2005 Legislation
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SENATE BILL NO. 1115 – Liquor fund, deposits

SENATE BILL NO. 1115

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Bill Status



S1115......................................................by STATE AFFAIRS
STATE LIQUOR FUND - Amends existing law to clarify that the State Liquor
Account is now the State Liquor Fund; to clarify that moneys in the State
Liquor Account are to be deposited in the liquor fund; and to revise the
distribution of moneys in the State Liquor Fund.
                                                                        
02/14    Senate intro - 1st rdg - to printing
02/15    Rpt prt - to St Aff

Bill Text


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-eighth Legislature                   First Regular Session - 2005
                                                                        
                                                                        
                                       IN THE SENATE
                                                                        
                                    SENATE BILL NO. 1115
                                                                        
                                 BY STATE AFFAIRS COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO DISTRIBUTIONS OF MONEYS IN THE STATE LIQUOR FUND; AMENDING SECTION
  3        23-401, IDAHO CODE, TO CLARIFY THAT THE LIQUOR ACCOUNT IS NOW  THE  LIQUOR
  4        FUND,  TO CLARIFY THAT MONEYS IN THE STATE LIQUOR ACCOUNT ARE TO BE DEPOS-
  5        ITED IN THE LIQUOR FUND AND TO MAKE A TECHNICAL CORRECTION; AMENDING  SEC-
  6        TION  23-404,  IDAHO CODE, TO MAKE TECHNICAL CORRECTIONS AND TO REVISE THE
  7        DISTRIBUTION OF MONEYS IN THE STATE  LIQUOR  FUND;  AND  AMENDING  SECTION
  8        63-3638A,  IDAHO  CODE, TO PROVIDE THAT SALES TAX ON LIQUOR BE PAID TO THE
  9        LIQUOR FUND AND TO MAKE A TECHNICAL CORRECTION.
                                                                        
 10    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 11        SECTION 1.  That Section 23-401, Idaho Code, be, and the  same  is  hereby
 12    amended to read as follows:
                                                                        
 13        23-401.  LIQUOR  ACCOUNT CREATED FUND. The state treasurer shall be custo-
 14    dian of an account in the agency asset fund,  which  is  hereby  created,  and
 15    state  controller  shall  maintain  and  account for a state liquor fund to be
 16    known as the "liquor account fund," which shall contain  the  moneys  formerly
 17    deposited in the "liquor account" and which shall replace the "liquor account"
 18    and  into  which  shall be paid all revenues derived from alcoholic beverages,
 19    excise taxes, licenses, permits, fees, profits on sales,  sales  of  equipment
 20    and  supplies, and all other moneys accruing or received under any of the pro-
 21    visions of this act chapter. All moneys, properties, buildings, plants,  appa-
 22    ratus,  real estate, securities acquired by or through the moneys belonging to
 23    the liquor account fund, including interest earned thereon, shall be the prop-
 24    erty of the liquor account fund.
                                                                        
 25        SECTION 2.  That Section 23-404, Idaho Code, be, and the  same  is  hereby
 26    amended to read as follows:
                                                                        
 27        23-404.  DISTRIBUTION  OF MONEYS IN LIQUOR ACCOUNT FUND. (1) After collec-
 28    tion and distribution of any and all surcharges required under title 23, Idaho
 29    Code, tThe moneys received into the liquor account fund shall  be  transferred
 30    or appropriated as follows:
 31        (a)  An  amount of money equal to the actual cost of purchase of alcoholic
 32        liquor and payment of expenses of administration and operation of the dis-
 33        pensary, as determined by the superintendent and  certified  quarterly  to
 34        the  state  controller,  shall be transferred back to the dispensary; pro-
 35        vided, that the amount so transferred back for administration  and  opera-
 36        tion  of  the  dispensary  shall  not  exceed  the amount authorized to be
 37        expended by regular appropriation authorization.
 38        (b)  From the balance remaining after transferring the amounts  authorized
 39        by subsection paragraph (a) above of this subsection:
 40             (i)    One million two hundred thousand dollars ($1,200,000) shall be
 41             transferred  annually to the alcoholism treatment account fund, which
                                                                        
