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H0202...............................................by REVENUE AND TAXATION
SALES TAX - DISTRIBUTION - Amends existing law to provide for distribution
of six percent of sales tax collections to cities, counties and special
purpose taxing districts according to a revised formula.
02/09 House intro - 1st rdg - to printing
02/10 Rpt prt - to Rev/Tax
02/25 Rpt out - rec d/p - to 2nd rdg
02/26 2nd rdg - to 3rd rdg
03/03 3rd rdg - FAILED - 33-34-3
AYES -- Alltus, Bieter, Black, Boe, Clark, Crow, Deal, Ellsworth,
Field(13), Gagner, Hansen(23), Hansen(29), Henbest, Lake, Limbaugh,
McKague, Meyer, Montgomery, Moyle, Pischner, Pomeroy, Ringo, Robison,
Sali, Schaefer, Smith, Smylie, Stoicheff, Stone, Taylor, Trail,
Williams, Zimmermann
NAYS -- Barraclough, Barrett, Bell, Bruneel, Campbell, Chase, Cuddy,
Denney, Field(20), Geddes, Gould, Hadley, Hammond, Hornbeck, Jaquet,
Jones, Judd, Kempton, Kendell, Kunz, Linford, Loertscher, Mader,
Marley, Mortensen, Reynolds, Ridinger, Sellman, Stevenson, Tilman,
Tippets, Wheeler, Wood, Mr Speaker
Absent and excused -- Callister, Kellogg, Watson
Floor Sponsor - Kellogg
Filed with Chief Clerk
H0202|||| LEGISLATURE OF THE STATE OF IDAHO |||| Fifty-fifth Legislature First Regular Session - 1999IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 202 BY REVENUE AND TAXATION COMMITTEE 1 AN ACT 2 RELATING TO SALES TAX DISTRIBUTIONS; AMENDING SECTION 63-316, IDAHO CODE, TO 3 PROVIDE A CORRECT CODE REFERENCE; AMENDING SECTION 63-3638, IDAHO CODE, TO 4 REVISE THE FORMULA BY WHICH SIX PERCENT OF SALES TAX COLLECTIONS ARE 5 APPROPRIATED TO THE SEVERAL COUNTIES FOR DISTRIBUTION TO CITIES, COUNTIES 6 AND SPECIAL PURPOSE TAXING DISTRICTS, AND TO MAKE TECHNICAL CORRECTIONS; 7 AND AMENDING SECTION 67-6211, IDAHO CODE, TO PROVIDE A CORRECT CODE REFER- 8 ENCE. 9 Be It Enacted by the Legislature of the State of Idaho: 10 SECTION 1. That Section 63-316, Idaho Code, be, and the same is hereby 11 amended to read as follows: 12 63-316. ADJUSTMENT OF ASSESSED VALUE -- COMPLETION OF ASSESSMENT PROGRAM 13 BY STATE TAX COMMISSION -- PAYMENT OF COSTS. (1) Whenever the state tax com- 14 mission, after a hearing, determines that any county assessor or the county 15 commissioners in assessing property in the county subject to taxation have 16 failed to abide by, adhere to and conform with the laws of the state of Idaho 17 and the rules of the state tax commission in determining market value for 18 assessment purposes, the state tax commission shall order the county assessor 19 and county commissioners of such county to make the necessary changes or cor- 20 rections in such assessments and if the county assessor and the county commis- 21 sioners refuse or neglect to comply with such order, the state tax commission 22 is authorized to and shall forthwith adjust or change the property roll in 23 such county. 24 (2) In lieu of the hearings and actions permitted in subsection (1) of 25 this section, the state tax commission shall monitor each county's implementa- 26 tion of the continuing appraisal required in section 63-314, Idaho Code, and 27 may require each county to file such reports of its progress at implementation 28 of such continuing appraisals as the commission may find necessary. In the 29 event that the commission finds that any county is failing to meet the 30 requirements of section 63-314, Idaho Code, the commission may order that 31 county's indexing or appraisal or reappraisal programs be conducted under the 32 exclusive and complete control of the state tax commission and the results of 33 such programs shall be binding upon the county officers of the county for 34 which ordered. Payments for the actual cost of such programs shall be made 35 from the sales tax distribution created in section 63-3638, Idaho Code, and 36 the amount of such payments shall be withheld from the payments otherwise made 37 under the provisions of section 63-3638(e)(7)(c) and 38(g)(7)(d) , Idaho Code, to the county for which 39 indexing, appraisal or reappraisal has been ordered, and this subsection shall 40 constitute the necessary appropriation to accomplish such payments, any other 41 provision of law notwithstanding. 42 SECTION 2. That Section 63-3638, Idaho Code, be, and the same is hereby 2 1 amended to read as follows: 2 63-3638. SALES TAX -- DISTRIBUTION. All moneys collected under this chap- 3 ter, except as may otherwise be required in section 63-3203, Idaho Code, shall 4 be distributed by the tax commission as follows: 5 (a1 ) An amount of money shall be distributed to 6 the state refund account sufficient to pay current refund claims. All refunds 7 authorized under this chapter by the commission shall be paid through the 8 state refund account, and those moneys are continuously appropriated. 