Ecosystem services

AN ACT Relating to expanding revenue generation and economic 1
opportunities from natural climate solutions and ecosystem services; 2
amending RCW 79.02.010, 79.105.150, and 79.15.010; reenacting and 3
amending RCW 79.64.110 and 79.22.050; adding a new chapter to Title 4
79 RCW; and providing an expiration date. 5
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:6
NEW SECTION. Sec. 1. The definitions in this section apply 7
throughout this chapter unless the context clearly requires 8
otherwise.9
(1) "Ecosystem service credit" means a predetermined and 10
standardized unit that represents a measurable ecosystem service 11
provided in the context of a payment for an ecosystem service 12
project. 13
(2) "Ecosystem service marketplace" has the same meaning as 14
"ecosystem services market" as defined in RCW 76.09.020.15
(3) "Ecosystem service project broker" means an entity that 16
facilitates the process of matching ecosystem service providers and 17
purchasers of ecosystem service project credits. An ecosystem service 18
project broker may sell or procure credits on their clients' behalf 19
and provide financing and marketing expertise. Ecosystem service 20
project brokers may also act as ecosystem service project developers.21
H-0599.1
HOUSE BILL 1508
State of Washington 69th Legislature 2025 Regular Session
By Representatives Reeves, Parshley, and Springer
Read first time 01/22/25. Referred to Committee on Agriculture &
Natural Resources.
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(4) "Ecosystem service project developer" means an entity that 1
sources and initiates ecosystem service projects on behalf of the 2
ecosystem service provider including, but not limited to, by working 3
with ecosystem service project standards and verification bodies, 4
bearing financial risks of projects, and working with a network of 5
distributors and retailers to deliver auditable ecosystem service 6
project credits to a marketplace. An ecosystem service project 7
developer may also act as an ecosystem service project broker.8
(5)(a) "Ecosystem services" has the same meaning as defined in 9
RCW 76.09.020. 10
(b) Examples of ecosystem services include, but are not limited 11
to, carbon sequestration and storage projects that are consistent 12
with the policies outlined in RCW 70A.45.090, air and water 13
filtration, climate stabilization, and disturbance mitigation.14
(6) "Payment for ecosystem service project" means a transaction 15
within an ecosystem service marketplace that transfers financial 16
incentives to ecosystem service providers that are conditional on the 17
provision of the service. Project types include, but are not limited 18
to, carbon offset projects. 19
NEW SECTION. Sec. 2. (1) The department is authorized to enter 20
into contracts for payment for ecosystem service projects on public 21
lands, consistent with this chapter and other relevant laws, on terms 22
and conditions acceptable to the department, after approval by the 23
board of natural resources, only for the purpose of generating 24
additional revenue by providing ecosystem services. Any ecosystem 25
service project on public lands:26
(a) Must be limited to afforestation, reforestation, and aquatic 27
projects; 28
(b) Must be consistent with the policies outlined in RCW 29
70A.45.090; 30
(c) Must support the workforce development goals and investments 31
made under RCW 76.04.521; 32
(d) May not be inconsistent with ongoing forest health planning 33
efforts and investments such as expenditures from the wildfire 34
response, forest restoration, and community resilience account 35
created in RCW 76.04.511; 36
(e) Must result in an increase in revenue to beneficiaries as 37
compared to expected revenue that may exist in absence of the 38
underlying ecosystem service project; and 39
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(f) May not limit or impair the exercise of tribal treaty and 1
reserved rights, existing tribal access to lands managed by the 2
department, or preexisting agreements between tribes and the 3
department. 4
(2) The contract term under this section may represent the sale 5
or lease of ecosystem service credits and may not last for a period 6
of longer than 125 years. Proceeds from contracts for ecosystem 7
services must be deposited into the appropriate account in the state 8
treasury. 9
(3) The authority of the department to enter into a contract that 10
results in payments for ecosystem service projects under subsection 11
(1) of this section is conditional on any specific project being 12
