2003 Legislation
Print Friendly

HOUSE BILL NO. 406 – Sales tax, county local option

HOUSE BILL NO. 406

View Daily Data Tracking History

View Bill Text

View Amendment

View Engrossed Bill (Original Bill with Amendment(s) Incorporated)

View Statement of Purpose / Fiscal Impact



Text to be added within a bill has been marked with Bold and
Underline. Text to be removed has been marked with
Strikethrough and Italic. How these codes are actually displayed will
vary based on the browser software you are using.

This sentence is marked with bold and underline to show added text.

This sentence is marked with strikethrough and italic, indicating
text to be removed.

Daily Data Tracking History



H0406aa.............................................by REVENUE AND TAXATION
SALES TAX - COUNTY LOCAL OPTION - Amends existing law to provide
legislative findings; to provide authority for a county sales or use tax;
to create the county property tax relief fund; to provide general
provisions for an ordinance assessing the tax; to provide for collection
and administration of local option sales or use taxes by the State Tax
Commission; and to provide for distribution.
                                                                        
04/03    House intro - 1st rdg - to printing
04/04    Rpt prt - to Rev/Tax
04/09    Rpt out - to Gen Ord
04/14    Rpt out amen - to engros
04/15    Rpt engros - 1st rdg - to 2nd rdg as amen
04/16    Ret'd to Rev/Tax

Bill Text


                                                                        
                                                                        
  ||||              LEGISLATURE OF THE STATE OF IDAHO             ||||
 Fifty-seventh Legislature                 First Regular Session - 2003
                                                                        
                                                                        
                              IN THE HOUSE OF REPRESENTATIVES
                                                                        
                                     HOUSE BILL NO. 406
                                                                        
                             BY REVENUE AND TAXATION COMMITTEE
                                                                        
  1
  2                                        AN ACT
  3    RELATING TO A  COUNTY SALES TAX; REPEALING CHAPTER 26, TITLE 63,  IDAHO  CODE;
  4        AMENDING  TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW CHAPTER 26, TITLE
  5        63, IDAHO CODE, TO PROVIDE LEGISLATIVE FINDINGS,  TO PROVIDE AUTHORITY FOR
  6        A COUNTY SALES OR USE TAX, TO CREATE THE COUNTY PROPERTY TAX RELIEF  FUND,
  7        TO  PROVIDE GENERAL PROVISIONS FOR AN ORDINANCE ASSESSING THE TAX, TO PRO-
  8        VIDE FOR COLLECTION AND ADMINISTRATION OF LOCAL OPTION SALES OR USE  TAXES
  9        BY  THE  STATE  TAX  COMMISSION AND TO PROVIDE FOR DISTRIBUTION; PROVIDING
 10        SEVERABILITY; DECLARING AN EMERGENCY AND PROVIDING A SUNSET CLAUSE.
                                                                        
 11    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 12        SECTION 1.  That Chapter 26, Title 63,  Idaho Code, be, and  the  same  is
 13    hereby repealed.
                                                                        
 14        SECTION  2.  That Title 63, Idaho Code, be, and the same is hereby amended
 15    by the addition thereto of a NEW CHAPTER, to be known and designated as  Chap-
 16    ter 26, Title 63, Idaho Code, and to read as follows:
                                                                        
 17                                      CHAPTER 26
 18                                   COUNTY SALES TAX
                                                                        
 19        63-2601.  LEGISLATIVE FINDINGS. The legislature finds that the increase in
 20    growth  of the population of certain  counties and the influx of great numbers
 21    of people traveling to those counties for sport, recreation and business  have
 22    created  a drain on the  county infrastructure that is borne to an inequitable
 23    degree by the property owners of the  county. The legislature finds that it is
 24    both equitable and desirable to shift this tax burden in part from  the  prop-
 25    erty  owners  of the county to those visitors partaking of the services of the
 26    county. The legislature also finds that this objective must be subject to  the
 27    approval  and  supervision  of  the  voters  of the  county both through their
 28    elected officials and through direct input at the ballot box.
                                                                        
