct or the inability to practice with reasonable skill and safety because of a physical or mental condition. A health care professional who prevails in a civil action on the good faith defense provided in this immunity statute is entitled to recover expenses and reasonable attorneys' fees incurred in establishing the defense.
Medical Quality Assurance Commission (MQAC). The public membership component of the MQAC is increased from four to six members, and at least two of the public members must not be representatives of the health care industry.
Health Care Provider Discipline. When imposing a sanction against a health care provider, a health profession disciplining authority may consider prior findings of unprofessional conduct, stipulations to informal disposition, and the actions of other Washington or out-of-state disciplining authorities.
Disclosure of Adverse Events. A medical facility must notify the Department of Health (DOH) within 48 hours of confirmation that an adverse event has occurred. The medical facility must submit a subsequent report of the adverse event to the DOH within 45 days. The report must include a root cause analysis of the adverse event and a corrective action plan, or an explanation of the reasons for not taking corrective action. Facilities and health care workers may report the occurrence of "incidents." "Adverse event" is defined as the list of serious reportable events adopted by the National Quality Forum in 2002. "Incident" is defined as an event involving clinical care that could have injured the patient or that resulted in an unanticipated injury that does not rise to the level of an adverse event.
The DOH must contract with an independent entity to develop a secure internet-based system for the reporting of adverse events and incidents. The independent entity is responsible for receiving and analyzing the notifications and reports and developing recommendations for changes in health care practices for the purpose of reducing the number and severity of adverse events. The independent entity must report to the Legislature and the Governor on an annual basis regarding the number of adverse events and incidents reported and the information derived from the reports.
Coordinated Quality Improvement Programs. The types of programs that may apply to the DOH to become coordinated quality improvement programs are expanded to include consortiums of health care providers that consist of at least five health care providers.
Prescription Legibility. Prescriptions for legend drugs must either be hand-printed, typewritten, or generated electronically.
INSURANCE INDUSTRY REFORM
Medical Malpractice Closed Claim Reporting. Self-insurers and insuring entities that write medical malpractice insurance are required to report medical malpractice closed claims that are closed after January 1, 2008, to the Office of the Insurance Commissioner (Commissioner). Closed claims reports must be filed annually by March 1, and must include data for closed claims for the preceding year. The reports must contain specified data relating to: the type of health care provider, specialty, and facility involved; the reason for the claim and the severity of the injury; the dates when the event occurred, the claim was reported to the insurer, and the suit was filed; the injured person's age and sex; and information about the settlement, judgment, or other disposition of the claim, including an itemization of damages and litigation expenses.
If a claim is not covered by an insuring entity or self-insurer, the provider or facility must report the claim to the Commissioner after a final disposition of the claim. The Commissioner may impose a fine of up to $250 per day against an insuring entity that fails to make the required report. The DOH may require a facility or provider to take corrective action to comply with the reporting requirements.
A claimant or the claimant's attorney in a medical malpractice action that results in a final judgment, settlement, or disposition, must report to the Commissioner certain data, including the date and location of the incident, the injured person's age and sex, and information about the amount of judgment or settlement, court costs, attorneys' fees, or expert witness costs incurred in the action.
The Commissioner must use the data to prepare aggregate statistical summaries of closed claims and an annual report of closed claims and insurer financial reports. The annual report must include specified information, such as: trends in frequency and severity of claims; types of claims paid; a comparison of economic and non-economic damages; a distribution of allocated loss adjustment expenses; a loss ratio analysis for medical malpractice insurance; a profitability analysis for medical malpractice insurers; a comparison of loss ratios and profitability; and a summary of approved medical malpractice rate filings for the prior year, including analyzing the trend of losses compared to prior years.
Any information in a closed claim report that may result in the identification of a claimant, provider, health care facility, or self-insurer is exempt from public disclosure.
Underwriting Standards. During the underwriting process, an insurer may consider the following factors only in combination with other substantive underwriting factors: (1) that an inquiry was made about the nature or scope of coverage; (2) that a notification was made about a potential claim that did not result in the filing of a claim; or (3) that a claim was closed without payment. If an underwriting activity results in a higher premium or reduced coverage, the insurer must provide written notice to the insured describing the significant risk factors that led to the underwriting action.
Cancellation or Non-Renewal of Liability Insurance Policies. The mandatory notice period for cancellation or non-renewal of medical malpractice liability insurance policies is increased from 45 days to 90 days. An insurer must actually deliver or mail to the insured a written notice of the cancellation or non-renewal of the policy, which must include the actual reason for the cancellation or non-renewal and the significant risk factors that led to the action. For policies the insurer will not renew, the notice must state that the insurer will not renew the policy upon its expiration date.
Prior Approval of Medical Malpractice Insurance Rates. Medical malpractice rate filings and form filings are changed from the current "use and file" system to a prior approval system. An insurer must, prior to issuing a medical malpractice policy, file the policy rate and forms with the Commissioner. The Commissioner must review the filing, which cannot become effective until 30 days after its filing.
HEALTH CARE LIABILITY REFORM
Statutes of Limitations and Repose. Tolling of the statute of limitations during minority is eliminated.
