H-3411.2
SUBSTITUTE HOUSE BILL 2089
State of Washington 68th Legislature 2024 Regular Session
By House Capital Budget (originally sponsored by Representatives
Tharinger, Leavitt, Callan, Reeves, and Hackney; by request of Office
of Financial Management)
READ FIRST TIME 02/26/24.
1 AN ACT Relating to the capital budget; amending RCW 70A.65.305,
2 79.64.020, and 79A.25.210; amending 2023 c 474 ss 1013, 1016, 1017,
3 1032, 1011, 1020, 1022, 1023, 6049, 1024, 1025, 6076, 1038, 1026,
4 1019, 1035, 1045, 1047, 1054, 1055, 1061, 1065, 1070, 2026, 6148,
5 2031, 2035, 2044, 2046, 2049, 3032, 3046, 6352, 3051, 3050, 3056,
6 3062, 3065, 3066, 3064, 3060, 3080, 3115, 3120, 3122, 5001, 5002,
7 5003, 5005, 5006, 5008, 5013, 5015, 5031, 5032, 5033, 5056, 5072,
8 6236, 5082, 5085, 5086, 5087, 5089, 6002, 6029, 6043, 6047, 6053,
9 6066, 6055, 6052, 6028, 6031, 6061, 6068, 6084, 6073, 6097, 6104,
10 6105, 6135, 6164, 6165, 6179, 6228, 6328, 6336, 6337, 6366, 6376,
11 6392, 6460, 6528, 6496, 7052, 8001, and 8002 (uncodified); amending
12 2022 c 296 s 5009 (uncodified); reenacting and amending RCW
13 43.155.050; adding new sections to 2023 c 474 (uncodified); creating
14 new sections; repealing 2023 c 474 ss 6083, 6343, 6489, and 6490
15 (uncodified); providing effective dates; providing a contingent
16 effective date; and declaring an emergency.
17 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
18 NEW SECTION. Sec. 1. A supplemental capital budget is hereby
19 adopted and, subject to the provisions set forth in this act, the
20 several dollar amounts hereinafter specified, or so much thereof as
21 shall be sufficient to accomplish the purposes designated, are hereby
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1 appropriated and authorized to be incurred for capital projects
2 during the period beginning with the effective date of this act and
3 ending June 30, 2025, out of the several funds specified in this act.
4 PART 1
5 GENERAL GOVERNMENT
6 NEW SECTION. Sec. 1001. A new section is added to 2023 c 474
7 (uncodified) to read as follows:
8 FOR THE OFFICE OF THE GOVERNOR
9 OCO Tenant Improvements (30000001)
10 Appropriation:
11 State Building Construction Account—State. . . . . . . . $350,000
12 Prior Biennia (Expenditures). . . . . . . . . . . . . . . . . $0
13 Future Biennia (Projected Costs). . . . . . . . . . . . . . . $0
14 TOTAL. . . . . . . . . . . . . . . . . . . . . . . . $350,000
15 Sec. 1002. 2023 c 474 s 1013 (uncodified) is amended to read as
16 follows:
17 FOR THE DEPARTMENT OF COMMERCE
18 2023-25 Broadband Infrastructure Federal Match Projects
19 (40000290)
20 The appropriations in this section are subject to the following
21 conditions and limitations:
22 (1)(a) (($50,000,000)) $61,390,000 of the state building
23 construction account—state appropriation in this section is provided
24 solely as match for federal authority allocated under this section
25 and section 7017 of this act for the statewide broadband office to
26 administer the broadband equity, access, and deployment state grants
27 program in section 60102 of P.L. 117-58 (infrastructure investment
28 and jobs act). Expenditure of the amount in this subsection is
29 contingent on the receipt of this grant funding.
30 (b) To the extent permitted by federal law, the office shall
31 provide state match only for projects where the lead applicant is a
32 public or tribal government entity. The office must allocate state
33 match funds in a manner that prioritizes projects based on
34 affordability, fair labor practices, speed to deployment, open
35 access, local and tribal coordination, and the provision of digital
36 navigation services, as outlined in the scoring criteria contained in
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 1 the plan submitted by the office to the national telecommunications
2 and information administration.
3 (c) The legislature intends to provide sufficient funds to match
4 federal funds available during the 2025-2027 fiscal biennium.
5 (2) In addition to scoring and weighting criteria established
6 pursuant to the federal broadband equity, access, and deployment
7 program, the state broadband office must establish additional
8 secondary selection criteria, including, but not limited to, criteria
9 that give weight to projects that:
10 (a) Provide open-access wholesale last-mile broadband service for
11 the useful life of the subsidized networks on fair, equal, and
12 neutral terms to all potential retail providers; and
13 (b) Demonstrate support from the local government or any tribal
14 government with oversight over the location or locations to be
15 served.
