2006 Legislation
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HOUSE BILL NO. 501 – County sales tax/affordable housing

HOUSE BILL NO. 501

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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

Bill Text


                                                                        
                                                                        
  ]]]]              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 / Fiscal Impact



                       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