The eight-year statute of repose is re-established. Legislative intent and findings regarding the justification for a statute of repose are provided in response to the Washington Supreme Court's decision overturning the statute of repose.
Certificate of Merit. In medical negligence actions involving a claim of a breach of the standard of care, the plaintiff must file a certificate of merit at the time of commencing the action, or no later than 45 days after filing the action if the action is filed 45 days prior to the running of the statute of limitations. The certificate of merit must be executed by a qualified expert and state that there is a reasonable probability that the defendant's conduct did not meet the required standard of care based on the information known at the time. The court for good cause may grant up to a 90-day extension for filing the certificate of merit.
Failure to file a certificate of merit that complies with these requirements results in dismissal of the case. If a case is dismissed for failure to comply with the certificate of merit requirements, the filing of the claim may not be used against the health care provider in liability insurance rate setting, personal credit history, or professional licensing or credentialing.
Voluntary Arbitration. A new voluntary arbitration system is established for disputes involving alleged professional negligence in the provision of health care. The voluntary arbitration system may be used only where all parties have agreed to submit the dispute to voluntary arbitration once the suit is filed, either through the initial complaint and answer, or after the commencement of the suit upon stipulation by all parties.
The maximum award an arbitrator may make is limited to $1 million for both economic and non-economic damages. In addition, the arbitrator may not make an award of damages based on the "ostensible agency" theory of vicarious liability.
The arbitrator is selected by agreement of the parties, and the parties may agree to more than one arbitrator. If the parties are unable to agree to an arbitrator, the court must select an arbitrator from names submitted by each side. A dispute submitted to the voluntary arbitration system must follow specified time periods that will result in the commencement of the arbitration no later than 12 months after the parties agreed to submit to voluntary arbitration.
The number of experts allowed for each side is generally limited to two experts on the issue of liability, two experts on the issue of damages, and one rebuttal expert. In addition, the parties are generally entitled to only limited discovery. Depositions of parties and expert witnesses are limited to four hours per deposition and the total number of additional depositions of other witnesses is limited to five per side, for no more than two hours per deposition.
There is no right to a trial de novo on an appeal of the arbitrator's decision. An appeal is limited to the bases for appeal provided under the current arbitration statute for vacation of an award under circumstances where there was corruption or misconduct, or for modification or correction of an award to correct evident mistakes.
Pre-Suit Notice and Mandatory Mediation. A medical malpractice action may not be commenced unless the plaintiff has provided the defendant with 90 days prior notice of the intention to file a suit. The 90-day notice requirement does not apply if the defendant's name is unknown at the time of filing the complaint.
The mandatory mediation statute is amended to require mandatory mediation of medical malpractice claims unless the claim is subject to either mandatory or voluntary arbitration. Implementation of the mediation requirement contemplates the adoption of a rule by the Supreme Court establishing a procedure for the parties to certify the manner of mediation used by the parties.
Collateral Sources. The collateral source payment statute is amended to remove the restriction on presenting evidence of collateral source payments that come from insurance purchased by the plaintiff. The plaintiff, however, may introduce evidence of amounts paid to secure the right to the collateral source payments (e.g., premiums), in addition to introducing evidence of an obligation to repay the collateral source compensation.
Frivolous Lawsuits. An attorney in a medical malpractice action, by signing and filing a claim, counterclaim, cross claim, or defense, certifies that the claim or defense is not frivolous. An attorney who signs a filing in violation of this section is subject to sanctions, including an order to pay reasonable expenses and reasonable attorneys' fees incurred by the other party.
Votes on Final Passage:
House 54 43
Senate 48 0 (Senate amended)
House 82 15 (House concurred)
Effective: June 7, 2006
July 1, 2006 (Sections 112 and 210) Click here for additional information.
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Chapter 11, Laws of 2006 (HB 2364) - Creating a use tax exemption when converting or merging a federal, foreign, or out-of-state credit union into a state charter.
Personal property, services, and extended warranties that are acquired by a state credit union from a federal, out-of-state, or foreign credit union as a result of a conversion or merger are exempt from use tax.
Votes on Final Passage:
House: 87 8
Senate: 47 0
Effective: June 7, 2006 Click here for additional information.
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Chapter 17, Laws of 2006 (SB 6674) - Requiring that funds collected from construction of the second Tacoma Narrows bridge be deposited in the Tacoma Narrows toll bridge account.
Proceeds from the sale of surplus real property acquired for the purpose of constructing the new Tacoma Narrows Bridge and any liquidated damages collected on any contract used to construct the bridge are to be deposited into the Tacoma Narrows Toll Bridge Account instead of the Motor Vehicle Account. Votes on Final Passage:
Senate 40 0
House 95 0
Effective: June 7, 2006 Click here for additional information.
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Chapter 18, Laws of 2006 (3SHB 1458) - Concerning the management of on-site sewage systems in marine areas.
Revised for 3rd Substitute: Concerning the management of on-site sewage disposal systems in marine areas.
