The legislature hereby recognizes the necessity of developing a uniform and coordinated procedure for determining the expected fiscal impact of bills and resolutions on state government. The legislature also recognizes that developing these statements of fiscal impact requires the designation of a state agency to be principally responsible for the statements. The statements are to be generally known as fiscal notes and dynamic fiscal impact statements. Dynamic fiscal impact statements may be included in certain fiscal notes in accordance with section 2 of this act.
The office of financial management shall, in cooperation with appropriate legislative committees and legislative staff, establish a procedure for the provision of fiscal notes on the expected impact of bills and resolutions which increase or decrease or tend to increase or decrease state government revenues or expenditures. Such fiscal notes shall indicate by fiscal year the impact for the remainder of the biennium in which the bill or resolution will first take effect as well as a cumulative forecast of the fiscal impact for the succeeding four fiscal years. Fiscal notes shall separately identify the fiscal impacts on the operating and capital budgets. Estimates of fiscal impacts shall be calculated using the procedures contained in the fiscal note instructions issued by the office of financial management.
In establishing the fiscal impact called for pursuant to this chapter, the office of financial management shall coordinate the development of fiscal notes with all state agencies affected.
The preparation and dissemination of the ongoing cost projections and other requirements of RCW 43.135.031 for bills increasing taxes or fees shall take precedence over fiscal notes.
For proposed legislation that uniquely affects school districts, in addition to any fiscal note prepared under this chapter, a school district fiscal note must be prepared under the process established in RCW 28A.300.0401.
[ 2011 c 140 § 1; 2008 c 1 § 3 (Initiative Measure No. 960, approved November 6, 2007); 1994 c 219 § 3; 1979 c 151 § 146; 1977 ex.s. c 25 § 2; ]
When a fiscal note is prepared and approved as to form, accuracy, and completeness by the office of financial management, which depicts the expected fiscal impact of a bill or resolution, copies shall be filed immediately with:
The chairperson of the committee to which the bill or resolution was referred upon introduction in the house of origin;
The senate committee on ways and means, or its successor; and
The house committees on revenue and appropriations, or their successors.
Whenever possible, such fiscal note and, in the case of a bill increasing taxes or fees, the cost projection and other information required under RCW 43.135.031 shall be provided prior to or at the time the bill or resolution is first heard by the committee of reference in the house of origin.
When a fiscal note has been prepared for a bill or resolution, a copy of the fiscal note shall be placed in the bill books or otherwise attached to the bill or resolution and shall remain with the bill or resolution throughout the legislative process insofar as possible. For bills increasing taxes or fees, the cost projection and other information required by RCW 43.135.031 shall be placed in the bill books or otherwise attached to the bill or resolution and shall remain with the bill or resolution throughout the legislative process insofar as possible.
[ 2008 c 1 § 4 (Initiative Measure No. 960, approved November 6, 2007); 1986 c 158 § 16; 1979 ex.s. c 112 § 1; 1979 c 151 § 147; 1977 ex.s. c 25 § 3; ]
The office of financial management shall also provide a fiscal note on any legislative proposal at the request of any legislator. Such fiscal note shall be returned to the requesting legislator, and copies shall be filed with the appropriate legislative committees pursuant to RCW 43.88A.030 at the time such proposed legislation is introduced in either house.
[ 1979 c 151 § 148; 1977 ex.s. c 25 § 4; ]
Nothing in this chapter shall prevent either house of the legislature from acting on any bill or resolution before it as otherwise provided by the state Constitution, by law, and by the rules and joint rules of the senate and house of representatives, nor shall the lack of any fiscal note as provided in this chapter or any error in the accuracy thereof affect the validity of any measure otherwise duly passed by the legislature.
[ 1977 ex.s. c 25 § 5; ]
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For purposes of this chapter, a dynamic fiscal impact statement is: (i) A written statement that includes a dynamic impact estimate of the legislation or proposed legislation; and (ii) contained only in the narrative explanation of the fiscal note and not reflected in the fiscal impact calculation required by RCW 43.88A.020.
A dynamic fiscal impact statement must include information on the assumptions that were used in computing the dynamic impact estimate. The dynamic impact estimate should, at a minimum, be based on assumptions of the probable behavioral response of persons directly impacted by the legislation or proposed legislation.
By July 1, 2022, the office of financial management must, in consultation with the economic and revenue forecast council, establish the process and methodology for dynamic fiscal impact statements and dynamic impact estimates.
Dynamic fiscal impact statements may be produced only on request from a member of the senate ways and means committee, house of representatives appropriations committee, house of representatives finance committee, or any successor committee to these committees.
Dynamic fiscal impact statements may not be made unless: (a) The fiscal note in which it would be contained reflects a positive or negative revenue impact of more than ten million dollars per fiscal year; or (b) the proposed or draft legislation is a broad-based business or labor regulation reasonably likely to exceed ten million dollars per year in impact on business.
Requests for dynamic fiscal impact statements on existing or draft legislation must be submitted to the office of financial management at least sixty days before the beginning of a regular legislative session.
Dynamic fiscal impact statements may not be updated when a bill or resolution is substantively amended during a legislative session. If the office of financial management determines that a substantive amendment to a bill or resolution would likely affect the dynamic impact estimate for that bill or resolution, the dynamic fiscal impact statement must be removed from any fiscal note that reflects the amendment.
This section does not limit the provisions of chapter 43.132 RCW.
For purposes of this chapter, "dynamic impact estimate" means an estimate of the net fiscal impact of a bill, resolution, or proposed legislation that takes into account behavioral changes of persons directly impacted by the legislation or proposed legislation and the effect that those behavioral changes may have on the economy as a whole. Dynamic impact estimates may take into consideration factors such as the effects of the legislation or proposed legislation on persons to save, spend, invest, and expand or reduce their business activities in this state.
This section expires June 30, 2027.
[ 2021 c XXX § 2; ]**