New reference guide clarifies the relationship between county treasurers and the special purpose districts they serve

Because our Office has fielded questions from local governments about the sometimes-confusing fiscal relationship between Washington counties and the special purpose districts (SPDs) they serve (like fire districts and public hospital districts), we researched the topic to clarify the relevant statutory requirements. You can find the Requirements of counties guide (PDF) here. 

We found that state law requires county treasurers as well as county auditors to carry out fiscal duties for certain SPDs. Of our 39 Washington counties, each one provides the required services to its SPDs. However, some counties charge SPDs for these required services like issuing warrants. Charging for these required services is not permissible; however, counties can charge their SPDs for optional, supplementary services. If an SPD were to opt into such resources, like calculating payroll, then it may be permissible for the county to charge a fee.  

Notably, county auditors and county treasurers must draw and issue warrants for SPDs unless the SPD is authorized (and chooses) to do so themselves. In this context, a warrant refers to an official, authorized order to make claim payments directly from the SPD account held by the county treasurer. Some counties may want to issue lump sum warrant payments to their SPDs, rather than individual payroll or accounts payable warrants. We encourage local governments to consider the risks of this practice; during our research, state statutes did not appear to authorize this practice. Further, SPDs required to use the county treasurer would not be allowed to open a separate bank account for issuing payments. 

Again, these county-SPD relationships can be complex, especially when it comes to required versus optional services, warrant payments and opening separate bank accounts. If an SPD or county is considering any of these practices, it should conduct adequate research and consult with its legal counsel beforehand. The full analysis can be found here (PDF), including a helpful appendix listing each type of SPD and the relevant state rules that apply to it.