By July 1, 2007, local health officers in 12 counties bordering the Puget Sound must develop and approve an OSS program management plan that will guide the development and management of OSS in marine recovery areas within the local health jurisdiction. The local health jurisdictions are in the following counties and regions: Clallam, Island, Kitsap, Jefferson, Mason, San Juan, Seattle-King, Skagit, Snohomish, Tacoma-Pierce, Thurston, and Whatcom.
In developing the OSS program management plan, the local health officers must propose marine recovery areas where an OSSs is a significant factor contributing to concerns with: (1) shellfish growing areas that have been threatened or downgraded; (2) state waters listed under the CWA for low oxygen levels or fecal coliform; or (3) marine waters where nitrogen has been identified as a contaminant of concern. In determining the area's boundaries, the health officer must include geographic areas where existing OSS may have an impact. Once a marine recovery area has been proposed, the local health officer must develop and approve an on-site strategy to manage OSS within the proposed area.
The onsite strategy must address how the jurisdiction will: - find failing OSS and ensure system owners make repairs by July 1, 2012; and
- find unknown OSS and ensure they are inspected or repaired by July 1, 2012.
The DOH may grant a 12-month extension where a local health jurisdiction has demonstrated substantial progress.
In addition, local health officers must require that OSS maintenance specialists and septic tank pumpers report any failing OSS. Working with the DOH, local health officers must develop an electronic data system to actively manage OSS within their jurisdiction.
The OSS management plans must be submitted to the DOH by July 1, 2007. The DOH must review all plans to ensure the required elements and designation of marine recovery areas are addressed. Within 30 days of receiving an on-site strategy, the DOH must either approve the strategy or provide in writing the reasons for not approving the strategy. If the strategy is not approved, the local board of health can revise and resubmit the strategy or may appeal the denial to the Board.
The DOH will enter into a contract with each local health jurisdiction to implement OSS plans or enhance its data systems. The contract must require evidence of progressive improvement in the marine recovery areas and other performance expected under the plan.
The DOE must offer financial and technical assistance to local governments and tribal entities in Puget Sound counties to establish or expand OSS repair and replacement loan and grant programs. The programs shall give priority to low-income home owners and award grants based on financial need.
The DOH must report to the appropriate committees of the Legislature by December 31, 2008, on progress in designating marine recovery areas and developing and implementing on-site strategies. The DOH shall convene a work group for the purpose of making recommendations to the Legislature for the development of certification or licensing of OSS maintenance specialists. Votes on Final Passage:
House 70 26
Senate 28 15
Effective: June 7, 2006 Click here for additional information.
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Chapter 20, Laws of 2006 (SHB 2344) - Authorizing three superior court judges in Clallam county.
Revised for 1st Substitute: Increasing the number of superior court judicial positions in Clallam and Cowlitz counties.
One additional superior court judge is authorized in Clallam County and one additional superior court judge is authorized in Cowlitz County.
The additional judicial positions are effective only if each county documents its approval of the additional position and agrees to pay for its share of the costs for the position without reimbursement from the state.
Votes on Final Passage:
House 97 1
Senate 48 0
Effective: June 7, 2006 Click here for additional information.
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Chapter 26, Laws of 2006 (SHB 2608) - Defining performance of duty for the volunteer fire fighters' and reserve officers' relief and pension act.
The definition of "performance of duty" or "performance of service" in the Volunteer Fire System includes other officially assigned duties that are secondary to duties as a fire fighter, emergency worker, or reserve officer, including maintenance, public education, inspections, investigations, court testimony, and fundraising for the benefit of the department. Performance of duty or service also includes being on call or standby under the orders of the chief or designated officer, except at the individual's home or place of business.
Votes on Final Passage:
House 97 0
Senate 47 0
Effective: June 7, 2006 Click here for additional information.
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Chapter 27, Laws of 2006 (HB 1305) - Authorizing background checks before an authorized emergency vehicle permit is issued.
The WSP's equipment and standards review unit must require a records check of all applicants for an authorized emergency vehicle permit through the WSP and the FBI. The record check is required to include a fingerprint check, and the applicant may be employed on a conditional basis pending completion of the investigation.
Votes on Final Passage:
House 96 0
Senate 46 0
Effective: June 7, 2006 Click here for additional information.
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Chapter 32, Laws of 2006 (HB 2676) - Posting interlocal agreements in an electronic format in lieu of filing with the county auditor.
As an alternative to filing an interlocal agreement with a county auditor, a public agency may list the agreement by subject on its website or other electronically retrievable public source.
Votes on Final Passage:
House 98 0
Senate 49 0
Effective: June 7, 2006 Click here for additional information.
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Chapter 33, Laws of 2006 (SHB 2684) - Allowing vesting after five years of service in the defined benefit portion of the public employees' retirement system, the school employees' retirement system, and the teachers' retirement system plan 3.
The vesting requirement for members of PERS, SERS, and TRS Plans 3 is reduced from 10 years or five years with one year after age 54 to five years of service with one year after age 44. Votes on Final Passage:
House 97 0
Senate 45 0
Effective: June 7, 2006 Click here for additional information.
