2007 Legislation
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HOUSE BILL NO. 250 – Sales tax rebate/certain developers

HOUSE BILL NO. 250

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Bill Status



H0250...............................................by REVENUE AND TAXATION
SALES AND USE TAX - REBATE - Adds to and amends existing law to provide a
sales and use tax rebate for certain developers of certain retail
commercial complexes; to provide requirements for the rebate; to provide
procedures; and to provide when the rebate is no longer paid.
                                                                        
02/28    House intro - 1st rdg - to printing
03/01    Rpt prt - to Rev/Tax
03/05    Rpt out - rec d/p - to 2nd rdg
03/06    2nd rdg - to 3rd rdg
03/07    3rd rdg - PASSED - 68-1-1
      AYES -- Anderson, Andrus, Barrett, Bayer, Bedke, Bilbao, Black,
      Block, Bock, Boe, Bolz, Brackett, Bradford, Chadderdon, Chavez, Chew,
      Clark, Collins, Crane, Durst, Edmunson, Eskridge, Hagedorn, Hart,
      Harwood, Henbest, Henderson, Jaquet, Killen, King, Kren, Labrador,
      Lake, Loertscher, Luker, Marriott, Mathews, McGeachin, Mortimer,
      Moyle, Nielsen, Nonini, Pasley-Stuart, Patrick, Pence, Raybould,
      Ring, Ringo, Roberts, Ruchti, Rusche, Sayler, Schaefer, Shepherd(2),
      Shepherd(8), Shirley, Shively, Smith(30), Smith(24), Snodgrass,
      Stevenson, Thayn, Trail, Vander Woude, Wills, Wood(27), Wood(35), Mr.
      Speaker
      NAYS -- LeFavour
      Absent and excused -- Bell
    Floor Sponsor - Nonini
    Title apvd - to Senate
03/08    Senate intro - 1st rdg - to Loc Gov
03/14    Rpt out - rec d/p - to 2nd rdg
03/15    2nd rdg - to 3rd rdg
03/20    3rd rdg - PASSED - 24-10-1
      AYES -- Bair, Bastian, Bilyeu, Broadsword, Cameron, Corder,
      Darrington, Davis, Fulcher, Geddes, Goedde, Hammond, Heinrich, Hill,
      Jorgenson, Keough, Lodge, McGee, McKague, McKenzie, Pearce,
      Richardson, Siddoway, Stegner
      NAYS -- Andreason, Burkett, Coiner, Kelly, Langhorst, Little,
      Malepeai, Schroeder, Stennett, Werk
      Absent and excused -- Gannon
    Floor Sponsor - Hammond
    Title apvd - to House
03/21    To enrol - Rpt enrol - Sp signed
03/22    Pres signed - To Governor
03/26    Governor signed
         Session Law Chapter 172
         Effective: 07/01/07

Bill Text


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-ninth Legislature                   First Regular Session - 2007
                                                                        
                                                                        
                              IN THE HOUSE OF REPRESENTATIVES
                                                                        
                                     HOUSE BILL NO. 250
                                                                        
                             BY REVENUE AND TAXATION COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO THE SALES AND USE TAX; AMENDING CHAPTER 36, TITLE 63, IDAHO  CODE,
  3        BY  THE  ADDITION OF A NEW SECTION 63-3641, IDAHO CODE, TO PROVIDE A SALES
  4        AND USE TAX REBATE TO CERTAIN  DEVELOPERS  OF  CERTAIN  RETAIL  COMMERCIAL
  5        COMPLEXES,  TO  PROVIDE  QUALIFICATIONS, TO PROVIDE PROCEDURES, TO PROVIDE
  6        WHEN THE REBATE IS NO LONGER PAID AND TO DEFINE TERMS; AND  AMENDING  SEC-
  7        TION 63-3638, IDAHO CODE, TO PROVIDE FOR DISTRIBUTION OF MONEYS TO CERTAIN
  8        DEVELOPERS  OF  CERTAIN RETAIL COMMERCIAL COMPLEXES WHO HAVE INCURRED CER-
  9        TAIN COSTS FOR IMPROVEMENTS.
                                                                        
