SENATE JOURNAL FOURTH SPECIAL SESSION of the FIFTY-SIXTH LEGISLATURE September 19, 2006 Pursuant to the proclamation of His Excellency, Governor Jon M. Huntsman, Jr, the Senate of the Fifty-Sixth Legislature of the State of Utah met in the Senate Chamber of the State Capitol Complex in a Special Session at 2:00 p.m. on Tuesday, September 19, 2006. The Senate was called to order at 2:25 p.m., with President John Valentine presiding. Prayer - Senator Parley Hellewell Pledge of Allegiance - Senator Pete Knudson Roll Call - All Senators present. * * * Annette B. Moore read the following Proclamation and Certification: PROCLAMATION WHEREAS, since the adjournment of the 2006 General Session of the Fifty-Sixth Legislature of the State of Utah, matters have arisen which require immediate legislative attention; and WHEREAS, Article VII, Section 6 of the Constitution of the State of Utah provides that the Governor may, by proclamation, convene the Legislature into a Special Session; NOW, THEREFORE, I, JON M. HUNTSMAN, JR., Governor of the State of Utah by virtue of the authority vested in me by the Constitution and the Laws of the State of Utah, do by this Proclamation call the Fifty-Sixth Legislature of the State of Utah into a Fourth Special Session at the State Capitol Complex in Salt Lake City, Utah, on the 19th day of September 2006, at 2:00 p.m. for the following purposes: 1. To consider state and local option funding for transportation; and 2. To consider legislation amending the individual income tax system by modifying tax brackets, modifying the additions to and subtractions from income, and allowing an individual to elect between a single rate tax system and the existing graduated tax system. IN TESTIMONY WHEREOF, I have hereunto set my hand and caused to be affixed the Great Seal of the State of Utah. Done at the State Capitol Complex in Salt Lake City, Utah this 15th day of September 2006. Jon M. Huntsman, Jr. Governor Gary R. Herbert Lieutenant Governor I, GARY R. HERBERT, LIEUTENANT GOVERNOR OF THE STATE OF UTAH, DO HEREBY CERTIFY THAT the attached copy of a proclamation issued on the 15th day of September, 2006, and signed by Governor Jon M. Huntsman, Jr., is a true and correct copy of the original Proclamation calling the Fifty-Sixth Legislature of the State of Utah into a Fourth Special Session at the Capitol Complex at Salt Lake City, Utah, on the 19th day of September, 2006, at 2:00 p.m., for the purposes named in the Proclamation. I FURTHER TESTIFY THAT the membership of the Utah State Senate has not changed from that Certification of 2006 General Session with the following exception. NINTH DISTRICT: County of Salt Lake Wayne Niederhauser IN TESTIMONY WHEREOF, I have hereunto set my hand and caused to be affixed the Great Seal of the State of Utah at Salt Lake City, this 15 day of September, 2006. Gary R. Herbert Lieutenant Governor * * * On motion of Senator Waddoups, the Senate voted to adopt the Senate Rules of the 2006 General Session of the Fifty-Sixth Legislature as the rules for the Fourth Special Session. President Valentine appointed a committee comprised of Senators Howard Stephenson, Wayne Niederhauser and Brent Goodfellow to notify Governor Jon M. Huntsman, Jr. that the Senate is convened in the Fourth Special Session in accordance with his proclamation and is organized and ready to receive any communication from him. President Valentine appointed a committee comprised of Senator Curtis Bramble, Scott Jenkins, and Scott McCoy to notify the House of Representatives that the Senate is organized and ready to do business. Senator Bramble reported that the House has been notified. Senator Stephenson reported that the Governor has been notified. On motion of Senator Waddoups, and as provided by the Utah State Constitution and the Joint Rules of the Legislature, the Senate voted to suspend the reading of the titles of bills and resolutions on the Senate calendar as they are read for the first time and introduced and considered on Second Reading, Third Reading, and Consent Calendars. This suspension applies to all bills and resolutions introduced during this special legislative session, except