16 (3) The statewide broadband office must include, in the five-year
17 action plan developed using initial planning funds from the broadband
18 equity, access, and deployment program funded under P.L. 117-58
19 (infrastructure investment and jobs act):
20 (a) Consideration of broadband infrastructure projects that use
21 wireless technology in order to expand access at the lowest cost to
22 the most unserved or underserved residents; and
23 (b) Steps the office will take to promote: The use of existing
24 infrastructure; dig-once policies; streamlined permitting processes;
25 and cost-effective access to poles, conduits, easements, and rights-
26 of-way. To the extent permitted under federal law, the office must
27 consider creating a pool of grant funds dedicated to pole costs.
28 (4) $300,000 of the general fund—federal appropriation provided
29 in this section is for a staff position dedicated to advising the
30 statewide broadband office on the availability and feasibility of
31 deploying new and emerging technologies in broadband internet
32 service.
33 Appropriation:
34 General Fund—Federal. . . . . . . . . . . . . . (($150,000,000))
35 $245,560,000
36 State Building Construction Account—State. . . . (($50,000,000))
37 $61,390,000
38 Subtotal Appropriation. . . . . . . . . . . (($200,000,000))
39 $306,950,000
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1 Prior Biennia (Expenditures). . . . . . . . . . . . . . . . . $0
2 Future Biennia (Projected Costs). . . . . . . . (($150,000,000))
3 $1,227,742,000
4 TOTAL. . . . . . . . . . . . . . . . . . . . (($350,000,000))
5 $1,534,692,000
6 Sec. 1003. 2023 c 474 s 1016 (uncodified) is amended to read as
7 follows:
8 FOR THE DEPARTMENT OF COMMERCE
9 Capital Pre-Development Funding (40000293)
10 The appropriation in this section is subject to the following
11 conditions and limitations: Of the amounts provided in this section,
12 $2,800,000 is provided solely for the LETI Incubator for Family
13 Success project in Everett.
14 Appropriation:
15 State Taxable Building Construction Account—
16 State. . . . . . . . . . . . . . . . . . . . . . . $5,000,000
17 Prior Biennia (Expenditures). . . . . . . . . . . . . . . . . $0
18 Future Biennia (Projected Costs). . . . . . . . . . . $20,000,000
19 TOTAL. . . . . . . . . . . . . . . . . . . . . . $25,000,000
20 Sec. 1004. 2023 c 474 s 1017 (uncodified) is amended to read as
21 follows:
22 FOR THE DEPARTMENT OF COMMERCE
23 2023-25 Clean Energy Fund Program (40000294)
24 The appropriation in this section is subject to the following
25 conditions and limitations:
26 (1)(a) $500,000 of the appropriation in this section is provided
27 solely for the department to convene a work group to:
28 (i) Analyze the financial investments required for owners of tier
29 1 covered buildings to comply with the state energy performance
30 standard under RCW 19.27A.210; and
31 (ii) Make recommendations to the legislature to assist building
32 owners in attaining compliance, which must include, but are not
33 limited to:
34 (A) Identifying energy efficiency investments or other strategies
35 and related timelines for increasing energy efficiency in the
36 buildings sector;
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 1 (B) Providing a cost-benefit analysis of options, including
2 energy efficiency, to meet the goal of reducing greenhouse gas
3 emissions from the buildings sector; and
4 (C) Recommendations to balance financial investments while
5 maximizing clean energy benefits for the state, including statutory
6 changes that may be necessary for this purpose.
7 (b) The work group membership convened under this section must
8 include, but is not limited to: One representative of the office of
9 the superintendent of public instruction; one representative of a
10 K-12 maintenance and operation administrators association; one
11 representative of each of the state's public four-year institutions
12 of higher education; one representative of the state board for
13 community and technical colleges; one representative of the
14 department of social and health services; one representative of the
15 department of corrections; one representative of the department of
16 enterprise services; one representative of a health care
17 organization; one representative from a local government; one
18 representative from an organization representing privately owned tier
19 1 covered buildings; one representative from a business specializing
20 in performance contracting for energy services; one representative
21 from a nonprofit specializing in clean energy; and two
22 representatives of a national association for industrial and office
23 parks.
24 (c) The department must submit to the appropriate committees of
25 the legislature:
26 (i) Analysis of financial investments as required by this section
27 by December 15, 2023; and
28 (ii) A final report with recommendations as required by this
29 section by September 1, 2024.
30 (2) Except as provided in subsections (1) ((and)), (13), and (14)
31 of this section, the appropriation in this section is provided solely
32 for competitive grants to eligible entities for predevelopment,
33 design, and construction of projects that provide a public benefit
34 through research, development, demonstration, or deployment of clean
35 energy technologies that save energy and reduce energy costs, reduce
36 harmful air emissions, or increase energy independence for the state.
37 Priority must be given to projects that benefit vulnerable
38 populations and overburdened communities, including tribes.
39 (3) Entities eligible for grant funding under this section
40 include local governments, federally recognized tribal governments
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 1 and tribes' contracted service providers, public and private
2 utilities that serve retail customers in the state, for-profit
3 entities, research institutions, nonprofit organizations, and state
4 agencies.