 10    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 11        SECTION 1.  That Chapter 36, Title 63, Idaho Code, be,  and  the  same  is
 12    hereby  amended by the addition thereto of a NEW SECTION, to be known and des-
 13    ignated as Section 63-3641, Idaho Code, and to read as follows:
                                                                        
 14        63-3641.  TANGIBLE PERSONAL PROPERTY SOLD BY CERTAIN RETAILERS. (1) A  de-
 15    veloper  of  a  retail  commercial complex whose stores sell tangible personal
 16    property or taxable services and collected sales or use tax from customers  at
 17    the  location  of  the developer's retail commercial complex may qualify for a
 18    rebate of taxes paid on such purchases, but only if the developer of a  retail
 19    commercial  complex  whose  stores  sell tangible personal property or taxable
 20    services has built a complex in Idaho that is of a minimum cost as provided in
 21    subsection (2) of this section and has incurred costs in excess of eight  mil-
 22    lion  dollars  ($8,000,000)  for  the  installation  of an interchange from an
 23    interstate highway or a highway enumerated in section 40-201, Idaho  Code,  by
 24    the Idaho transportation department or a political subdivision or a contractor
 25    of  the  transportation  department  or  political  subdivision and/or freeway
 26    interchange improvements on land owned by the state of Idaho  or  a  political
 27    subdivision and/or auxiliary lanes necessitated by the design and construction
 28    of interchanges.
 29        (2)  To  qualify for the rebate, the developer of a retail commercial com-
 30    plex whose stores sell tangible personal property or  taxable  services  shall
 31    have  those  stores  collect sales and use taxes on sales of tangible personal
 32    property or taxable services from the retail commercial complex. Any  improve-
 33    ment  or  alteration to a public highway must be bonded in accordance with the
 34    public contracts bond act in chapter 19, title 54, Idaho Code. Once the devel-
 35    oper of a retail commercial complex whose stores sell tangible personal  prop-
 36    erty  or  taxable  services   certifies that the retail commercial complex has
 37    cost a minimum of four million dollars ($4,000,000) and  the  developer  of  a
 38    retail  commercial  complex  whose   stores sell tangible personal property or
 39    taxable services  has expended in excess of eight million dollars ($8,000,000)
 40    for the installation of an interchange and/or related interchange improvements
 41    from an interstate highway by the Idaho transportation department or a politi-
 42    cal subdivision or a contractor of the transportation department or  political
 43    subdivision  and/or  freeway  interchange improvements, the developer may file
                                                                        