consistent with the department's management of the underlying public 13
land for agriculture or commercial timber harvest and ensure the 14
department meets its fiduciary responsibility to the state's trust 15
beneficiaries. Any ecosystem service project, or the sum of all 16
ecosystem service projects, may not prevent the department from 17
managing state lands and state forestlands for sustained yield as 18
required by RCW 79.10.310. 19
(4) The department may: 20
(a) Directly offer for sale ecosystem service credits, consistent 21
with this section, with established compliance ecosystem service 22
marketplaces or verifiable and established voluntary ecosystem 23
service marketplace; 24
(b) Enter into contracts with ecosystem service project 25
developers or brokers, through public auction or by direct 26
negotiation, to bring ecosystem service credits to market. Contracts 27
for ecosystem services are subject to approval by, and the rules 28
adopted by, the board. 29
(5) Notice of intent to contract by negotiation must be published 30
on the department's website. The notice must be published within the 31
90 days preceding commencement of negotiations. 32
(6) The department is authorized to conduct any additional 33
advertising that it determines to be in the best interest of the 34
state. 35
(7) The department may enter into contracts or agreements with 36
third-party ecosystem service project developers or brokers for 37
purposes that include, but are not limited to, determining the 38
feasibility of entering into a contract for a payment for an 39
ecosystem service project, establishing a payment for an ecosystem 40
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service project with an ecosystem service marketplace, and marketing 1
and selling credits on an established ecosystem service marketplace.2
(8) The department must provide a report to the board upon 3
execution of a contract for a payment for an ecosystem service 4
project that includes the term of the contract and projected 5
revenues. 6
(9)(a) Before entering into the sale of ecosystem service credits 7
under this section, the board must find that the conditions of this 8
section are satisfied and approve contract terms and a minimum 9
payment for ecosystem services that is valid for a period of 180 10
days, or a longer period as may be established by resolution.11
(b) Where the board has set a minimum payment for ecosystem 12
service credits, the department may set the final payment for 13
ecosystem service credits, which must be based on current market 14
prices. The board may reestablish the minimum payment at any time.15
NEW SECTION. Sec. 3. (1) By December 1, 2026, the department 16
must submit a report to the office of financial management and the 17
legislature, consistent with RCW 43.01.036, that includes information 18
on payment for ecosystem service projects entered into or committed 19
to by the department, including type of projects, number of acres 20
involved, and projected revenues. The report must also include any 21
challenges or barriers encountered by the department in the process 22
of attempting to implement carbon offset or payment for ecosystem 23
service projects and recommendations to address those challenges and 24
barriers, including the operability of the carbon offset rules 25
adopted under RCW 70A.65.170.26
(2) This section expires June 30, 2027. 27
Sec. 4. RCW 79.02.010 and 2018 c 258 s 1 are each amended to 28
read as follows: 29
The definitions in this section apply throughout this title 30
unless the context clearly requires otherwise. 31
(1) "Aquatic lands" means all state-owned tidelands, shorelands, 32
harbor areas, and the beds of navigable waters as defined in RCW 33
79.105.060 that are administered by the department.34
(2) "Board" means the board of natural resources.35
(3) "Commissioner" means the commissioner of public lands.36
(4) "Community and technical college forest reserve lands" means 37
lands managed under RCW 79.02.420. 38
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(5) "Community forest trust lands" means those lands acquired and 1
managed under the provisions of chapter 79.155 RCW.2
(6) "Department" means the department of natural resources.3
(7)(a) "Forest biomass" means the by-products of: Current forest 4
management activities; current forest protection treatments 5
prescribed or permitted under chapter 76.04 RCW; or the by-products 6
of forest health treatment prescribed or permitted under chapter 7
76.06 RCW. 8
(b) "Forest biomass" does not include wood pieces that have been 9
treated with chemical preservatives such as: Creosote, 10