 29        63-2602.  AUTHORITY FOR COUNTY SALES OR USE TAX. The voters  of  a  county
 30    are  given the authority to authorize their county government to adopt, imple-
 31    ment and collect a sales tax or use tax upon  all  sales,  without  exception,
 32    that  are  subject  to  taxation  under  chapter 36, title 63, Idaho Code. The
 33    county commissioners of any such  county are  hereby  given  the  freedom  and
 34    authority  to  adopt,  implement  and  collect  a sales or use tax as provided
 35    herein if approved by the required minimum of sixty percent  (60%)  of  county
 36    voters  voting in an election conducted on the fourth Tuesday in May or on the
 37    first Tuesday after the first Monday in November. No local option sales or use
 38    tax proposal may be presented to  county voters for approval  or  modification
 39    for  a  period  of fifty-one (51) weeks after an election to approve or disap-
 40    prove such tax. The question presented to the voters of a  county shall  state
                                                                        
                                           2
                                                                        
  1    the  rate  of the local sales or use tax, the duration of the tax, which shall
  2    not exceed ten (10) years, and the purpose of the  tax  which  shall  be  debt
  3    retirement for expansion of detention facilities.
                                                                        
  4        63-2603.  COUNTY  PROPERTY  TAX  RELIEF FUND. (1) Any  county which imple-
  5    ments a sales or use tax pursuant to this chapter  shall create and  establish
  6    in  the  office of the county treasurer a county property tax relief fund into
  7    which shall be placed a minimum of fifty percent (50%) of any revenue received
  8    from the county sales or use tax. On or before the Tuesday following the first
  9    Monday in September of each year, the county treasurer  shall  submit  to  the
 10    board of county commissioners and the state tax commission a statement showing
 11    the  balance  in the county property tax relief fund as of September 1 of that
 12    year.
 13        (2)  No later than October 10, the balance  in  the  county  property  tax
 14    relief  fund,  as  of  September 1, shall be distributed to the county and any
 15    cities within the county entitled to receive revenues from the county sales or
 16    use tax. Moneys distributed shall be in an amount proportional to the percent-
 17    age that the previous year's property tax portion of the budget subject to the
 18    limitations of section 63-802, Idaho Code, for the county and each city  bears
 19    to the previous year's total property tax portion of the budget subject to the
 20    limitations  of  section  63-802, Idaho Code, for the county and all cities in
 21    the county.
 22        (3)  The dollar amount subject to the limitations of section 63-802, Idaho
 23    Code, shall be the sum of the dollar amount of the portion of  property  taxes
 24    certified  to  the  board  of county commissioners under section 63-804, Idaho
 25    Code, and subject to the limitations of section 63-802, Idaho Code, as  if  no
 26    county  property tax relief fund moneys were to be distributed, and the dollar
 27    amount to be received from the property tax relief fund. The division  of  the
 28    resulting  sum  by  the value subject to taxation is a quotient that shall not
 29    exceed the levy limits prescribed by Idaho  Code.  If  these  limitations  are
 30    exceeded, the board of county commissioners shall reduce any applicable budget
 31    request  to comply with this section. The levy set to fund this portion of the
 32    budget shall be calculated based on the budget subject to the  limitations  of
 33    section  63-802,  Idaho  Code,  less  the money to be received from the county
 34    property tax relief fund.
                                                                        