                                       2
                                                                        
  1    with the state tax commission a refund request of sixty percent (60%)  of  the
  2    sales  and  use  taxes collected for the sale of tangible personal property or
  3    taxable services  from  stores in the retail commercial  complex.  The  refund
  4    request  shall  state  that the developer of a retail commercial complex whose
  5    stores sell tangible personal property or taxable services has  constructed  a
  6    retail facility that meets the minimum expenditure requirements and also meets
  7    the minimum expenditure requirements for an interchange and/or related freeway
  8    interchange  improvements  and/or  highway improvements to be eligible for the
  9    rebate, and that the developer is entitled to receive a rebate of  sixty  per-
 10    cent  (60%)  of all sales and use taxes collected by the  stores in the retail
 11    commercial complex that qualifies for the rebate created by this section.  The
 12    state  tax commission may require that sufficient documentation be provided by
 13    the developer of a retail commercial complex whose stores sell  tangible  per-
 14    sonal property or taxable services regarding expenditures and shall require an
 15    attestation  from  the Idaho transportation department or a political subdivi-
 16    sion  that the minimum requirements of this section have been met. The  trans-
 17    portation  department  or  the political subdivision shall verify to the state
 18    tax commission the amount of expenditures the developer has  expended  on  the
 19    interchange  and/or  related  freeway  interchange improvements and/or highway
 20    improvements.
 21        (3)  Upon filing of a written refund claim by the developer  of  a  retail
 22    commercial  complex  whose  stores  sell tangible personal property or taxable
 23    services entitled to the rebate, and subject to such reasonable  documentation
 24    and  verification as the state tax commission may require, the rebate shall be
 25    paid by the state tax commission from the demonstration  pilot  project  fund,
 26    which  is  hereby  created  in  the  state treasury, in a timely manner not to
 27    exceed sixty (60) calendar days after receipt as funds are available. To qual-
 28    ify for the rebate, stores in an eligible complex shall report their sales  to
 29    the  state  tax commission separately from other stores they own in the state.
 30    Nothing in this section shall be deemed to hold the  state  of  Idaho  or  any
 31    political  subdivision liable for any and all liens filed on a project subject
 32    to rebate pursuant to this section. All sales and use tax information remitted
 33    by retailers shall be deemed a trade secret,  shall be confidential and  shall
 34    not  be disclosed by the state tax commission. A developer of a retail commer-
 35    cial complex whose stores sell tangible personal property or taxable  services
 36    must  submit  a claim for refund pursuant to this section within two (2) years
 37    of the developer's last expenditure on the interchange and/or related  freeway
 38    interchange  improvements  and/or  highway  improvements. No interest shall be
 39    paid by the state on moneys refunded and all moneys  refunded  shall  be  paid
 40    from  the  sales  tax  account pursuant to subsection (11) of section 63-3638,
 41    Idaho Code, and shall be limited to a total aggregate of  thirty-five  million
 42    dollars ($35,000,000) or lesser amount if that is what was expended.
 43        (4)  Once  the developer of a retail commercial complex whose  stores sell
 44    tangible personal property or taxable services   has  recouped  its  costs  of
 45    funding the interchange and/or related freeway interchange improvements and/or
 46    highway  improvements   and/or related transportation  infrastructure, the de-
 47    veloper shall be ineligible to receive the rebate pursuant to this section.
 48        (5)  As used in this section:
 49        (a)  "Development of a retail commercial complex whose  stores sell tangi-
 50        ble personal property or taxable services"  includes  all  buildings,  the
 51        parking lot, sidewalks and all accessory equipment including, but not lim-
 52        ited  to,  lighting and traffic signs. Retail stores in the retail commer-
 53        cial complex shall sell tangible personal  property  or  taxable  services
 54        that are subject to the sales and use tax.
 55        (b)  "Freeway  interchange  improvements" includes on and off ramps, over-
                                                                        
                                       3
                                                                        
  1        pass and underpass improvements  and   signalization   to  facilitate  the
  2        effective access from the interstate highway system.
  3        (c)  "Highway  improvements" shall be improvements or upgrades to highways
  4        enumerated in section 40-201, Idaho Code.
                                                                        