                                           2
                                                                        
  1             is hereby created in the trust and agency fund;
  2             (ii)   Three hundred thousand dollars ($300,000) shall be transferred
  3             annually to the community college account fund,  created  by  section
  4             33-2139, Idaho Code;
  5             (iii)  One million two hundred thousand dollars ($1,200,000) shall be
  6             transferred  annually to the public school income fund, as defined in
  7             section 33-903, Idaho Code;
  8             (iv)   Four  million  nine  hundred   forty-five   thousand   dollars
  9             ($4,945,000)  shall be transferred annually to the general account in
 10             the state operating fund; and
 11             (v)    Six hundred fifty thousand dollars ($650,000) shall be  trans-
 12             ferred  annually  to the cooperative welfare account in the dedicated
 13             fund.
 14             (vi)   Seventeen  million  four  hundred  thirty   thousand   dollars
 15             ($17,430,000)  shall  be allocated annually to the county-city allot-
 16             ment to be distributed in  accordance  with  subsections  (1)(c)  and
 17             (1)(d) of this section.
 18             (vii)  For  any  balance remaining after the distributions in subsec-
 19             tions (1)(b)(i) through (vi) of this  section,  fifty  percent  (50%)
 20             shall  be  transferred annually to the general fund and fifty percent
 21             (50%) shall be allocated to the county-city allotment to be  distrib-
 22             uted  in  accordance  with subsections (1)(c) and (1)(d) of this sec-
 23             tion.
 24             (viii) In the event the balance in the liquor fund is insufficient to
 25             pay the full amount set forth in subsections (1)(b)(i)  through  (vi)
 26             of  this  section,  payment  of the sums under this subsection (1)(b)
 27             shall be made first to subsections (1)(b)(i) through (v) of this sec-
 28             tion, to be prorated according to their relative amounts if the  fund
 29             balance  is  insufficient to pay the amounts in subsections (1)(b)(i)
 30             through (v) of this section in  full,  with  any  balance  thereafter
 31             applied to subsection (1)(b)(vi) of this section.
 32        (c)  Forty  percent  (40%)  of  the  balance remaining after the transfers
 33        authorized by paragraphs (a) and (b)  above  have  been  made  county-city
 34        allotment is hereby appropriated to and shall be paid to the several coun-
 35        ties.  Each  county  shall be entitled to an amount in the proportion that
 36        liquor sales through the dispensary in that county during the state's pre-
 37        vious fiscal year bear to total liquor sales through the dispensary in the
 38        state during the state's previous fiscal year, except that no county shall
 39        be entitled to an amount less than that county received  in  distributions
 40        from the liquor account fund during the state's fiscal year 1981 2004.
 41        (d)  Sixty  percent  (60%)  of  the  balance remaining after the transfers
 42        authorized by paragraphs (a) and (b)  above  have  been  made  county-city
 43        allotment  is hereby appropriated to and shall be paid to the several cit-
 44        ies as follows:
 45             (i)   Ninety percent (90%) of the amount appropriated to  the  cities
 46             shall  be  distributed  to  those cities which have a liquor store or
 47             distribution station located within the corporate limits of the city.
 48             Each such city shall be entitled to an amount in the proportion  that
 49             liquor  sales  through the dispensary in that city during the state's
 50             previous fiscal year bear to total liquor sales through  the  dispen-
 51             sary  in  the  state  during the state's previous fiscal year, except
 52             that no city shall be entitled to  an  amount  less  than  that  city
 53             received  in  distributions  from  the liquor account fund during the
 54             state's fiscal year 1981 2004;
 55             (ii)  Ten percent (10%) of the  amount  appropriated  to  the  cities
                                                                        