that any senator may request the reading of the long title, short title, or both of any House of Senate bill or resolution. INTRODUCTION OF BILLS S.B. 4001, Income Tax Amendments (C. Bramble), read the first time by short title. * * * On motion of Senator Knudson, under suspension of the rules, S.B. 4001 was placed on the Second Reading Calendar for immediate consideration. S.B. 4001, INCOME TAX AMENDMENTS, was read the second time. Senator Bramble explained the bill. Senators Thomas, Dmitrich, Knudson, Hillyard, Stephenson, and Hale commented. Senator Dmitrich proposed the following amendment: 1. Page 1, Lines 12 through 14 12 This bill: 13 " modifies tax brackets for taxable years beginning on or after January 1, 2006; " for taxable years beginning on or after January 1, 2009, requires individual income tax brackets to be adjusted for changes in the consumer price index; 14 " modifies additions to and subtractions from federal taxable income for purposes of 2. Page 9, Line 250 through Page 10, Line 287: 250 Section 2. Section 59-10-104 is amended to read: 251 59-10-104. Tax basis -- Rates -- Exemption. 252 (1) Except as provided in Subsection { (4) } (5) or Part 12, Single Rate Individual Income Tax 253 Act, for taxable years beginning on or after January 1, [2001] 2006, a tax is imposed on the 254 state taxable income[, as defined in Section 59-10-112,] of every resident individual as 255 provided in this section. 256 (2) For an individual, other than a husband and wife or head of household required to 257 use the tax table under Subsection (3), the tax under this section is imposed in accordance with 258 the following { table } income brackets : 259 If the state taxable income is: The tax is: 260 Less than or equal to [$863] $1,105 2.3% of the state taxable income 261 Greater than [$863] $1,105 but less than [$20] $25, plus 3.3% of state taxable 262 or equal to [$1,726] $2,208 income greater than [$863] $1,105 263 Greater than [$1,726] $2,208 but less than [$48] $62, plus 4.2% of state taxable 264 or equal to [$2,588] $3,313 income greater than [$1,726] $2,208 265 Greater than [$2,588] $3,313 but less than [$85] $108, plus 5.2% of state taxable 266 or equal to [$3,450] $4,416 income greater than [$2,588] $3,313 267 Greater than [$3,450] $4,416 but less than [$129] $166, plus 6% of state taxable 268 or equal to [$4,313] $5,521 income greater than [$3,450] $4,416 269 Greater than [$4,313] $5,521 [$181] $232, plus 7% of state taxable 270 income greater than [$4,313] $5,521 271 (3) For a husband and wife filing a single return jointly, or a head of household as 272 defined in Section 2(b), Internal Revenue Code, filing a single return, the tax under this section 273 is imposed in accordance with the following { table } income brackets : 274 If the state taxable income is: The tax is: 275 Less than or equal to [$1,726] $2,210 2.3% of the state taxable income 276 Greater than [$1,726] $2,210 but less than [$40] $51, plus 3.3% of state taxable 277 or equal to [$3,450] $4,416 income greater than [$1,726] $2,210 278 Greater than [$3,450] $4,416 but less than [$97] $124, plus 4.2% of state taxable 279 or equal to [$5,176] $6,626 income greater than [$3,450] $4,416 280 Greater than [$5,176] $6,626 but less than [$169] $216, plus 5.2% of state taxable 281 or equal to [$6,900] $8,832 income greater than [$5,176] $6,626 282 Greater than [$6,900] $8,832 but less than [$259] $331, plus 6% of state taxable 283 or equal to [$8,626] $11,042 income greater than [$6,900] $8,832 284 Greater than [$8,626] $11,042 [$362] $464, plus 7% of state taxable 285 income greater than [$8,626] $11,042 (4) (a) For taxable years beginning on or after January 1, 2009, the commission shall: (i) make the following adjustments to the income brackets under Subsection (2): (A) increase or decrease the income brackets under Subsection (2) by a percentage equal to the percentage difference between the consumer price index for the preceding calendar year and the consumer price index for the calendar year 2007; and (B) after making an increase or decrease under Subsection (4)(a)(i)(A), round the income brackets under Subsection (2) to the