H.B. 58 Enrolled

1

SEVERANCE TAX AMENDMENTS
2 2008 GENERAL SESSION
3 STATE OF UTAH
4 Chief Sponsor: John Dougall
5 Senate Sponsor: Wayne L. Niederhauser
6
7 LONG TITLE
8 General Description:
9 This bill provides for the disposition of certain revenues from severance taxes.
10 Highlighted Provisions:
11 This bill:
12 . provides that certain severance tax revenues that exceed a base amount are
13 deposited into the permanent state trust fund or the Severance Tax Holding
14 Account;
15 . provides that certain interest earnings be deposited into the Infrastructure and
16 Economic Diversification Investment Account;
17 . defines terms; and
18 . makes technical changes.
19 Monies Appropriated in this Bill:
20 None
21 Other Special Clauses:
22 This bill takes effect on July 1, 2008.
23 This bill coordinates with H.B. 63, Recodification of Title 63 State Affairs in General,
24 changing technical cross references.
25 Utah Code Sections Affected:
26 AMENDS:
27 59-5-115, as last amended by Laws of Utah 1996, Chapter 135
28 59-5-215, as enacted by Laws of Utah 1988, Chapter 4
29 63-97a-201, as enacted by Laws of Utah 2007, Chapter 384

30 63-97a-202, as enacted by Laws of Utah 2007, Chapter 384
31 ENACTS:
32 63-97a-301, Utah Code Annotated 1953
33
34 Be it enacted by the Legislature of the state of Utah:
35 Section 1. Section 59-5-115 is amended to read:
36 59-5-115. Disposition of taxes collected -- Credit to General Fund.
37 All taxes imposed and collected under Section 59-5-102 shall be paid to the commission,
38 [and] promptly remitted to the state treasurer, and except those taxes otherwise allocated under
39 Section 59-5-116 , [or] 59-5-119 , or 63-97a-301 , credited to the General Fund.
40 Section 2. Section 59-5-215 is amended to read:
41 59-5-215. Disposition of taxes collected -- Credit to General Fund.
42 All taxes imposed and collected under Section 59-5-202 shall be paid to the commission,
43 [and] promptly remitted to the state treasurer, [to be] and except those taxes otherwise
44 allocated under Section 63-97a-301 , credited to the General Fund.
45 Section 3. Section 63-97a-201 is amended to read:
46 63-97a-201. Creation of Infrastructure and Economic Diversification Investment
47 Account.
48 (1) (a) There is created a restricted account within the General Fund known as the
49 "Infrastructure and Economic Diversification Investment Account."
50 (b) The Infrastructure and Economic Diversification Investment Account shall consist
51 of:
52 (i) all monies credited to the account under Section [ 63-97a-202 ] 63-97a-301 ;
53 (ii) appropriations from the Legislature;
54 (iii) grants from private foundations; and
55 (iv) interest and investment earnings on account monies.
56 (2) (a) The Infrastructure and Economic Diversification Investment Account shall earn
57 interest.

58 (b) All interest earned on monies in the Infrastructure and Economic Diversification
59 Investment Account shall be deposited into the Infrastructure and Economic Diversification
60 Investment Account.
61 (3) The Legislature may appropriate monies from the Infrastructure and Economic
62 Diversification Investment Account for infrastructure and economic diversification investment
63 projects.
64 (4) At least 25% of the monies appropriated in accordance with Subsection (3) shall be
65 used for the following projects within areas of the state that produced the severance tax
66 revenues:
67 (a) capital and infrastructure development; and
68 (b) economic diversification investment.
69 Section 4. Section 63-97a-202 is amended to read:
70 63-97a-202. Creation of Severance Tax Holding Account -- Distribution of funds
71 in the account.
72 (1) (a) There is created a restricted account within the General Fund known as the
73 "Severance Tax Holding Account."
74 (b) The Severance Tax Holding Account shall consist of:
75 (i) appropriations from the Legislature;
76 (ii) grants from private foundations; [and]
77 (iii) interest and investment earnings on Severance Tax Holding Account monies[.]; and
78 (iv) all monies credited to the Severance Tax Holding Account under Section
79 63-97a-301 .
80 (2) (a) The Severance Tax Holding Account shall earn interest.
81 (b) All interest earned on monies in the Severance Tax Holding Account shall be
82 deposited into the Severance Tax Holding Account.
83 (3) If authorized by law the Division of Finance shall deposit all of the monies in the
84 Severance Tax Holding Account as of June 30, 2009, into the permanent state trust fund.
85 [(4) The state treasurer shall invest and separately account for the earnings on funds

86 that are deposited into the permanent state trust fund under this section.]
87 [(5) (a) In accordance with Utah Constitution Article XXII, Section 4, the interest and
88 dividends earned annually on revenue from severance taxes that are deposited into the
89 permanent state trust fund shall be deposited in the General Fund.]
90 [(b) Interest and dividends earned on revenue from severance taxes that are deposited in
91 the General Fund pursuant to Subsection (5)(a) shall be credited to the Infrastructure and
92 Economic Diversification Investment Account created in Section 63-97a-201 .]
93 Section 5. Section 63-97a-301 is enacted to read:
94 63-97a-301. Crediting of certain severance tax revenues to the permanent state
95 trust fund.
96 (1) (a) After making the distributions of oil and gas severance tax revenues as required
97 under Sections 59-5-116 and 59-5-119 , the Division of Finance shall make the distributions
98 required under Subsections (2) through (5).
99 (b) For purposes of this section, revenue collected from severance taxes on oil and gas
100 imposed under Title 59, Chapter 5, Severance Tax on Oil, Gas, and Mining, does not include
101 revenue that is distributed under Section 59-5-116 or 59-5-119 .
102 (2) Beginning with fiscal year 2008-09, if authorized by law, the Division of Finance
103 shall credit to the permanent state trust fund all revenue collected in a fiscal year from severance
104 taxes on oil and gas imposed under Title 59, Chapter 5, Severance Tax on Oil, Gas, and Mining,
105 that exceed $71,000,000.
106 (3) Beginning with fiscal year 2008-09, if authorized by law, the Division of Finance
107 shall credit to the permanent state trust fund all revenue collected in a fiscal year from severance
108 taxes on mining imposed under Title 59, Chapter 5, Severance Tax on Oil, Gas, and Mining,
109 that exceed $27,600,000.
110 (4) The state treasurer shall invest and separately account for the earnings on funds that
111 are deposited into the permanent state trust fund under this section.
112 (5) (a) In accordance with Utah Constitution Article XXII, Section 4, the interest and
113 dividends earned annually on revenue from severance taxes that are deposited into the

114 permanent state trust fund shall be deposited in the General Fund.
115 (b) Interest and dividends earned on revenue from severance taxes that are deposited in
116 the General Fund pursuant to Subsection (5)(a) shall be credited to the Infrastructure and
117 Economic Diversification Investment Account created in Section 63-97a-201 .
118 Section 6. Effective date.
119 This bill takes effect on July 1, 2008.
120 Section 7. Coordinating H.B. 58 with H.B. 63 -- Technical renumbering.
121 If this H.B. 58 and H.B. 63, Recodification of Title 63 State Affairs in General, both
122 pass, it is the intent of the Legislature that the Office of Legislative Research and General
123 Counsel, in preparing the Utah Code database for publication:
124 (1) renumber Section 63-97a-301 in this H.B. 58 to Section 51-9-305 ; and
125 (2) change all internal cross references.