9 (b2 ) Five hundred thousand dollars ($500,000) 10 per year is continuously appropriated and shall be distributed to the perma- 11 nent building account, provided by section 57-1108, Idaho Code. 12 (c3 ) Four million eight hundred thousand dol- 13 lars ($4,800,000) per year is continuously appropriated and shall be distrib- 14 uted to the water pollution control account established by section 39-3605, 15 Idaho Code. 16 (d4 )(1)An amount equal to the sum 17 required to be certified by the chairman of the Idaho housing and finance 18 association to the state tax commission pursuant to section 67-6211, Idaho 19 Code, in each year is continuously appropriated and shall be paid to any capi- 20 tal reserve fund, established by the Idaho housing and finance association 21 pursuant to section 67-6211, Idaho Code. Such amounts, if any, as may be 22 appropriated hereunder to the capital reserve fund of the Idaho housing and 23 finance association shall be repaid for distribution under the provisions of 24 this section, subject to the provisions of section 67-6215, Idaho Code, by the 25 Idaho housing and finance association, as soon as possible, from any moneys 26 available therefor and in excess of the amounts which the association deter- 27 mines will keep it self-supporting. 28 (25 ) An amount equal to the sum required by the 29 provisions of section 63-709, Idaho Code, is continuously appropriated and 30 shall be paid as provided by section 63-709, Idaho Code. 31 (e6 )Six percent (6%) is hereby appropri-32ated and shall be paid to the county treasurer of each county in amounts to be33determined as follows:34(1) Each taxing district other than school districts shall be entitled to35a base share of sales tax moneys equal to the amount distributed to that36district for the fourth calendar quarter of 1979. The computation shall37not include any distributions made to the credit of either the former38county school levy or the state water pollution control levy. The percent-39age so determined for each taxing district shall be applied each quarter40to the above percentage of sales tax. The resulting sums shall be paid to41the county treasurer of each county for distribution to each taxing dis-42trict, except school districts, which received sales tax moneys in 1979.43Whenever a taxing district is dissolved, the dissolved district's share of44sales moneys shall be credited continuously to the county current expense45fund.46(2) Whenever the amount of nonschool district sales tax moneys distrib-47uted exceeds in any quarter the total amount of moneys distributed to non-48school districts for the base quarter, which is the fourth calendar quar-49ter of 1979, by ten percent (10%), or more, the excess of the base quarter50shall be paid to the county treasurer of each county for distribution to51each taxing district in the county, except school districts, in the fol-52lowing manner.53The state tax commission shall compute the percentage that the aver-54age amount of taxes collected from assessments for the years 1965, 19663 1and 1967 on the personal property described as business inventory in sub-2sections (1) and (2) of section 63-602W, Idaho Code, for each county bears3to the average total amount of taxes collected from assessments for said4years on the personal property described as business inventory in subsec-5tions (1) and (2) of section 63-602W, Idaho Code, for all counties in the6state. The percentage so determined for each county shall be applied to7the sales tax distributed under this subsection and the resulting sum8shall be paid to the county treasurer of each county for distribution to9each taxing district, except school districts, in the county as follows:10(i) Each year the county commissioners in each county shall take11the tax charge, applicable to the current property roll equalized by12county commissioners sitting as a board of equalization, of each tax-13ing district within the county, except school districts, and divide14it by the total current tax charges applicable to the current prop-15erty roll of all taxing districts, except school districts, within16said county and the resulting percentages shall be applied to the17county's proportionate share of said sales tax account and the18resulting amount shall be distributed to each taxing district in the19county periodically but not less frequently than quarterly by the20county auditor and applied by such taxing districts in the same man-21ner and in the same proportions as revenues from property taxation.22(ii) The moneys set aside and appropriated to the county treasurer23out of the sales tax account above may be considered by the counties24and other taxing districts and budgeted against at the same time, in25the same manner and in the same year as revenues from taxation on all26classes of personal property which these moneys replace.27(3) All moneys distributed pursuant to subsection (e) shall be subject to28the redistribution provisions of section 40-801, Idaho Code, where appli-29cable.30(f)One dollar ($1.00) on each application for certificate of 31 title to a motor vehicle, or initial application for registration processed by 32 the county assessor or the Idaho transportation department excepting those 33 applications in which any sales or use taxes due have been