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Chapter 35, Laws of 2006 (SHB 2759) - Authorizing the transfer of certain real property and facilities.
Public bodies may transfer, without further monetary consideration, real property and facilities acquired, constructed, or improved using Referendum 29 or Referendum 37 bonds to nonprofit social service providers, in exchange for the promise to continually operate services benefitting the public on the site, subject to certain conditions. The deed transferring the property must provide for immediate reversion back to the public body if the nonprofit corporation ceases to use the property for the purposes outlined in the act. Transfers may include lease renewals.
The nonprofit corporation is authorized to sell the property transferred to it only if certain conditions are satisfied. Any sale must have the prior written approval by the Department. All proceeds from the sale must be applied to the purchase price of a different property or properties of equal or greater value than the original property. Any new property must be used for the purposes stated in the act. The new property must be available for use within one year of sale. If the nonprofit corporation ceases to use the new property for the specified purposes, the nonprofit corporation must reimburse the public entity for the value of the original property at the time of the sale. If the nonprofit corporation ceases to use the property for the specified purposes, the property and facilities revert immediately to the public body. The public body must determine if the property, or the reimbursed amount in the case of reimbursement, can be used by another social service program as designated by the Department. Such programs will have priority in obtaining the property to ensure the purposes of the original referenda are carried out.
Votes on Final Passage:
House 96 2
Senate 49 0
Effective: June 7, 2006 Click here for additional information.
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Chapter 39, Laws of 2006 (HB 2932) - Establishing a catastrophic disability allowance under the law enforcement officers' and fire fighters' retirement system, plan 2.
A member of the Law Enforcement Officers' and Fire Fighters' Retirement System, Plan 2 (LEOFF 2) who is totally disabled in the line of duty is entitled to a disability allowance equal to 70 percent of final average salary. The total disability benefit is reduced to the extent that in combination with certain workers' compensation payments and Social Security disability benefits, the disabled member would receive more that 100 percent of final average salary. Department of Fish and Wildlife Enforcement Officers' compensation insurance benefits are also reduced for any disability benefits received from LEOFF 2.
Total disability is defined as a member's inability to perform any substantial gainful activity due to a physical or mental condition that may be expected to result in death or last for at least 12 months. Substantial gainful activity is defined as average earnings of more than $860 per month, adjusted annually based on Federal Social Security standards.
The Department of Retirement Systems may require a person to submit to periodic medical examinations and disclose financial records as a condition of continued eligibility. In the event that a totally disabled member's earnings exceed the substantial gainful activity threshold, a member's benefit will be converted to a line-of-duty disability retirement allowance.
Votes on Final Passage:
House 96 0
Senate 40 0
Effective: March 14, 2006 Click here for additional information.
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Chapter 40, Laws of 2006 (ESHB 2951) - Creating a firearms training certificate program for retired law enforcement officers.
A process is created for issuing firearms certificates to retired law enforcement officers who are Washington residents in order to satisfy the certification requirements contained in the federal Law Enforcement Officers Safety Act of 2004.
The Washington Association of Sheriffs and Police Chiefs must develop a firearms certificate form to be used by local law enforcement agencies when issuing firearms certificates to retired law enforcement officers.
A retired law enforcement officer may apply to a local law enforcement agency for a firearms certificate. The law enforcement agency may issue the certificate to the retired officer if the retired officer: (1) has been qualified or otherwise found to meet the standards established by the Criminal Justice Training Commission for firearms qualifications for active law enforcement officers in the state; and (2) has undergone a background check and is not ineligible to possess a firearm. The firearms qualification may be provided either by the local law enforcement agency or by an individual or entity certified to provide firearms training.
The firearms certificate is valid for a period of one year. An applicant for the firearms certificate must pay a fee of $36, plus additional charges imposed by the Federal Bureau of Investigation that are passed on to the applicant. The fee is distributed in the same manner as the fee for a concealed pistol license. The retired law enforcement officer is also responsible for paying the costs of the firearms qualification.
Votes on Final Passage:
House 98 0
Senate 44 0
Effective: June 7, 2006 Click here for additional information.
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Chapter 41, Laws of 2006 (HB 3056) - Allowing second class cities and towns to pay claims by check or warrant.
Second class cities and towns are given the power to adopt a policy on the payment of claims and other obligations, which are payable by warrant or check if the funds are solvent. If the funds are not solvent, warrants must be used as payment. The legislative bodies of second class cities and towns must also designate a depository upon which to draw checks and authorize or require certain officers to sign checks.
The term "warrant" includes checks where allowed by these provisions.
Votes on Final Passage:
House 98 0
Senate 47 0
Effective: June 7, 2006 Click here for additional information.
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Chapter 47, Laws of 2006 (SSB 6359) - Ensuring employers do not evade their contribution rate.
If ESD determines that a significant purpose of transferring a business was to obtain a reduced array calculation factor rate, then one of two actions may occur:
If the successor was an employer at the time the transfer occurred, then the experience rating accounts of all employers are combined into a single account and the employers are assigned the higher of the predecessor or successor array calculation factor rate which takes effect the date of the transfer; or if the successor is not an employer at the time the transfer occurs, then the experience rating account of the acquired business cannot be transferred to the successor and, instead, a new employer rate is assigned.
