H.B. 53

1

TECHNICAL AMENDMENTS TO TOBACCO
2 SETTLEMENT TRUST FUND
3 2002 GENERAL SESSION
4 STATE OF UTAH
5 Sponsor: Karen W. Morgan
6 This act makes technical amendments to the distribution of the tobacco settlement funds
7 necessary to comply with Utah Constitution Article XXII, Section 4. This act provides an
8 effective date and has retrospective operation.
9 This act affects sections of Utah Code Annotated 1953 as follows:
10 AMENDS:
11 63-97-301, as enacted by Chapter 351, Laws of Utah 2000
12 Be it enacted by the Legislature of the state of Utah:
13 Section 1. Section 63-97-301 is amended to read:
14 63-97-301. Permanent state trust fund.
15 (1) Until July 1, 2003, 50% of all funds of every kind that are received by the state that are
16 related to the settlement agreement that the state entered into with leading tobacco manufacturers
17 on November 23, 1998, shall be deposited into the permanent state trust fund created by and
18 operated under Utah Constitution Article XXII, Section 4.
19 (2) On and after July 1, 2003, 60% of all funds of every kind that are received by the state
20 that are related to the settlement agreement that the state entered into with leading tobacco
21 manufacturers on November 23, 1998, shall be deposited into the permanent state trust fund
22 created by and operated under Utah Constitution Article XXII, Section 4.
23 (3) Funds in the permanent state trust fund shall be deposited or invested pursuant to
24 Section 51-7-12.1 .
25 (4) (a) [Fifty percent of] In accordance with Utah Constitution Article XXII, Section 4, the
26 interest and dividends earned annually from the permanent state trust fund shall [remain in the
27 fund to] be deposited in the General Fund. There shall be transferred on an ongoing basis from

28 the General Fund to the permanent state trust fund created under Utah Constitution Article XXII,
29 Section 4, an amount equal to 50% of the interest and dividends earned annually from the
30 permanent state trust fund. The amount transferred into the fund under this Subsection (4)(a) shall
31 be treated as principal.
32 (b) Any annual interest or dividends earned from the permanent state trust fund that remain
33 in the General Fund after Subsection (4)(a) may be appropriated by the Legislature.
34 (c) Any realized or unrealized gains or losses on investments in the permanent state trust
35 fund shall remain in the permanent state trust fund.
36 Section 2. Effective date and retrospective operation.
37 If approved by two-thirds of all the members elected to each house, this act takes effect
38 upon approval by the governor, or the day following the constitutional time limit of Utah
39 Constitution Article VII, Section 8, without the governor's signature, or in the case of a veto, the
40 date of veto override, except Subsection 63-97-301 (4) shall have retrospective operation to July
41 1, 2001.




Legislative Review Note
as of 11-20-01 9:03 AM


The amendments in Subsection 63-97-301(4) of this bill address a constitutional conflict that
happened when the permanent state trust fund was approved by the voters in November 2000 and
became law on January 1, 2001. That new constitutional provision requires the income from the
state trust fund to be deposited into the state's General Fund. The current statute retains fifty
percent of the interest and dividends in the state trust fund to be treated as principal. The
amendments to Subsection 63-97-301(4) in this bill maintain the intent of the 2000 Legislature to
retain fifty percent of the interest as principal, but does so by transferring it on an ongoing basis
from the General Fund to the permanent state trust fund.

Office of Legislative Research and General Counsel

Committee Note

The Health and Human Services Interim Committee recommended this bill.