                                           3
                                                                        
  1             shall be distributed to those cities which do not have a liquor store
  2             or  distribution  station  located within the corporate limits of the
  3             city. Each such city shall be entitled to an amount in the proportion
  4             that that city's population bears to the population of all cities  in
  5             the  state  which  do not have a liquor store or distribution station
  6             located within the corporate limits of the city, except that no  city
  7             shall  be  entitled to an amount less than that city received in dis-
  8             tributions from the liquor account fund  during  the  state's  fiscal
  9             year 1981 2004.
 10        (2)  All  transfers  and distributions shall be made periodically, but not
 11    less frequently than quarterly but, the apportionments made to any  county  or
 12    city,  which  may during the succeeding three (3) year period be found to have
 13    been in error either of computation or transmittal, shall be corrected  during
 14    the  fiscal year of discovery by a reduction of apportionments  in the case of
 15    over-apportionment or by an increase of apportionments in the case  of  under-
 16    apportionment.  The decision of the superintendent on entitlements of counties
 17    and cities shall be final, and shall not be subject to judicial review.
                                                                        
 18        SECTION 3.  That Section 63-3638A, Idaho Code, be, and the same is  hereby
 19    amended to read as follows:
                                                                        
 20        63-3638A.  SALES TAX ON LIQUOR TO BE PAID TO LIQUOR ACCOUNT FUND. Notwith-
 21    standing  the  provisions  of  section 63-3638, Idaho Code, the sales tax col-
 22    lected on the retail sale of liquor by the superintendent of the state  liquor
 23    dispensary  shall  be  credited directly to the liquor account fund, and shall
 24    not be or become a part of the sales tax account fund.

Statement of Purpose / Fiscal Impact


                               STATEMENT OF PURPOSE

                                      RS14823
                                
This bill will freeze the current distribution of the Liquor Fund (Idaho Code, Section 23-404) at
the fiscal year 2004 levels and then reallocate any future growth 50% to the counties and cities 
and 50% to the General Fund. This bill also provides  a hierarchy for distribution in the 
unlikely event the future distributable balance in the Liquor Fund  fall below the 2004 
levels. 

Section 23-404, Idaho Code, provides the formula for distribution of Liquor Fund profits. 
The current formula, established in 1985, allocates fixed annual distributions to:
     $1,200,000    Alcohol Treatment Fund
     $  300,000    Community Colleges
     $1,200,000    Public Schools
     $4,945,000    General Fund
     $  650,000    Cooperative Welfare Fund
The remaining balance of Liquor Fund profits, after the above fixed distributions, is 
allocated to the counties and cities.

Since 1985, the counties and cities share of Liquor Fund distributions has grown from 
$4,485,000 to $17,430,000, while the General Fund share has remained fixed at 
$4,945,000.

This bill would allow the General Fund to share equally with the counties and cities in 
any future growth in Liquor Fund profits.



                                    FISCAL IMPACT


This bill would have the following effect on estimated Liquor Fund distributions:


          Current formula        Proposed formula        General      Cities and
       General   Cities and    General    Cities and       Fund        Counties
        Fund      Counties      Fund       Counties      Increase      Decrease

FY04  4,945,000  17,430,000    4,945,000  17,430,000         -             -
FY05  4,945,000  18,965,000    4,945,000  18,965,000         -             - 
FY06  4,945,000  19,528,000    5,944,000  18,479,000    1,049,000     (1,049,000)
FY07  4,945,000  20,981,000    6,721,000  19,205,000    1,776,000     (1,776,000) 
FY08  4,945,000  22,433,000    7,446,000  19,932,000    2,501,000     (2,501,000)
FY09  4,945,000  23,886,000    8,173,000  20,658,000    3,228,000     (3,228,000) 



CONTACT
Name:     Dyke Nally
Agency:   State Liquor Dispensary
Phone:    947-9402

STATEMENT OF PURPOSE/FISCAL NOTE                                       S 1115