If ESD assesses a delinquency against an employer, and the delinquency or a part of it is due to an intent to knowingly evade the successorship provisions, then for the rate year in which the Commissioner assesses the delinquency and for the following three rate years, the Commissioner must assign to the employer and to any business knowingly promoting the evasion of successorship provisions, a civil penalty assessment rate in addition to the assigned rate that increases the array calculation factor rate for that rate year to the maximum plus 2 percent, which total rate is not limited by any maximum array calculation factor rate.
The employer may also be criminally prosecuted. An employer subject to the civil penalty assessment must also pay the reasonable costs of auditing the employer's books and collecting the penalty.
A person, not an employer, who knowingly evades, knowingly attempts to evade, or knowingly promotes the evasion of the successorship provisions is subject to a civil penalty of $5000 per occurrence. The person must also pay the reasonable costs of auditing the employer's books and collecting the penalty.
Beginning the January 1st after the transfer occurs, the successor's contribution rate for each rate year will be based on an array calculation factor rate that combines the successor's experience with payrolls and benefits and any experience assigned to the predecessor involved in the transfer. If only a portion of the business was transferred, then the experience attributable to the acquired portion is assigned to the successor if the successor is a "qualified employer," by including the transferred experience. If the successor is not a "qualified employer" the contribution rate will equal the sum of rates determined by the Commissioner as well as the transferred experience.
Beginning the January 1st after the transfer occurs, the predecessor's contribution rate or the array calculation factor rate must be based on its experience with payrolls and benefits excluding the experience of the transferred business or portion of the business transferred.
Votes on Final Passage:
Senate 44 0
House 98 0
Effective: January 1, 2006 Click here for additional information.
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Chapter 52, Laws of 2006 (SB 6596) - Revising the dissolution of Washington corporations.
Assets of a corporation transferred to a liquidy trust or other successor are not considered to be distributed for purposes of measuring their legality, until the trust or other successor distributes the assets to the shareholders.
A shareholder is personally liable for distributions he or she received while knowing the distribution, or a portion thereof, was made in violation of the WBCA's provisions for distribution, or made in violation of the corporation's articles of incorporation. The shareholder in violation is entitled to contribution from every other shareholder also in violation. A proceeding against the shareholder for the violation must begin within two years of the effective date of the distribution, or within three years after the date of dissolution of the corporation, whichever is earlier.
The board of directors of a corporation may dedicate the corporation's assets to the repayment of its creditors by way of assignment for the benefit of creditors, or receivership.
A majority of initial directors or incorporators may authorize dissolution of the corporation if shares have not been issued. If not prohibited by the articles of incorporation, a majority of the board of directors may authorize dissolution of the corporation without approval of the shareholders if the corporation is not able to pay its liabilities as they become due, the corporation's assets are less than the sum of its liabilities, and if ten or more days have passed since the board gave notice to all shareholders of its intention to dissolve the corporation.
Within thirty days of a voluntary dissolution, the corporation must publish notice of the dissolution and request that persons with claims present them to the corporation in a format prescribed in the initial published notice. The notice must also state that claims not filed in a timely manner may be barred. The corporation's failure to publish its dissolution does not change the effective date of the dissolution.
The corporation may give written notice of dissolution to the holders for claims known to the corporation, stating a general description of the claims or liabilities and stating that the claim may be barred if the claim holder does not respond, and stating that the claim may be rejected, in which case the claim holder will have a limited period of time in which to commence an action to enforce the claim.
As a dissolved corporation winds up its affairs, it may dispose of properties and apply the proceeds to the payment of liabilities, or dispose of the properties with the applicable liens and security interests attached, and within the applicable contractual restrictions. Once dissolved, the board of directors may determine that the payment of outstanding liabilities is provided for by an insurance policy reasonably calculated to provide for payment of the liabilities. Once that determination is made, the board may consider the liabilities satisfied and may make a subsequent distribution of remaining assets to the shareholders.
If the board of directors turns over control of the dissolved corporation to a court or receiver, the directors are relieved from any further duties of liquidating the corporation's assets and satisfying the liabilities.
Directors or shareholders may make decisions necessary to authorize the activities of dissolution.
A dissolved corporation may apply to a superior court for a determination that its proposed satisfaction of a claim or liability is reasonable. The corporation must give notice to the claim holder of such a proceeding. The superior court's determination of the amount and form of satisfaction of a claim satisfies the corporation's obligation with respect to that particular claim and further claims on the same facts are barred.
The holder of an unpaid claim may begin a proceeding against the corporation to collect on the claim. The proceeding may include a petition to collect assets that have already been distributed
to shareholders, and those shareholders may become parties to the proceeding, but the claim holder may not proceed directly against the directors, officers, or shareholders, except in limited circumstances. Claims that are barred by any of the circumstances in this act cannot be enforced against the corporation.
A dissolved corporation may seek supervision by a superior court over its winding up and liquidation. The action must occur in the county where the corporation's registered office is, or was, located. The shareholders or directors need not be made party to the proceeding unless relief is sought against them.