nearest whole dollar; (ii) after making the adjustments described in Subsection (4)(a)(i) to the income brackets under Subsection (2), adjust the income brackets under Subsection (3) so that for each income bracket under Subsection (2) there is a corresponding income bracket under Subsection (3) that is equal to the product of: (A) each income bracket under Subsection (2); and (B) two; and (iii) to the extent necessary to reflect an adjustment under Subsection (4)(a)(i) or (ii): (A) increase or decrease the amount of tax under Subsection (2) or (3) prior to adding in the portion of the tax calculated as a percentage of state taxable income; and (B) after making an increase or decrease under Subsection (4)(a)(iii)(A), round the amount of tax under Subsection (2) or (3) to the nearest whole dollar. (b) The commission may not increase or decrease the tax rate percentages provided in Subsection (2) or (3). (c) For purposes of Subsection (4)(a)(i), the commission shall calculate the consumer price index as provided in Sections 1(f)(4) and 1(f)(5), Internal Revenue Code. 286 { (4) } (5) This section does not apply to a resident individual exempt from taxation under 287 Section 59-10-104.1. Senator Dmitrich's motion to amend passed on a voice vote. # # # Senator Thomas proposed the following amendment: 1. Page 32, Lines 959 through 963 959 (2) (a) A resident individual that calculates and pays a tax under this section: 960 (i) shall pay for a taxable year an amount equal to the product of: 961 (A) the resident individual's state taxable income for that taxable year; and 962 (B) { 5.35% } 4.9% ; and 963 (ii) is exempt from paying the tax imposed by Section 59-10-104. Senator Thomas' motion to amend failed on the following roll call vote: Yeas, 10; Nays, 19; Absent, 0. Voting in the affirmative were: Senators Buttars Hatch Hellewell Hillyard Jenkins Madsen Peterson Stephenson Thomas Waddoups Voting in the negative were: Senators Arent Bell Bramble Christensen Davis Dmitrich Eastman Evans Fife Goodfellow Hale Hickman Killpack Knudson Mayne McCoy Niederhauser Walker Valentine Senators Waddoups, Arent, Peterson, Bell, McCoy, Mayne, Peterson, Hale, and Hickman commented. On motion of Senator Bramble, under suspension of the rules, S.B. 4001, INCOME TAX AMENDMENTS, was considered read the second and third times. Senator Bramble explained the bill. The bill passed on the following roll call: Yeas, 22; Nays, 7; Absent, 0. Voting in the affirmative were: Senators Bell Bramble Buttars Christensen Dmitrich Eastman Evans Hatch Hellewell Hickman Hillyard Jenkins Killpack Knudson Madsen Niederhauser Peterson Stephenson Thomas Waddoups Walker Valentine Voting in the negative were: Senators Arent Davis Fife Goodfellow Hale Mayne McCoy S.B. 4001, as amended, was transmitted to the House. * * * On motion of Senator Knudson, and at 4:00 p.m., the Senate sauntered. The Senate was called to order at 4: 50 p.m., with President Pro Tem Knudson presiding. COMMUNICATIONS FROM THE HOUSE Mr. President: September 19, 2006 The House passed, as amended, H.B. 4001, COUNTY OPTION FUNDING FOR REGIONALLY SIGNIFICANT TRANSPORTATION INFRASTRUCTURE, by Representative R. Lockhart, and it is transmitted for consideration. Sandy D. Tenney, Chief Clerk Communications filed. H.B. 4001 was read the first time. * * * On motion of Senator Eastman, under suspension of the rules, H.B. 4001 was placed on the Second Reading Calendar for immediate consideration. * * * H.B. 4001, COUNTY OPTION FUNDING FOR REGIONALLY SIGNIFICANT TRANSPORTATION INFRASTRUCTURE, was read the second time. Senator Killpack explained the bill. Senator Thomas proposed the following amendment: 1. Page 2, Line 50 through Page 3, Line 62 50 17-50-322. County funding for a fixed guideway. 51 (1) For purposes of this section, "fixed guideway" means a public transit facility that 52 uses and occupies: 53 (a) rail for the use of public transit; or 54 (b) a separate right-of-way for the use of public transit. 55 (2) (a) Except as provided in Subsection (2)(b), a county legislative body may not levy 56 a property tax or expend revenues from uniform fees or any tax or fee imposed in lieu of a 57 property tax, to purchase, erect, repair, rebuild, maintain, or otherwise fund a fixed guideway. 