pentachlorophenol, or copper-chrome-arsenic; wood from existing old 11
growth forests; wood required to be left on-site under chapter 76.09 12
RCW, the state forest practices act; and implementing rules, and 13
other legal and contractual requirements; or municipal solid waste.14
(8) "Good neighbor agreement" means an agreement entered into 15
between the state and the United States forest service or United 16
States bureau of land management to conduct forestland, watershed, 17
and rangeland restoration activities on federal lands, as originally 18
authorized by the 2014 farm bill (P.L. 113-79). 19
(9) "Improvements" means anything considered a fixture in law 20
placed upon or attached to lands administered by the department that 21
has changed the value of the lands or any changes in the previous 22
condition of the fixtures that changes the value of the lands.23
(10) "Land bank lands" means lands acquired under RCW 79.19.020.24
(11) "Person" means an individual, partnership, corporation, 25
association, organization, cooperative, public or municipal 26
corporation, or agency of a federal, state, or local governmental 27
unit, however designated. 28
(12) "Public lands" means lands of the state of Washington 29
administered by the department including but not limited to state 30
lands, state forestlands, lands included in a state forestland pool, 31
and aquatic lands. 32
(13) "State forestland pool" or "land pool" means state 33
forestlands acquired and managed under RCW 79.22.140.34
(14) "State forestlands" means lands acquired under RCW 35
79.22.010, 79.22.040, and 79.22.020. 36
(15) "State lands" includes: 37
(a) School lands, that is, lands held in trust for the support of 38
the common schools; 39
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(b) University lands, that is, lands held in trust for university 1
purposes; 2
(c) Agricultural college lands, that is, lands held in trust for 3
the use and support of agricultural colleges; 4
(d) Scientific school lands, that is, lands held in trust for the 5
establishment and maintenance of a scientific school;6
(e) Normal school lands, that is, lands held in trust for state 7
normal schools; 8
(f) Capitol building lands, that is, lands held in trust for the 9
purpose of erecting public buildings at the state capital for 10
legislative, executive, and judicial purposes; 11
(g) Institutional lands, that is, lands held in trust for state 12
charitable, educational, penal, and reformatory institutions; and13
(h) Land bank, escheat, donations, and all other lands, except 14
aquatic lands, administered by the department that are not devoted to 15
or reserved for a particular use by law. 16
(16) "Valuable materials" means any product or material on the 17
lands, such as forest products, forage or agricultural crops, stone, 18
gravel, sand, peat, and all other materials of value except: (a) 19
Mineral, coal, petroleum, and gas as provided for under chapter 79.14 20
RCW; ((and)) (b) forest biomass as provided for under chapter 79.150 21
RCW; and (c) ecosystem services as provided for under chapter 79.--- 22
RCW (the new chapter created in section 9 of this act).23
(17) "Ecosystem services" has the same meaning as defined in RCW 24
76.09.020.25
Sec. 5. RCW 79.64.110 and 2023 c 475 s 944 and 2023 c 383 s 8 26
are each reenacted and amended to read as follows:27
(1) Any moneys derived from the lease of state forestlands or 28
from the sale of valuable materials, oils, gases, coal, minerals, 29
((or)) fossils, or contracts for payments for ecosystem service 30
projects under chapter 79.--- RCW (the new chapter created in section 31
9 of this act) from those lands, except as provided in RCW 79.64.130, 32
or the appraised value of these resources when transferred to a 33
public agency under RCW 79.22.060, must be distributed as follows:34
(a) For state forestlands acquired through RCW 79.22.040 or by 35
exchange or as replacement for lands acquired through RCW 79.22.040:36
(i) The expense incurred by the state for administration, 37
reforestation, and protection, not to exceed 25 percent, which rate 38
of percentage shall be determined by the board, must be returned to 39
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the forest development account created in RCW 79.64.100. During the 1
2017-2019, 2019-2021, 2021-2023, and 2023-2025 fiscal biennia, the 2
board may increase the 25 percent limitation up to 27 percent.3
(ii) Any balance remaining must be paid to the county in which 4
the land is located or, if the land acquired under RCW 79.22.040 was 5
exchanged, transferred, or disposed, payment must be made to the 6