 35        63-2604.  GENERAL PROVISIONS. Any ordinance assessing a  tax  pursuant  to
 36    this  chapter  shall  contain  a  finding by the board of county commissioners
 37    based upon evidence presented to it that the conditions set forth  in  section
 38    63-2601,  Idaho  Code,  exist  and shall provide the methods for reporting and
 39    collecting taxes due. Taxes collected pursuant to any such ordinance shall  be
 40    remitted  to  the  county  official designated in such ordinance or other such
 41    official contracting, pursuant to this chapter, with  the  county  to  provide
 42    collection  services, and shall constitute revenue of the county available for
 43    any lawful purpose approved by county voters subject to the provisions of this
 44    chapter. In any election, the ordinance submitted to county voters shall:  (1)
 45    state and define the sales or use tax to be approved; (2) state the exact rate
 46    of  the  tax to be assessed, which in no event shall exceed five-tenths of one
 47    percent (0.5%) of the sales price of an item subject to  taxation;  (3)  state
 48    the exact purpose or purposes for which the revenues derived from the sales or
 49    use tax shall be used; (4) state the duration of the tax which shall not be in
 50    excess of ten (10) years or the date the obligation has been met for the proj-
 51    ect  for   which  the  sales  and use tax was passed pursuant to this chapter,
 52    whichever occurs first. No tax shall be redefined, no rate shall be increased,
 53    no purpose shall be modified, and no duration shall be extended without subse-
                                                                        
                                           3
                                                                        
  1    quent approval of county voters. The county clerk of any  county  adopting  an
  2    ordinance, or any amendment thereto,  shall forward a copy of the ordinance or
  3    amendment  to  the  state controller, the chairman of the state tax commission
  4    and the chairman of the state board of tax appeals.
                                                                        
  5        63-2605.  COLLECTION AND ADMINISTRATION OF LOCAL OPTION SALES OR USE TAXES
  6    BY THE STATE TAX COMMISSION -- DISTRIBUTION. (1) Any  county which has  levied
  7    a tax pursuant to section 63-2602, Idaho Code, may contract with the state tax
  8    commission  for the collection and administration of such taxes in like manner
  9    and under definitions and rules of the state tax commission for the collection
 10    and administration of the state sales or use tax under chapter 36,  title  63,
 11    Idaho  Code. A county which levies such tax shall have the right to review and
 12    audit the records of collection thereof maintained by the commission  and  the
 13    returns  of  taxpayers  relating to such tax. Alternatively, such county shall
 14    have authority to administer and collect such tax.
 15        (2)  All revenues collected by the state tax commission pursuant  to  sec-
 16    tion 63-2602, Idaho Code, shall be distributed as follows:
 17        (a)  An amount of money shall be distributed to the state refund fund suf-
 18        ficient  to  pay current refund claims. All refunds authorized by the com-
 19        mission to be paid shall be paid through the state refund fund  and  those
 20        moneys are continuously appropriated.
 21        (b)  An  amount  of  money equal to such fee as may be agreed upon between
 22        the state tax commission and such county for the actual cost of  the  col-
 23        lection  and administration of the tax. The amount retained by the commis-
 24        sion shall not exceed the amount authorized to be expended  by  appropria-
 25        tion  by the legislature. Any unencumbered balance in excess of the actual
 26        cost at the end of each fiscal year shall be distributed  as  provided  in
 27        subsection (2)(c) of this section.
 28        (c)  All  remaining  moneys  received  pursuant  to  this chapter shall be
 29        placed in a fund designated by the state controller and  remitted  monthly
 30        to the county levying such sales or use tax.
                                                                        
 31        SECTION  3.  SEVERABILITY.  The provisions of this act are hereby declared
 32    to be severable and if any provision of this act or the  application  of  such
 33    provision  to  any  person or circumstance is declared invalid for any reason,
 34    such declaration shall not affect the validity of the  remaining  portions  of
 35    this act.
                                                                        
 36        SECTION  4.  An  emergency  existing  therefor,  which emergency is hereby
 37    declared to exist, this act shall be in full force and effect on and after its
 38    passage and approval, and shall be null,  void and of no force and  effect  on
 39    and after December 31, 2009.