58 (b) Subsection (2)(a) does not apply to a property tax levy imposed by a county for the 59 purpose of paying for bonds if: 60 (i) before January 1, 2007, the bonds were issued or approved by voters for issuance to 61 fund a fixed guideway; and 62 (ii) the county does not impose a sales and use tax authorized by Section 59-12-1703. Senators Hillyard, McCoy, Waddoups, Eastman, and Fife commented. Senator Thomas' motion to amend failed on the following roll call: Yeas, 12; Nays, 17; Absent, 0. Voting in the affirmative were: Senators Arent Bell Goodfellow Hale Hatch Hillyard Madsen Mayne McCoy Stephenson Thomas Waddoups Voting in the negative were: Senators Bramble Buttars Christensen Davis Dmitrich Eastman Evans Fife Hellewell Hickman Jenkins Killpack Knudson Niederhauser Peterson Walker Valentine Senators Hillyard, Eastman, Hatch, Stephenson, Hale, Bell, Mayne, Waddoups, Jenkins, and Buttars commented. # # # Senator Hatch proposed the following amendment: 1. Page 38, Line 1153: After "significance" delete "." and insert "," 2. Page 38, Line 1158: Delete "or " 3. Page 38, Line 1159: Delete "." and insert ";" and add "or" and after line 1159 insert "(v)" and the language on line 1153. Senator Hatch's motion to amend passed on a voice vote. # # # Senator Hickman proposed the following amendment: 1. Page 41, Lines 1254 through 1257 1254 (c) (i) Notwithstanding the designated use of revenues in Subsection (4)(a), of the 1255 revenues generated by the tax imposed under this section by any county of the first or second 1256 class, 25% or more shall be expended for the purpose described in Subsection (4)(a)(ii). (ii) Subsection (4)(c)(i) does not apply if, through the prioritization process described in Section 59-12-1705, a county chooses an airport of regional significance as its primary project or service. 1257 (d) For purposes of this Subsection (4), the revenues a county will receive from a tax Senator Hickman's motion to amend failed on a voice vote. # # # Senator Bell proposed the following amendment: 1. Page 39, Line 1190: After "capacity for" delete "transportation of regional significance" and insert "regionally significant transportation facilities" 2. Page 39, Line 1195 and 1196: After "capacity for" delete "transportation of regional significance" and insert "regionally significant transportation facilities" Senator Bell's motion to amend passed on a voice vote. * * * On motion of Senator Killpack, under suspension of the rules, H.B. 4001, COUNTY OPTION FUNDING FOR REGIONALLY SIGNIFICANT TRANSPORTATION INFRASTRUCTURE, was considered read the second and third times and passed on the following roll call: Yeas, 24; Nays, 5; Absent, 0. Voting in the affirmative were: Senators Arent Bell Bramble Buttars Christensen Davis Dmitrich Eastman Evans Fife Goodfellow Hale Hatch Hellewell Hickman Jenkins Killpack Knudson Mayne McCoy Niederhauser Peterson Walker Valentine Voting in the negative were: Senators Hillyard Madsen Stephenson Thomas Waddoups H.B. 4001, as amended, was returned to the House for further consideration. * * * On motion of Senator Eastman, and at 6:40 p.m., the Senate sauntered. The Senate was called to order at 7:25 p.m., with President Valentine presiding. COMMUNICATIONS FROM THE HOUSE Mr. President: September 19, 2006 The House concurred in the Senate amendments and passed H.B. 4001, COUNTY OPTION FUNDING FOR REGIONALLY SIGNIFICANT TRANSPORTATION INFRASTRUCTURE, by Representative R. Lockhart, and it is transmitted for the signature of the President. Sandy D. Tenney, Chief Clerk Communications filed. H.B. 4001, was signed by the President of the Senate in open session and returned to the House for the signature of the Speaker. * * * Mr. President: September 19, 2006 The House passed S.B. 4001, INCOME TAX AMENDMENTS, by Senator C. Bramble, with the following amendments: 1. Page 9, Line 260: Delete "$1,105" and insert "$1,000" 2. Page 9, Line 261: Delete "$1,105" and insert "$1,000" and delete "$25" and insert "$23" 3. Page 9, Line 262: Delete "$2,208" and insert "$2,000" and delete "$1,105" and