(1) The proceeds from the sale of the bonds authorized in RCW 67.40.030, proceeds of the taxes imposed under RCW 67.40.090 and 67.40.130, and all other moneys received by the state convention and trade center from any public or private source which are intended to fund the acquisition, design, construction, expansion, exterior cleanup and repair of the Eagles building, conversion of various retail and other space to meeting rooms, purchase of the land and building known as the McKay Parcel, development of low-income housing, or renovation of the center, and those expenditures authorized under RCW 67.40.170 shall be deposited in the state convention and trade center account hereby created in the state treasury and in such subaccounts as are deemed appropriate by the directors of the corporation.

     (2) Moneys in the account, including unanticipated revenues under RCW 43.79.270, shall be used exclusively for the following purposes in the following priority:

     (a) For reimbursement of the state general fund under RCW 67.40.060;

     (b) After appropriation by statute:

     (i) For payment of expenses incurred in the issuance and sale of the bonds issued under RCW 67.40.030;

     (ii) For expenditures authorized in RCW 67.40.170;

     (iii) For acquisition, design, and construction of the state convention and trade center;

     (iv) For debt service for the acquisition, design, and construction and retrofit of the museum of history and industry museum property or other future expansions of the convention center as approved by the legislature; and

     (v) For reimbursement of any expenditures from the state general fund in support of the state convention and trade center; and

     (c) For transfer to the state convention and trade center operations account.

     (3) The corporation shall identify with specificity those facilities of the state convention and trade center that are to be financed with proceeds of general obligation bonds, the interest on which is intended to be excluded from gross income for federal income tax purposes. The corporation shall not permit the extent or manner of private business use of those bond-financed facilities to be inconsistent with treatment of such bonds as governmental bonds under applicable provisions of the Internal Revenue Code of 1986, as amended.

     (4) In order to ensure consistent treatment of bonds authorized under RCW 67.40.030 with applicable provisions of the Internal Revenue Code of 1986, as amended, and notwithstanding RCW 43.84.092, investment earnings on bond proceeds deposited in the state convention and trade center account in the state treasury shall be retained in the account, and shall be expended by the corporation for the purposes authorized under chapter 386, Laws of 1995 and in a manner consistent with applicable provisions of the Internal Revenue Code of 1986, as amended.

     (5) Subject to the conditions in subsection (6) of this section, starting in fiscal year 2008, the state treasurer shall transfer:

     (a) The sum of four million dollars, or as much as may be available pursuant to conditions set forth in this section, from the state convention and trade center account to the tourism enterprise account, with the maximum transfer being four million dollars per fiscal year; and

     (b) The sum of five hundred thousand dollars, or as much as may be available pursuant to conditions set forth in this section, from the state convention and trade center account to the tourism development and promotion account, with the maximum transfer being five hundred thousand dollars per fiscal year.

     (6)(a) Funds required for debt service payments and reserves for bonds issued under RCW 67.40.030; for debt service authorized under RCW 67.40.170; and for the issuance and sale of financial instruments associated with the acquisition, design, construction, and retrofit of the museum of history and industry museum property or for other future expansions of the center, as approved by the legislature, shall be maintained within the state convention and trade center account.

     (b) No less than six million one hundred fifty thousand dollars per year shall be retained in the state convention and trade center account for funding capital maintenance as required by the center's long-term capital plan, facility enhancements, unanticipated replacements, and operating reserves for the convention center operation. This amount shall be escalated annually as follows:

     (i) Four percent for annual inflation for capital maintenance, repairs, and replacement;

     (ii) An additional two percent for enhancement to the facility; and

     (iii) An additional three percent for growth in expenditure due to aging of the facility and the need to maintain an operating reserve.

     (c) Sufficient funds shall be reserved within the state convention and trade center account to fund operating appropriations for the annual operation of the convention center.

[2007 c 228 § 106; 2005 c 518 § 936; 2003 1st sp.s. c 25 § 929; 1995 c 386 § 13; 1991 sp.s. c 13 § 11; 1990 c 181 § 2; 1988 ex.s. c 1 § 4; 1987 1st ex.s. c 8 § 4; 1985 c 57 § 66; 1983 2nd ex.s. c 1 § 4; 1982 c 34 § 4.]

NOTES:

     Part headings not law -- 2007 c 228: See RCW 43.336.900.

     Severability -- Effective date -- 2005 c 518: See notes following RCW 28A.500.030.

     Severability -- Effective date -- 2003 1st sp.s. c 25: See notes following RCW 19.28.351.

     Severability -- Effective date -- 1995 c 386: See notes following RCW 67.40.130.

     Effective dates -- Severability -- 1991 sp.s. c 13: See notes following RCW 18.08.240.

     Severability -- 1987 1st ex.s. c 8: See note following RCW 67.40.020.

     Effective date -- 1985 c 57: See note following RCW 18.04.105.