previously col- 34 lected by a retailer, shall be a fee for the services of the assessor of the 35 county or the Idaho transportation department in collecting such taxes, and 36 shall be paid into the current expense fund of the county or state highway 37 account established in section 40-702, Idaho Code. 38 (g7 )SevenThirteen 39 and three-quarters percent (713 .75%) is continu- 40 ously appropriated and shall be distributed to the revenue sharing account 41 which is created in the stateoperating fundtreasury 42 , and the moneys in the revenue sharing account will be paid by the tax 43 commission as follows: 44 (1a )One-half (1/2)Twenty- 45 eight and two-tenths percent (28.2%) shall be paid to the various 46 cities as follows: 47 (i) Fifty percent (50%) of such amount shall be paid to the various 48 cities, and each city shall be entitled to an amount in the propor- 49 tion that the population of that city bears to the population of all 50 cities within the state; and 51 (ii) Fifty percent (50%) of such amount shall be paid to the various 52 cities, and each city shall be entitled to an amount in the propor- 53 tion that the preceding year's market value for assessment purposes 54 for that city bears to the preceding year's market value for assess- 55 ment purposes for all cities within the state. 4 1 (2b )One-half (1/2)Twenty- 2 eight and two-tenths percent (28.2%) shall be paid to the3state's general account or to thevarious counties as follows: 4 (i) One million three hundred twenty thousand dollars ($1,320,000) 5 shall be distributed one forty-fourth (1/44) to each of the various 6 counties; and 7 (ii) The balance of such amount shall be paid to the various coun- 8 ties, and each county shall be entitled to an amount in the propor- 9 tion that the population of that county bears to the population of 10 the state ; 11 (c) Thirty-six percent (36%) of the amount appropriated in this 12 subsection (7) shall be paid to the several counties for distribution to 13 the cities and counties as follows: 14 (i) Each city and county which received a payment under the provi- 15 sions of section 63-3638(e), Idaho Code, during the fourth quarter of 16 calendar year 1998, shall be entitled to a like amount during suc- 17 ceeding calendar quarters. 18 (ii) If the dollar amount of money available under this subsection 19 (7)(c) in any quarter does not equal the amount paid in the fourth 20 quarter of calendar year 1998, each city's and county's payment shall 21 be reduced proportionately. 22 (iii) If the dollar amount of money available under this subsection 23 (7)(c) in any quarter exceeds the amount paid in the fourth quarter 24 of calendar year 1998, each city and county shall be entitled to a 25 proportionately increased payment, but such increase shall not exceed 26 one hundred five percent (105%) of the total payment made in the 27 fourth quarter of calendar year 1998. 28 (iv) If the dollar amount of money available under this subsection 29 (7)(c) in any quarter exceeds one hundred five percent (105%) of the 30 total payment made in the fourth quarter of calendar year 1998, any 31 amount over and above such one hundred five percent (105%) shall be 32 paid fifty percent (50%) to the various cities in the proportion that 33 the population of the city bears to the population of all cities 34 within the state, and fifty percent (50%) to the various counties in 35 the proportion that the population of a county bears to the popula- 36 tion of the state; and 37 (d) Seven and six-tenths percent (7.6%) of the amount appropriated in 38 this subsection (7) shall be paid to the several counties for distribution 39 to special purpose taxing districts as follows: 40 (i) Each such district which received a payment under the provi- 41 sions of section 63-3638(e), Idaho Code, during the fourth quarter of 42 calendar year 1998, shall be entitled to a like amount during suc- 43 ceeding calendar quarters. 44 (ii) If the dollar amount of money available under this subsection 45 (7)(d) in any quarter exceeds the amount distributed under paragraph 46 (i) of this subsection (7)(d), each special purpose taxing district 47 shall be entitled to a share of the excess based on the proportion 48 each such district's current property tax budget bears to the sum of 49 the current property tax budgets of all such districts in the state. 50 The state tax commission shall calculate district current property 51 tax budgets to include any unrecovered foregone amounts as determined 52 under section 63-802(1)(e), Idaho Code. When a special purpose taxing 53 district is situated in more than one (1) county, the tax commission 54 shall determine the portion attributable to the special purpose tax- 55 ing district from each county in which it is situated. 5 1 (iii) If special purpose taxing districts are consolidated, the 2 resulting district is entitled to a base amount equal to the sum of 3 the base amounts which were received in the last calendar quarter by 4 each district prior to the consolidation. 