Opinion ID: 1179895
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Heading: const. art. 32 applies only to bonds issued under rcw 39.84

Text: [3] Const. art. 32 was proposed and passed to provide an exception to the lending of credit prohibitions under Const. art. 8. At the time Const. art. 32 and its companion legislation, RCW 39.84, were passed, it was believed that nonrecourse revenue bonds issued to finance industrial development projects would be a constitutionally prohibited lending of credit under Port of Longview v. Taxpayers of Port of Longview, 85 Wn.2d 216, 225, 533 P.2d 128 (1974). See Agreed Statement of Facts, exhibit 1; Official Voters Pamphlet 13 (Nov. 3, 1981) (hereafter Voters Pamphlet). Therefore, Const. art. 32 was proposed and adopted to insure that nonrecourse industrial development bonds issued pursuant to RCW 39.84 would be valid. Its purpose was simple  to permit issuances of nonrecourse bonds that were otherwise thought to be unconstitutional. [2] By its own terms Const. art. 32 was not meant to limit any other types of bonds that could be legally issued. Both the Voters Pamphlet and legislative history support the notion that Const. art. 32 was proposed and adopted so that its companion legislation, RCW 39.84, would not violate lending of credit prohibitions. The Voters Pamphlet includes the text of Laws of 1981, ch. 300, later codified as RCW 39.84. Voters Pamphlet, at 1922. It refers to RCW 39.84 as the implementing statutes for the amendment and states that the text of the law was included to facilitate the voter's understanding of the effect of the adoption of that proposed amendment to the state constitution. Voters Pamphlet, at 19. In essence, Const. art. 32 and its implementing statute were presented to voters as a single package. The Voters Pamphlet also stated that such bonds were currently prohibited under the Washington State Constitution, an oblique reference to the Port of Longview decision. Voters Pamphlet, at 13. In addition, the legislative history of both Substitute House Joint Resolution 7, which became Const. art. 32, and its implementing legislation, RCW 39.84, indicate the close tie between them. House Journal, 47th Legislature (1981), at 812; Senate Journal, 47th Legislature (1981), at 1355. The text of Const. art. 32 demonstrates not only the close tie between it and its implementing legislation, RCW 39.84. It also indicates any limitations were meant to apply only to bonds issued pursuant to RCW 39.84. Const. art. 32, § 1(d) provides that Nonrecourse revenue bonds or other nonrecourse revenue obligations may only be used to finance industrial development projects as defined in legislation. Const. art. 32, § 1(d). That definition is contained, not surprisingly, in RCW 39.84.020(6). In addition, Const. art. 32 requires that the Legislature can only expand that definition if a three-fifths majority approves. This demonstrates Const. art. 32 is closely linked to RCW 39.84. Any analysis of the application of Const. art. 32 should begin by recognizing this relation. [4] More importantly, the limitations contained in Const. art. 32, § 1(a), (b), (c) and (e) all refer to [n]onrecourse revenue bonds ... issued pursuant to this section. (Italics ours.) The phrase bonds ... issued pursuant to this section means bonds issued under the authority of Const. art. 32, i.e., under the implementing statute, RCW 39.84. If the limitations in Const. art. 32 were meant to apply to any nonrecourse bonds issued under any authority, as Treasurer Grimm contends, the phrase issued pursuant to this section would be superfluous. We have, however, consistently stated that statutes or constitutional provisions should be construed so that no clause, sentence or word shall be superfluous, void, or insignificant. Washington Water Power Co. v. Graybar Elec. Co., 112 Wn.2d 847, 859, 774 P.2d 1199, 779 P.2d 697 (1989); Group Health Coop. v. King Cy. Med. Soc'y, 39 Wn.2d 586, 637, 237 P.2d 737 (1951). Treasurer Grimm argues that Const. art. 32 not only provides an exception to the lending of credit prohibition, but also places limits on all industrial nonrecourse revenue bonds. [3] He argues that had the Legislature intended simply to provide an exception to the lending of credit prohibition, it could have proposed a brief amendment. For example, Const. art. 8, § 8, which briefly provides that promotional port expenditures are not a lending of credit, was proposed and adopted in response to our holding in State ex rel. O'Connell v. Port of Seattle, 65 Wn.2d 801, 399 P.2d 623 (1965). Treasurer Grimm's argument is unpersuasive for several reasons. First, it ignores the fact that Const. art. 32 was passed specifically so the legislative program contained in RCW 39.84 would not violate the prohibition against lending of credit. Given that fact, it is not surprising that elements of the statutory framework were adopted as part of the text of the constitutional amendment. More importantly, unless we view Const. art. 32 as having the very limited function of allowing bonds to be legally issued under RCW 39.84, we would jeopardize existing bonds we have already approved. The text of Const. art. 32 places several limits on nonrecourse bonds, including that they be for industrial development and be tax exempt. Const. art. 32, § 1(c), (d). Treasurer Grimm and the dissent would have us read Const. art. 32 as requiring that all nonrecourse industrial development bonds be tax exempt. If we adopted such an approach, the converse should also be true: Const. art. 32 should require that all nonrecourse tax exempt bonds be industrial development bonds. We have, however, approved the issuance of nonrecourse tax exempt bonds which were not for industrial development. Higher Educ. Facilities Auth. v. Gardner, 103 Wn.2d 838, 699 P.2d 1240 (1985) (holding that tax exempt nonrecourse bonds to enable higher educational institutions to build and improve facilities did not violate lending of credit prohibitions). Thus, Treasurer Grimm and the dissent urge us to adopt a position that would either draw into question the constitutional validity of existing bonds, or create a logical inconsistency we are not prepared to accept. Therefore, Const. art. 32 and RCW 39.84 must be viewed as a single package approved by the voters. The limitations contained in Const. art. 32 only apply to nonrecourse industrial development bonds issued pursuant to RCW 39.84. In addition, the final clause of Const. art. 32, which expressly disavows any intent to repeal or limit any other authority, demonstrates the limitations of Const. art. 32 were meant to apply only to bonds issued under RCW 39.84.