county from which the land was exchanged, transferred, or disposed. 7
For counties participating in a land pool created under RCW 8
79.22.140, to each participating county proportionate to its 9
contribution of asset value to the land pool as determined by the 10
board. Payments made under this subsection are to be paid, 11
distributed, and prorated to the various funds in the same manner as 12
general taxes are paid and distributed during the year of payment. 13
However, a county may in its discretion pay, distribute, and prorate 14
payments made under this subsection of moneys derived from state 15
forestlands acquired by exchange or as replacement lands, for lands 16
acquired through RCW 79.22.040, in the same manner as general taxes 17
are paid and distributed during the year of payment for the former 18
state forestlands that were subject to the exchange.19
(iii) Any balance remaining, paid to a county with a population 20
of less than 16,000, must first be applied to the reduction of any 21
indebtedness existing in the current expense fund of the county 22
during the year of payment. 23
(iv) With regard to moneys remaining under this subsection 24
(1)(a), within seven working days of receipt of these moneys, the 25
department shall certify to the state treasurer the amounts to be 26
distributed to the counties. The state treasurer shall distribute 27
funds to the counties four times per month, with no more than 10 days 28
between each payment date. 29
(b) For state forestlands acquired through RCW 79.22.010 or by 30
exchange or as replacement lands for lands acquired through RCW 31
79.22.010, except as provided in RCW 79.64.120: 32
(i) Fifty percent shall be placed in the forest development 33
account. 34
(ii) Fifty percent shall be prorated and distributed to the state 35
general fund, to be dedicated for the benefit of the public schools, 36
to the county in which the land is located or, for counties 37
participating in a land pool created under RCW 79.22.140, to each 38
participating county proportionate to its contribution of asset value 39
to the land pool as determined by the board, and according to the 40
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relative proportions of tax levies of all taxing districts in the 1
county. The portion to be distributed to the state general fund shall 2
be based on the regular school levy rate under RCW 84.52.065 (1) and 3
(2) and the levy rate for any school district enrichment levies. With 4
regard to the portion to be distributed to the counties, the 5
department shall certify to the state treasurer the amounts to be 6
distributed within seven working days of receipt of the money. The 7
state treasurer shall distribute funds to the counties four times per 8
month, with no more than 10 days between each payment date. The money 9
distributed to the county must be paid, distributed, and prorated to 10
the various other funds in the same manner as general taxes are paid 11
and distributed during the year of payment. 12
(2) A school district may transfer amounts deposited in its debt 13
service fund pursuant to this section into its capital projects fund 14
as authorized in RCW 28A.320.330. 15
Sec. 6. RCW 79.22.050 and 2003 c 334 s 220 and 2003 c 313 s 7 16
are each reenacted and amended to read as follows:17
(1) Except as provided in RCW 79.22.060, all land, acquired or 18
designated by the department as state forestland, shall be forever 19
reserved from sale, but the valuable materials thereon may be sold or 20
the land may be leased in the same manner and for the same purposes 21
as is authorized for state lands if the department finds such sale or 22
lease to be in the best interests of the state and approves the terms 23
and conditions thereof. 24
(2) Ecosystem services may be sold only if consistent with the 25
conditions in chapter 79.--- RCW (the new chapter created in section 26
9 of this act) and may not be sold if chapter 79.--- RCW (the new 27
chapter created in section 9 of this act) does not appear in codified 28
statute.29
(3) In the event that the department sells logs using the 30
contract harvesting process described in RCW 79.15.500 through 31
79.15.530, the moneys received subject to this section are the net 32
proceeds from the contract harvesting sale. 33
Sec. 7. RCW 79.105.150 and 2022 c 157 s 19 are each amended to 34
read as follows: 35
(1) After deduction for management costs as provided in RCW 36
79.64.040 and payments to towns under RCW 79.115.150(2), all moneys 37
received by the state from the sale or lease of state-owned aquatic 38