5 (4) To be eligible, a project must be consistent with the state
6 energy strategy adopted under chapter 43.21F RCW and policies under
7 chapter 19.405 RCW. To the extent practicable, the department must
8 prioritize projects that build upon Washington's strengths in
9 aerospace, maritime, information and communications technology, grid
10 modernization, advanced materials, and decarbonizing the built
11 environment.
12 (5) The department must invite stakeholders to participate in the
13 design and implementation of grant programs funded under this
14 section. The department must consider equity and environmental
15 justice when developing the program structure and opportunities for
16 applicant participation.
17 (6) When soliciting and evaluating proposals, awarding contracts,
18 and monitoring projects under this section, the department must:
19 (a) Ensure that competitive processes, rather than sole source
20 contracting processes, are used to select all projects, except as
21 otherwise noted in this section;
22 (b) Ensure that a public benefit results from the use of public
23 funds through due diligence and monitoring of contracted projects,
24 including ensuring compliance with all applicable laws related to the
25 project selection process, project monitoring, and contracting; and
26 (c) Prioritize projects for funding that leverage the greatest
27 amount of matching funds, such as local levy funding.
28 (7)(a) The department must require project applicants to:
29 (i) Disclose all sources of public funding invested in a project;
30 and
31 (ii) Identify by name any former or current state of Washington
32 employees employed by the applicant or its governing body in the 24
33 months preceding the application submittal. The identification must
34 include the person's separation date and job title or position held.
35 If the department determines that a conflict of interest or other
36 violation of chapter 42.52 RCW exists, the application must be
37 disqualified from further consideration.
38 (b) If, after a grant has been awarded, the department finds that
39 a grantee has violated chapter 42.52 RCW, either in procuring or
40 performing under the grant, the department in its sole discretion may
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 1 terminate the grant funding by written notice. If the grant is
2 terminated, the department must reserve its right to pursue all
3 available remedies under law to address the violation.
4 (8) The department must specify the requirements in subsections
5 (6) and (7) of this section in funding contracts entered into by the
6 department under this section.
7 (9) $10,000,000 of the appropriation in this section is provided
8 solely for grants to tribes for clean energy development projects.
9 Eligible uses of grant funding include planning, predesign, design,
10 construction, project predevelopment, and deployment of clean energy
11 projects that contribute to achieving the state's greenhouse gas
12 emissions reduction goals and related policies. The department must
13 collaborate with tribes in the design and development of this grant
14 program.
15 (10) $10,000,000 of the appropriation in this section is provided
16 solely for state match for federal funding that aligns with
17 subsection (2) of this section and accelerates meeting state clean
18 energy and climate goals. Funding may be used to match federal grants
19 to the state or nonstate entities for clean energy research,
20 development, and demonstration projects.
21 (11) $12,000,000 of the appropriation in the section is provided
22 solely for grants for strategic research, development, and
23 demonstration of new and emerging clean energy generation and storage
24 technologies and climate change mitigation technologies, including
25 greenhouse gas removal. Grants awarded under this subsection must
26 reduce reliance on fossil fuels, reduce risk of irregularities in
27 power supply, offer opportunities for economic and job growth, and
28 strengthen technology supply chains. Grant funds are intended to
29 catalyze diverse new technologies that change production, use,
30 storage, and transportation of energy. The department may provide
31 funding to projects at various stages of readiness, including early-
32 stage research, pilot and demonstration projects, and dual use
33 projects that produce clean energy and additional benefits.
34 (12) $20,000,000 of the appropriation in this section is provided
35 solely for grants for electrical grid integration and innovation
36 projects. To be eligible, a project must develop and demonstrate
37 distributed energy resources, as defined in RCW 19.405.020, and
38 nonwire alternatives that advance community resilience, support
39 implementation of demand response and sustainable microgrids, improve
40 integration of renewable energy and energy storage, and accelerate
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 1 beneficial load integration and demand management for building
2 electrification, equipment electrification, and electric vehicle
3 charging.
4 (13) $7,500,000 of the appropriation in this section is provided
5 solely to support regional energy analytics capability at Pacific
6 Northwest national laboratory.
7 (14) $500,000 of the appropriation in this section is provided
8 solely for the Nooksack Indian tribe to enter into an agreement with
9 a third-party contractor to complete a prefeasibility study of
10 geothermal power generation options in Whatcom county. Power
11 generation options considered must include, at a minimum: Hydro-
12 thermal, enhanced geothermal, and high enthalpy enhanced geothermal.
13 The tribe must select the contractor in consultation with the public
14 utility district No. 1. of Whatcom county. The tribe must submit the
15 completed study to the department by June 15, 2025.
16 (15) The department must strive to allocate all of the amounts
17 appropriated in this section within the 2023-2025 fiscal biennium in
18 the manner prescribed in each subsection. Howev