Amendment


                                                                        
                                                                        
  ||||              LEGISLATURE OF THE STATE OF IDAHO             ||||
 Fifty-seventh Legislature                 First Regular Session - 2003
                                                                        
                                                                        
                                                     Moved by    Ridinger            
                                                                        
                                                     Seconded by Kellogg             
                                                                        
                                                                        
                              IN THE HOUSE OF REPRESENTATIVES
                              HOUSE AMENDMENT TO H.B. NO. 406
                                                                        
  1                                AMENDMENT TO SECTION 2
  2        On page 1 of the printed bill, in line 35, delete  "sixty  percent  (60%)"
  3    and insert: "sixty-six and two-thirds percent (66 2/3%)".

Engrossed Bill (Original Bill with Amendment(s) Incorporated)


                                                                        
                                                                        
  ||||              LEGISLATURE OF THE STATE OF IDAHO             ||||
 Fifty-seventh Legislature                 First Regular Session - 2003
                                                                        
                                                                        
                              IN THE HOUSE OF REPRESENTATIVES
                                                                        
                               HOUSE BILL NO. 406, As Amended
                                                                        
                             BY REVENUE AND TAXATION COMMITTEE
                                                                        
  1
  2                                        AN ACT
  3    RELATING TO A  COUNTY SALES TAX; REPEALING CHAPTER 26, TITLE 63,  IDAHO  CODE;
  4        AMENDING  TITLE 63, IDAHO CODE, BY THE ADDITION OF A NEW CHAPTER 26, TITLE
  5        63, IDAHO CODE, TO PROVIDE LEGISLATIVE FINDINGS,  TO PROVIDE AUTHORITY FOR
  6        A COUNTY SALES OR USE TAX, TO CREATE THE COUNTY PROPERTY TAX RELIEF  FUND,
  7        TO  PROVIDE GENERAL PROVISIONS FOR AN ORDINANCE ASSESSING THE TAX, TO PRO-
  8        VIDE FOR COLLECTION AND ADMINISTRATION OF LOCAL OPTION SALES OR USE  TAXES
  9        BY  THE  STATE  TAX  COMMISSION AND TO PROVIDE FOR DISTRIBUTION; PROVIDING
 10        SEVERABILITY; DECLARING AN EMERGENCY AND PROVIDING A SUNSET CLAUSE.
                                                                        
 11    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 12        SECTION 1.  That Chapter 26, Title 63,  Idaho Code, be, and  the  same  is
 13    hereby repealed.
                                                                        
 14        SECTION  2.  That Title 63, Idaho Code, be, and the same is hereby amended
 15    by the addition thereto of a NEW CHAPTER, to be known and designated as  Chap-
 16    ter 26, Title 63, Idaho Code, and to read as follows:
                                                                        
 17                                      CHAPTER 26
 18                                   COUNTY SALES TAX
                                                                        
 19        63-2601.  LEGISLATIVE FINDINGS. The legislature finds that the increase in
 20    growth  of the population of certain  counties and the influx of great numbers
 21    of people traveling to those counties for sport, recreation and business  have
 22    created  a drain on the  county infrastructure that is borne to an inequitable
 23    degree by the property owners of the  county. The legislature finds that it is
 24    both equitable and desirable to shift this tax burden in part from  the  prop-
 25    erty  owners  of the county to those visitors partaking of the services of the
 26    county. The legislature also finds that this objective must be subject to  the
 27    approval  and  supervision  of  the  voters  of the  county both through their
 28    elected officials and through direct input at the ballot box.
                                                                        
 29        63-2602.  AUTHORITY FOR COUNTY SALES OR USE TAX. The voters  of  a  county
 30    are  given the authority to authorize their county government to adopt, imple-
 31    ment and collect a sales tax or use tax upon  all  sales,  without  exception,
 32    that  are  subject  to  taxation  under  chapter 36, title 63, Idaho Code. The
 33    county commissioners of any such  county are  hereby  given  the  freedom  and
 34    authority  to  adopt,  implement  and  collect  a sales or use tax as provided
 35    herein if approved by the required minimum of sixty-six and two-thirds percent
 36    (66 2/3%) of county voters voting in an election conducted on the fourth Tues-
 37    day in May or on the first Tuesday after the  first  Monday  in  November.  No
 38    local  option  sales or use tax proposal may be presented to county voters for
 39    approval or modification for a period of fifty-one (51) weeks after  an  elec-
 40    tion  to  approve or disapprove such tax. The question presented to the voters
                                                                        
