2006 Legislation
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HOUSE BILL NO. 495 – Sales tax increase, school funding

HOUSE BILL NO. 495

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Bill Status



H0495..............................................................by RINGO
SALES TAX - SCHOOLS - Adds to existing law to increase the sales and use
tax by one cent effective July 1, 2006; and to provide that the increased
revenue be used for the funding of public schools.
                                                                        
01/27    House intro - 1st rdg - to printing
01/30    Rpt prt - to Rev/Tax

Bill Text


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-eighth Legislature                   Second Regular Session - 2006
                                                                        
                                                                        
                              IN THE HOUSE OF REPRESENTATIVES
                                                                        
                                     HOUSE BILL NO. 495
                                                                        
                                          BY RINGO
                                                                        
  1                                        AN ACT
  2     RELATING TO THE SALES AND USE TAX AND FUNDING FOR THE PUBLIC SCHOOLS;  AMEND-
  3        ING  CHAPTER  36,  TITLE  63, IDAHO CODE, BY THE ADDITION OF A NEW SECTION
  4        63-3641, IDAHO CODE, TO IMPOSE AN ADDITIONAL ONE  PERCENT  SALES  AND  USE
  5        TAX,  TO  PROVIDE  FOR  STATE  TAX COMMISSION AUTHORITY AND TO PROVIDE FOR
  6        DEPOSIT OF MONEYS; AMENDING CHAPTER 9, TITLE 33, IDAHO CODE, BY THE  ADDI-
  7        TION  OF  NEW  SECTIONS 33-908, 33-909, 33-910, 33-911, 33-912, 33-913 AND
  8        33-914, IDAHO CODE, TO PROVIDE A SHORT TITLE, TO PROVIDE THE  PURPOSE  FOR
  9        RAISING  THE  SALES  AND USE TAX, TO CREATE THE IDAHO LOCAL PUBLIC SCHOOLS
 10        INVESTMENT FUND, TO PROVIDE FOR USE OF ENHANCED REVENUES, TO  PROVIDE  FOR
 11        LOCAL  ANNUAL ACCOUNTABILITY REPORTS ON USE OF REVENUES, TO PROVIDE FOR AN
 12        ANNUAL GENERAL ACCOUNT APPROPRIATION AMOUNT AND TO PROVIDE  FOR  DISTRIBU-
 13        TION OF THE GENERAL ACCOUNT APPROPRIATION AMOUNT.
                                                                        
 14    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 15        SECTION  1.  That  Chapter  36,  Title 63, Idaho Code, be, and the same is
 16    hereby amended by the addition thereto of a NEW SECTION, to be known and  des-
 17    ignated as Section 63-3641, Idaho Code, and to read as follows:
                                                                        
 18        63-3641.  IMPOSITION  AND RATE OF ADDITIONAL TAX. (1) On and after July 1,
 19    2006, in addition to the taxes imposed by sections 63-3619 and 63-3621,  Idaho
 20    Code,  there  is hereby imposed a tax of one percent (1%) upon the  same sales
 21    and upon the same use, storage or other consumption as are  taxed  under  sec-
 22    tions  63-3619  and 63-3621, Idaho Code. The additional tax shall be collected
 23    at the same time and in the  same  manner  as  taxes  imposed  under  sections
 24    63-3619  and  63-3621, Idaho Code, and shall be subject to all the collection,
 25    enforcement and administrative provisions of chapter 36, title 63, Idaho Code.
 26        (2)  All taxes collected under this section, together with  all  interest,
 27    penalties or other amounts relating to such taxes, shall not be subject to the
 28    distribution provisions of section 63-3638, Idaho Code, but shall be deposited
 29    in  the  Idaho local public schools investment fund created by section 33-910,
 30    Idaho Code.
                                                                        
 31        SECTION 2.  That Chapter 9, Title 33, Idaho Code,  be,  and  the  same  is
 32    hereby amended by the addition thereto of NEW SECTIONS, to be known and desig-
 33    nated  as  Sections 33-908, 33-909, 33-910, 33-911, 33-912, 33-913 and 33-914,
 34    Idaho Code, and to read as follows:
                                                                        
 35        33-908.  SHORT TITLE. This act shall be entitled "The Idaho  Local  Public
 36    Schools Investment Act."
                                                                        
 37        33-909.  INCREASE  EDUCATION  FUNDING  FOR ALL K-12 PUBLIC SCHOOLS THROUGH
 38    RAISING BY ONE PERCENT THE STATE SALES AND USE  TAX  RATE  EFFECTIVE  JULY  1,
 39    2006.  For  the  purpose  of providing adequate and stable funding for Idaho's
 40    K-12 public schools, effective July 1, 2006, the sales and use  taxes  imposed
                                                                        
                                           2
                                                                        
  1    shall  be raised from the current five percent (5%) rate to, and be maintained
  2    at, the rate of six percent (6%) as provided in section 63-3641, Idaho Code.
                                                                        