5 (iv) If a special purpose taxing district is dissolved or 6 disincorporated, the state tax commission shall continuously distrib- 7 ute to the board of county commissioners an amount equal to the last 8 quarter's distribution prior to dissolution or disincorporation. The 9 board of county commissioners shall determine any redistribution of 10 moneys so received. 11 (v) Taxing districts formed after January 1, 1999, are not entitled 12 to a payment under the provisions of this subsection (7)(d). 13 (vi) For purposes of this subsection (7)(d), a special purpose tax- 14 ing district is any taxing district which is not a city, a county or 15 a school district. 16 (h8 ) Any moneys remaining over and above those 17 necessary to meet and reserve for payments under other subsections of this 18 section shall be distributed to the general account. 19 SECTION 3. That Section 67-6211, Idaho Code, be, and the same is hereby 20 amended to read as follows: 21 67-6211. ADDITIONAL DEFINITIONS AND CAPITAL RESERVE FUND PROCEDURES. As 22 used in this section, the following words and phrases shall have the following 23 meanings unless the context shall indicate another or different meaning or 24 intent: 25 (a) "Maximum capital reserve fund requirement" shall mean the amount set 26 forth in the association's resolution or indenture authorizing the bonds or 27 other obligations secured by a capital reserve fund, or, if no amount is 28 stated in such resolution or indenture, then, as of any particular date of 29 computation, an amount of money equal to the greatest of the respective 30 amounts, for the then current or any future fiscal year of the association, of 31 annual debt service of the association, such annual debt service for any fis- 32 cal year being the amount of money equal to the aggregate of: 33 (1) All interest payable during such fiscal year on all bonds secured by 34 such capital reserve fund of the association outstanding on said date of 35 computation, plus 36 (2) The principal amount of all bonds of the association secured by such 37 capital reserve fund, outstanding on said date of computation which 38 matures during such fiscal year, plus 39 (3) The amount of all annual sinking fund payments payable during such 40 fiscal year with respect to any bonds of the association secured by such 41 capital reserve fund, outstanding on said date of computation. 42 (b) "Annual sinking fund payment" shall mean the amount of money speci- 43 fied in the resolution authorizing term bonds as payable into a sinking fund 44 during a particular fiscal year for the retirement of term bonds which mature 45 after such fiscal year, but shall not include any amount payable by reason 46 only of the maturity of a bond. 47 (c) "Available operating revenues" shall mean all amounts received on 48 account of rentals and fees and other charges imposed by the association, if 49 any, and income or interest earned or added to funds of the association due to 50 the investment thereof and not required under the terms or provisions of any 51 covenant or agreement with holders of any bonds or notes of the association to 52 be applied to any purposes other than payment of expenses of the association. 53 (d) "Amortized value," when used with respect to securities purchased at 6 1 a premium above or a discount below par, shall mean the value as of any given 2 date obtained by dividing the total premiums or discount at which such securi- 3 ties were purchased by the number of interest payments remaining to maturity 4 on such securities after such purchase, and by multiplying the amount so cal- 5 culated by the number of interest payment dates having passed since the date 6 of such purchase; and 7 (1) In the case of securities purchased at a premium, by deducting the 8 product thus obtained from the purchase price, and 9 (2) In the case of securities purchased at a discount, by adding the 10 product thus obtained to the purchase price. 11 (e) The association shall create and establish one (1) or more special 12 funds (herein referred to as "capital reserve funds"), and shall credit each 13 such capital reserve fund: 14 (1) Any proceeds of sale of notes or bonds, to the extent provided in the 15 resolution or resolutions of the association authorizing the issuance 16 thereof, 17 (2) Any funds directed to be transferred by the association to such fund, 18 and 19 (3) Any other moneys which may be made available to the association for 20 the purpose of such fund from any other source or sources. 21 (f) All moneys held in or credited to each such capital reserve fund, 22 except as hereinafter provided, shall be used, as required, solely for the 23 payment of the principal of bonds or of the sinking fund payments hereinafter 24 mentioned with respect to such bonds, the purchase or redemption of bonds, the 25 payment of interest on bonds or the payment of any redemption premium required 26 to be paid when such bonds are redeemed prior to maturity; provided, however: 27 (1) That moneys in any such fund shall not be withdrawn therefrom at any 28 time in such amount as would reduce the amount of such fund to less than 29 the maximum capital reserve fund requirement, except for the purposes of 30 making payment, when due, with respect to such bonds, of principal or 31 redemption price of, interest and the sinking fund payments, as the same 32 become due, and for the payment of which other moneys of the association 33 are not available. 