                                           2
                                                                        
  1    of a  county shall state the rate of the local sales or use tax, the  duration
  2    of  the tax, which shall not exceed ten (10) years, and the purpose of the tax
  3    which shall be debt retirement for expansion of detention facilities.
                                                                        
  4        63-2603.  COUNTY PROPERTY TAX RELIEF FUND. (1) Any   county  which  imple-
  5    ments  a sales or use tax pursuant to this chapter  shall create and establish
  6    in the office of the county treasurer a county property tax relief  fund  into
  7    which shall be placed a minimum of fifty percent (50%) of any revenue received
  8    from the county sales or use tax. On or before the Tuesday following the first
  9    Monday  in  September  of  each year, the county treasurer shall submit to the
 10    board of county commissioners and the state tax commission a statement showing
 11    the balance in the county property tax relief fund as of September 1  of  that
 12    year.
 13        (2)  No  later  than  October  10,  the balance in the county property tax
 14    relief fund, as of September 1, shall be distributed to  the  county  and  any
 15    cities within the county entitled to receive revenues from the county sales or
 16    use tax. Moneys distributed shall be in an amount proportional to the percent-
 17    age that the previous year's property tax portion of the budget subject to the
 18    limitations  of section 63-802, Idaho Code, for the county and each city bears
 19    to the previous year's total property tax portion of the budget subject to the
 20    limitations of section 63-802, Idaho Code, for the county and  all  cities  in
 21    the county.
 22        (3)  The dollar amount subject to the limitations of section 63-802, Idaho
 23    Code,  shall  be the sum of the dollar amount of the portion of property taxes
 24    certified to the board of county commissioners  under  section  63-804,  Idaho
 25    Code,  and  subject to the limitations of section 63-802, Idaho Code, as if no
 26    county property tax relief fund moneys were to be distributed, and the  dollar
 27    amount  to  be received from the property tax relief fund. The division of the
 28    resulting sum by the value subject to taxation is a quotient  that  shall  not
 29    exceed  the  levy  limits  prescribed  by Idaho Code. If these limitations are
 30    exceeded, the board of county commissioners shall reduce any applicable budget
 31    request to comply with this section. The levy set to fund this portion of  the
 32    budget  shall  be calculated based on the budget subject to the limitations of
 33    section 63-802, Idaho Code, less the money to  be  received  from  the  county
 34    property tax relief fund.
                                                                        
 35        63-2604.  GENERAL  PROVISIONS.  Any  ordinance assessing a tax pursuant to
 36    this chapter shall contain a finding by  the  board  of  county  commissioners
 37    based  upon  evidence presented to it that the conditions set forth in section
 38    63-2601, Idaho Code, exist and shall provide the  methods  for  reporting  and
 39    collecting  taxes due. Taxes collected pursuant to any such ordinance shall be
 40    remitted to the county official designated in such  ordinance  or  other  such
 41    official  contracting,  pursuant  to  this chapter, with the county to provide
 42    collection services, and shall constitute revenue of the county available  for
 43    any lawful purpose approved by county voters subject to the provisions of this
 44    chapter.  In any election, the ordinance submitted to county voters shall: (1)
 45    state and define the sales or use tax to be approved; (2) state the exact rate
 46    of the tax to be assessed, which in no event shall exceed five-tenths  of  one
 47    percent  (0.5%)  of  the sales price of an item subject to taxation; (3) state
 48    the exact purpose or purposes for which the revenues derived from the sales or
 49    use tax shall be used; (4) state the duration of the tax which shall not be in
 50    excess of ten (10) years or the date the obligation has been met for the proj-
 51    ect for  which the sales and use tax was  passed  pursuant  to  this  chapter,
 52    whichever occurs first. No tax shall be redefined, no rate shall be increased,
 53    no purpose shall be modified, and no duration shall be extended without subse-
                                                                        