  5        SECTION 2.  That Section 63-3638, Idaho Code, be, and the same  is  hereby
  6    amended to read as follows:
                                                                        
  7        63-3638.  SALES TAX -- DISTRIBUTION. All moneys collected under this chap-
  8    ter,  except  as  may  otherwise  be required in sections 63-3203 and 63-3709,
  9    Idaho Code, shall be distributed by the tax commission as follows:
 10        (1)  An amount of money shall be distributed to the state  refund  account
 11    sufficient  to  pay  current  refund claims. All refunds authorized under this
 12    chapter by the commission shall be paid through the state refund account,  and
 13    those moneys are continuously appropriated.
 14        (2)  Five  million dollars ($5,000,000) per year is continuously appropri-
 15    ated and shall be distributed to the permanent building fund, provided by sec-
 16    tion 57-1108, Idaho Code.
 17        (3)  Four million eight hundred thousand dollars ($4,800,000) per year  is
 18    continuously appropriated and shall be distributed to the water pollution con-
 19    trol account established by section 39-3605, Idaho Code.
 20        (4)  An  amount  equal to the sum required to be certified by the chairman
 21    of the Idaho housing and finance association to the state tax commission  pur-
 22    suant  to  section 67-6211, Idaho Code, in each year is continuously appropri-
 23    ated and shall be paid to any capital reserve fund, established by  the  Idaho
 24    housing  and finance association pursuant to section 67-6211, Idaho Code. Such
 25    amounts, if any, as may be appropriated hereunder to the capital reserve  fund
 26    of  the Idaho housing and finance association shall be repaid for distribution
 27    under the provisions of this section, subject to  the  provisions  of  section
 28    67-6215,  Idaho Code, by the Idaho housing and finance association, as soon as
 29    possible, from any moneys available therefor and  in  excess  of  the  amounts
 30    which the association determines will keep it self-supporting.
 31        (5)  An  amount  equal  to  the sum required by the provisions of sections
 32    63-709 and 63-717, Idaho Code, after allowance for the amount appropriated  by
 33    section  63-718(3), Idaho Code, is continuously appropriated and shall be paid
 34    as provided by sections 63-709 and 63-717, Idaho Code.
 35        (6)  An  amount  required by the provisions of chapter 53, title 33, Idaho
 36    Code.
 37        (7)  An amount required by the provisions of chapter 87, title  67,  Idaho
 38    Code.
 39        (8)  One  dollar  ($1.00)  on each application for certificate of title or
 40    initial application for registration of  a  motor  vehicle,  snowmobile,  all-
 41    terrain vehicle or other vehicle processed by the county assessor or the Idaho
 42    transportation  department  excepting those applications in which any sales or
 43    use taxes due have been previously collected by a retailer, shall be a fee for
 44    the services of the assessor of the county or the Idaho transportation depart-
 45    ment in collecting such taxes, and shall be paid into the current expense fund
 46    of the county or state highway account established in  section  40-702,  Idaho
 47    Code.
 48        (9)  Eleven  and  five-tenths percent (11.5%) is continuously appropriated
 49    and shall be distributed to the revenue sharing account which  is  created  in
 50    the state treasury, and the moneys in the revenue sharing account will be paid
 51    in installments each calendar quarter by the tax commission as follows:
 52        (a)  Twenty-eight and two-tenths percent (28.2%) shall be paid to the var-
 53        ious cities as follows:
                                                                        
                                       4
                                                                        
  1             (i)   Fifty percent (50%) of such amount shall be paid to the various
  2             cities,  and  each city shall be entitled to an amount in the propor-
  3             tion that the population of that  city bears to the population of all
  4             cities within the state; and
  5             (ii)  Fifty percent (50%) of such amount shall be paid to the various
  6             cities, and each city shall be entitled to an amount in  the  propor-
  7             tion  that  the preceding year's market value for assessment purposes
  8             for that city bears to the preceding year's market value for  assess-
  9             ment purposes for all cities within the state.
 10        (b)  Twenty-eight and two-tenths percent (28.2%) shall be paid to the var-
 11        ious counties as follows:
 12             (i)   One  million three hundred twenty thousand dollars ($1,320,000)
 13             annually shall be distributed one forty-fourth (1/44) to each of  the
 14             various counties; and
 15             (ii)  The  balance  of such amount shall be paid to the various coun-
 16             ties, and each county shall be entitled to an amount in  the  propor-
 17             tion  that  the  population of that county bears to the population of
 18             the state;
 19        (c)  Thirty-five and nine-tenths percent (35.9%) of the  amount  appropri-
 20        ated in this subsection (9) shall be paid to the several counties for dis-
 21        tribution to the cities and counties as follows:
 22             (i)   Each  city and county which received a payment under the provi-
 23             sions of section 63-3638(e), Idaho Code, during the fourth quarter of
 24             calendar year 1999, shall be entitled to a like  amount  during  suc-
 25             ceeding calendar quarters.
 26             (ii)  If  the  dollar amount of money available under this subsection
 27             (9)(c) in any quarter does not equal the amount paid  in  the  fourth
 28             quarter of calendar year 1999, each city's and county's payment shall
 29             be reduced proportionately.
 30             (iii) If  the  dollar amount of money available under this subsection
 31             (9)(c) in any quarter exceeds the amount paid in the  fourth  quarter
 32             of  calendar  year  1999, each city and county shall be entitled to a
 33             proportionately increased payment, but such increase shall not exceed
 34             one hundred five percent (105%) of the  total  payment  made  in  the
 35             fourth quarter of calendar year 1999.
 36             (iv)  If  the  dollar amount of money available under this subsection
 37             (9)(c) in any quarter exceeds one hundred five percent (105%) of  the
 38             total  payment  made in the fourth quarter of calendar year 1999, any
 39             amount over and above such one hundred five percent (105%)  shall  be
 40             paid fifty percent (50%) to the various cities in the proportion that
 41             the  population  of  the  city  bears to the population of all cities
 42             within the state, and fifty percent (50%) to the various counties  in
 43             the  proportion  that the population of a county bears to the popula-
 44             tion of the state; and
 45        (d)  Seven and seven-tenths percent (7.7%) of the amount  appropriated  in
 46        this subsection (9) shall be paid to the several counties for distribution
 47        to special purpose taxing districts as follows:
 48             (i)   Each  such  district  which received a payment under the provi-
 49             sions of section 63-3638(e), Idaho Code, during the fourth quarter of
 50             calendar year 1999, shall be entitled to a like  amount  during  suc-
 51             ceeding calendar quarters.
 52             (ii)  If  the  dollar amount of money available under this subsection
 53             (9)(d) in any quarter does not equal the amount paid  in  the  fourth
 54             quarter of calendar year 1999, each special purpose taxing district's
 55             payment shall be reduced proportionately.
                                                                        