Survival provisions are clarified to make clear that claims arising after filing for dissolution can be asserted against the corporation, and extending the survival period to three rather than two years.
Technical changes are made to various provisions of the WBCA to comport with the new provisions. Grammatical changes are made to various provisions of the WBCA to clarify the law.
Votes on Final Passage:
Senate 41 0
House 98 0
Effective: June 7, 2006 Click here for additional information.
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Chapter 56, Laws of 2006 (ESSB 6896) - Providing for state funding stabilization.
Revised for 1st Substitute: Providing for state funding stabilization. (REVISED FOR ENGROSSED: Funding state budgetary reserves including an adjustment to the state expenditure limit.)
The Legislature intends to provide for the fiscal stability of the Health Services Account, the Student Achievement Fund, and the state's retirement systems by making appropriations for these purposes.
The Pension Funding Stabilization Account is established for the purpose of making employer contributions to specified state-funded retirement systems, subject to legislative appropriation. Monies in the account will be invested by the State Investment Board, with the investment earnings retained in the account. New supplemental employer contribution rates are established for the purpose of reducing the unfunded actuarial liabilities of plan 1 of the Public Employees' Retirement System and the Teachers' Retirement System. For Fiscal Year 2006, three hundred fifty million dollars is appropriated for this purpose.
For Fiscal Year 2006, two hundred million dollars is appropriated from the state General Fund to the Health Services Account to provide fiscal stability for the account.
For Fiscal Year 2006, two hundred seventy-five million dollars is appropriated from the state General Fund to the Student Achievement Fund to provide fiscal stability for the fund.
The state expenditure limit for Fiscal Year 2006 is declared to be the expenditure limit as adopted at the November 2005 meeting of the Expenditure Limit Committee and adjusted upward to include the appropriations to the Pension Funding Stabilization Account, the Health Services Account, and the Student Achievement Fund. Expenditures from the Pension Funding Stabilization Account are not considered to be a program cost shift under Initiative 601.
The authority of the Legislature to increase state revenues without a two-thirds vote is terminated on June 30, 2006.
Votes on Final Passage:
Senate 25 22
House 51 47
Effective: March 15, 2006
July 1, 2006 (Section 10) Click here for additional information.
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Chapter 59, Laws of 2006 (SSB 6185) - Modifying the family and medical leave act.
Portions of the state Family Leave Law are amended to conform in part to the federal Family and Medical Leave Act.
An employee is entitled to a total of 12 workweeks of leave in a 12 month period for any of the following: the birth of a child; the placement of a child with the employee for adoption or foster care; to care for a family member of the employee, if the family member has a serious health condition; or for a serious health condition that makes the employee unable to perform his or her job duties. The leave entitlement for birth or placement of a child expires at the end of the 12 month period beginning on the date of the birth or placement.
The act applies to all employers in the state, including local governments, which employ 50 or more employees for each working day during each of 20 or more calendar workweeks in the current or preceding calendar year. The provisions of the bill also apply to the state, state institutions and state agencies, regardless of size.
Leave may be taken intermittently or on a reduced leave schedule, with the employer's agreement: for the birth or placement of a child; when medically necessary for the medical treatment of a serious health condition; or to provide care or psychological comfort to an immediate family member with a serious health condition. There is no limit on the size of the increment of intermittent or reduced leave although the employer may limit leave increments to the shortest period of time that the employer's payroll system uses to account for absences or use of leave.
Intermittent or reduced schedule leave cannot result in a reduction of the total amount of leave to which the employee is entitled.
"Serious health condition" is defined in the same manner as in regulations adopted by the federal Secretary of Labor.
If the leave for birth or placement of a child is foreseeable based on the expected birth or placement, the employee must provide the employer with at least 30 days notice before the date leave is to begin. If the birth date or placement makes giving 30 days notice impracticable, then the employee must provide as much notice to the employer as possible.
If leave to care for a family member with a serious health condition or because of the employee's health condition becomes necessary , the employee must make a reasonable effort to schedule the treatment so as to not unduly interrupt the operations of the employer. The employee must also provide the employer notice of leave at least 30 days before leave is to begin, unless impracticable.
An employer may require that a leave request for a family member's serious health condition or the employee's serious health condition be supported by a health care provider's certification. The employee must provide a copy of the certification to the employer in a timely manner. If the employer has reason to doubt the validity of the certification, he or she can request the opinion of a second health care provider.
Any person taking leave under this act is entitled to the following upon return from leave: to be restored to the position he or she held when leave started; or to be restored to an equivalent position with equal benefits, pay and other terms and conditions of employment at a workplace within 20 miles of the employee's workplace when leave commenced. Employees maintain all employment benefits accrued before leave was taken.
During the leave period, if the employee is not eligible to receive employer-paid benefits, the employee may opt to continue the benefits at the employee's expense. The premium paid by the employee cannot exceed 102 percent of the applicable premium for the leave period.
An employer cannot discharge or discriminate against any employee who takes leave under this act.