insert "$1,000" 4. Page 9, Line 263: Delete "$2,208" and insert "$2,000" and delete "$62" and insert "$56" 5. Page 9, Line 264: Delete "$3,313" and insert "$3,000" and delete "$2,208" and insert "$2,000" 6. Page 9, Line 265: Delete "$3,313" and insert "$3,000" and delete "$108" and insert "$98" 7. Page 9, Line 266: Delete "$4,416" and insert "$4,000" and delete "$3,313" and insert "$3,000" 8. Page 9, Line 267: Delete "$4,416" and insert "$4,000" and delete "$166" and insert "$150" 9. Page 9, Line 268: Delete "$5,521" and insert "$5,500" and delete "$4,416" and insert "$4,000" 10. Page 9, Line 269: Delete "$5,521" and insert "$5,500" and delete "$232" and insert "$240" and bracket "7%" and insert "6.95%" 11. Page 9, Line 270: Delete "$5,521" and insert "$5,500" 12. Page 9, Line 275: Delete "$2,210" and insert "$2,000" 13. Page 10, Line 276: Delete "$2,210" and insert "$2,000" and delete "$51" and insert "$46" 14. Page 10, Line 277: Delete "$4,416" and insert "$4,000" and delete "$2,210" and insert "$2,000" 15. Page 10, Line 278: Delete "$4,416" and insert "$4,000" and delete "$124" and insert "$112" 16. Page 10, Line 279: Delete "$6,626" and insert "$6,000" and delete "$4,416" and insert "$4,000" 17. Page 10, Line 280: Delete "$6,626" and insert "$6,000" and delete "$216" and insert "$196" 18. Page 10, Line 281: Delete "$8,832" and insert "$8,000" and delete "$6,626" and insert "$6,000" 19. Page 10, Line 282: Delete "$8,832" and insert "$8,000" and delete "$331" and insert "$300" 20. Page 10, Line 283: Delete "$11,042" and insert "$11,000" and delete "$8,832" and insert "$8,000" 21. Page 10, Line 284: Delete "$11,042" and insert "$11,000" and delete "$464" and insert "$480" and bracket "7%" and insert "6.95%" 22. Page 10, Line 285: Delete "$11,042" and insert "$11,000" Sandy D. Tenney, Chief Clerk Communications filed. On motion of Senator Bramble, the Senate voted to concur in the House amendments to S.B. 4001, INCOME TAX AMENDMENTS. The bill, as amended, passed on the following roll call: Yeas, 23; Nays, 6; Absent, 0. Voting in the affirmative were: Senators Bell Bramble Buttars Christensen Dmitrich Eastman Evans Goodfellow Hatch Hellewell Hickman Hillyard Jenkins Killpack Knudson Madsen Niederhauser Peterson Stephenson Thomas Waddoups Walker Valentine Voting in the negative were: Senators Arent Davis Fife Hale Mayne McCoy S.B. 4001 was returned to the House for the signature of the Speaker. * * * Mr. President: September 19, 2006 The Speaker of the House has signed S.B. 4001 , INCOME TAX AMENDMENTS, by Senator C. Bramble, and it is transmitted for the signature of the President. Sandy D. Tenney, Chief Clerk S.B. 4001 were signed by the President of the Senate in open session. The bills will be enrolled and transmitted to the Governor. * * * President Valentine appointed Senators Stephenson, Niederhauser, and Goodfellow to wait upon the Governor and ask if he has any further business to bring before the Senate. President Valentine appointed Senators Bramble, Jenkins, and McCoy to notify the House of Representatives that the Senate has concluded its business and is ready to adjourn sine die. Senator Bramble reported the House has been notified that the business of the Senate has concluded and the Senate is ready to adjourn sine die. Senator Stephenson reported that his committee had notified the Governor. The Governor asked that the committee convey to the Senate that he has no further business to bring before the legislature. On motion of Senator Knudson and at 7:40 p.m., the Senate adjourned sine die. Page index H.B. 4001 -- COUNTY OPTION FUNDING FOR REGIONALLY SIGNIFICANT TRANSPORTATION INFRASTRUCTURE (R. Lockhart) Read for the first time 8 Placed on calendar 9 Read the second time 9 Amendments 9 Read the second and third time 11 Transmitted to the House 12 Signed by the President and returned to the House 12 S.B. 4001 -- INCOME TAX AMENDMENTS (C. Bramble) Read the first time by short title 3 Placed on calendar 4 Read the second time 4 Amendments 4 Read the second and third time 8 Transmitted to the House 8 Concurrence 14 Returned to the House 14 Signed by the President and transmitted to the Governor 15