                                       5
                                                                        
  1             (iii) If  the  dollar amount of money available under this subsection
  2             (9)(d) in any quarter exceeds the amount distributed under  paragraph
  3             (i)  of  this subsection (9)(d), each special purpose taxing district
  4             shall be entitled to a share of the excess based on   the  proportion
  5             each  such district's current property tax budget bears to the sum of
  6             the current property tax budgets of all such districts in the  state.
  7             The  state  tax  commission shall calculate district current property
  8             tax budgets to include any unrecovered foregone amounts as determined
  9             under section 63-802(1)(e), Idaho Code. When a special purpose taxing
 10             district is situated in more than one (1) county, the tax  commission
 11             shall  determine the portion attributable to the special purpose tax-
 12             ing district from each county in which it is situated.
 13             (iv)  If special  purpose  taxing  districts  are  consolidated,  the
 14             resulting  district  is entitled to a base amount equal to the sum of
 15             the base amounts which were received in the last calendar quarter  by
 16             each district prior to the consolidation.
 17             (v)   If   a   special   purpose  taxing  district  is  dissolved  or
 18             disincorporated, the state tax commission shall continuously distrib-
 19             ute to the board of county commissioners an amount equal to the  last
 20             quarter's  distribution prior to dissolution or disincorporation. The
 21             board of county commissioners shall determine any  redistribution  of
 22             moneys so received.
 23             (vi)  Taxing districts formed after January 1, 2001, are not entitled
 24             to a payment under the provisions of this subsection (9)(d).
 25             (vii) For  purposes of this subsection (9)(d), a special purpose tax-
 26             ing district is any taxing district which is not a city, a county  or
 27             a school district.
 28        (10) Amounts calculated in accordance with section 2, chapter 356, laws of
 29    2001, for annual distribution to counties and other taxing districts beginning
 30    in  October  2001 for replacement of property tax on farm machinery and equip-
 31    ment exempted pursuant to section 63-602EE, Idaho  Code.  For  nonschool  dis-
 32    tricts,  the  state  tax  commission shall distribute one-fourth (1/4) of this
 33    amount certified quarterly to each county. For school districts, the state tax
 34    commission shall distribute one-fourth (1/4) of the amount certified quarterly
 35    to each school district. For nonschool districts,  the  county  auditor  shall
 36    distribute  to  each district within thirty (30) calendar days from receipt of
 37    moneys from the tax commission. Moneys received by each  taxing  district  for
 38    replacement  shall  be utilized in the same manner and in the same proportions
 39    as revenues from property taxation. The moneys remitted to  the  county  trea-
 40    surer  for  replacement  of  property exempt from taxation pursuant to section
 41    63-602EE, Idaho Code, may be considered by the counties and other taxing  dis-
 42    tricts  and budgeted at the same time, in the same manner and in the same year
 43    as revenues from taxation on personal property which these moneys replace.  If
 44    taxing  districts  are  consolidated, the resulting district is entitled to an
 45    amount equal to the sum of the amounts which were received in the last  calen-
 46    dar quarter by each district pursuant to this subsection prior to the consoli-
 47    dation.  If  a  taxing district is dissolved or disincorporated, the state tax
 48    commission shall continuously distribute to the board of county  commissioners
 49    an  amount  equal  to  the last quarter's distribution prior to dissolution or
 50    disincorporation. The board of county commissioners shall determine any redis-
 51    tribution of moneys so received.  If a taxing district annexes territory,  the
 52    distribution  of  moneys  received  pursuant to this subsection shall be unaf-
 53    fected. Taxing districts formed after January 1, 2001, are not entitled  to  a
 54    payment  under  the  provisions  of  this  subsection.  School districts shall
 55    receive an amount determined by multiplying the sum of the  year  2000  school
                                                                        