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lands ((and)), from the sale of valuable material from state-owned 1
aquatic lands, and from the sale of ecosystem services under chapter 2
79.--- RCW (the new chapter created in section 9 of this act), shall 3
be deposited in the aquatic lands enhancement account which is hereby 4
created in the state treasury. After appropriation, these funds shall 5
be used solely for aquatic lands enhancement projects; for the 6
purchase, improvement, or protection of aquatic lands for public 7
purposes; for providing and improving access to the lands; and for 8
volunteer cooperative fish and game projects. The aquatic lands 9
enhancement account may be used to support the shellfish program, the 10
ballast water program, hatcheries, the Puget Sound toxic sampling 11
program and steelhead mortality research at the department of fish 12
and wildlife, the knotweed program at the department of agriculture, 13
actions at the University of Washington for reducing ocean 14
acidification, which may include the creation of a center on ocean 15
acidification, the Puget SoundCorps program, and support of the 16
marine resource advisory council and the Washington coastal marine 17
advisory council. During the 2017-2019 and 2019-2021 fiscal biennia, 18
the legislature may transfer from the aquatic lands enhancement 19
account to the geoduck aquaculture research account for research 20
related to shellfish aquaculture. During the 2015-2017 fiscal 21
biennium, the legislature may transfer moneys from the aquatic lands 22
enhancement account to the marine resources stewardship trust 23
account. 24
(2) In providing grants for aquatic lands enhancement projects, 25
the recreation and conservation funding board shall:26
(a) Require grant recipients to incorporate the environmental 27
benefits of the project into their grant applications;28
(b) Utilize the statement of environmental benefits, 29
consideration, except as provided in RCW 79.105.610, of whether the 30
applicant is a Puget Sound partner, as defined in RCW 90.71.010, 31
whether a project is referenced in the action agenda developed by the 32
Puget Sound partnership under RCW 90.71.310, and except as otherwise 33
provided in RCW 79.105.630, and effective one calendar year following 34
the development and statewide availability of urban forestry 35
management plans and ordinances under RCW 76.15.090, whether the 36
applicant is an entity that has been recognized, and what gradation 37
of recognition was received, in the evergreen community designation 38
program created in RCW 76.15.090 in its prioritization and selection 39
process; and 40
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(c) Develop appropriate outcome-focused performance measures to 1
be used both for management and performance assessment of the grants.2
(3) To the extent possible, the department should coordinate its 3
performance measure system with other natural resource-related 4
agencies as defined in RCW 43.41.270. 5
(4) The department shall consult with affected interest groups in 6
implementing this section. 7
(5) Any project designed to address the restoration of Puget 8
Sound may be funded under this chapter only if the project is not in 9
conflict with the action agenda developed by the Puget Sound 10
partnership under RCW 90.71.310. 11
Sec. 8. RCW 79.15.010 and 2003 c 334 s 331 are each amended to 12
read as follows: 13
(1) Valuable materials situated upon state lands and state 14
forestlands may be sold separate from the land, when in the judgment 15
of the department, it is for the best interest of the state so to 16
sell the same. The sale of any ecosystem services is limited to 17
consistency with the conditions in chapter 79.--- RCW (the new 18
chapter created in section 9 of this act) and may not be sold if 19
chapter 79.--- RCW (the new chapter created in section 9 of this act) 20
does not appear in codified statute.21
(2) Sales of valuable materials from any university lands 22
require: 23
(a) The consent of the board of regents of the University of 24
Washington; or 25
(b) Legislative directive. 26
(3) When application is made for the purchase of any valuable 27
materials, the department shall appraise the value of the valuable 28
materials if the department determines it is in the best interest of 29
the state to sell. No valuable materials shall be sold for less than 30
the appraised value thereof. 31
NEW SECTION. Sec. 9. Sections 1 through 3 of this act 32
constitute a new chapter in Title 79 RCW.33
--- END ---
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