Special purpose quasi-municipal corporations known as "PDAs" are authorized under RCW 35.21.730, et seq., which allows cities, towns, and counties to establish "public corporations, commissions, or authorities." The purpose for the creation of a public corporation under these statutes is to improve the administration of authorized federal grants or programs, to improve governmental efficiency and services, or to improve the general living conditions in the urban areas of the state. The provision was initially enacted to authorize cities, towns, and counties to participate in and implement federally assisted programs, including revenue sharing.
Many communities have established public corporations for a variety of public purposes. In the opinion of many municipal attorneys, a public corporation created under RCW 35.21.730, et seq. is best used for unusual endeavors, which for a variety of reasons, the parent municipality would not want to undertake itself. This page provides a few examples of PDAs that have been formed including documents, and descriptions of the authorities from the Washington State Auditor's Office reports.
Discussion of PDAs
The following are several articles that address the powers and limitations of public development authorities.
- Fifty Years of 63-20 Financing: Revisiting an Alternative Development Tool for Washington State Agencies and Municipalities, Pacifica Law Group, 09/2012 - Tax-exempt bonds (63-20 bonds) may be issued by nonprofit corporations "on behalf of" state and municipal entities
- Public Development Authorities, by Jay Reich, Stacey Crawshaw Lewis, and Deanna Gregory, Preston Gates and Ellis LLP, from MRSC Budget Suggestions, Information Bulletin No. 416, 08/2003 - Addresses frequently asked questions about PDAs.
- City and County Options for Creative Financing: PFDs, PDAs and 501(c)(3)s: Alternative Financing Mechanisms, by Jay Reich and Stacey Crenshaw-Lewis, Attorneys, Preston Gates & Ellis, Washington Economic Development Association's Spring Conference in Pasco on April 15-16, 2003 - Identifies and compares the advantages and disadvantages of these alternative financing approaches to assist local government decision makers in weighing their options
Ordinance Provisions, Charters, Bylaws
The documents listed below are examples of documents used to form of public corporations. For the most part, descriptions of the PDAs have come from the State Auditor's Reports.
Bellevue Public Development Authority - Meydenbauer Center
The city of Bellevue established the authority in 1989 to construct and operate a convention center and theatre with the purpose of providing economic stimulation to the community. The authority is governed by a board of directors appointed by the city manager with the concurrence of the city council. Although the authority is legally separate from the city, the city reports the authority as a discrete component unit in their Comprehensive Annual Financial Report. The authority derives its revenue from the city’s lease and operation payments and from user fees paid by customers. The city’s monthly lease and operation payments equal the transient occupancy tax (TOT) receipts collected by the city. The major expense categories for the authority include debt service, operations, and capital. The authority also maintains a series of reserves to protect against fluctuations in the revenue streams. (Washington State Auditor’s Office Accountability Audit Report, Issued August 5, 2013)
Bellingham Public Development Authority
The Bellingham Public Development Authority was created May 8, 2008, by the city of Bellingham for the purpose of developing properties together with private property owners and investors, focusing operations on Bellingham’s Waterfront, Old Town and downtown districts. The initial, vacant or under-utilized properties placed under the purview of the authority are either city-owned and managed by the authority or were city-owned and conveyed to the authority for redevelopment. The authority is governed by a seven-member board of directors, appointed by the mayor and confirmed by city council. The authority’s staff consists of an executive director and a part-time administrative assistant. The city council approves the authority’s budget on an annual basis.(2008-2011 Washington State Auditor's Office Accountability Report, Issued December 10, 2012
- Bellingham Municipal Code Ch. 6.64 - Public Authorities
- Ordinance No. 2008-05-247 - Creates the Bellingham Public Development Authority to assist with development of downtown, Old Town and the waterfront, passed 05/2008 - Includes bylaws
- First Operating Agreement between Bellingham and the Bellingham Public Development Authority, 11/20/2008, terminates 2038
Cultural Development Authority of King County (4Culture)
This PDA was organized as a quasi-autonomous public development authority in January 2003 governed by a 15-member citizen board who are nominated by the King County Executive and confirmed by the King County Council. 4Culture
serves as the cultural services agency for King County and is committed to making our region stronger by supporting citizens and groups who preserve our shared heritage, and create arts and cultural opportunities for residents and visitors. 4Culture offers grants and operating programs related to arts funding, public art, and heritage programs.