                                       6
                                                                        
  1    district  levy  minus .004 times the market value on December 31, 2000, in the
  2    district of the property exempt from taxation pursuant  to  section  63-602EE,
  3    Idaho  Code,  provided that the result of these calculations shall not be less
  4    than zero (0). The result of these school district calculations shall be  fur-
  5    ther increased by six percent (6%). For purposes of the limitation provided by
  6    section  63-802, Idaho Code, moneys received pursuant to this section as prop-
  7    erty tax replacement for property exempt from  taxation  pursuant  to  section
  8    63-602EE, Idaho Code, shall be treated as property tax revenues.
  9        (11) Amounts  necessary  to  pay  refunds as provided in subsection (3) of
 10    section 63-3641, Idaho Code, to a developer of  a  retail  commercial  complex
 11    whose   stores sell tangible personal property or taxable services  subject to
 12    the sales and use tax up to an aggregate total of thirty-five million  dollars
 13    ($35,000,000) per project shall be remitted to the demonstration pilot project
 14    fund  created  in  subsection (3) of section 63-3641, Idaho Code, and shall be
 15    specific to and accounted for by each project.
 16        (12) Any moneys remaining over and  above  those  necessary  to  meet  and
 17    reserve for payments under other subsections of this section shall be distrib-
 18    uted to the general fund.

Statement of Purpose / Fiscal Impact


                    STATEMENT OF PURPOSE
                              
                          RS 17131
  
         The purpose of this legislation is to establish a new
  method of financing public transportation infrastructure
  projects utilizing the State Tax Anticipation Revenue
  (STAR) concept.  Upon approval of this legislation, private
  funds could be used to pay for all phases of qualified and
  approved projects to interstate and other state highways,
  from development to right-of-way acquisition, to
  construction.  

       The developer of a retail commercial complex whose
  stores sell tangible personal property or taxable services,
  may qualify for a rebate of taxes paid on purchases at the
  site to reimburse the developer for project expenses
  incurred for the installation of approved transportation
  improvements.

       An account will be established to receive funds from a
  portion of sales taxes collected on the site as a result of
  new businesses and economic development attracted to the
  location.  The Tax Commission will have oversight
  responsibilities for all monies disbursed to repay the
  costs incurred by the private sector to construct the
  facilities, after approval by the Idaho Transportation
  Department.

       No general fund or Idaho Transportation Department
  budget funds would be used to construct the transportation
  improvements.  Appropriate checks and balances are
  specified to ensure the integrity of the transfer of funds.
  Project management would be coordinated through local,
  state, and federal units of government.  Acquisition of
  additional right-of way will require the transfer of
  ownership to the Department if purchased by the developer.

  
                       Fiscal Impact

       The estimated new sales tax revenue at build out of the
  first "pilot project" is estimated to be $30 million
  dollars annually.
  

  
  
  
  Contact:  Speaker of the House Lawerence Denney
            Representative Mike Moyle
            Representative Bob Nonini
            Representative Frank Henderson
            Senator Jim Hammond
  
  Phone:    334-1120
  
  
  STATEMENT OF PURPOSE/FISCAL NOTE                  H 250