34 (2) Any income or interest earned by, or increment to, any capital 35 reserve fund due to the investment thereof may be transferred by the asso- 36 ciation to other funds or accounts of the association to the extent it 37 does not reduce the amount of such capital reserve fund below the maximum 38 capital reserve fund requirement. 39 (g) Within sixty (60) days after the close of the association's fiscal 40 year, the chairman of the association shall certify to the state tax commis- 41 sion the amount, if any, required to maintain the capital reserve funds estab- 42 lished pursuant to this section at the maximum capital reserve fund require- 43 ment, but only for any capital reserve fund of the association which is 44 required by a resolution of the association to be maintained by a continuing 45 appropriation from the sales tax account. The chairman of the association 46 shall not be entitled to so certify to the state tax commission for any capi- 47 tal reserve fund of the association for bonds issued by the association after 48 January 1, 1996. 49 (h) The association shall not issue bonds at any time if upon issuance 50 there will be created a capital reserve fund and the amount in the capital 51 reserve fund securing such bonds will be less than the maximum capital reserve 52 fund requirement, unless the association, at the time of issuance of such 53 bonds, shall deposit in such fund, from the proceeds of the bonds so to be 54 issued, or sources other than the state sales tax fund, an amount which, 55 together with the amount then in such fund, will not be less than the maximum 7 1 capital reserve fund requirement. 2 (i) Moneys in a capital reserve fund not required for immediate use or 3 disbursement may be invested in obligations of the state or the United States 4 of America or obligations the principal of and interest on which are guaran- 5 teed by the state or the United States of America or obligations of agencies 6 of the United States of America or any obligations which may from time to time 7 be legally purchased by banks under title 26, Idaho Code, as investment of 8 funds belonging to them or in their control. In computing the amount of a cap- 9 ital reserve fund for the purposes of this section, securities in which all or 10 a portion of such fund are invested shall be valued at par if purchased at par 11 or, if purchased at other than par, at amortized value. 12 (j) The association shall create and establish such other fund or funds 13 as may be necessary or desirable for its corporate purposes. 14 (k) In the event of the dissolution of the association, any funds or 15 assets of the association remaining after paying its bonds, notes or other 16 obligations shall revert to the state. 17 (l) The total principal amount of the association's outstanding bonds 18 secured by a capital reserve fund entitled to appropriation from the state 19 sales tax account pursuant to section 67-6211(g), Idaho Code, and section 20 63-3638(d)(1)(4) , Idaho Code, shall not exceed the 21 sum of eighty-nine million dollars ($89,000,000).
STATEMENT OF PURPOSE
RS 08466C1
This legislation revises the formula by which six percent of
sales tax collections are appropriated to the counties,
cities, and special purpose taxing districts. Currently,
taxing districts, other than schools, get a base share equal
to the amount of sales tax distributed in the fourth quarter
of 1979. The remainder is distributed based on business
inventory taxes collected in 1965, 1966, and 1967. After
studying the issue throughout the summer of 1998, the
Legislative councils' interim committee on Revenue Sharing
recommends changes. With this legislation, a new base is
calculated so that no jurisdiction receives less than they
currently receive. Then a new "excess" distribution is made
depending on population for cities and counties, and on
property tax budgets for special purpose taxing districts.
FISCAL NOTE
There is no impact on the total revenue sharing dollars
flowing from the sales tax to cities, counties, and special
purpose taxing districts. However, it does affect the
distribution of the "excess". Some jurisdictions will receive
more of the new money, others less, than they would receive
under current law. Cities and counties that have higher
population growth will receive a larger proportion of the
excess than those with slower population growth. Special
purpose taxing districts that have higher growth in property
tax budgets will receive a larger proportion of the excess
than those with slower growth in property tax budgets.
CONTACT: Representative Hilde Kellogg, 332-1000
Senator John Andreason, 332-1405
STATEMENT OF PURPOSE/ FISCAL NOTE H 202