  3        33-910.  CREATION OF THE IDAHO LOCAL PUBLIC SCHOOLS INVESTMENT  FUND.  The
  4    increased  revenue derived from raising the sales and use taxes by one percent
  5    (1%) shall be placed in the "Idaho  Local  Public  Schools  Investment  Fund,"
  6    which is hereby created. All revenues placed in the Idaho local public schools
  7    investment  fund  shall  be  utilized for funding public education at the K-12
  8    level. The provisions of this act shall include and apply  to  public  charter
  9    schools.
                                                                        
 10        33-911.  USE  OF ENHANCED REVENUES. Local school districts shall spend one
 11    hundred percent (100%) of the  revenues  placed  in  the  Idaho  local  public
 12    schools investment fund on any of the following items designed to help improve
 13    local schools and support students:
 14        (1)  Providing current and adequate classroom materials, such as textbooks
 15    and supplies, for students;
 16        (2)  Providing  every  high  school  student  with the opportunity to take
 17    either college preparatory courses  or  professional  and  technical  training
 18    courses;
 19        (3)  Reducing class sizes and preventing class size increases;
 20        (4)  Attracting and retaining highly qualified teachers and other school
 21    employees  including,  but  not  limited  to,  providing competitive salaries,
 22    offering continuing education opportunities, and  providing  support  for  new
 23    educators;
 24        (5)  Replacing  out-of-date  or  broken  technology such as computers that
 25    students need for individualized learning and access to information;
 26        (6)  Restoring  local  educational  programs  previously   eliminated   or
 27    reduced, enhancing existing educational programs, or providing new educational
 28    programs  with the goal of ensuring that Idaho student achievement levels meet
 29    or exceed local, state and national standards and requirements;
 30        (7)  Providing classroom aides to help provide more individualized  assis-
 31    tance to students;
 32        (8)  Providing support for arts and music education in all public schools;
 33    and
 34        (9)  Paying for routine school maintenance to protect the public's invest-
 35    ment and promote student safety.
                                                                        
 36        33-912.  LOCAL  ANNUAL ACCOUNTABILITY REPORTS ON USE OF REVENUES. In addi-
 37    tion to its annual audit and in order to provide  information  to  the  public
 38    about how revenues appropriated from the Idaho local public schools investment
 39    fund  were  used,  at  least once annually the board of trustees of each local
 40    school district shall issue a document available and easily accessible to  the
 41    general  public  identifying the provisions set forth in section 33-911, Idaho
 42    Code, for which such additional revenues were  utilized  and  benefitted  stu-
 43    dents.
                                                                        
 44        33-913.  ANNUAL  GENERAL  FUND  APPROPRIATION AMOUNT. In order to augment,
 45    rather than replace, K-12 public school support, the  revenues  in  the  Idaho
 46    local  public  schools  investment  fund are to be provided in addition to the
 47    state's general fund appropriation to K-12 public schools and not in place  of
 48    any  part  of  that appropriation. To that end, the general fund appropriation
 49    for K-12 public school support established during the 2005 legislative session
 50    shall constitute the initial base funding level for K-12  public  schools.  In
 51    every  year  thereafter, the general fund appropriation for K-12 public school
                                                                        
                                           3
                                                                        
  1    support shall consist, at minimum, of:
  2        (1)  The base funding amount for the prior year;
  3        (2)  Dedicated endowment lands, lottery dividends and miscellaneous  reve-
  4    nues, cigarette and lottery tax revenues, and federal funds;
  5        (3)  The revenues in the Idaho local public schools investment fund;
  6        (4)  Sufficient  revenues  to  cover the cost of increased student enroll-
  7    ment; and
  8        (5)  An annual inflationary factor, based on the percentage change in  the
  9    consumer  price  index  for all urban consumers, as published by the bureau of
 10    labor statistics, United States department of labor, from December of the sec-
 11    ond previous year to December of the previous year.
 12        The general fund appropriation for K-12 public school support may only  be
 13    reduced  in  future  years if there is a decline in student enrollment greater
 14    than ten percent (10%) statewide for two (2) or more consecutive years.
                                                                        
 15        33-914.  DISTRIBUTION OF GENERAL FUND APPROPRIATION AMOUNT. In every year,
 16    the general fund appropriation for K-12 public school support,  as  determined
 17    in section 33-913, Idaho Code, shall be distributed to local public schools as
 18    provided in chapter 10, title 33, Idaho Code.

Statement of Purpose / Fiscal Impact



                       STATEMENT OF PURPOSE

                            RS 15828 

This legislation returns the sales tax rate to six percent (6%)
effective July 1, 2006, for the purpose of providing adequate and
stable funding for Idaho's K-12 public schools. 


                           FISCAL NOTE

There will be no impact on the state general fund.  This
legislation directs the revenues from the increase in the sales
tax into a newly created Idaho Local Public Schools Investment
Fund which, along with other revenue sources, will be used
exclusively for K-12 public education at the local level and
which must be used for supporting students in the classroom and
improving local public schools.



Contact
Name: Rep. Shirley Ringo 
Phone: 332-1000


STATEMENT OF PURPOSE/FISCAL NOTE                         H 495