The director of the Department of Labor and Industries (L&I) is required to investigate any complaint under this act. Any employer found to have violated the act after an investigation is subject to a civil penalty of at least $1000 per violation. These penalties are collected by L&I and deposited into the Family and Medical Leave Enforcement Account, which is created in this act. Employees may also bring suit directly against the employer for violation of this act and could recover damages equal to the amount of wages, benefits, salary or other compensation lost or denied as a result of the violation or any actual monetary losses as a result of the violation up to a sum equal to 12 weeks of the employee's wages or salary.
Employers are required to post notice of the provisions of this act. Willful failure to post this notice could subject an employer to a civil penalty of $100 per violation.
Leave under this act and leave under the federal act are in addition to any sick or temporary disability leave provided because of pregnancy or childbirth. Leave under state law must be taken concurrently with leave under the federal FMLA.
The provision suspending enforcement of the State Family Leave Law is repealed.
Votes on Final Passage:
Senate 37 12
House 54 44
Effective: June 7, 2006 Click here for additional information.
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Chapter 60, Laws of 2006 (ESSB 6189) - Regulating hospitals and ambulatory surgical centers.
Revised for 1st Substitute: Requiring hospitals to provide patients certain billing information.
The Legislature's intent is to encourage hospitals to design the implementation of health information technologies to provide patients with understandable billing information.
Hospitals are required to furnish patients with a list of those professionals that commonly provide care at the hospital and from whom the patient may get a bill, along with appropriate contact information. Hospitals owned or operated by a health maintenance organization are exempt.
Votes on Final Passage:
Senate 42 1
House 96 1
Effective: June 7, 2006 Click here for additional information.
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Chapter 62, Laws of 2006 (SB 6338) - Regarding the property tax exemption for seniors and for persons retired due to disability.
The one-acre limitation on residential property eligible for the senior citizen property tax exemption program is increased to five acres of land if zoning requires this larger parcel size. The bill applies to taxes levied for collection in 2007 and thereafter.
Votes on Final Passage:
Senate 46 0
House 98 0
Effective: June 7, 2006 Click here for additional information.
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Chapter 63, Laws of 2006 (ESSB 6366) - Concerning preparation and response to pandemic influenza.
To the extent state or federal funds are provided for this purpose, by November 1, 2006, each local health jurisdiction in the state must develop a pandemic flu preparedness and response plan consistent with the requirements and performance standards established by the state Department of Health (DOH) and the United States Department of Health and Human Services. Each plan is to be based on an initial assessment by the local health jurisdiction of its existing response capacity, and is to be developed in consultation with appropriate public and private sector partners. At a minimum, a plan must prioritize and address a list of issues enumerated in the bill, including public education, disease surveillance, communications' systems, vaccination protocols, and strategies to maintain health care and other essential community services.
DOH will provide technical assistance and distribute funds, based on a predetermined formula, to support local health jurisdictions in developing their plans. Upon receipt of a plan meeting its established requirements and standards, DOH will provide additional funds and assistance to support implementation of the identified preparedness and response activities. At least biannually, DOH is to assess the compliance of each local jurisdiction with its requirements and standards for pandemic flu preparedness.
Votes on Final Passage:
Senate 47 0
House 98 0 (House amended)
Senate (Senate refused to concur)
House 98 0 (House amended)
Senate 44 0 (Senate concurred)
Effective: June 7, 2006 Click here for additional information.
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Chapter 76, Laws of 2006 (SHB 2715) - Regarding the state interoperability executive committee.
New responsibilities are outlined for the Committee. The Committee is charged with coordinating the purchasing of all state wireless radio communications system equipment to ensure that, at a minimum: (1) any new trunked standard, after the transition from a radio over internet protocol network, is P-25; (2) any new system that requires advanced digital features is P-25; and (3) any new system or equipment purchases are upgradeable to P-25 standards.
Votes on Final Passage:
House 93 2
Senate 42 0
Effective: June 7, 2006 Click here for additional information.
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Chapter 82, Laws of 2006 (SHB 3120) - Concerning notice requirements for tort claims against state and local governments and their officers, employees, or volunteers.
The claim filing statutes that apply to tort claims against the state or local governments are amended to specifically provide that these statutes apply to claims against officers, employees, or volunteers of the state or local government when acting in that capacity.
A local governmental entity that fails to comply with its duty to designate and record an agent to receive claim filings is precluded from raising a defense under the claim filing statute.
Votes on Final Passage:
House 97 0
Senate 46 0
Effective: June 7, 2006 Click here for additional information.
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Chapter 87, Laws of 2006 (SSB 6168) - Regulating business development companies and the participation of financial institutions and nondepository lenders in economic development within the state.
"Business Development Corporations" are established in statute, to promote economic development in Washington State. Minimum requirements for incorporation are set forth, along with specific, expanded corporate powers, and corporate governance standards.
The Department of Financial Institutions (DFI) has broad regulatory oversight and rulemaking authority. DFI performs confidential examinations to ensure safety and soundness, and sets standards for capital, surplus, and investment caps.
