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H0501...............................................by REVENUE AND TAXATION
COUNTY SALES TAX - Amends existing law to revise legislative findings
regarding a county sales tax; to delete reference to use tax; to revise the
purposes of the tax to include providing affordable housing for local
public employees and employees of school districts; to revise general
provisions of the tax; and to provide for joint exercise of powers
agreements.
01/30 House intro - 1st rdg - to printing
01/31 Rpt prt - to Rev/Tax
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-eighth Legislature Second Regular Session - 2006
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 501
BY REVENUE AND TAXATION COMMITTEE
1 AN ACT
2 RELATING TO COUNTY SALES TAXES; AMENDING SECTION 63-2601, IDAHO CODE, TO
3 REVISE LEGISLATIVE FINDINGS; AMENDING SECTION 63-2602, IDAHO CODE, TO
4 REVISE THE PURPOSES OF THE TAX, TO DEFINE A TERM AND TO DELETE REFERENCE
5 TO USE TAX; AMENDING SECTION 63-2603, IDAHO CODE, TO DELETE REFERENCE TO
6 USE TAX; AMENDING SECTION 63-2604, IDAHO CODE, TO REVISE GENERAL PROVI-
7 SIONS, TO DELETE REFERENCE TO USE TAX AND TO PROVIDE FOR JOINT EXERCISE OF
8 POWERS AGREEMENTS; AND AMENDING SECTION 4, CHAPTER 363, LAWS OF 2003, TO
9 REMOVE A SUNSET DATE.
10 Be It Enacted by the Legislature of the State of Idaho:
11 SECTION 1. That Section 63-2601, Idaho Code, be, and the same is hereby
12 amended to read as follows:
13 63-2601. LEGISLATIVE FINDINGS. The legislature hereby finds that the
14 increase in rapid growth of the population of certain counties and the influx
15 of great numbers of people traveling short-term residents to those counties
16 for sport, recreation and business have has created a drain on the county in-
17 frastructure that is borne to an inequitable degree by the property owners of
18 those counties through the payment of property taxes. The legislature finds
19 that it is both equitable and desirable to shift a portion of this tax burden
20 in part from the property owners of the county to those visitors partaking of
21 the services of the county. This would be accomplished by using one-half (1/2)
22 of the proceeds of sales taxes collected pursuant to this chapter for property
23 tax relief. The legislature finds that a local option tax has been used effec-
24 tively in parts of Idaho and that other counties could benefit from this tool
25 as a means of paying for infrastructure enhancement and the provision of
26 affordable housing within the county for employees of the county, city, other
27 political subdivision or a school district located in the county. The legisla-
28 ture also finds that this objective must be subject to the approval and super-
29 vision of the voters of the county, both through their elected officials and
30 through direct input at the ballot box.
31 SECTION 2. That Section 63-2602, Idaho Code, be, and the same is hereby
32 amended to read as follows:
33 63-2602. AUTHORITY FOR COUNTY SALES OR USE TAX. The voters of a county
34 are given the authority to authorize their county government to adopt, imple-
35 ment and collect a sales tax or use tax upon all sales, without exception,
36 that are subject to taxation under chapter 36, title 63, Idaho Code. The
37 county commissioners of any such county are hereby given the freedom and
38 authority to adopt, implement and collect a sales or use tax as provided
39 herein if approved by the required minimum of sixty-six and two-thirds percent
40 (66 2/3%) of county voters voting in an election conducted on the fourth Tues-
41 day in May or on the first Tuesday after the first Monday in November. No
2
1 local option sales or use tax proposal may be presented to county voters for
2 approval or modification for a period of fifty-one (51) weeks after an elec-
3 tion to approve or disapprove such tax. The question presented to the voters
4 of a county shall state the rate of the local sales or use tax, the duration
5 of the tax, which shall not exceed ten (10) years, and the purposes of the tax
6 which shall be county property tax relief and debt retirement for expansion of
7 detention facilities the funding of capital projects, exclusive of maintenance
8 and operation costs including affordable housing as defined in this section or
9 by federal guidelines. As used in this section, "affordable housing" means
10 property that is developed or purchased by the county, city, other political
11 subdivision or school district located within the county or their designees
12 for affordable housing for full-time county, city, other political subdivision
13 or school district employees. For the purposes of this section, the term
14 "affordable housing" shall mean that all of the following conditions are met:
15 (1) The county commissioners, city council, board of another political
16 subdivision or the board of trustees of a school district by majority vote of
17 the members of the full board of county commissioners, city council, board of
18 another political subdivision or the full board of trustees of a school dis-
19 trict, through resolution has made an express determination that affordable
20 housing is needed for full-time county, city, other political subdivision or
21 school district employees because the median cost of a single family home in
22 the county exceeds by three hundred percent (300%) the median salary of a
23 full-time employee of the county, city, other political subdivision or school
24 district.
25 (2) The board of county commissioners has signed findings of fact and
26 conclusions of law which support such resolution and has determined that the
27 resolution was based on substantial and competent evidence.
28 (3) The real property or other housing designated as affordable housing
29 must be conveyed to the employee of the county, city, other political subdivi-
30 sion or school district under a restriction on the transfer of title or
31 interest. Where the real property or other housing is sold by the county,
32 city, other political subdivision or school district, the deed from the
33 county, city, other political subdivision or school district shall restrict
34 any subsequent transfer of the real property or other housing as follows:
35 (a) The real property or other housing shall only be conveyed, leased or
36 otherwise transferred to a person approved by the board of county commis-
37 sioners, city council, board of another political subdivision or the board
38 of trustees of the school district in writing. The board of county commis-
39 sioners, city council, board of another political subdivision or the board
40 of trustees shall only approve such person(s) as subsequent transferees
41 who qualify for affordable housing under guidelines published by the board
42 of county commissioners, city council, board of another political subdivi-
43 sion or the board of trustees, which guidelines shall include findings
44 based on substantial and competent evidence; and
45 (b) The board of county commissioners, city council, board of another
46 political subdivision or the board of trustees of a school district
47 shall record a deed or title restriction such that the real property or
48 other housing will be available in perpetuity as affordable housing,
49 unless and until title reverts to the county, city, other political subdi-
50 vision or the school district as the case may be.