Grays Harbor Public Development Authority - Satsop Development Park
In 1998 the Grays Harbor County Commissioners passed a resolution, charter and bylaws, which created the Grays Harbor Public Development Authority. The authority was organized to facilitate the redevelopment of the Washington Public Power Supply System (WPPSS) site. It began operations in July 1999. It is the successor organization to the Satsop Redevelopment Project (SRP), which was created by an inter-local agreement between the elected commissioners of Grays Harbor County, the Port of Grays Harbor and the Grays Harbor Public Utility District (PUD). The SRP was organized to examine the economic potential of the site of the never completed WPPSS Satsop nuclear plant. A seven-member board of directors governs the authority. The Grays Harbor County Commission, the Grays Harbor PUD and the Port of Grays Harbor each appoint one of their current commissioners. Those three commissioners select the remaining four members who are to be civic or business leaders with expertise in finance, real estate development and law or construction projects and must also reside in Grays Harbor County. The Grays Harbor County commissioners have final approval over all appointments made to the authority’s board. The authority’s employees operate on an average $2.8 million annual budget that focuses on developing the site into a business park. (Washington State Auditor’s Office Accountability Audit Report, issued June 10, 2013
Grays Harbor (Satsop Business Park), Port of Grays Harbor
- Washington State Auditor’s Office Accountability Audit Report , Audit Period January 1, 1999 through December 31, 2000, Report No. 63315, issued May 14, 2002 - During first audit of the authority, the auditors found that the authority did not comply laws regarding the conduct of business by local governments in several areas including: state bid laws, loaning of the authority's credit, expenditures, investments, compensation to employees.
Odessa Public Development Authority
Odessa Public Development Authority was formed in 2000 by the town of Odessa to assist Lincoln County communities through the creation of jobs. A seven-member board of directors governs the authority. Directors are proposed by the town mayor and approved by the town council. The authority has two part-time employees. The authority’s primary source of revenue comes from industrial tenant rent. (Washington State Auditor’s Office Accountability Audit Report, issued February 13, 2012)
Republic Public Development Authority
The Republic Public Development Authority was created in 2003 by the city of Republic. For the purpose of attracting businesses to the Republic area, the authority’s primary task since its inception has been the acquisition of land and building an industrial park. An appointed, seven-member board of directors governs the authority. The authority has no employees as the board members perform all business functions. The authority is funded primarily through grants and donations. The audit of 2010 found that the authority did not consistently document compliance with laws relating to the board’s open public meetings. (Washington State Auditor’s Office Accountability Audit Report, Report Issued October 11, 2010)
South Correctional Entity Facility Public Development Authority (SCORE)
The South Correctional Entity Facility Public Development Authority, doing business as SCORE Facility PDA, was formed by the city of Renton to finance a portion of the costs of acquiring, constructing, improving and equipping the South Correctional Entity facility. The authority issued $86,235,000 in bonds to finance this facility. The authority is governed by the administrative board of the South Correctional Entity. Member cities include Auburn, Burien, Des Moines, Federal Way, Renton, SeaTac, and Tukwila. Member cities are obligated to contribute to pay debt service and administrative expenses on the bonds (Washington State Auditor’s Office Accountability Audit Report, 12/12/2011.
This entity was formed by interlocal contract to provide sufficient capacity to replace the jail space being lost when existing contracts were terminated; to allow all inmates to be housed within King County; and to provide for long-range capacity needs of the owner cities for the next 20 years. Other reasons for its formation include to allow for programming space for education, community transition, and job training; to provide jail services at a cost-effective rate and operational control for the owner cities; provide jail services that are conveniently located; and to provide efficiencies for the criminal justice partners.
Valley Communications Center Development Authority (Federal Way, Kent, Renton, Tukwila)
The Valley Communications Center Development Authority was formed by the City of Kent, pursuant to RCW 35.21.730 through 35.21.757, Resolution No. 1564 and Ordinance No. 3510 of the City of Kent.
The Authority was formed to provide an independent legal entity to finance the acquisition, construction, and equipping of a new dispatch facility for the operations of the Valley Communications Center through the issuance and servicing of up to $12,758,000 of bonds, and to perform other functions specified in its charter. The member cities are each obligated to contribute in equal shares to pay debt service on the bonds and to pay administrative expenses with respect to the bonds. Each member city is obligated to pay one-fifth of the debt service on the bonds, and its obligation is limited to its equal allocable share, without regard to the payment or lack thereof by any other jurisdiction. All payments with respect to the bonds will be made to Valley Communications Center in its capacity as administrator and servicer of the bonds issued by the authority. (Washington State Auditor’s Office Financial Statements Audit Report, 01/17/2012)
General Code Provisions for PDAs
- Carnation Municipal Code Ch. 19.04 - Public Corporations
- Tacoma Municipal Code Ch. 1.60 - Public Development Corporations
- Spokane Municipal Code Ch. 4.25 - Public Development Authority
- Union Gap Municipal Code Ch. 2.110 - Public Corporations