Technical details regarding transparency and ratification of insider transactions, treatment of insolvency and liquidation, mergers, and conversion to limited liability corporations are set forth, in an effort to maintain regulatory parity with the treatment of state chartered commercial banks.
Votes on Final Passage:
Senate 47 0
House 97 0
Effective: June 7, 2006 Click here for additional information.
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Chapter 88, Laws of 2006 (EHB 3192) - Authorizing a contract extension for reimbursement by property owners for street, road, and water or sewer projects.
Subject to specified conditions, contracts by cities, towns, or water-sewer districts requiring pro rata reimbursement to a property owner for funding excess infrastructure capacity may be of a duration exceeding 15 years. However, the contract extension may not exceed the duration of pertinent legal constraints restricting applications for new development within the area benefitted by the excess infrastructure capacity.
Votes on Final Passage:
House 98 0
Senate 45 0
Effective: June 7, 2006 Click here for additional information.
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Chapter 91, Laws of 2006 (HB 3156) - Creating a pilot program to assist low-income families.
Asset Building Program
The Department of Community, Trade, and Economic Development (CTED) must offer consulting services to Community Action Agencies who are interested in developing pilot programs to assist low-income families to accumulate assets. The Community Action Agencies are encouraged to facilitate bringing together community partners to determine the asset building programs to initiate within the community.
"Asset" or "asset building" is defined to mean an investment or saving for an investment in a family home, higher education, small business, or other long-term asset that will assist low-income families to attain greater self-sufficiency.
The CTED must select four pilot sites to whom it will offer consulting services, with at least one of the pilot sites located in eastern Washington. The CTED will select the pilot sites through an application process which must begin by July 31, 2006.
A Community Action Agency may submit an application to be selected as a pilot site. The application must include the following: - identification of the local agency that will be the lead agency for the pilot program;
- identification of the community partners with whom the Community Action Agency will be collaborating and a description of how the lead agency will work with community partners to implement the program activities;
- identification of the areas of potential need based upon input from the community partners. Areas of potential need may include financial literacy, assistance with federal income tax preparation and the use of tax credits, the use of individual development accounts, and other asset-building strategies; and
- identification of the resources within the community that might support training for the implementation of the selected best practices chosen to address the needs identified by the community.
The CTED must report to the Legislature by December 1, 2007, on the progress of the implementation of the program including the application process, the status of the program, and any implementation issues that arose while initiating the program.
Earned Income Tax Credit
To the extent funding is appropriated, the CTED must establish a program to create an outreach campaign to increase the number of eligible families who claim the federal Earned Income Tax Credit. The CTED may work collaboratively with other state agencies, private and nonprofit agencies, local communities, and others with expertise that might assist the CTED in implementing the program.
Expiration Date
The asset building and Earned Income Tax Credit programs expire on January 1, 2008.
Votes on Final Passage:
House 93 5
Senate 48 0 (Senate amended)
House 96 1 (House concurred)
Effective: June 7, 2006 Click here for additional information.
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Chapter 100, Laws of 2006 (HB 2972) - Determining community rates for health benefit plans.
Health benefit plans may be offered to individuals who are part of a purchasing pool consisting of 500 people in the same industry. The plans will allow contributions from more than one employer and will have premiums calculated using an adjusted community rating method that spreads financial risk across the entire purchasing pool the individual belongs to. This act will not be implemented until a federal opinion is received by the Insurance Commissioner that the provisions of this act comply with federal law.
Votes on Final Passage:
House 98 0
Senate 44 0 (Senate amended)
House 95 0 (House concurred)
Effective: June 7, 2006 Click here for additional information.
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Chapter 105, Laws of 2006 (2SHB 2498) - Establishing an industry cluster-based approach to economic development.
The Department of Community, Trade and Economic Development (DCTED) must work with industry associations and organizations to identify regional and statewide industry clusters. This includes conducting focus groups, supporting industry cluster associations, and providing methods of economic communication and information among the firms within an industry cluster. The regional and statewide industry clusters may include aerospace, agriculture, food processing, forest products, business services, financial services, health and biomedical, software, digital and interactive media, transportation and distribution, and microelectronics.
In addition to the groups the DCTED works with currently, the DCTED is directed to work with industry and cluster associations as well as federal and state industries in developing industry cluster-based economic development strategies. In developing industry-cluster based strategies, the DCTED must continue to use information gathered in each service delivery region. The DCTED may conduct focus group discussions and studies, support the formation of industry cluster associations, and provide methods for communication among firms within the industry clusters. The DCTED must also work with industry clusters, private organizations, local governments, local economic development organizations, and higher education and training institutions to develop strategies to strengthen Washington's industry clusters. On a continual basis the DCTED must evaluate the potential returns to the state from devoting additional state resources to an industry cluster-based approach to economic development.
A competitive grant program is created to assist communities to develop, in partnerships, regional economic development and industry cluster strategies and to conduct related cluster market strategies. In administering the grant program, the DCTED must work with an industry cluster advisory committee. This advisory committee must have equal representation from the Workforce Training and Education Coordinating Board, the State Board for Community and Technical Colleges, the Employment S | |