51 SECTION 3. That Section 63-2603, Idaho Code, be, and the same is hereby
52 amended to read as follows:
53 63-2603. COUNTY PROPERTY TAX RELIEF FUND. (1) Any county which imple-
3
1 ments a sales or use tax pursuant to this chapter shall create and establish
2 in the office of the county treasurer a county property tax relief fund into
3 which shall be placed a minimum of fifty percent (50%) of any revenue received
4 from the county sales or use tax. On or before the Tuesday following the first
5 Monday in September of each year, the county treasurer shall submit to the
6 board of county commissioners and the state tax commission a statement showing
7 the balance in the county property tax relief fund as of September 1 of that
8 year.
9 (2) No later than October 10, the balance in the county property tax
10 relief fund, as of September 1, shall be distributed to the county and any
11 cities within the county entitled to receive revenues from the county sales or
12 use tax. Moneys distributed shall be in an amount proportional to the percent-
13 age that the previous year's property tax portion of the budget subject to the
14 limitations of section 63-802, Idaho Code, for the county and each city bears
15 to the previous year's total property tax portion of the budget subject to the
16 limitations of section 63-802, Idaho Code, for the county and all cities in
17 the county.
18 (3) The dollar amount subject to the limitations of section 63-802, Idaho
19 Code, shall be the sum of the dollar amount of the portion of property taxes
20 certified to the board of county commissioners under section 63-804, Idaho
21 Code, and subject to the limitations of section 63-802, Idaho Code, as if no
22 county property tax relief fund moneys were to be distributed, and the dollar
23 amount to be received from the property tax relief fund. The division of the
24 resulting sum by the value subject to taxation is a quotient that shall not
25 exceed the levy limits prescribed by Idaho Code. If these limitations are
26 exceeded, the board of county commissioners shall reduce any applicable budget
27 request to comply with this section. The levy set to fund this portion of the
28 budget shall be calculated based on the budget subject to the limitations of
29 section 63-802, Idaho Code, less the money to be received from the county
30 property tax relief fund.
31 SECTION 4. That Section 63-2604, Idaho Code, be, and the same is hereby
32 amended to read as follows:
33 63-2604. GENERAL PROVISIONS. Any ordinance assessing a tax pursuant to
34 this chapter shall contain a finding by the board of county commissioners
35 based upon evidence presented to it that the conditions set forth in section
36 63-2601, Idaho Code, exist and shall provide the methods for reporting and
37 collecting taxes due. Taxes collected pursuant to any such ordinance shall be
38 remitted to the county official designated in such ordinance or other such
39 official contracting, pursuant to this chapter, with the county to provide
40 collection services, and shall constitute revenue of the county available for
41 county property tax relief and debt retirement for expansion of detention
42 facilities the funding of capital projects, exclusive of maintenance and oper-
43 ation costs including affordable housing as defined in section 63-2602, Idaho
44 Code, or by federal guidelines. In any election, the ordinance submitted to
45 county voters shall: (1) state and define the sales or use tax to be approved;
46 (2) state the exact rate of the tax to be assessed, which in no event shall
47 exceed five-tenths of one percent (0.5%) of the sales price of an item subject
48 to taxation; (3) state that the revenues derived from the sales or use tax
49 shall be used for county property tax relief and debt retirement for expansion
50 of detention facilities the funding of capital projects, exclusive of mainte-
51 nance and operation costs including affordable housing as defined in section
52 63-2602, Idaho Code, or by federal guidelines; (4) state the duration of the
53 tax which shall not be in excess of ten (10) years or the date the obligation
4
1 has been met for the project for which the sales and use tax was passed pursu-
2 ant to this chapter, whichever occurs first. The county clerk of any county
3 adopting an ordinance, or any amendment thereto, shall forward a copy of the
4 ordinance or amendment to the state controller, the chairman of the state tax
5 commission and the chairman of the state board of tax appeals.
6 A board of county commissioners, a city council, the board of another
7 political subdivision or the board of trustees of a school district may enter
8 into a joint exercise of powers agreement to implement the provisions of this
9 chapter and provide for sharing of revenue in the event a tax is adopted for
10 affordable housing purposes.
11 SECTION 5. That Section 4, Chapter 363, Laws of 2003, be, and the same is
12 hereby amended to read as follows:
13 SECTION 4. An emergency existing therefor, which emergency is hereby
14 declared to exist, this act shall be in full force and effect on and after its
15 passage and approval, and shall be null, void and of no force and effect on
16 and after December 31, 2009.
STATEMENT OF PURPOSE
RS 15652C1
This legislation provides counties the opportunity to implement
and collect a sales tax, of up to 0.5% or five tenths of one
percent. It requires a 66 2/3% vote, sunsets every ten years and
clarifies that the revenues are to be used for property tax
relief and the funding of capital projects, exclusive of
maintenance and operations, including affordable housing.
FISCAL NOTE
No impact to the state's general fund. County revenues dependent
on county sales tax receipts.
Contact
Name: Rep. Wendy Jaquet
Phone: 332-1130
STATEMENT OF PURPOSE/FISCAL NOTE H 501