                                           3
                                                                        
  1    quent  approval  of  county voters. The county clerk of any county adopting an
  2    ordinance, or any amendment thereto,  shall forward a copy of the ordinance or
  3    amendment to the state controller, the chairman of the  state  tax  commission
  4    and the chairman of the state board of tax appeals.
                                                                        
  5        63-2605.  COLLECTION AND ADMINISTRATION OF LOCAL OPTION SALES OR USE TAXES
  6    BY  THE STATE TAX COMMISSION -- DISTRIBUTION. (1) Any  county which has levied
  7    a tax pursuant to section 63-2602, Idaho Code, may contract with the state tax
  8    commission for the collection and administration of such taxes in like  manner
  9    and under definitions and rules of the state tax commission for the collection
 10    and  administration  of the state sales or use tax under chapter 36, title 63,
 11    Idaho Code. A county which levies such tax shall have the right to review  and
 12    audit  the  records of collection thereof maintained by the commission and the
 13    returns of taxpayers relating to such tax. Alternatively,  such  county  shall
 14    have authority to administer and collect such tax.
 15        (2)  All  revenues  collected by the state tax commission pursuant to sec-
 16    tion 63-2602, Idaho Code, shall be distributed as follows:
 17        (a)  An amount of money shall be distributed to the state refund fund suf-
 18        ficient to pay current refund claims. All refunds authorized by  the  com-
 19        mission  to  be paid shall be paid through the state refund fund and those
 20        moneys are continuously appropriated.
 21        (b)  An amount of money equal to such fee as may be  agreed  upon  between
 22        the  state  tax commission and such county for the actual cost of the col-
 23        lection and administration of the tax. The amount retained by the  commis-
 24        sion  shall  not exceed the amount authorized to be expended by appropria-
 25        tion by the legislature. Any unencumbered balance in excess of the  actual
 26        cost  at  the  end of each fiscal year shall be distributed as provided in
 27        subsection (2)(c) of this section.
 28        (c)  All remaining moneys received  pursuant  to  this  chapter  shall  be
 29        placed  in  a fund designated by the state controller and remitted monthly
 30        to the county levying such sales or use tax.
                                                                        
 31        SECTION 3.  SEVERABILITY.  The provisions of this act are hereby  declared
 32    to  be  severable  and if any provision of this act or the application of such
 33    provision to any person or circumstance is declared invalid  for  any  reason,
 34    such  declaration  shall  not affect the validity of the remaining portions of
 35    this act.
                                                                        
 36        SECTION 4.  An emergency existing  therefor,  which  emergency  is  hereby
 37    declared to exist, this act shall be in full force and effect on and after its
 38    passage  and  approval, and shall be null,  void and of no force and effect on
 39    and after December 31, 2009.

Statement of Purpose / Fiscal Impact



                       STATEMENT OF PURPOSE
                            Rs13257 
This legislation authorizes counties to adopt local option sales
taxes and to implement and collect such tax. The bill requires
that the measure 1)be put to the voters and obtain a minimum of
60% approval, 2)be used for the specific purpose of debt
retirement of detention facilities, 3)be set for a period of time
10 years or less, & 4) set forth the rate of taxation and that
rate shall not exceed .5%.  Not less than 50% of the revenue
generated would be applied to reduce existing property taxes and
the balance of such revenues used to provide needed services,
which would otherwise be paid for by general fund revenues. The
measure sunsets on December 31, 2009.
                          FISCAL IMPACT
There is no impact to the State of Idaho as a result of this
legislation. Counties whose voters approve such a measure will
enjoy a reduction in property taxes while paying higher sales
tax.  
Contact
Name: Senators John Goedde, Dick Compton & Kent Bailey
      Representatives Hilde Kellogg, Wayne Meyer, Charles Eberle, 
      Bonnie Douglas, George Sayler
Phone: 332-1340 




STATEMENT OF PURPOSE/FISCAL NOTE                         H 406